EDA, IP Numbers Strong

Japan bounces back after multi-year slump; strong sales in all major sectors; employment up.


EDA and IP sales were 7.1% in Q3 across all major segments and all geographical regions, increasing to $1.957 billion compared with $1.828 billion in the same period in 2014, according to just-released numbers from the EDA Consortium. The four-quarter moving average was up 8.8%.

“This was an excellent quarter for EDA,” said Wally Rhines, board sponsor for the EDA Consortium’s Market Statistics Service and chairman and CEO of Mentor Graphics. “CAE grew 5%, physical design and verification grew 14%. In addition, IP was strong, Japan was up, and headcount in Japan grew 6.3%.”

Japan has been in a slump for the past several years, despite solid growth in other regions and across a gamut of EDA and IP segments. That changed last quarter. Revenue was up 10% for EDA, IP and services. While Japan still trails growth in the rest of the world—those same segments were up 46% in the Americas, 28% in Asia/Pacific, and 15% in Europe, the Middle East and Africa—it finally puts EDA sales in that country back in positive sales territory.

What’s also noteworthy is that semiconductor IP topped CAE revenue for the first time ever. The shift is due to more reliance on third-party IP to get more complex designs into production under tighter market deadlines, and a sign of just how complex SoC design has become.

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Fig. 1: The growing importance of IP. Source: EDAC

Rhines pointed to solid growth in a number of categories, including analog/mixed signal, formal verification, logic verification, physical verification, and new packaging technology.
There also was increased head count across the board, which is a leading indicator of confidence by chipmakers in future growth.

“The third quarter typically represents what people are anticipating is ahead for the coming year,” he said. “EDA does not fluctuate with the ups and downs of the semiconductor industry, which is more volatile.”

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Fig. 2: Q3 revenues by segment. Source: EDAC.