In the fourth quarter of 2024, the electronic design automation (EDA) industry delivered a stellar report card. According to the latest Electronic Design Market Data (EDMD) report released by the ESD Alliance, a division of the SEMI Technology Community, the revenue of the EDA industry increased by 11% year-on-year in the quarter, soaring to $4.9 billion from $4.44 billion in the same period in 2023.
In terms of product categories, there were significant growth in several areas. Computer-aided engineering (CAE) revenue reached $1,696.9 million in Q4 2024, up 10.9% year-over-year, with a four-quarter moving average growth of 12.3%. Integrated circuit (IC) physical design and verification revenue grew even more robustly, reaching $797.9 million, or 15.4%, with a four-quarter moving average of 8.1%. Printed circuit board (PCB) and multi-chip module (MCM) revenue jumped 15.9% to $476.2 million, representing a four-quarter moving average of 8.3%. Among them, the growth of IC package design is particularly prominent, as high as 70%. Although the actual market size of IC packaging design may be underestimated due to the classification differences of some companies in the data statistics, the annual revenue of $84 million and such a high growth rate in this field are enough to demonstrate its important position and development potential in the industry. Semiconductor Intellectual Property (SIP) revenue increased 7.9% to $1,760.7 million, representing a four-quarter moving average growth of 15.7%. Services revenue grew 11% to $195.6 million, with a four-quarter moving average growth of 26.2%, indicating that demand for design services remains strong and labor supply is difficult to fully meet, even in times of economic volatility.
In terms of geography, the regional markets have grown to varying degrees. The Americas, the highest revenue reporting region, purchased electronic system design products and services of $2,171.8 million in Q4 2024, an increase of 12.9%, and a four-quarter moving average growth of 17.1%. Europe, Middle East and Africa (EMEA) purchases were $622.3 million, up 2.3% and up 10.6% on a four-quarter moving average. Japanese purchases increased 21.7% to $318.4 million, representing a four-quarter moving average increase of 10.8%. Asia-Pacific (excluding China) grew 10.2% to $1,814.8 million in purchases, representing a four-quarter moving average growth of 9.3%. Notably, despite the decline in China, the Asia-Pacific region as a whole maintained 10% growth, showing strong support from the rest of the region.
Chart: In Q4 2024, the revenue of the EDA industry will increase by 11%, releasing positive signals in many fields
At the technical level, the development trend in the field of resolution enhancement technology is good. At present, the global semiconductor manufacturing technology is constantly evolving, and some Chinese manufacturers use the quadruple patterning process in lithography technology, which is different from the world's mainstream extreme ultraviolet lithography (EUV) technology route. This has sparked a discussion about the sources of relevant software for Chinese companies, especially in the context of trade restrictions for some companies such as SMIC, and how to obtain technical support has become the focus of the industry, which also reflects the importance and complexity of resolution enhancement technology in the market competition.
The employment data also reflects the dynamics of the industry. In Q4 2024, the EDMD report tracks a total of 61,827 employees worldwide, an increase of 2.9% compared to 60,106 in Q4 2023, but a slight decrease of 0.9% compared to Q3 2024. This fluctuation reflects the balance between the industry in the process of expansion and adjustment, although the overall employment is on the rise, but in the short term it is still affected by a variety of factors, such as project cycles, technology upgrades and changes in the structure of talent demand.
For the future development of the EDA industry, it can be seen from the data of this report that the growth of the industry has a wide range of supporting factors, covering product innovation, market expansion and technology upgrading. Despite the challenges of international trade situation and technological blockade, the continuous increase in R&D investment has laid a solid foundation for the development of the industry. In times of economic volatility, the EDA industry has shown resilience because companies know that design innovation is the key to gaining a foothold in the market competition, and R&D efforts will not be halted by short-term economic difficulties. With the rapid development of emerging technologies such as 5G, artificial intelligence, and the Internet of Things, the requirements for chip performance and complexity continue to increase, and the market demand for EDA, as a key tool for chip design, is expected to further expand. In the future, the EDA industry will continue to move forward on the road of technological innovation and market expansion, constantly break through technical bottlenecks, expand application fields, and provide strong technical support for the global semiconductor industry and electronic system design.
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