ESD Alliance reports EDA market reaches $5.6bn in Q3 2025
The electronic system design (ESD) industry kept its growth momentum through the third quarter of 2025, posting solid year-over-year gains despite mixed regional dynamics. New data from the ESD Alliance shows broad-based strength across product categories and most geographies.
For eeNews Europe readers, the figures offer a clear snapshot of where EDA and related design spending is heading globally and which segments are driving growth. The data also highlights regional trends that matter to European suppliers, tool users, and ecosystem partners planning investments for 2026 and beyond.
Strong Q3 growth across EDA segments
According to the ESD Alliance’s latest Electronic Design Market Data (EDMD) report, industry revenue increased 8.8% year over year to $5.6 billion in Q3 2025, up from $5.1 billion in the same quarter of 2024. The four-quarter moving average rose an even stronger 10.4%, signaling sustained momentum rather than a one-off spike.
“The electronic design automation (EDA) industry continues to report strong year-over-year revenue growth in Q3 2025,” said Walden C. Rhines, Executive Sponsor of the SEMI Electronic Design Market Data report. “All product categories reported increases, with Semiconductor IP (SIP) and Services showing double digit gains. Geographic regions including Americas, EMEA, and APAC reported growth in Q3, with a double digit increase in APAC.”
Semiconductor IP was the standout category, with revenue up 13.6% to $1.92 billion and a four-quarter moving average increase of 14.8%. Services also posted double-digit growth, rising 10.2% year over year to $221.4 million. Computer-aided engineering (CAE) tools remained the largest segment, growing 9.1% to just over $2.1 billion.
Not all categories grew at the same pace. IC physical design and verification saw a modest 1.3% increase to $865.4 million, while PCB and multi-chip module tools rose 3.4% to $466.2 million.
APAC drives regional expansion
From a regional perspective, Asia Pacific was the clear growth engine. APAC revenue jumped 20.5% year over year to $2.22 billion, with a four-quarter moving average growth rate of 12.8%. This performance reflects continued strength in semiconductor and system design activity across China, South Korea, Taiwan, and Southeast Asia.
The Americas remained the largest market overall, generating $2.4 billion in Q3 revenue, up 3.4%. EMEA posted a 4.6% increase to $675.1 million, with its four-quarter moving average growing 7.6%, a data point of particular relevance to European tool vendors and design houses.
Japan was the only region to decline, with revenue down 11.5% year over year to $264 million, although its four-quarter moving average still showed modest growth.
Workforce continues to expand
Headcount growth underlined the industry’s confidence. Companies tracked in the EDMD report employed more than 73,000 people globally in Q3 2025, up 17.3% from a year earlier. That expansion suggests EDA suppliers are still hiring to meet demand, even as some regional markets soften.
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