The global lighting market size was valued at USD 138.30 billion in 2025 and is projected to grow from approximately USD 145.35 billion in 2026 to USD 216.39 billion by 2034, registering a CAGR of 5.10% during the forecast period (2026–2034). Asia Pacific dominated the lighting market with a share of 45.3% in 2025.
Lighting products are systems and equipment designed to provide artificial illumination across residential, commercial, industrial, outdoor, architectural, infrastructure, and specialized applications. They include LED lamps and luminaires, fluorescent lighting, high-intensity discharge lamps, halogen and incandescent lamps, streetlights, downlights, panel lights, smart lighting systems, and connected lighting controls. Lighting products are primarily classified under HSN Code 9405, which covers lamps and lighting fittings, including illuminated signs and related products, while SIC Code 3646 covers electric lighting equipment.
The lighting market demand is driven by the replacement of conventional lighting systems with energy-efficient LED technologies, increasing construction and infrastructure development, urbanization, renovation and retrofit activities, and growing adoption of smart and connected lighting systems. The emphasis on energy conservation, government energy-efficiency regulations, declining LED technology costs, and demand for lower electricity consumption supports lighting market growth.
By Light Type
By Installation Type
By Application
By Sales Channel
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Shift Toward Networked Lighting Systems
The increasing deployment of digitally addressable luminaires and communication gateways is shifting lighting from individually controlled fixtures toward interconnected lighting networks. This transition allows multiple lighting points to be managed through a common platform, improving centralized scheduling, fault monitoring, dimming, and maintenance coordination across large installations. For example, the City of Los Angeles converted more than 200,000 streetlights to an interconnected LED system, creating a remotely managed network for streetlight operation and maintenance.
Adoption of IoT-Enabled Lighting
The growing use of occupancy sensors, environmental sensors, and cloud-based analytics is shifting lighting from predetermined operating schedules toward systems that respond to real-time conditions. This transition enables lighting systems to automatically adjust illumination based on factors such as occupancy and available daylight, linking lighting consumption with actual space utilization.
Supply chain disruptions are expected to have a moderate impact on the lighting market share, given its exposure to fluctuations in LED chips, semiconductors, electronic drivers, sensors, printed circuit boards, aluminum and other metals, plastics, electronic assemblies, and international freight costs. The market could experience a K-shaped recovery, as established lighting manufacturers with diversified supplier networks, larger procurement volumes, and integrated production capabilities can stabilize production faster, while smaller brands and emerging manufacturers remain more exposed to component shortages and higher procurement costs. The market is expected to grow at a CAGR of 5.10%, but prolonged supply chain constraints could potentially reduce this growth rate by approximately 2.0 percentage points, resulting in short-term growth of around 3.10%. As supply conditions normalize through improved semiconductor and LED component availability, stabilized raw-material pricing, and replenished inventories, lighting market growth is expected to gradually return to 5.10%.
The lighting market forecasts investment/funding directed toward smart lighting solutions, intelligent streetlighting infrastructure, connected lighting controls, LED retrofit technologies, AI-enabled lighting management, and modernization of municipal and commercial lighting networks.
Key Investment and Funding Activities in Lighting Market, 2025–2026
Commercial and Industrial Retrofit Activity and Demand for High-Performance Lighting Fixtures Drives Market
The large installed base of conventional lighting across commercial and industrial facilities is creating sustained demand for retrofit solutions as building operators seek lower electricity consumption and operating costs. The availability of LED retrofit products that can replace existing fluorescent, metal-halide, and other fixtures without complete lighting system replacement is making upgrades more practical across warehouses, offices, hospitals, and manufacturing facilities.
The need for greater illumination efficiency and improved lighting quality is increasing demand for high-performance fixtures across warehouses, distribution centers, manufacturing facilities, and other high-use environments. Higher-efficiency LED fixtures provide greater usable illumination while reducing electricity consumption, supporting purchasing decisions toward high output luminaires rather than conventional lower-efficiency products.
High Upfront Cost of Advanced Lighting Systems and Inconsistent Performance of Low-Quality LED Fixtures Restrain Market Expansion
The higher initial investment required for smart luminaires, connected lighting controls, sensors, and integrated lighting systems can delay upgrade decisions among commercial and residential users. Additional expenses for system design, installation, commissioning, and control integration can increase the total project cost beyond the price of conventional lighting fixtures.
The variable quality of low-cost LED fixtures can create concerns around lumen depreciation, color consistency, driver reliability, thermal performance, and product lifespan. Premature failures and declining light output can increase replacement and maintenance requirements, reducing the perceived economic benefit of LED adoption.
