Cellular IoT Module Shipments Grew 23% in Q1 2025 as US–China tensions impact vendor landscape

In short

• Shipments of cellular IoT modules and chipsets grew 23% year-over-year in Q1 2025, according to IoT Analytics’ Global Cellular IoT Module and Chipset Market Tracker & Forecast.
• This marks the fifth straight quarter of shipment growth as inventory correction drives renewed demand.
• Geopolitical tension and regulations are creating a dynamic market environment, as key market player u-blox exits the cellular IoT module business.
• The top 5 companies by module shipments—Quectel, China Mobile, Fibocom, Sunsea AIoT, and Telit Cinterion—account for 73% of shipments in Q1 2025.

Why it matters

• There is renewed demand for cellular IoT modules and chipsets. Cellular Network operators, device, module and chipset manufacturers, and component players should study market projections and how peers are adapting amid geopolitical tensions, new regulations, and market shakeups.

Cellular IoT module market overview

Cellular IoT module shipments continued a strong rebound in Q1 2025, growing 23% year-over-year (YoY). In June 2025, IoT Analytics updated its Global Cellular IoT Module and Chipset Market Tracker & Forecast, a quarterly in-depth analysis of the revenues and shipment volumes of companies supplying cellular IoT modules and chipsets. According to the latest data, cellular IoT module shipments grew by 23% year-over-year. This builds on the momentum of 2024, which saw a 15% YoY increase in shipments, following a difficult 2023 that ended with a 16% YoY market decline.

Q1 2025 marks the fifth straight quarter of shipment growth as inventory correction drives renewed demand. The Q1 2025 rebound marks the fifth consecutive quarter of shipment growth and the fourth of double-digit growth. A key driver behind this recovery is the resolution of the inventory overhang that plagued the market throughout 2023. During that period, elevated stock levels held back both module and chipset demand, despite underlying demand remaining resilient. As inventories normalize, the market is regaining traction, as shown in the tracker. Strengthening demand signals are translating into higher shipment volumes in Q1 2025, reflecting a broader recovery across multiple verticals and regions.

“The inventory situation cleared up. This marks a return to a growth trajectory for the company.” – Senior executive at Telit Cinterion during an interview with IoT Analytics in Q1 2025

Company actions and regional regulations changing market dynamics

The Cellular IoT module market continues to evolve, driven by ongoing consolidation and strategic realignments. Over the past few years, a series of mergers and acquisitions has reshaped the competitive landscape.

• Telit divestiture (2019): UK-based IoT connectivity company Telit divested its automotive business segment to TUS International, a Hong Kong-based automotive investment holding company.
• Thales acquired Gemalto (2019):French-based aerospace supplier Thales acquired Gemalto, a Netherlands-based digital security company.
• Sierra Wireless sells automotive segment (2020): Canada-based IoT communications solutions provider Sierra Wireless sold its automotive segment to Rolling Wireless, a Luxembourg-based provider of automotive network access modules and devices.
• Telit and Thales form new company (2022): Telit and Thales announced the formation of Telit Cinterion, with Thales acquiring a 25% stake.
• Season Group acquires Pycom (2022): Hong Kong-based electronics design and manufacturing services company Season Group acquired UK-based IoT module company Pycom Ltd.
• Semtech acquired Sierra Wireless (2023): US-based semiconductor company Semtech announced its intention to acquire Sierra Wireless, a move that surprised many industry observers given Semtech’s historical focus on unlicensed LPWA technologies, such as LoRa.
• Telit Cinterion sells automotive segment (2023): Telit Cinterion sold its cellular automotive module unit to Germany-based IoT and embedded computing technology company Kontron, further streamlining the former’s portfolio.

The following are the new wave of strategic developments emerging, signaling continued shifts in market dynamics and vendor positioning that will affect 2025 and beyond.

Quectel

Quectel’s inclusion on the US’s 1260H list raises compliance risks and prompts reassessment among Western device manufacturers. On January 6, 2025, the US Department of Defense updated its 1260H List, a list mandated by Section 1260H of the National Defense Authorization Act (NDAA) for Fiscal Year 2021 that identifies “Chinese military companies” operating in the United States. The update added 134 Chinese entities across various sectors, including artificial intelligence, aerospace, and biotechnology. Among the newly added companies was Quectel, the clear global market leader in cellular IoT modules. Entities on the 1260H list are identified as supporting China’s military-civil fusion strategy and face significant reputational and compliance risks. While inclusion does not automatically trigger sanctions, it flags the listed companies as potential Military End Users (MEUs) under the US Export Administration Regulations (EAR), increasing scrutiny in federal procurement, research funding, and compliance processes.

