EDA Trends and Forecast
The future of the global EDA market looks promising with opportunities in the consumer electronics industry, automotive, and healthcare markets. The global EDA market is expected to reach an estimated $28.7 billion by 2030 with a CAGR of 9.9% from 2024 to 2030. The major drivers for this market are the growing demand for miniaturization in various industries and the rising demand for digitalization tools.
• Lucintel forecasts that, within the deployment type category, on-premises is expected to witness higher growth over the forecast period due to handling intricate chip designs, vast datasets, and uniformly transition to new operational processes for chip design, manufacturing, and verification with minimal risk and complexity in its management.
• Within this end-use category, consumer electronics will remain the largest segment due to the high adoption of advanced gadgets such as smart TVs and smartphones.
• In terms of regions, APAC is expected to witness the highest growth over the forecast period due to the strong position of the semiconductor industry in countries such as China, Japan, South Korea, and Taiwan.
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Emerging Trends in the EDA Market
The world is undergoing radical changes, and the EDA market is no exception. Some of these changes involve an increased focus on new chip manufacturing, with a particular emphasis on 5G and AI integration, as well as adopting multi-chip designs. As chip design becomes more complex than the single-transistor designs of the pre-1980s, EDA tools like Magma software have risen to meet these challenges. Below are five key trends shaping the future of the EDA market, many of which overlap.
• AI and Machine Learning in EDA: AI is not just a buzzword; it is a game-changer, especially for EDA tools. AI can speed up the design process and mitigate potential problems during the design stage autonomously. This technology enables faster and easier chip layout optimization, involving many variables. AI in EDA tools allows design engineers to access data more quickly during the development process, which ultimately benefits the designs of modern semiconductors.
• Embrace of Multi-Chip and Heterogeneous Integration: The growing complexity of designs has led to a trend toward multi-chip and heterogeneous integration. EDA tools are evolving to support the design of systems that feature multiple chips working together. These tools help optimize the interaction between components, addressing performance, power, and size requirements. This trend is becoming increasingly important in technologies such as AI, IoT, and 5G, where multi-chip systems are gaining traction.
• Chips Designed with a Focus on Low Power Consumption: The increasing use of mobile devices and the growth of edge computing are driving the demand for power-efficient chips, which have become a priority in the EDA market. New EDA tools incorporate features like power analysis and optimization, allowing designers to create chips with high performance and low power consumption. These developments are crucial for industries like consumer electronics and automotive, where energy efficiency is a priority.
• Quantum Computing and New EDA Tools: The field of quantum computing is driving the development of new EDA tools tailored to quantum chip design. These tools address the challenges of developing quantum circuits that control and optimize qubits. As quantum computing becomes more feasible, the demand for EDA systems suited for quantum applications is expected to grow significantly.
• Application of Cloud EDA and Establishing Cooperation: There is a growing trend toward adopting cloud-based EDA tools, which create scalable, collaborative environments for chip design teams. Cloud-based platforms offer remote access, eliminate the need for expensive local infrastructure, and improve collaboration among different teams. These tools are particularly beneficial for smaller startups and design firms, as they provide access to software without incurring high capital costs.
The EDA market is being revolutionized by emerging trends such as the integration of AI, multi-chip design, power-efficient chips, quantum computing, and cloud-based design collaboration. These developments are enabling faster and more efficient chip design processes that align with the growing needs of advanced semiconductor manufacturing. As these trends unfold, they will lead to the next generation of EDA tools, helping to meet the challenges associated with advanced chip design and manufacturing.
Recent Developments in the EDA Market
Technological progress in semiconductor design, coupled with the increasing complexity of electronic devices, is driving the rapid growth of the EDA market. Below are five key trends expected to shape the future of the EDA industry, ranging from AI integration to cloud solutions.
• AI-enabled Design Automation: Artificial intelligence is transforming the design automation process with AI-powered tools. These tools use machine learning algorithms to perform tedious tasks, optimize chip placement, and anticipate design issues. This integration accelerates the design cycle and enhances the quality of designs, particularly in complex semiconductor products such as 5G chips and AI processors.