Expansion of Intelligent Controls Across Industrial Facilities and Lighting Systems in Architectural Projects Offer Growth Opportunities
Industrial automation providers, lighting controls companies, and smart building technology vendors can expand their offerings by integrating connected controls, sensors, and lighting management software into factories and warehouses. These solutions create additional revenue through controls hardware, software platforms, commissioning, monitoring, and maintenance services rather than luminaire sales alone.
Architectural lighting manufacturers, lighting designers, and system integrators can capture higher-value project revenue through integrated façade, dynamic, and digitally controlled lighting systems. These projects create opportunities for premium luminaires, lighting-control platforms, software, installation, and ongoing management services. For example, Signify’s Interact Landmark solution at CEPSA Tower in Madrid uses 2,500 Color Kinetics ColorBlast Powercore fixtures and connected software to enable remotely managed architectural lighting and dynamic facade displays.
The LED segment accounted for a share of 62.8% in 2025, supported by its widespread use across residential, commercial, industrial, and outdoor lighting applications. Higher energy efficiency, longer operating life, and broad availability of LED luminaires reinforce segment dominance.
The HID segment is expected to grow at a CAGR of 2.7% during the forecast period, driven by continued use in applications requiring high-intensity illumination, including industrial facilities, warehouses, sports infrastructure, and selected outdoor lighting installations.
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The new installations segment is expected to grow at a CAGR of 5.5% during the forecast period, supported by lighting requirements associated with new residential, commercial, industrial, and infrastructure projects. New construction allows lighting systems to be specified and integrated during the initial project stage, including LED fixtures, controls, and application-specific lighting systems.
The retrofit & replacement segment is expected to grow at a CAGR of 4.6% during the forecast period, fueled by replacement of aging lighting equipment and modernization of existing buildings and facilities.
The commercial segment accounted for a share of 41.2% in 2025 due to the extensive lighting requirements across offices, retail stores, hospitality facilities, healthcare buildings, educational institutions, and other commercial spaces. The need for indoor illumination, architectural lighting, outdoor lighting, and energy-efficient systems contributes to the segment's large market base.
The industrial segment is expected to grow at a CAGR of 5.0% during the forecast period, driven by lighting requirements across manufacturing plants, warehouses, logistics facilities, and other industrial environments.
The direct sales segment accounted for a share of 39.4% in 2025, supported by direct procurement relationships between lighting manufacturers, distributors, contractors, project developers, and large commercial or industrial customers.
The e-commerce segment is expected to grow at a CAGR of 8.2% during the forecast period, fueled by the increasing availability of lighting fixtures, lamps, smart lighting products, and replacement components through online platforms. Digital purchasing channels provide consumers and smaller businesses with broader product selection and convenient comparison of product specifications and pricing.
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Asia Pacific: Market Dominance Led by Deployment of Energy-Efficient Lighting in Urban Infrastructure
The Asia Pacific lighting market accounted for a share of 43.2% in 2025 due to continued deployment of energy-efficient lighting across urban roads, public facilities, and municipal infrastructure.
Japan’s Ministry of Land, Infrastructure, Transport and Tourism promotes LED installation in both new and existing government buildings, including daylight and occupancy-based lighting controls to reduce electricity consumption. Japan’s government implementation plan sets a 100% LED lighting target for government facilities by FY2030, creating a defined replacement pipeline across public buildings.
The China Lighting Market is expected to benefit from the expansion of smart lighting deployment within digital city programs, as government initiatives increasingly integrate intelligent sensing, connected infrastructure, and digital municipal management. In March 2026, China’s National Data Administration, together with the National Development and Reform Commission and other ministries, advanced the nationwide digital-city transformation plan, including intelligent upgrades of municipal infrastructure and smart sensing systems.
The India lighting market is expected to benefit from the expansion of government-led LED procurement and bulk-replacement programs across municipalities and urban infrastructure. The Street Lighting National Programme, implemented through Energy Efficiency Services Limited, is designed to replace conventional streetlights with smart and energy-efficient LED systems through a self-financing model. Government-backed efficiency projects have also supported LED municipal streetlighting with remote operating technology across multiple Indian states, creating an established procurement model for large-scale replacements.
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Middle East & Africa: Fastest Growth Driven by Expansion of Electrification Programs
The Middle East & Africa lighting market is expected to grow at a 6.4% CAGR during the forecast period, reflecting the region’s expanding electrification and infrastructure-development pipeline.
