Electronic Design Automation (EDA) Market Analysis APAC, North America, Europe, South America, Middle East and Africa - US, China, Germany, Japan, South Korea - Size and Forecast 2024-2028

Electronic Design Automation Market Size 2024-2028 

The electronic design automation market size is projected to increase by USD 8.69 billion at a CAGR of 10.26% between 2023 and 2028. Market expansion hinges on multiple factors, prominently the escalating importance of Electronic Design Automation (EDA) in the electronic design sphere. As technological advancements drive complexity in electronic design, EDA tools play an increasingly crucial role in streamlining and optimizing the design process. Moreover, the growing relevance of EDA extends beyond traditional applications, encompassing emerging domains such as system-level design and hardware-software co-design. This expanding significance underscores the indispensable role of EDA solutions in enabling innovation and accelerating time-to-market for electronic products. Additionally, the proliferation of IoT managed services and IoT devices, the surge in demand for high-performance computing, and the advent of artificial intelligence further underscore the growing relevance of EDA across diverse industries. These factors collectively contribute to the robust growth trajectory of the EDA market, propelling it towards continued expansion and innovation.

What will be the Size of the Market During the Forecast Period?

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Market Dynamics 

In the realm of technology, the market plays a pivotal role in shaping innovation. It enables seamless creation and testing of integrated circuits (ICs) for various applications, from smartwatches to laptops. With the rise of streaming services and social media platforms, demand for advanced consumer electronics is ever-growing, driving the need for sophisticated semiconductor components. EDA tools facilitate the development of fitness devices like fitness trackers and complex aircraft avionics systems , leveraging cutting-edge artificial intelligence and cloud-based solutions for enhanced performance. This market thrives on precision, enabling efficient circuit design for diverse electronics firms through advanced computer-aided design techniques.

The market growth and forecasting report includes key player's detailed analyses of the competitive landscape of the market and information about 20 market companies, including Advanced Micro Devices Inc., Agnisys Inc., Aldec Inc., ANSYS Inc., Autodesk Inc., Cadence Design Systems Inc., ElectroMagneticWorks Inc., Eremex Ltd., Intercept Technology Inc., Keysight Technologies Inc., Labcenter Electronics, Mirabilis Design Inc, National Instruments Corp., Siemens AG, Sigasi NV, Silvaco Inc., Synopsys Inc., Verific Design Automation Inc., WestDev Ltd., and Zuken Inc. Additionally, Advanced Micro Devices Inc offers a wide range of electronic design automation software and services under its subsidiary Xilinx Inc.

 Key Market Driver

The growing significance of EDA in the electronic design process is driving growth in the market. The global market for semiconductors has been significantly enhanced by the growing demand for electronic devices. Semiconductors are used in all devices such as smartphones, wearables, and the forthcoming IoT. With the growing popularity of these devices, capital investments in the semiconductor industry have increased exponentially over the years.

However, the global semiconductor market is recording a rapid technological transformation. This is giving rise to rapid product developments and reduced time-to-market for developed products.  In PCBs that are to comply with ICs, one of the main focus areas for PCB manufacturers, is embedded semiconductors should be integrated. This has compelled manufacturers of PCB to extensively use EDA tools to design products to support the trend of miniaturization. Therefore, the growing significance of EDA in the electronic design process will drive the growth of the global electronic automation market during the forecast period.

Significant Market Trends

Machine learning disrupting the market is a primary trend in market growth.  Machine learning is beginning to have an impact on the market. Machine learning tools allow for the recommendation of solutions to common problems, and this will take much less time for the design team. The approach through machine learning consequently reduces the cost of designs. The reduction of the cost of design theoretically expands the market for EDA tools. It creates opportunities for new designs and companies requiring more chips.

Moreover, machine learning is one of the up-to-the-minute areas of development for the semiconductor industry. Packaging and optimization of solutions into usable forms for battery-operated consumers or the automotive sector, as well as IoT products, is a possibility. Therefore, factors like machine learning disrupting the market can drive the growth of the market during the forecast period.

Major Market Challenge

The increased risk of cyber threats is a major challenge faced by the market. The reputations of the companies and their businesses could be affected by any compromises of information related to business or customers due to cyber attacks as well as other security breaches. The market companies store sensitive data, including IP, proprietary business information, private customer data, and confidential employee information, in their data centers and on their networks.

Moreover, despite high-security measures, the IT infrastructure might be vulnerable to attacks by hackers or can be breached owing to employee error or other commotions that could lead to unauthorized disclosure or loss of delicate information.  It is often based on the sophistication of security methods that techniques to gain unauthorized access to networks and disrupt systems change. The techniques generally cannot be recognized until tried against a target. Therefore, the increased risk of cyber threats will negatively impact the growth of the market during the forecast period.

Market Segmentation 

Electronic design automation (EDA) is at the forefront of innovation, especially in the cloud based solutions era. As the IoT industry and AI industry expand, demand for miniaturized chips/ICs surges, emphasizing the need for precision and accuracy in designing circuits. EDA tools provide robust support for hardware development, leveraging advanced computer aided design techniques. With a focus on efficiency and reliability, these solutions empower engineers to navigate the complexities of modern hardware design with ease.

This market report extensively covers market segmentation by product type (semiconductor IP, CAE, IC physical design and verification, PCB and multi-chip module, and services), deployment (on-premises and cloud-based), and geography (APAC, North America, Europe, South America, and Middle East and Africa). It also includes an in-depth analysis of drivers, trends, and challenges. Furthermore, the market forecasting report includes historic market data from 2018 to 2022.