• Emergence of Cloud-based EDA Platforms: With the growing demand for cloud-based EDA platforms, semiconductor design teams now have the option of working in flexible, scalable, and cost-efficient environments. Cloud solutions reduce capital expenses by eliminating the need for expensive local infrastructure, and they enhance collaboration among global teams, making the design process more flexible and efficient.
• Creation of Specialized EDA Tools for 5G Chip Design: Alongside the evolution of 5G technologies, there is an increasing demand for EDA tools that enhance the design of 5G chips. These tools focus on meeting the functional requirements of 5G chips, including high-speed data processing and low power consumption. EDA providers are upgrading their tools to accommodate the unique demands of 5G technology, helping manufacturers reduce lead times for 5G-capable products.
• Development of Tools Focused on Energy-efficient Design: With growing concerns about global warming and the proliferation of IoT devices, there is a global push toward energy-efficient designs. New EDA tools are being developed to support better power management, allowing designers to optimize power consumption during the entire design phase. This is particularly important for mobile devices, electric vehicles, and industries focused on energy efficiency.
• Management of Multi-chip Solutions and Advanced Packaging Designs: EDA tools have evolved to support advanced packaging designs, such as System-in-Package (SiP) and 3D packaging, which house multiple chips within a single unit. These advancements are crucial for designing high-performance chips and systems in smaller packages. As the demand for advanced multi-chip designs grows, EDA tools are adapting to the new requirements of 3D packaging.
These changes are accelerating chip design processes and addressing the complexities of modern semiconductor products. As these developments continue, they will shape the future of semiconductor design and manufacturing, supporting new technologies like 5G and AI.
Strategic Growth Opportunities for EDA Market
The EDA market continues to grow in various applications, offering opportunities driven by advancements in technology and the increasing complexity of semiconductor devices, including AI, 5G, automotive, quantum computing, and mobile devices.
• AI and Machine Learning Chip Design: There is growing demand for machine learning algorithms, which is creating a need for specialized chips. This is driving interest in EDA tools that assist AI architects working with custom-built chip architectures. This segment presents significant growth opportunities for EDA providers targeting AI and machine learning applications.
• 5G and Telecom Infrastructure: The demand for building 5G networks is creating a need for differentiated EDA tools. These tools optimize the design of 5G chips, which require high-speed data processing and low latency. As investments in telecom infrastructure expand, EDA providers focusing on 5G chip design will see vast growth potential.
• Automotive and Autonomous Vehicles: Semiconductor chips are essential for electric vehicles, autonomous driving systems, and advanced driver-assistance systems. The automotive industry is increasingly relying on EDA tools for designing electronic chips, sensors, cameras, and radar systems. This trend presents an opportunity for EDA providers to serve the growing automotive semiconductor market.
• Quantum Computing: Moving towards New Frontiers: Chip design in quantum computing is an emerging research area, requiring specialized EDA tools. As research in quantum computing advances, there is a growing need for tools to optimize quantum circuits and control quantum bits (qubits). This new field offers a significant market opportunity for EDA providers developing tools for quantum processor design.
• Consumer Electronics and IoT Devices: With the rise of IoT and the increasing demand for consumer electronics like smartphones, wearables, and smart home devices, there is a high demand for advanced semiconductor designs. The market for IoT applications and consumer electronics offers significant growth potential, thanks to the availability of EDA tools that assist in designing large, low-power integrated circuit (IC) chips.
Growth opportunities in AI chip design, 5G network architecture, automotive applications, quantum computing, and IoT are key drivers of the EDA market. By leveraging these opportunities, EDA providers can expand their market presence and meet the demands of advanced semiconductor designs. As industries evolve, the role of EDA tools in shaping future electronics and technologies will be crucial.
EDA Market Driver and Challenges
The EDA market is influenced by several factors, including technological, economic, and regulatory pressures. Key drivers include the increasing complexity of semiconductors, the development of AI, and advances in 5G and quantum computing. However, the industry also faces challenges such as high R&D costs, intellectual property (IP) issues, and regulatory barriers.
The factors responsible for driving the EDA market include:
• Increasing Complexity of Semiconductor Designs: As devices become more advanced, the complexity of semiconductor designs increases. This requires more sophisticated EDA tools capable of handling multi-chip designs, 3D packaging, and AI optimization.