On January 7, 2025, Quectel responded publicly, stating:

“We will take appropriate action to protect ourselves and our stakeholders. We are confident that we will be removed from the 1260H list.” – Norbert Muhrer, president and CSO, Quectel

Implications

While not an outright ban, the listing has stirred concern among Western device manufacturers. The move has drawn sentiment-driven comparisons to the 2019 Huawei ban, triggering an opportunity for module vendors like Telit (US), Semtech (US), and Cavli Wireless (US). Quectel’scustomers are adopting early-stage risk assessments and dual-sourcing discussions among device manufacturers, particularly in the US and Europe. Although no major design transitions have been finalized, several device manufacturers are reportedly evaluating product redesigns as a precautionary step to reduce exposure to Chinese module vendors. However, module pricing remains a key barrier for Western players, especially when compared to Quectel and other Chinese vendors.

“Quectel’s listing on the 1260H list has become a key discussion point in customer meetings. Many [device manufacturers] aren’t reacting immediately, but they’re certainly reviewing their sourcing strategies more seriously now. We’re seeing increased interest in dual-design approaches and long-term risk mitigation through diversification.” – Senior executive at a Western IoT module vendor, during an interview with IoT Analytics in Q1 2025

Quectel anticipated US sanctions with strategic U.S. partnership. Quectel’s inclusion on the US 1260H list was not entirely unexpected. The company had already begun preparing for such scenarios by licensing its manufacturing technology and its reference design to an Ohio-based startup, Eagle Electronics, as part of a broader effort to localize operations and mitigate geopolitical risks.

In December 2024, Eagle launched a production facility in Solon, Ohio. The company was founded by The O.H.I.O. Fund, led by Mark Kvamme and Ray Leach, and TJ Dembinski, who also serves as Eagle’s CEO. Eagle Electronics is entering the market with more than just manufacturing capabilities. Backed by a licensing agreement with Quectel, the startup will leverage Quectel’s cellular IoT module reference designs and manufacturing technology, generating license revenue for Quectel. To support the setup, Quectel will send approximately 30 employees to Ohio in early 2025 to train Eagle’s workforce over a 2-month period.

Additionally, Eagle plans to build its own branded line of modules, targeting initial growth in the 4G segment. Further, Eagle may fill the gap left by Western automotive module vendors.

“Eagle Electronics is a fully independent company. We have our own module manufacturing facility for our brand ‘Eagle Electronics.’ We are focused on 4G modules and currently use Quectel reference designs. This is just the beginning; we are moving with a hardware-as-a-product approach. We will rapidly develop the company to grow in the IoT module tech stack, adding in the ability to do full product production for markets like payment terminals and TCUs, as an example, over time.” – TJ Dembinski, CEO at Eagle Electronics, during an interview with IoT Analytics in Q1 2025

u-blox

u-blox exits the cellular IoT module market through a two-pronged divestment strategy, triggering supplier realignment. In late 2024, Switzerland-based wireless and positioning technology company u-blox unexpectedly announced its intention to exit the cellular IoT module business, initiating a two-part divestiture. The first step was completed in April 2025, with the sale of its dual-mode cellular-satellite business to Trident IoT. The second step followed on June 6, 2025, with the official transfer of its broader cellular business, including modules and related IP, to Irish firm Trasna. For Trasna, the acquisition provides access to mature cellular module IP, complementing its existing SIM, eSIM, and cloud-based device management services and positioning it to offer integrated IoT connectivity solutions.

Implication

u-blox’s exit opens a strategic window for Western module suppliers as customers begin evaluating long-term alternatives. u-blox accounted for 1.1% of global cellular IoT module revenue and 1.2% of shipments at the time of its exit, according to the Cellular IoT Module and Chipset Tracker. This creates a modest but strategic opening for Western suppliers such as Telit, Cavli Wireless, and Semtech. While legacy module shipments are expected to continue under existing contracts, the exit has introduced notable uncertainty among customers and distributors—particularly in Europe. Several key accounts have already initiated discussions about potential transitions, and some are now preparing long-term redesigns to enable a full supplier switch in future product generations.

“We’ve started seeing more inbound from former u-blox customers, especially in Europe. It’s still a niche shift compared to the geopolitical-driven changes, but the divestment is clearly opening the door for new supplier evaluations.” – Business development director at a Western IoT module vendor during an interview with IoT Analytics in Q1 2025

“u-blox’s exit is creating a window of opportunity, especially in Europe, but it’s not a landslide. Some customers are cautiously exploring alternatives like us, while others are holding back due to continuity assurances and the redesign costs involved.” – Regional sales head at a Western IoT module vendor during an interview with IoT Analytics in Q1 2025

EU’s Radio Equipment Directive

The EU’s Radio Equipment Directive (RED) poised to reshape the EU cellular IoT module landscape. RED is the EU’s regulatory framework for all radio-enabled devices sold in the European Economic Area (EEA). Starting August 1, 2025, a new cybersecurity extension to RED introducing mandatory security requirements for radio equipment—including secure boot, encrypted communications, firmware update mechanisms, and protection against unauthorized access—will take effect.

