Smart Lighting Market to Reach USD 53.93 Billion by 2031 as Smart Cities and Voice Control Drive Adoption

The global smart lighting market is forecast to expand dramatically, rising from USD 18.49 billion in 2024 to USD 53.93 billion by 2031, at a robust CAGR of 16.52% — among the strongest growth rates of any connected-technology category tracked in recent industry analysis. The surge reflects the convergence of three powerful forces: the maturing Internet of Things (IoT) ecosystem, mounting consumer demand for energy efficiency, and an accelerating global push toward smart city infrastructure.

Smart lighting refers to systems equipped with sensors, wireless connectivity, and programmable controls that allow users to automate, customize, and remotely manage lighting settings. Once limited to simple illumination, these systems have evolved into integral nodes within connected living environments, letting users adjust brightness, color temperature, and scheduling through smartphone apps, voice assistants, or automated routines. The market spans a wide product range, including smart bulbs, fixtures, switches, sensors, and centralized lighting management systems.

Hardware Leads a Market Built on Connectivity

By offering, the hardware segment generated the highest revenue in 2023 at USD 8.47 billion, and is projected to retain its lead with revenue of USD 26.86 billion by 2031. This segment covers the physical building blocks of connected lighting — smart bulbs with built-in Wi-Fi or Bluetooth connectivity, smart switches and dimmers that replace traditional wall controls, and centralized hubs that manage multiple devices and custom lighting scenes. The sheer diversity of hardware form factors continues to fuel innovation and give the segment its durable market lead.

Indoor Applications Dominate, but Outdoor and Municipal Use Cases Expand

By application, the indoor segment held the largest share at 61.05% in 2023, spanning residential, commercial, and institutional deployments. Smart lighting is transforming these spaces by offering personalized ambience for homeowners, productivity-enhancing controls for businesses, and safety-focused automation for institutions. As adoption of connected lighting accelerates on the back of shifting consumer preferences and continued technology advancement, this segment is expected to sustain strong growth momentum through the forecast period.

Wireless Connectivity Becomes the Default Standard

On the connectivity front, the wireless segment is expected to command the largest market share by 2031, at 51.33%. Technologies such as Wi-Fi, Bluetooth mesh networking, Zigbee, Z-Wave, Thread, and emerging 5G connectivity are giving wireless smart lighting systems the flexibility, scalability, and reliability needed for both residential and commercial deployment. Wi-Fi in particular continues to dominate small and mid-sized installations thanks to its high-speed data transmission and broad coverage.

Voice Control Becomes a Baseline Expectation

One of the clearest consumer-facing trends shaping the market is the growing adoption of voice-activated lighting control. As smart assistants such as Amazon Alexa, Google Assistant, and Apple's Siri become embedded in daily routines, consumers increasingly expect hands-free control over their lighting environments. This shift toward voice-first interaction is reinforcing smart lighting's position as a cornerstone feature of broader smart home ecosystems, rather than a standalone product category.

Smart Cities Turn Streetlights Into Data Infrastructure

Beyond the home, municipalities worldwide are investing heavily in smart street lighting as part of broader urban modernization efforts. Equipped with advanced sensors, these systems can adjust brightness based on time of day and weather conditions, optimizing energy consumption while cutting municipal costs. Many also monitor traffic flow and air quality, feeding valuable data back to city planners working to improve mobility and environmental outcomes. Integration with surveillance systems further enhances public safety by enabling real-time monitoring and faster incident response — positioning smart streetlights as a foundational layer of next-generation urban infrastructure.

Interoperability Remains the Market's Biggest Hurdle

Despite strong tailwinds, the smart lighting market continues to grapple with interoperability and compatibility challenges. With numerous manufacturers offering proprietary technologies and protocols, consumers and businesses often struggle to seamlessly integrate products from different vendors into a single smart home or automation ecosystem. This fragmentation limits the full potential of interconnected lighting — energy savings, convenience, and automation — and creates confusion that can slow broader adoption.

Addressing this challenge will require sustained collaboration among industry stakeholders to establish common standards and protocols. Progress on this front, including the emergence of the Matter connectivity standard, is helping unify previously siloed ecosystems and is expected to gradually ease integration friction across the market.

Regional Outlook: Europe Leads, Asia-Pacific Accelerates Fastest

Europe held the largest regional share in 2023, at 36.12% (USD 5.84 billion), supported by advanced telecommunications infrastructure, widespread internet connectivity, and strong regulatory emphasis on sustainability and energy efficiency. Government incentives and stringent efficiency standards across the region continue to accelerate adoption of connected lighting technologies.

Asia-Pacific, meanwhile, is projected to be the fastest-growing region, with a CAGR of 18.32% through 2031. Aggressive government investment in smart city initiatives, combined with a thriving base of innovative startups and established technology companies, is positioning the region as a key engine of future market expansion.

Competitive Landscape

The competitive landscape remains fragmented, with companies including Acuity Brands Lighting, Signify Holding, Honeywell International, Itron, IDEAL INDUSTRIES, Häfele America, Wipro Lighting, YEELIGHT, Sengled Optoelectronics, and Verizon actively pursuing partnerships, product innovation, and geographic expansion. In a notable July 2023 development, Yeelight launched its Matter-standard Cube Smart Lamp, designed for seamless integration with Apple HomeKit — marking the company's first Matter-supported product and reflecting the industry's broader push toward interoperability.

Outlook

With energy efficiency mandates tightening globally, smart city budgets expanding, and consumer comfort with voice- and app-based control now firmly established, the smart lighting market appears set for a sustained period of double-digit growth. As interoperability standards mature and hardware costs continue to decline, connected lighting is likely to shift from a premium upgrade to a default expectation across both residential and commercial construction.