By Product Type

The market share by the semiconductor IP segment will be significant during the forecast period. The semiconductor IP market segment held the largest share of the market in 2022. New products have emerged due to the increasing complexity of semiconductor designs and production techniques as well as their integration with advanced technologies. This is increasing the number of IPs being registered in the semiconductor industry.

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The semiconductor IP segments showed a gradual increase in the market share of USD 3.26 billion in 2017. The semiconductor industry has been recording increased demand for many devices, including sensors, chips, radio frequency (RF) components, and memory devices. The increasing use of semiconductors in a range of sectors, e.g. automotive, energy, medical care, and engineering, has led to this demand. Such factors will increase segment growth during the forecast period.

By Deployment

The on-premises deployment segment refers to the traditional approach of deploying software or applications on local servers or computing infrastructure that is owned and managed by an organization. On-premises infrastructure gives the organization complete control over the resources, services, and data. The performance of the On-premises systems provides certain advantages, such as latency. On-premises provide provision to store data locally, allowing greater control, which will avoid the cases of sensitive data leaving the company. All these advantages make the on-premises software highly preferable to the chip designers. EDA workflows include front-end design, backend workloads, as well as performance stimulation and verification and include timing and power analysis, design rule checkups, and other applications from the backend workload to prepare a chip for production. 

By Region

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APAC is estimated to contribute 45% to the growth of the global market during the forecast period. Technavio's analysts have provided an extensive insight into the market forecast, detailing the regional trends and drivers influencing the market's trajectory throughout the forecast period.

The growing concentration of electronic manufacturers and the presence of a large number of semiconductor foundries in the region are primarily propelling the growth of the market in APAC. In terms of strong semiconductor value chain establishments, countries such as China, Taiwan, and South Korea have grown exponentially.

Furthermore, the region has a high presence of electronic device manufacturers that need EDA software tools to operate. The increasing number of manufacturers in APAC, particularly China and India (with substantial investments and government backing), would drive the growth of the market in the region during the forecast period.

Key Market Customer Landscape

The market forecasting report includes the adoption lifecycle of the market research and growth, covering from the innovator’s stage to the laggard’s stage. It focuses on adoption rates in different regions based on penetration. Furthermore, the report also includes key purchase criteria and drivers of price sensitivity to help companies evaluate and develop their market  growth and trends strategies.

Global Market Customer Landscape

Key Companies & Market Insights

Companies are implementing various strategies, such as strategic alliances, partnerships, mergers and acquisitions, geographical expansion, and product/service launches, to enhance their presence in the market.

Agnisys Inc. - The company offers electronic design automation such as IDesignSpec, IDS NextGen, and others.

Market analysis and report of qualitative and quantitative analysis of companies has been conducted to help clients understand the wider business environment as well as the strengths and weaknesses of key market players. Data is qualitatively analyzed to categorize companies as pure play, category-focused, industry-focused, and diversified; it is quantitatively analyzed to categorize companies as dominant, leading, strong, tentative, and weak.

Segment Overview

The market research report provides comprehensive data (region wise segment analysis), with forecasts and estimates in "USD billion" for the period 2024-2028, as well as historical data from 2018 - 2022 for the following segments.

• Product Type Outlook 
  • Semiconductor IP
  • CAE
  • IC physical design and verification
  • PCB and multi-chip module
  • Services
• Deployment Outlook
  • On-premises
  • Cloud-based
• Region Outlook
  • North America
    • The U.S.
    • Canada
  • Europe
    • The U.K.
    • Germany
    • France
    • Rest of Europe
  • APAC
    • China
    • India
  • Middle East & Africa
    • Saudi Arabia
    • South Africa
    • Rest of the Middle East & Africa
  • South America 
    • Chile
    • Brazil
    • Argentina

Market Analyst Overview

The market is witnessing significant growth driven by the demand for programmable chip platforms in the silicon sector. Electronics makers are increasingly relying on EDA tools to streamline the IC design process and develop advanced electronic systems. From printed circuit boards to microprocessors, EDA enables automated processes and helps identify and rectify bugs, defects, and design errors in sophisticated designs. It plays a crucial role in various industries such as aerospace and military, healthcare, manufacturing, and the Internet of Things (IoT). With the proliferation of connected gadgets and sensing devices, EDA tools are essential for optimizing sensor technologies and supporting AI and automotive industries. Additionally, advancements in VLSI structures and silicon photonics are driving growth in 5G communications and hyper-scale computing within the aerospace systems sector.

Further, the market continues to evolve with the growing demand for semiconductor design and advanced electronic systems. EDA tools play a crucial role in optimizing memory management units and ensuring the efficiency of microprocessors and controllers. Additionally, they facilitate the analysis and optimization of Average Selling Prices (ASPs), crucial for maintaining competitiveness in AI industries and beyond. Furthermore, EDA tools support the development of various electronic devices such as television sets, media players, printers, and smartcard applications by enabling automated controls and enhancing sensing applications. As the demand for smart devices and hyper-scale computing continues to surge, EDA solutions are instrumental in driving innovation and efficiency across the electronics industry.

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What are the Key Data Covered in this Market Report?

• CAGR of the market during the forecast period
• Detailed information on factors that will drive the market growth and forecasting of the market between 2024 and 2028
• Precise estimation of the size of the market size and its contribution to the parent market
• Accurate predictions about upcoming market trends and analysis and changes in consumer behavior
• Growth of the market industry across Europe, North America, APAC, South America, and Middle East and Africa
• Thorough market growth analysis of the market’s competitive landscape and detailed information about companies
• Comprehensive market analysis and report on the factors that will challenge the market research and growth of market companies

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