Implication

Transparent IoT module suppliers stand to benefit. The new rules apply not only to end-user devices but also to embedded components, such as cellular IoT modules. Vendors shipping into the EU will need to upgrade firmware, enhance software security features, and pass more rigorous CE certification testing. These changes are likely to increase development costs and lengthen the time-to-market. For low-cost and opaque vendors—especially some Chinese suppliers—compliance may be slower or partial, opening the door for Western module makers with transparent, standards-aligned platforms. Device manufacturers are already starting to request RED-compliant documentation and security audit trails, favoring module vendors with strong certification and engineering support.

“The updated RED Directive … adds a whole chapter of cybersecurity requirements. While the end devices are the primary focus, compliance will require new features at the module level. We’re undertaking a significant development effort—including new software versions and features—to meet these demands.” – Senior executive at Telit Cinterion during an interview with IoT Analytics in Q1 2025

Cellular IoT module competitive landscape: The top 5 companies

According to the cellular IoT module and chipset tracker, the top 5 cellular IoT module companies (by 1Q 2025 shipments)—Quectel, China Mobile, Fibocom, Sunsea AIoT, and Telit Cinterion—accounted for 73% of global cellular IoT module shipments.

1. Quectel (40% share)

Despite its inclusion on the US’s 1260H list and increased geopolitical scrutiny, Quectel maintained its leadership position, growing its shipments by 31% YoY in Q1 2025. The company continues to scale across core LTE and smart module segments.

2. China Mobile (15% share)

China Mobile recorded the fastest growth among the top five, with 100% YoY shipment growth, driven primarily by a rapid ramp-up in LTE CAT 1 bis modules. This performance reflects strong domestic deployments.

3. Fibocom (8% share)

Fibocom reported 28% YoY growth in shipments. The company benefited from rising demand in sectors such as smart energy, automotive, and industrial IoT across Asia and Europe.

4. Sunsea AIoT (5% share)

Sunsea AIoT posted 5% YoY shipment growth in Q1 2025. Its performance remains stable, but it is comparatively slower than other top-tier Chinese peers.

5. Telit Cinterion (4% share)

The only Western vendor in the top 5, Telit Cinterion achieved 10% YoY shipment growth.

Market outlook

According to IoT Analytics’ Global Cellular IoT Module and Chipset Market Tracker & Forecast (Q1 update), the cellular IoT module revenue market is expected to continue to grow at 17% YoY in 2025.

Cellular IoT recovery is accelerating supplier shifts amid geopolitical tension. As demand returns and US–China tensions intensify, device manufacturers are initiating redesigns, specifically of PCBs or devices, to accommodate modules from different vendors. ODM offerings from vendors such as Quectel and SG Wireless are driving this shift forward. Western suppliers are gaining ground on security and local production, but price gaps remain a major hurdle. 2025 is a setup year—full supplier transitions and redesigned architectures may follow in 2026. For newcomers like Trasna (acquiring u-blox’s cellular business) and Eagle Electronics (building US capacity on Quectel IP), 2025 is crucial for establishing credibility, scaling, and expanding into broader parts of the cellular IoT module technology stack, including software and connectivity services.

The implications of US–China geopolitical tensions are still evolving, with recent US tariffs prompting the industry to reassess its exposure. Meanwhile, the RED’s cybersecurity requirements are clearly defined, and all module vendors are expected to update their firmware and security features before shipping to the EU starting in August 2025.

Key technologies to watch out for

1. LTE Cat 1 bis

With shipments having grown 122% YoY,Cat 1 bis is gaining traction as a globally compatible, cost-effective alternative to NB-IoT and LTE-M. Its single-antenna design simplifies integration, making it ideal for tracking, logistics, metering, and payment terminals.

“LTE CAT 1bis adoption is rising sharply… It offers a cost-effective, globally compatible alternative with sufficient performance for most IoT applications, while the added advantage being that it can be deployed across existing LTE infrastructure.” – Abhinand Dinesh, Senior Associatefor Corporate Marketing at Cavli Wireless, during an interview with IoT Analytics in Q1 2025

“Cat-1 bis is picking up for sure, and it’s going to continue in the coming quarters.” – Senior executive at a Western IoT module vendor during an interview with IoT Analytics in Q1 2025

2. 5G

5G module shipments grew 36% YoY. The technology is expanding in fixed wireless access, automotive C-V2X, and industrial routers. While mainstream 5G serves high-bandwidth use cases, RedCap is emerging as a solution for mid-tier IoT, striking a balance between cost, power, and performance. Target applications include body cams, hunting cameras, industrial sensors, and wearables.

“5G RedCap is emerging as a key enabler for mid-tier IoT applications… offering simplified 5G performance tailored for use cases like industrial sensors, wearables, asset tracking, and IoT gateways.” – Abhinand Dinesh, Senior Associatefor Corporate Marketing at Cavli Wireless, during an interview with IoT Analytics in Q1 2025

“I was positively surprised by RedCap… it’s not just a showcase tech—it’s a commercial product some key customers will pick up.” – Senior executive at a Western IoT module vendor during an interview with IoT Analytics in Q1 2025

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