Hearing Aid Industry: Big Five Still Rule the Roost

The hearing-aid market remains a tight oligopoly dominated by the so-called “Big Five” – Switzerland’s Sonova, Denmark’s Demant and GN Store Nord, WS Audiology (the merged Widex/Signia group), and U.S.-based Starkey. These incumbents account for roughly nine‐tenths of global hearing-device sales. Sonova (maker of Phonak, Unitron and other brands) is the largest. It recently rolled out a new AI-powered hearing aid platform and expects another year of mid-single-digit growth (having beaten its own forecast even as peers flagged slowing demand). Demant (parent of Oticon, Sennheiser and others) is No. 2 and saw only about 2% organic revenue growth in 2024, blaming a “very strong” prior year and intense competition. GN Store Nord (ReSound hearing aids and Jabra audio) reported roughly 5% overall revenue growth in early 2024, with its hearing-aid division up ~14% as it gained share. WS Audiology (Signia and Widex brands) – privately held after a 2019 merger – has been treading water, posting mid-single-digit sales gains this year. In the U.S., Demant-owned Oticon appears to lead, followed by Starkey and Sonova, based on industry reports (a recent survey gave Oticon roughly $574 m in U.S. sales vs. $348m for Starkey and $205m for Sonova in 2024. All five firms continue to invest heavily in R&D and patent portfolios (often pooling inventions in joint partnerships), reinforcing high barriers to entry.

Aging Baby Boomers and Rising Demand

Global demand for hearing aids is underpinned by demographics. The World Health Organization estimates that by 2050 over 700 million people will have disabling hearing loss (already more than 25% of those over 60 do today). In the U.S. alone, one study notes that 22% of Americans aged 65–74 and 55% of those 75+ have disabling hearing loss. Yet adoption lags: roughly 28.8 million U.S. adults could benefit from hearing aids, and fewer than one-third of seniors (age 70+) who need them actually use them. This gap – coupled with low penetration in many emerging markets – suggests healthy long-term growth. Aging populations worldwide imply rising base demand, while public-health recognition of hearing care (linked to cognitive health and quality of life) could drive higher usage.

Government and insurance programs also shape volume and pricing. In the U.S., traditional Medicare excludes hearing aids entirely, effectively forcing retirees to pay full price or hope for supplemental benefits. By contrast, over half of seniors now enroll in Medicare Advantage (MA) plans, and nearly all MA insurers voluntarily cover some hearing services or devices. The Department of Veterans Affairs – which offers no-cost, high-end hearing aids to veterans – already accounts for about 20% of the U.S. hearing-aid market. State Medicaid programs vary, and few private-insurance plans cover adult hearing loss. (Legislation to add hearing benefits to Medicare has been proposed repeatedly but not yet enacted) On the retail side, a landmark 2022 FDA rule created an over-the-counter (OTC) category for mild-to-moderate hearing loss, leading retailers like Walgreens, Walmart and Best Buy to offer self-fit devices that bypass audiologists. The White House estimated this change could save consumers roughly $2,800 per pair of hearing aids. Early data show many Americans taking advantage of OTC options, suggesting volume could rise (and pressure traditional pricing) even as those devices remain a niche today. In short, demographic tailwinds are strong, and evolving reimbursement rules are gradually broadening access – factors likely to sustain industry growth over the long run.

Moats Under Pressure: Tech, Distribution and New Entrants

The Big Five have long enjoyed protective moats. Product-wise, they lead in technical sophistication. For example, in 2024 Sonova unveiled “Sphere Infinio,” the first hearing aid to use real-time AI for noise reduction, powered by a new chip said to have 50× more processing power than its predecessors. Competitors likewise tout features like direct Bluetooth streaming, smartphone app tuning, and AI-enhanced speech algorithms. These firms also benefit from patent portfolios and industry consortia that discourage smaller challengers. On distribution, each company relies on broad clinic and audiologist networks around the world. (In many countries, hearing aids must still be dispensed by licensed professionals.) For example, Demant and WS Audiology operate large chains of clinics, and Amplifon – the largest hearing-aid retailer globally – sells all of the Big Five’s products through its thousands of stores. Bundled service contracts, warranty programs and tight doctor relationships have kept a grip on pricing power in the premium segment.

But cracks are appearing. Consumer-tech giants have targeted hearing loss with familiar form factors. Apple has built “hearing aid” functionality into its AirPods Pro earbuds, and in September 2024 the FDA authorized the first OTC hearing-aid software running on AirPods (letting them amplify sound for adults with mild-to-moderate loss). Bose, known for speakers and headphones, launched SoundControl OTC hearing aids in 2023, priced under $900/pair, and other startups (Lexie, Jabra/B2B, even Amazon) are vying for a piece of the market. Meanwhile, EssilorLuxottica – the global eyeglasses powerhouse – won FDA clearance in early 2025 for “Nuance Audio” smart glasses, pairing hearing-assist tech with prescription frames. These new devices typically target mild hearing loss, lacking custom ear molds or professional fitting. Audiologists note that while earbuds can introduce users to amplified sound, they “still fall short in customization and precision compared to dedicated hearing aids”. For now, high-end patients still rely on the specialized fitting and rechargeable batteries of premium aids, which often cost several thousand dollars per pair (well beyond the sub-$300 average for OTC gadgets). But as consumer audio chips become cheaper and regulations loosen, incumbents face growing competition at the entry level.

In response, the industry’s leaders are pushing innovations and new business models. Sonova is doubling down on its AI platform, Demant and WS Audiology are expanding app-based tuning and remote support, and all are exploring direct-to-consumer channels to meet price-sensitive buyers. Many have unveiled mid-tier products or adjusted pricing to compete with OTC entrants. They’re also partnering across sectors – for example, promoting bundled hearing-vision solutions to match moves like Essilor’s. In the premium segment, incumbents emphasize quality and service: as one audiologist put it, for patients “who fit the hearing profile” of mild loss, AirPods can be “a great introduction,” but serious users “still need” fully featured hearing aids to address complex needs.

Conclusion

The battle lines are clear: the Big Five will continue leveraging their R&D and distribution clout, while newcomers (and tech giants) nibble at the edges with convenience and low prices. Whether that erodes the incumbents’ margins over time remains to be seen, but for now they retain the dominant position – and expensive audiologist-delivered devices remain a distinct class from everyday earbuds.