52.9 Billion UHF RFID Endpoint ICs Shipped in 2024; Resurgent RFID Continues to Expand into New Markets, Bringing Item-Level Visibility Into the Mainstream

In February 2025, Impinj released its Fiscal Year (FY) 2024 results. Impinj’s business is divided into two reportable segments.

First, its endpoint Integrated Circuit (IC) business manufactures UHF RFID ICs for embedding in RFID inlays. This is its largest business and saw 30% revenue growth over 2023 to nearly US$306 million in 2024. This translated to a 34% increase in unit shipments, which ABI Research estimates to be around 26.8 billion units.

Second, its systems business offers UHF RFID reader ICs (chips that enable reading capabilities in RFID readers and printers), finished readers and gateways, and test and measurement software. This business declined by 18% to a little over US$60 million as a result of ending large projects using its finished readers and gateways. This segment tends to fluctuate considerably, given the project-driven nature of large deployments in the RFID market.

1. Impinj Results in Context: The UHF RFID Market Today

In 2024, ABI Research estimates that UHF RFID endpoint IC manufacturers shipped 52.9 billion endpoint ICs. This represents a growth of 17% over 2023. It is clear that Impinj was the largest driver of this growth in 2024. The result of this growth is that Impinj’s UHF RFID endpoint IC unit shipment market share reached 51% in 2024, overtaking NXP Semiconductors for the first time. NXP has traditionally been the largest vendor of UHF RFID endpoint ICs, but saw a more moderate growth of 3% between 2023 and 2024. This is likely a blip, coming off the back of 2 consecutive years of 27% UHF RFID endpoint IC unit shipment growth and overall market leadership in this segment until 2024. To a certain extent, Impinj’s growth (and NXP’s lack of growth) was driven by the continuation of UPS’ Smart Package Smart Facility (SPSF) program, to which it is currently the sole IC provider. This program is the single largest RFID program currently active, and it is unsurprising that NXP’s numbers have taken a hit, in what is a market driven currently by large projects more than by a broad customer base.

Apparel retail remains the largest UHF RFID market by far, accounting in 2024 for 67% of total tag revenue and 77% of tag unit shipments, according to ABI Research’s data. Apparel retail continues to grow, but more slowly; with an often-cited 40% penetration rate in this industry, most large apparel retailers have started tagging their items, so that the “longer tail” is what is left. This long tail will all adapt within the coming years: with RFID now an essential business tool, the differentiation for apparel retailers is in how they will use the technology, not whether they will do so. But volumes in the long tail tend to increase steadily, rather than in leaps and bounds. At first glance, 2024 was a good year for apparel retail. Avery Dennison, the largest inlay manufacturer and service bureau, reported in its own FY 2024 results a 20% revenue increase in its apparel intelligent label (RFID labeling) business in FY 2024. In context, however, this is primarily a correction from the flat year in 2023, during when the industry was beset by overstocking challenges by retailers (limiting inlay sales) and, consequently, by inlay manufacturers (limiting endpoint IC sales). ABI Research expects a more moderate 2024 to 2030 inlay revenue Compound Annual Growth Rate (CAGR) of 11%. Label suppliers will need to continue to actively generate demand in new markets to maintain higher growth rates.

1. Impinj’s Growth Markets

The RFID ecosystem is not too concerned by this challenge. While apparel has dominated the UHF RFID market in shipments and revenue, the last 36 months have seen an increasing diversification of end markets. This ABI Insight highlights three principal markets called out by Impinj, and where the market more broadly is growing: general merchandise, logistics (primarily mail initially), and food. Other markets like healthcare, manufacturing, and logistics, more broadly (e.g., Third-Party Logistics (3PLs) providers), are other areas where interest is growing significantly. 

General merchandise remains comparatively small market today, but inlay manufacturers’ capacity expansion is directly related to capacity planning conversations with Walmart, which is looking to expand its item-level RFID supplier mandate to more categories. Currently, this is fully rolled out only in its apparel and its auto tires and batteries categories, but supplier compliance continues to expand rapidly. The expectation is that as more items are tagged at the source, the barrier to entry is lowered for retailers other than Walmart to make use of already-tagged items. In addition to this, several important retailers both in Europe and the United States—including home improvement and pharmacy retailers—have adopted RFID within their operations on their own initiatives, highlighting that expansion into this category, while made mainstream by Walmart, is broader than a one-company initiative. Sporting goods, pharmacy and health & beauty, and home improvement will be some of the fastest growing segments in the coming years.

The year 2024 also saw the emergence of the item-level food market in UHF RFID. Avery Dennison announced in October 2024 that it (alongside other suppliers) was working with Kroger to tag bakery and deli items at the item-level in Kroger stores, with the goal of reducing waste. Impinj further noted in its earnings call a second major (unnamed) U.S. food (grocery) customer, looking to use UHF RFID for seamless checkout. Impinj noted that both of these programs are larger than any endpoint IC program that has come before, reinforcing why the RFID industry is so excited by the proposed Total Addressable Market (TAM) in the food market. Impinj noted that one or both of these programs may ramp up in 2H 2025, though these enormous programs typically take a long time to reach full deployment.