The UAE lighting market is expected to benefit from the expansion of smart city infrastructure across major urban developments, supported by the integration of intelligent technologies into the country’s road and public infrastructure. The UAE Ministry of Energy and Infrastructure launched an AI-powered Energy Management System for Federal Roads, replacing conventional high-pressure sodium lamps with LED lighting and using sensors to automatically adjust illumination levels according to road conditions.
The South African National Treasury specifies that municipal energy-efficiency funding should support electricity-saving projects, including public lighting infrastructure, with municipalities required to procure streetlight luminaires according to standardized energy-efficient technology specifications.
North America: Market Dominance Supported by Adoption of Connected Lighting for Building Energy Management
The North America lighting market is expected to grow at a CAGR of 4.4% during the forecast period, supported by the established commercial building base and accelerating integration of connected lighting with energy-management systems.
The U.S. lighting market is expected to benefit from increasing commercial building energy-performance requirements, particularly as federal standards place greater emphasis on energy efficiency in new construction and major renovations. The U.S. Department of Energy (DOE) requires new federal commercial buildings and major renovations to meet federal energy-efficiency standards, with requirements reaching 100% compliance with applicable performance targets for projects beginning in FY2030.
The Government of Canada’s Products Containing Mercury Regulations began prohibiting the manufacture and import of common mercury-containing lamps, including CFLs and several fluorescent lamp categories.
Europe: Market Expansion Led by Adoption of IoT Lighting for Occupancy-Based Indoor Illumination
The Europe lighting market is expected to grow at CAGR of 4.6% during the forecast period.
The UK Government’s renewed focus on expanding safe and connected active-travel networks. In June 2026, the UK Department for Transport and Active Travel England launched the third Cycling and Walking Investment Strategy (CWIS3), which targets 5,000 new walking, wheeling and cycling routes and 10,000 safer crossings by 2030. The future expansion of these networks is expected to create opportunities for LED lighting, adaptive outdoor lighting, durable fixtures, and intelligent lighting controls across pedestrian and cycling infrastructure.
The German Federal Ministry for Economic Affairs and Energy continues to support building efficiency measures through its Federal Funding for Efficient Buildings program. Germany’s energy-efficiency framework increasingly addresses energy use across non-residential buildings.
Latin America: Growth Supported by Use of Smart Lighting in Premium Hospitality and Tourism Development
The Latin America lighting market is expected to grow at a 4.9% CAGR during the forecast period. The Mexico lighting market benefits from the Voluntary Energy Efficiency Agreements (AVEE) framework for industrial, commercial, and service-sector facilities, encouraging companies with significant energy consumption to implement technically and economically viable efficiency measures and improve energy performance.
Brazil’s Ministry of Mines and Energy (MME) also participates in the IEA (International Energy Agency) technology program on integrated low-carbon lighting, covering digitalized lighting systems for commercial and industrial buildings.
The lighting market competitive landscape is moderately fragmented, with competition spread across established lighting manufacturers, LED technology providers, smart lighting companies, lighting controls specialists, and emerging connected-lighting players. Established companies such as Signify, ams-OSRAM, Acuity Brands, Zumtobel Group, and Panasonic are expected to account for approximately 40% of the global lighting market share.
Established players in the lighting market ecosystem compete through LED efficacy, lighting-fixture quality, product reliability, energy management integration, and broad distribution networks. Emerging and specialized players in the lighting market ecosystem compete through IoT-enabled lighting, decorative lighting solutions, and faster development of connected and energy-efficient solutions.
September 2026: Signify launched new Philips Hue smart-lighting innovations, including AI-powered lighting behaviors, Sonos integration, new entertainment features, and additional indoor and outdoor connected lighting products.
September 2026: Zumtobel partnered with Impact Acoustic to combine lighting, acoustics, design, and digital room-planning capabilities, enabling integrated lighting and acoustic solutions.
August 2026: Schreder acquired EdgeMachines following a year-long partnership, strengthening its smart city offering through real-time data capabilities and connected urban infrastructure solutions.
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Author's Details
Senior Research Analyst
Sumanta Mahato is a market intelligence and strategy professional with over 4+ years of experience advising organizations across industrial automation, machinery, aerospace and defense, and adjacent industrial technology sectors. He specializes in delivering data-driven market intelligence, strategic assessments, competitive benchmarking, demand forecasting, commercial due diligence, and growth strategy to support informed business and investment decisions.
His expertise encompasses industrial automation systems, manufacturing and process machinery, industrial equipment, aerospace technologies, defense systems, electrical and electromechanical infrastructure, and advanced industrial technologies. He brings strong domain knowledge in assessing market ecosystems, technology landscapes, supply-demand dynamics, regulatory and policy environments, pricing structures, value chains, competitive positioning, and emerging industry trends across global and regional markets.
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