EDA Market Projected to Grow at 9.4% CAGR, Hitting US$ 32.88 Bn by 2032 - Persistence Market Research

Introduction

The Electronic Design Automation (EDA) market plays a pivotal role in transforming the semiconductor landscape. EDA refers to software tools that aid in the design, simulation, verification, and manufacturing of electronic systems and integrated circuits (ICs). As the demand for high-performance computing devices, AI applications, and connected systems continues to soar, EDA has become a foundational enabler for innovation.

According to projections, the global EDA market is expected to rise from US$ 17.59 Bn in 2025 to US$ 32.88 Bn by 2032, growing at a CAGR of 9.4% over the forecast period. The primary drivers behind this growth are the increasing complexity of ICs, the adoption of AI and machine learning in design processes, and the shift toward cloud-based EDA platforms.

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Market Overview and Key Growth Drivers

The EDA market is undergoing a transformative evolution. With the global semiconductor industry producing over 1.1 trillion chips in 2022, there is a tremendous push toward more sophisticated design and verification tools. The surging demand for connected devices in areas like AI, 5G, and IoT necessitates faster, more reliable chip design workflows-making EDA tools indispensable.

North America is projected to hold the largest market share at 45% in 2025, primarily due to its advanced semiconductor R&D ecosystem and dominance in high-performance computing. Integrated Device Manufacturers (IDMs) are expected to lead the market by end-user segment, holding 42% market share in 2025, thanks to their adoption of advanced process nodes and in-house EDA capabilities.

➤ Key Highlights from the Report

1. ➤ The EDA market is set to grow at a CAGR of 9.4% between 2025 and 2032, driven by semiconductor complexity.
2. ➤ Cloud-based EDA deployments are expected to reach 38% market share by 2025.
3. ➤ EDA solutions (software) will dominate with a 78% market share in 2025.
4. ➤ IDMs are forecasted to lead with 42% market share, driven by AI-focused chip development.
5. ➤ North America will dominate with a 45% market share due to its tech innovation hubs.
6. ➤ AI and ML integration is accelerating simulation, verification, and chip optimization cycles.

Market Segmentation

The EDA market is segmented by component into solutions and services. Among these, solutions-including design, simulation, and verification tools-are forecasted to dominate with 78% share in 2025. This is due to the growing preference for integrated tool suites that provide end-to-end support for chip development, helping companies manage complexity more efficiently.

In terms of end users, the market includes IDMs, fabless semiconductor companies, foundries, and OSATs (Outsourced Semiconductor Assembly and Test providers). IDMs are projected to remain the leading end-user segment, owing to their capability to manage in-house chip development, especially in AI and high-speed computing domains. The increasing adoption of EDA tools by fabless firms is also notable, as they require flexible, cloud-accessible design environments.

Regional Insights

North America is set to dominate the global market through 2032, driven by its concentration of EDA vendors, semiconductor innovation centers, and leading tech companies. The region benefits from strong investments in AI, autonomous systems, and 5G infrastructure, further reinforcing its leadership position.

Asia Pacific is emerging as a high-growth region in the EDA market, propelled by rising semiconductor manufacturing in China, Taiwan, South Korea, and Japan. The region's aggressive investments in chip fabrication plants (fabs) and government-backed semiconductor initiatives are fostering significant demand for EDA solutions.

Market Drivers

The most prominent growth driver for the EDA market is the increasing complexity of ICs, especially as chips scale down to sub-5nm nodes. These advanced designs demand precise simulation, modeling, and testing tools. Furthermore, the expansion of AI, IoT, and 5G technologies is generating exponential demand for customized semiconductors, where EDA tools ensure speed, accuracy, and efficiency.

Market Restraints

Despite its promising growth, the market faces challenges. One major restraint is the high cost of EDA software suites, which can be prohibitive for small and mid-sized design firms. Additionally, steep learning curves associated with advanced toolchains and a shortage of skilled engineers in semiconductor design and verification limit broader adoption, especially in emerging markets.

Market Opportunities

Emerging technologies like quantum computing, autonomous vehicles, and edge AI devices present untapped opportunities for EDA vendors. Moreover, the growing shift toward cloud-based EDA platforms offers scalability, collaborative design environments, and real-time access-creating new revenue models and use cases for software providers. Startups and SMEs now have better access to advanced tools via cloud subscriptions.

Frequently Asked Questions (FAQs)

1. ➤ How Big is the Electronic Design Automation (EDA) Market in 2025?
2. ➤ Who are the Key Players in the Global Market for Electronic Design Automation (EDA)?
3. ➤ What is the Projected Growth Rate of the EDA Market from 2025 to 2032?
4. ➤ What is the Market Forecast for the EDA Industry by 2032?
5. ➤ Which Region is Estimated to Dominate the EDA Market through the Forecast Period?

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Company Insights

Prominent players in the global EDA market include:

✦ Synopsys Inc.
✦ Cadence Design Systems Inc.
✦ Siemens EDA (formerly Mentor Graphics)
✦ ANSYS Inc.
✦ Altium Limited
✦ Keysight Technologies
✦ Zuken Inc.
✦ Xilinx Inc.
✦ Aldec Inc.
✦ Silvaco Inc.

Recent Developments:

■ In 2024, Synopsys unveiled its AI-powered EDA platform, targeting faster chip development using deep learning algorithms.

■ Cadence Design Systems announced the acquisition of BETA CAE Systems to enhance its simulation and analysis offerings for semiconductor design.

Conclusion

The Electronic Design Automation (EDA) market is undergoing a renaissance, driven by the proliferation of smart technologies, cloud computing, and next-gen semiconductors. As the complexity of ICs rises, EDA tools are becoming more intelligent, scalable, and indispensable. With North America at the forefront and Asia Pacific quickly catching up, the global market is well-poised for sustained growth. For industry players and stakeholders, the next decade promises both technological breakthroughs and commercial opportunities that could redefine the boundaries of electronic design.

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