IoT Security Market Analysis and Forecast to 2035: Type, Product, Services, Technology, Component, Application, Device, Deployment, End User

IoT Security Market is anticipated to expand from $26.2 billion in 2025 to $79.9 billion by 2035, growing at a CAGR of approximately 11.5%. Key tech advancements in IOT security market includes AI models trained for IoT-specific malware detection, blockchain-based identity verification in industrial IoT hubs, and edge-computing firmware upgrades enabling on-device anomaly detection without cloud reliance.

In August 2025, Cisco acquired Sternum IoT Security for firmware-level protection, Microsoft partnered with Palo Alto Networks on cloud-to-edge IoT security integration, and Qualcomm collaborated with Skylo to embed satellite connectivity into IoT chipsets.

In August 2025, the UK government committed over £1 billion (~$ 1.3 billion) to secure critical infrastructure using AI and predictive threat prevention, and NIST updated IoT cybersecurity guidelines to include broader device components and end-of-life security measures.

In July 2025, Italian IoT security company Exein raised €70 million (~$81 million) to expand AI-based security offerings, while venture capital firms increased hiring of cybersecurity experts to assess IoT-focused startups.

In July 2025, Palo Alto Networks launched Cortex Cloud Application Security Posture Management (ASPM) to address cloud risks before deployment, while Matter 1.4.2 was released with improved device interoperability and stronger encryption for smart home ecosystems.

Emerging startups 1NCE, AssetWatch, Butlr, and Skylo drove innovation in IoT connectivity, industrial asset protection, occupancy sensing, and satellite-based communications for remote operations.

Segment Overview

Based on application, the market is segmetned into smart homes, smart manufacturing, connected logistics, connected healthcare, smart retail, and others. Out of these, the smart manufacturing segment is expected to dominate and be the fastest growing during the forecast period, with a CAGR of 13.2% from 2025 to 2034. This growth is driven by the urgent need to protect highly automated, downtime-sensitive production environments from escalating cyber threats. Following ransomware attacks that caused multiple eight-figure shutdowns, plants invested heavily in advanced security measures like zero-trust overlays and time-sensitive networking to protect daily outputs valued at millions of dollars. In 2025, Fortinet expanded its AI-powered FortiAI capabilities to enhance threat protection and streamline security for manufacturing networks. Additionally, the European Commission allocated over €7.3 billion through its Horizon Europe programme to support cybersecurity research in manufacturing. Meanwhile, the smart homes segment is rapidly growing as consumers adopt connected devices, increasing the attack surface and demand for integrated security solutions. Companies like Fortinet, Trend Micro, and Armis expanded their 2025 portfolios to address smart home vulnerabilities, offering proactive defense and peace of mind.

Based on component segment, the market is bifurcated into solution and service, with the solution segment dominating at a 67.6% share in 2024. This is driven by technologies such as Device Authentication & Management for secure device onboarding, Identity and Access Management (IAM) to enforce user and device policies, Intrusion Detection and Prevention Systems (IDS/IPS) for real-time threat monitoring, and Data Encryption & Tokenization to protect sensitive data. Emerging solutions like secure boot and behavioral analytics further strengthen IoT security. These solutions often come packaged as integrated SDKs combining encryption libraries, identity platforms, and anomaly detection agents, easing compliance with standards like ETSI EN 303 645 and ISO 27400 through pre-certified stacks that simplify audits. Leading players like Fortinet, Trend Micro, and Armis continue innovating-Fortinet's 2025 launch of an AI-powered workspace security platform, as highlighted in their June 2025 Global Threat Landscape Report, addresses the rise of AI-enabled cybercrime by integrating advanced automation and unified threat detection to protect complex IoT environments. Trend Micro's recent cloud security collaborations further expand solution capabilities. Together, these advancements enable enterprises to deploy scalable, automated, and regulation-compliant IoT security solutions that meet growing industry demands.

Geographical Overview

North America held the largest share of the IoT security market in 2024 at 35.7%, supported by federal initiatives like the FCC labeling scheme that promote secure update mechanisms. Early adoption of AI-enabled analytics, robust cloud infrastructure, and mature SOCs have strengthened enterprise defenses. The U.S. Department of Homeland Security prioritizes protecting critical infrastructure from foreign intrusions, directing grants toward water utility and pipeline monitoring pilots. Similarly, Canada follows this approach, while Mexico's near-shoring boom increases the need for integrated security across cross-border logistics. Innovation hubs in Silicon Valley and Austin contribute patented firmware-integrity and post-quantum cryptography solutions to major supply chains. The cloud deployment segment is rising rapidly as organizations embrace hybrid and cloud-native platforms for scalable, flexible, and cost-effective security. Industry leaders such as Fortinet, Palo Alto Networks, and Trend Micro are enhancing their cloud portfolios with AI-driven analytics, automated remediation, and unified management, fueling growth as North American enterprises protect complex, interconnected ecosystems from advanced cyber threats.