• Growth of AI and Machine Learning Applications: The rise of AI and machine learning is one of the primary drivers of the EDA market. The need to process vast datasets and develop specialized AI chips is pushing EDA tools to evolve.
• Expansion of 5G Networks: The deployment of 5G networks is driving new requirements for chip designs capable of handling augmented processing capabilities with low latency. The demand for EDA tools that optimize 5G chip configurations is increasing.
• The Demand for Power-efficient Designs: The growing popularity of smaller devices like phones and IoT devices, as well as electric vehicles, is increasing the demand for energy-efficient chips. EDA tools are adapting to meet these challenges by integrating power optimization techniques.
• Movement towards Cloud-Based EDA Tools: The rise of cloud computing has led to the growth of cloud-based EDA tools, which are flexible, scalable, and cost-efficient. These tools promote collaboration and make chip design more accessible to smaller firms and startups.
Challenges in the EDA market are:
• High R&D Costs and Long Development Cycles: The development of new EDA tools requires significant investment in R&D. High costs and lengthy development times can pose challenges to smaller players in the market.
• Intellectual Property (IP) Protection: As EDA tools are proprietary software, intellectual property concerns can limit collaboration and slow down innovation.
• Complex Regulations and Standards: The semiconductor industry is subject to various regulations, including export controls and intellectual property laws. Navigating these regulations can be challenging for EDA providers.
Despite these challenges, the market remains positive, with growth driven by innovation in chip design and manufacturing.
List of EDA Companies
Companies in the market compete on the basis of product quality offered. Major players in this market focus on expanding their manufacturing facilities, R&D investments, infrastructural development, and leverage integration opportunities across the value chain. Through these strategies EDA companies cater increasing demand, ensure competitive effectiveness, develop innovative products & technologies, reduce production costs, and expand their customer base. Some of the EDA companies profiled in this report include-
• Sigasi
• Keysight Technologies
• JEDA Technologies
• CadSoft Computer
• Cadenece Design System
• Silvaco International
• Mentor Graphics
EDA by Segment
The study includes a forecast for the global EDA by deployment mode, product, end use industry, and region.
EDA Market by Deployment Mode [Analysis by Value from 2018 to 2030]:
• On-premises
• Cloud-based
EDA Market by Product [Analysis by Value from 2018 to 2030]:
• CAE
• Semiconductor IP
• PCB & MCM
EDA Market by End Use Industry [Analysis by Value from 2018 to 2030]:
• Consumer Electronics Industry
• Automotive
• Healthcare
EDA Market by Region [Analysis by Value from 2018 to 2030]:
• North America
• Europe
• Asia Pacific
• The Rest of the World
Country Wise Outlook for the EDA Market
The Electronic Design Automation (EDA) market is undergoing significant changes due to advancements in semiconductor technology, the increasing need for adaptable systems, and the integration of AI and machine learning into design processes. The United States, China, Germany, India, and Japan are at the forefront of these changes. Each of these countries is working to improve EDA tools to meet the challenges of modern chip design and manufacturing, especially as complexity continues to increase.
• United States: The majority of companies using computer-aided design (EDA) tools are based in the US. Synopsys, Cadence, and Mentor Graphics are some of the most important brands in the industry. In recent years, there has been a trend toward integrating AI and machine learning tools into EDA software. This enables chip engineers to design and manufacture chips more quickly and accurately. Additionally, there are now improved tools for designing chips for 5G and AI, driven by the need for faster semiconductors required by industries such as telecommunications, automotive, and cloud computing.
• China: One of the key advancements in the Chinese EDA sector is its self-reliant semiconductor policies. The government is funding the development of EDA software to reduce dependency on foreign tools. More local companies are now developing conceptual EDA solutions for semiconductor design, with a focus on national industries in sectors such as 5G, AI, and automotive. Additionally, China is promoting the development of chip design tools through several projects aimed at strengthening the country’s technology ecosystem.
• Germany: Germany has been advancing in the EDA market with a focus on automotive and industrial applications. With growing demand, German companies are now concentrating on e-chip designs for the electric vehicle market and self-driving technology. Moreover, Germany is increasing its research in quantum computing due to the rapidly growing need for specialized EDA tools for designing quantum chips. Such policies toward future technologies are helping Germany strengthen its competitive position in the global EDA market.
