The global electronic design automation tools (EDA) market (henceforth referred to as the market studied) was valued at USD 10.80 billion in 2020, and it is expected to reach USD 18.37 billion by 2026, registering a CAGR of 9.46%, during the period of 2021-2026 (henceforth referred to as the forecast period). Electronic design automation (EDA) tools have provided the silicon industry with the ability to innovate over the past few years. EDA is responsible for developing the design tools that enable the IC design process to be achieved at a design cost that allows the ecosystem to operate at a profit.
- The market studied is entirely dependent on the semiconductor industry. The semiconductor business has been experiencing steady growth. However, the growth is expected to be faced with several challenges. According to the Semiconductor Industry Association, April 2021 stats, the global semiconductor industry sales amounted to USD 436.8 billion in 2020, an increase of 6.5 % compared to 2019. Global semiconductor sales increased moderately on an annual basis in 2020, weathering a challenging macroeconomic environment brought on by the pandemic and other factors.
- The upcoming trend of EDA toolset with machine learning capabilities along with the latest technology such as cloud, AI also contributes to the growth of the market studied. Significant investments that were made during the last couple of years which are aimed at empowering designers for the reduction of the number of errors, thereby saving significant time, are expected to produce results in the future.
- The increasing demand of miniaturized devices and FibFet architecture, resulting in the collaborations/partnerships of foundries and EDA vendors in order to migrate from the 16 nm/14 nm to 10 nm/7 nm logic nodes. For instance, in October 2020, Samsung Foundry announced its 3 nm designs would start on EDA tools from Cadence Design Systems that has been certified for the 3nm gate-all-around (GAA) process from Samsung Foundry. The certification means that mutual customers of Cadence and Samsung Foundry have immediate access to circuit design, layout, signoff, and verification tools and can begin their 3nm IC designs.
- Semiconductor foundries across the world are accelerating their efforts to prepare for a surge in demand from the automotive industry, augmented by advanced driver-assistance systems, autonomous vehicles, and connected cars. This, in turn, is expected to influence the demand for EDA over the coming years. According to Netscribes, the ADAS market for North America, Europe, APAC, Latin America, and Middle East & Africa in 2021 would account for USD 6.6 Billion, USD 5.68 Billion, USD 5.56 Billion, USD 2.07 Billion, and USD 1.36 billion, respectively.
- Owing to such developments, the EDA vendors are expected to focus on developing solutions for the automotive industry and partner with automotive vendors. For instance, in October 2020, Synopsys and Samsung Foundry announced reference flow for predictable execution of automotive safety integrity level (ASIL) autonomous driving and advanced driver-assistance systems (ADAS) applications compliant soc design for automotive applications.
Key Market Trends
IC Physical Design and Verification Segment to Grow Significantly
- IC physical design refers to the creation of geometric representations of ICs, using EDA tools. EDA is used to divide the chip into smaller blocks and then plan the specific space required for each block to ensure maximum performance. These blocks are then placed, using before and after clock synthesis.
- The major factors that have been impacting the growth of the segment are increasing complexity of IC designs and demand for high accuracy and precision of semiconductor devices. In the United States, for example, physical design and verification grew 20% in 2019. In addition, end-user industries have been rapidly adopting the IC design and verification tools to automatically carry out placement and routing of circuits on an integrated circuit (IC) or application-specific integrated circuit (ASIC).
- Variation, miniaturization, edge placement error, and a variety of other issues at new process geometries have been forcing chipmakers to adopt automation tools to handle complex and interconnected design rules to ensure efficient chip manufacturing.
- IC design forms the basis for the development of all microelectronic devices in use today. This includes microprocessors that power laptop computers and cell phones, image processing circuits that power computer monitors and television sets, and sensors that are used in wearable and implanted medical devices. These microelectronic devices also allow the trending use of artificial intelligence (AI) that is opening new frontiers, such as autonomous driving, machine vision, and natural language processing.
- Machine learning, in concert with cloud computing, has the potential to bring significant value to design. Machine learning in EDA is started gaining traction, but lack of datasets is a key concern. The cloud gives a chance for collecting data in the right way by aggregating only relevant data from the runs without giving away the proprietary design information. Another advantage of design in the cloud is remote debugging. The cloud design platforms, such as TSMC’s VDE, empower EDA tool suppliers for remotely and quickly debugging the customer issues.
North America is Expected to Hold a Significant Market Share
- The adoption of EDA tools in industries, such as consumer electronics, automotive, is set to increase demand for the market in North America. Also, growing developments in the semiconductor industry and circuit manufacturing industry have raised the market’s prominent in the region. Some of the major vendors of EDA tools are headquartered in North America, such as Xilinx Inc., Ansys Inc., Keysight Technologies Inc., Cadence Design Systems Inc., and Synopsys Inc.
- To cater to the demand for EDA tools in the region, some of the vendors in North America have been investing in upgrading their offerings and expanding their presence. For instance, in March 2020, Synopsys Inc. announced a discovery in electronic design technology with the introduction of DSO.ai (Design Space Optimization AI), the industry's first autonomous AI application for chip design. The design space AI is part of a multiyear, company-wide initiative and strategic investment in AI-based design technology. The solution revolutionizes the process of searching for optimal solutions by enabling autonomous optimization of broad design spaces. Hence, such innovations are expected to support the market's growth over the forecast period.