With regard to mail, the UPS program saw enormous growth in 2023, especially as UPS started ramping up tagging all of its parcels (a total of 5.7 billion parcels shipped in 2024), but also continued to grow in 2024 as the program grows toward full deployment. Full infrastructure deployment is expected in 2025, a year in which UPS is deploying a further 40,000 box trucks with RFID readers (bringing the total to 100,000 box trucks and over 1,000 facilities deployed with RFID readers). The deployment highlights the strong promise of the parcel delivery market; FedEx is expected to follow in the coming 1 to 2 years, but China is the real prize, responsible for 69% (111 billion parcels) of the total parcel shipping market globally and with an initial growing deployment from Cainiao. Tag suppliers are understandably excited by the prospect of massive volumes in this market, which can scale extremely rapidly—as the UPS deployment did. However, there is ongoing need for innovation in this market: customers typically want lower-cost tags with read-only functions in the mail industry, and this will be an area for IC vendors and inlay manufacturers to work on going forward.

1. What’s On Impinj’s Mind?

Outside of end markets, several other trends are worth commenting on, mentioned or alluded to in Impinj’s results.

First, the growth comes from the United States primarily. Impinj notes in its results that Europe is “stable” but not growing much. This is not too surprising, given the enormous “lighthouse” projects in the United States (UPS, Walmart, Kroger). But simultaneously, European RFID customers are typically thought of as “talking less and doing more” with RFID compared to the United States. While this may be the case within the apparel market for the time being, Europe is seeing much less expansion outside of apparel compared to the U.S. market.

Second, RFID remains a market driven by large projects, rather than consistent growth. Even during this period of growth in the market, Impinj notes that it has no major projects for 1H 2025. Deployments with the two food retailers may start ramping up later in 2025, but demand for 1H 2025 is weak. This again highlights the battle that the RFID ecosystem faces, and has always faced—namely, that suppliers have to work hard to generate demand in new markets and create tipping points in each one if they are to see consistent growth.

Third, Impinj noted that its label partner share is changing. Impinj’s 10K saw the appearance of “Customer C” as a customer accounting for over 10% of its revenue. In the past few years, Avery Dennison and Arizon have been the only inlay manufacturers on this list (28% and 17% of Impinj’s revenue, respectively, in 2024, almost entirely from its endpoint IC business). These two remain, but Customer C also now accounts for 15% of Impinj’s revenue. This is more likely than not to be Tageos, the French inlay manufacturer that has been investing heavily in inlay capacity expansion, and has seen enormous shipment growth over the past 2 years. In the first 3 quarters of 2024 alone, Tageos’ revenue increased 142% compared to the same period in 2023. Almost all of the major inlay manufacturers—Avery Dennison, Arizon, Beontag, Hana RFID, Tageos, and Xindeco—have announced huge expansions of their inlay production capacity over the past 24 months, but Tageos’ new capacity is actually fully booked. It is also interesting to note that Arizon’s share of Impinj revenue increased (from 11% in 2023 to 17% in 2024), while Avery Dennison’s declined (from 33% in 2023 to 28% in 2024), possibly reflecting continued overstocking related to the UPS program.

ABI Research expects endpoint IC unit shipments to reach 60.5 billion in 2025, reaching 143 billion in 2030. This highlights the belief that the market is moving from a long phase of being dominated by apparel retail to a much broader base. There are several reasons for this: lower technology cost, easier implementation through better off-the-shelf software, and big initiatives like Walmart driving source tagging. Possibly the most important factor, however, is the broader automation drive by retailers, supply chains, and manufacturing alike, so that RFID becomes a technology used not purely as a point solution like inventory cycle counting, but as an integrated part of broader automation operations.

The continued growth of the RFID industry from an endpoint IC and inlay perspective relies on continued demand generation activities to break down new markets. Requirements for endpoint IC and inlay manufacturers are different from those elsewhere in the RFID value chain; while growth in tagged products is important for reader, printer, and software suppliers, these suppliers have additional growth levers, like helping existing customers leverage value from tags in other parts of their operations (e.g., in the supply chain, for seamless checkout, or for theft prevention). Endpoint IC and inlay suppliers are increasingly in a commodity business driven entirely by a volume imperative, though there is limited apprehension currently, given the big rollouts planned for the next few years. Nonetheless, endpoint IC and inlay suppliers should take note and continue to educate their customers around the next stage of evolution of the market—whether sustainable paper labels, combined UHF/Near Field Communication (NFC) labels, industry-specific labels (e.g., for the mail industry or manufacturing), or simply determining how to generate new value or better Return on Investment (ROI) from existing tag deployments.