Asia Pacific is the fastest-growing region in the IoT security market, forecasted to grow at a CAGR of 13.2%, driven by aggressive smart city deployments and massive consumer IoT adoption. By August 2024, China reported 2.57 billion connected terminals, challenging local operators to authenticate traffic and block botnet attacks. Japan's Ministry of Internal Affairs and Communications issued secure smart city guidelines in 2024, promoting zero-trust frameworks in municipal projects, while South Korea's 6G research includes quantum-resistant key exchange for IoT endpoints, positioning vendors for future export opportunities. Governments in Indonesia and Vietnam are integrating cyber-hygiene audits into manufacturing incentives, requiring certified security platforms from foreign investors. Rapid digital infrastructure expansion across China, India, Japan, and South Korea, coupled with rising cyber threats such as ransomware and device hacking, is driving enterprises to invest heavily in AI-driven threat detection and blockchain authentication. The rollout of 5G networks further enhances connectivity but increases vulnerabilities, necessitating robust IoT security solutions throughout the region.

Key Trends and Drivers

Blockchain Technology Driving Enhanced IoT Security Across Industries -

Blockchain technology is emerging as a powerful tool for enhancing IoT security by ensuring data integrity, secure communication, and decentralized authentication. Industries like logistics, healthcare, and supply chain are using blockchain to create tamper-proof records and encrypt IoT data transactions. Companies such as IBM, VeChain, and Walmart are leading this shift by deploying blockchain-enabled IoT systems for secure tracking and authentication. In smart cities, blockchain secures public infrastructure, as seen in Dubai's use of blockchain-backed frameworks. With its decentralized approach eliminating single points of failure, blockchain is paving the way for scalable, resilient IoT security architectures amid rising global connectivity.

Rising IoT Device Adoption Spurs Demand for Advanced Security Solutions -

The proliferation of IoT devices is reshaping industries, with the global number of connected devices projected to reach 18.8 billion by February 2025, driven by automation and data-driven operations. This surge heightens the demand for robust IoT security. In the automotive sector, Tesla addresses cybersecurity risks by issuing frequent software updates, such as the February 2025 release 2025.2.6, which enhanced in-cabin radar and security features. In healthcare, connected medical devices improve patient care but pose data security risks. Companies like Medtronic and GE Healthcare are investing in strong encryption and real-time threat monitoring to safeguard sensitive patient information and device integrity.

Research Scope

• Estimates and forecasts the overall market size across type, product, and region.
• Provides detailed information and key takeaways on qualitative and quantitative trends, dynamics, business framework, competitive landscape, and company profiling.
• Identifies factors influencing market growth and challenges, opportunities, drivers, and restraints.
• Identifies factors that could limit company participation in international markets to help calibrate market share expectations and growth rates.
• Evaluates key development strategies like acquisitions, product launches, mergers, collaborations, business expansions, agreements, partnerships, and R&D activities.
• Analyzes smaller market segments strategically, focusing on their potential, growth patterns, and impact on the overall market.
• Outlines the competitive landscape, assessing business and corporate strategies to monitor and dissect competitive advancements.\n\nOur research scope provides comprehensive market data, insights, and analysis across a variety of critical areas. We cover Local Market Analysis, assessing consumer demographics, purchasing behaviors, and market size within specific regions to identify growth opportunities. Our Local Competition Review offers a detailed evaluation of competitors, including their strengths, weaknesses, and market positioning. We also conduct Local Regulatory Reviews to ensure businesses comply with relevant laws and regulations. Industry Analysis provides an in-depth look at market dynamics, key players, and trends. Additionally, we offer Cross-Segmental Analysis to identify synergies between different market segments, as well as Production-Consumption and Demand-Supply Analysis to optimize supply chain efficiency. Our Import-Export Analysis helps businesses navigate global trade environments by evaluating trade flows and policies. These insights empower clients to make informed strategic decisions, mitigate risks, and capitalize on market opportunities.