- North America is expected to be a significant contributor to the market in the coming times, as fabless semiconductor companies, integrated device manufacturers, and foundries are the primary customers for semiconductor foundries and are densely populated in the region. The fabless companies in the region are Apple, AMD, NVIDIA, Broadcom, Qualcomm, Marvell, and Xilinx.
- The United States is an important country in manufacturing, design, and research in the semiconductor industry. The region's prominence drives the demand in exporting electronics equipment and growing end-user industries that are significant consumers of semiconductors, such as consumer electronics and the automotive industry. For instance, according to the SIA(Semiconductor Industry Association), the semiconductor industry employs nearly a quarter of a million workers in the United States. The US semiconductor company sales totaled USD 208 billion in 2020.
- Computer-aided engineering (CAE) tools can accelerate the development and prototyping of batteries for electric vehicles. The Vehicle Technology Program in the department of energy started the Computer-Aided Engineering of Automotive Batteries (CAEBAT) to work with industry and software vendors to develop sophisticated software
The EDA market is highly fragmented. New opportunities in the automotive, IoT, artificial intelligence and virtual/augmented reality sectors have allowed semiconductor companies throughout all phases of the IC production cycle to prosper, with sizable revenue increases. This has occurred despite significant gains in chip performance but at relatively flat unit sales prices. Some of the key players in the industry include Synopsis, Keysight Technologies, ANSYS, Cadence Design Systems, etc. Some of the key developments in the EDA market are as follows:
- June 2021 - Aldec Inc. launched HES-DVM Proto Cloud Edition (CE). It is available through Amazon Web Service (AWS), HES-DVM Proto CE can be used for FPGA-based prototyping of SoC / ASIC designs and focuses on automated design partitioning to greatly reduce bring-up time when up to four FPGAs are needed to accommodate a design.
- Feburary 2021 - Keysight Technologies launched Eggplant's Digital Automation Intelligence (DAI) platform that enables organizations to automate the testing of high-speed applications, which optimizes the delivery and quality of digital products. Keysight's enhanced DAI platform enables enterprises to automate and test high-speed iOS applications through a new real-time Computer Vision service.
- May 2020 - Cadence Design Systems announced the new Cadence SpectreFX Simulator which is a next-generation FastSPICEcircuit simulator that enables the efficient verification of memory and large-scale system-on-chip (SoC) designs. According to the company it delivers up to 3X performance gains with superior accuracy.
- Feburary 2020 - Ansys Inc. released Ansys RaptorH, which may empower engineers to accelerate and improve 5G, three-dimensional integrated circuit (3D-IC), and radio-frequency integrated circuit design workflows for innovations, such as smart devices, antenna arrays, and data storage systems. RaptorH fuses the fidelity of Ansys' flagship HFSS with the speed and high-capacity architecture of RaptorX that may enable the designers to reduce chip size, lower power consumption, decrease production cost, and minimize time-to-market.
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1.1 Study Assumptions and Market Definition
1.2 Scope of the Study
2 RESEARCH METHODOLOGY
3 EXECUTIVE SUMMARY
4 MARKET INSIGHTS
4.1 Market Overview
4.2 Industry Value Chain Analysis
4.3 Industry Attractiveness: Porter's Five Forces Analysis
4.3.1 Bargaining Power of Suppliers
4.3.2 Bargaining Power of Buyers/Consumers
4.3.3 Threat of New Entrants
4.3.4 Intensity of Competitive Rivalry
4.3.5 Threat of Substitute Products
4.4 Assessment of the Impact of COVID-19 on the Industry
5 MARKET DYNAMICS
5.1 Market Drivers
5.1.1 Booming Automotive, IoT, and AI Sectors
5.1.2 Upcoming Trend of EDA Toolsets Equipped with Machine Learning Capabilities
5.2 Market Restraints
5.2.1 Moore's Law about to be Proven Faulty
6 MARKET SEGMENTATION
6.1.1 Computer-aided Engineering (CAE)
6.1.2 IC Physical Design and Verification
6.1.3 Printed Circuit Board and Multi-chip Module (PCB and MCM)
6.1.4 Semiconductor Intellectual Property (SIP)
6.2.2 Consumer Electronics
6.2.5 Other Applications
6.3.1 North America
6.3.4 Rest of the World
7 COMPETITIVE LANDSCAPE
7.1 Vendor Market Share
7.2 Company Profiles
7.2.1 Altium Limited
7.2.2 Ansys Inc.
7.2.3 Cadence Design Systems Inc.
7.2.4 Keysight Technologies Inc.
7.2.5 Agnisys Inc.
7.2.6 Aldec Inc.
7.2.7 Lauterbach GmbH
7.2.8 Mentor Graphic Corporation (Siemens PLM Software)
7.2.9 Synopsys Inc.
7.2.10 Xilinx Inc.
7.2.11 Zuken Ltd.
8 INVESTMENT ANALYSIS
9 FUTURE OF THE MARKET
- Altium Limited
- Ansys Inc.
- Cadence Design Systems Inc.
- Keysight Technologies Inc.
- Agnisys Inc.
- Aldec Inc.
- Lauterbach GmbH
- Mentor Graphic Corporation (Siemens PLM Software)
- Synopsys Inc.
- Xilinx Inc.
- Zuken Ltd.