• India: The Indian semiconductor industry is starting to take off, and with this progress, EDA tools are becoming increasingly popular. The country is transforming into a design and testing service provider. With government policies supporting semiconductor manufacturing and design, EDA tools have gained significant traction, positioning India at the heart of the global EDA ecosystem. Domestic advancements are also stimulating further progress in this area.
• Japan: Japan is focusing on next-generation chip devices, with EDA tools reaching multinational companies. Industries like robotics, automotive, and consumer electronics require cutting-edge chips, and Asia is targeting these sectors as promising markets. Japan has developed EDA software specifically for precision industries to improve microelectronics design. Furthermore, Japanese companies are integrating AI and machine learning into EDA tools to reduce design cycles for complex systems, thus improving process capabilities through software integration.
Features of the Global EDA Market
Market Size Estimates: EDA market size estimation in terms of value ($B).
Trend and Forecast Analysis: Market trends (2018 to 2023) and forecast (2024 to 2030) by various segments and regions.
Segmentation Analysis: EDA market size by deployment mode, product, end use industry, and region in terms of value ($B).
Regional Analysis: EDA market breakdown by North America, Europe, Asia Pacific, and Rest of the World.
Growth Opportunities: Analysis of growth opportunities in different deployment mode, product, end use industry, and regions for the EDA market.
Strategic Analysis: This includes M&A, new product development, and competitive landscape of the EDA market.
Analysis of competitive intensity of the industry based on Porter’s Five Forces model.
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FAQ
Q.1 What is the EDA market size?
Answer: The global EDA market is expected to reach an estimated $28.7 billion by 2030.
Q.2 What is the growth forecast for EDA market?
Answer: The global EDA market is expected to grow with a CAGR of 9.9% from 2024 to 2030.
Q.3 What are the major drivers influencing the growth of the EDA market?
Answer: The major drivers for this market are the growing demand for miniaturization in various industries and the rising demand for digitalization tools.
Q4. What are the major segments for EDA market?
Answer: The future of the EDA market looks promising with opportunities in the consumer electronics industry, automotive, and healthcare markets.
Q5. Who are the key EDA market companies?
Answer: Some of the key EDA companies are as follows:
• Sigasi
• Keysight Technologies
• JEDA Technologies
• CadSoft Computer
• Cadenece Design System
• Silvaco International
• Mentor Graphics
Q6. Which EDA market segment will be the largest in future?
Answer: Lucintel forecasts that on-premises is expected to witness higher growth over the forecast period due to handling intricate chip designs, vast datasets, and uniformly transition to new operational processes for chip design, manufacturing, and verification with minimal risk and complexity in its management.
Q7. In EDA market, which region is expected to be the largest in next 5 years?
Answer: APAC is expected to witness the highest growth over the forecast period due to the strong position of the semiconductor industry in countries such as China, Japan, South Korea, and Taiwan.
Q.8 Do we receive customization in this report?
Answer: Yes, Lucintel provides 10% customization without any additional cost.
This report answers following 11 key questions:
Q.1. What are some of the most promising, high-growth opportunities for the EDA market by deployment mode (on-premises and cloud-based), product (CAE, semiconductor IP, and PCM & MCM), end use industry (consumer electronics industry, automotive, and healthcare), and region (North America, Europe, Asia Pacific, and the Rest of the World)?
Q.2. Which segments will grow at a faster pace and why?
Q.3. Which region will grow at a faster pace and why?
Q.4. What are the key factors affecting market dynamics? What are the key challenges and business risks in this market?
Q.5. What are the business risks and competitive threats in this market?
Q.6. What are the emerging trends in this market and the reasons behind them?
Q.7. What are some of the changing demands of customers in the market?
Q.8. What are the new developments in the market? Which companies are leading these developments?
Q.9. Who are the major players in this market? What strategic initiatives are key players pursuing for business growth?
Q.10. What are some of the competing products in this market and how big of a threat do they pose for loss of market share by material or product substitution?
Q.11. What M&A activity has occurred in the last 5 years and what has its impact been on the industry?
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