EDA, IP Sales Up

IP shows biggest jump; Japan rebounds from a long slump.

popularity

EDA and IP revenue increased 4.5% in Q1, a significant increase given the semiconductor industry was flat last year and that EDA sales dropped 1.9% in Q4 of 2015.

Total sales were $1.962 billion, up from $1.877 in Q1 of 2015. The big surprise, though, was Japan, which grew 12%. Japan’s semiconductor business has been in a deep slump for several years.

“It’s been a long time since we’ve seen growth in Japan,” said Wally Rhines, board sponsor for the ESD Alliance Market Statistics Service and chairman and CEO of Mentor Graphics. “The restructuring is over. Leading companies are recovering and their use of EDA tools has bounced back.”

The entire Asia/Pacific region showed strong growth. Korea posted double digit growth, as well.

CAE, the largest category was down 2.2% to $619.9 million, driven by a weakness in RTL simulation. But there were bright spots in that segment. Emulation was up 14%, formal verification grew 2%, and IC/ASIC analysis was up slightly. PCB and multi-chip module revenue was up 2.8% year over year, as well, with revenue of $166 million.

IP revenue totaled $688.7 million, up 11.4% compared with the same period in 2015.

“What’s clear from the numbers is that the semiconductor industry is not just growing revenue,” said Rhines. “People are investing in the future.”

As further proof, employment also was up 7.4% compared to the previous period in 2015.

Screen Shot 2016-06-29 at 11.26.01 PM
Q1 revenue by segment and region. Source: ESD Alliance MSS