The Electronic System Design (ESD) industry continues to prove its value to the entire electronics supply chain as we report a revenue increase of 5.3% to $3,962.7 million in the second quarter of 2023. That’s up from $3,763.6 million in the second quarter of 2022, according to the latest Electronic Design Market Data (EDMD) report. The four-quarter moving average that compares the most recent four quarters to the prior four rose 9.5%.

Likewise, companies tracked in the EDMD report employed 59,160 people globally in Q2 2023, an 11.8% jump over the Q2 2022 headcount of 52,918 and up 2.5% compared to Q1 2023.

“Total license and maintenance revenue, which includes all design tools, was strong at 16.1% overall with double-digit growth in all regions except Japan,” remarks Wally Rhines, Executive Sponsor of the SEMI EDMD report. He added that growth in total electronic design automation (EDA) revenue in Q2 23 was limited by weak semiconductor IP (SIP) revenue.

The table highlights percentage growth for the industry by major category.
Source: SEMI EDMD

This week’s quarterly EDMD report includes revenue information broken down by category and geographic areas. For example, Computer-Aided Engineering (CAE) revenue jumped 19.7% to $1,512.4 million as the four-quarter CAE moving average increased 17.6%. IC Physical Design and Verification revenue rose 14.2% to $689 million and the four-quarter moving average increased 17.2%. Printed Circuit Board and Multi-Chip Module (PCB and MCM) revenue increased 6.3% to $369 million. The four-quarter moving average for PCB and MCM rose 11.7%. Services revenue increased 5.2% to $137.5 million as the four-quarter Services moving average rose 12.3%.

Only Semiconductor Intellectual Property (SIP) revenue decreased –– 11.6% to $1,255 million with the four-quarter SIP moving average falling 1.6%.

Two regions reported declines in Q2 2023 –– the Americas and Japan. The Americas, the largest reporting region by revenue, landed $1,627.9 million of electronic system design products and services in Q2 2023, an 0.6% decline, though the four-quarter moving average for the Americas rose 7.5%. Japan’s procurement of electronic system design products and services decreased 4.3% to $241.6 million as the four-quarter moving average for Japan fell 0.3%.
Read the rest of Electronic System Design Industry Posts $4 Billion in Revenue in Q2 2023, ESD Alliance Reports

Anyone who knows Dean Drako recognizes his innovative spirit and entrepreneurial mindset. He aimed those talents to EDA in the late 1980s when he started Design Acceleration (now Cadence) and then founded IC Manage in 2002 before moving on to security with Barracuda Networks and Eagle Eye. Dean remains firmly in charge today as CEO of both IC Manage and Eagle Eye.

Dean Drako

Not content with juggling the responsibilities of those two entrepreneurial endeavors, Dean and Shiv Sikand (also executive vice president at IC Manage) founded Drako Motors, an American luxury sports car manufacturer. Drako Motors’ much sought-after, limited-production electric supercars deliver high performance with maximum control and safety on road and track.

Now’s your chance to see the Drako Dragon, a powerful 2,000-horsepower quad motor hyper-luxury electric SUV with a top speed of 206 mph, launched late last year. I take great pleasure in inviting you to an interactive networking event featuring Drako Dragon, on display during a “Beer and Brats BBQ” networking reception.

The event, sponsored by the Electronic System Design (ESD) Alliance, a SEMI Strategic Technology Community, will be held Wednesday, October 18, at SEMI Headquarters in Milpitas, Calif., in conjunction with a meeting being held by SEMI’s Global Automotive Advisory Council (GAAC). GAAC’s mission is to bring the automotive electronics supply chain together to foster connection and collaboration.

Read the rest of Drive Innovation and Networking Event Featuring Drako Motors Dragon Electric Supercar

Early September has been a time of announcements from the ESD Alliance, a SEMI Technology Community.

First, we congratulate Dr. Lawrence Pileggi, Coraluppi Head and Tanoto Professor of Electrical and Computer Engineering at Carnegie Mellon University, as the 2023 Phil Kaufman Award for distinguished contributions to Electronic System Design (ESD). The annual award, given by the ESD Alliance and IEEE’s Council on Electronic Design Automation (CEDA), will be presented at the Phil Kaufman Award ceremony and dinner in Q1 2024. Details to follow.

Our other news came by way of SEMI. It announced that it will license the new SEMI Server Certification Protocol to combat software piracy starting in Q3. We managed the protocol joint development program with Cadence, Siemens EDA and Synopsys participating in the development effort. The protocol was reviewed and approved by an independent group of semiconductor companies that rely on EDA tools in their business operations.

With piracy costing the software industry an estimated billions of dollars annually, the protocol will help prevent unauthorized access to licensed software products by assigning a unique identifier to each customer license server to assure software access can only be granted by authorized servers.

To learn more, join us for a webinar about the SEMI License Server Certification Protocol and how it can be deployed It will be held Wednesday, September 27, from 10-11:30am PDT and registration is free of charge.

About Dr. Lawrence Pileggi

Dr. Lawrence Pileggi, the 2023 Phil Kaufman Award recipient.

Dr. Pileggi is this year’s Phil Kaufman Award recipient for his pioneering contributions to circuit simulation and optimization that enable the industry to address the challenge of interconnect delay dominated designs. He is also recognized for his innovations in Electrical and Computer Engineering (ECE) education.

Prior to his current role at Carnegie Mellon University, Dr. Pileggi held positions at Westinghouse Research and Development and the University of Texas at Austin. He has consulted for various semiconductor and EDA companies and co-founded Fabbrix Inc., Extreme DA, and Pearl Street Technologies. His research interests include various aspects of digital and analog integrated circuit design and simulation, optimization, and modeling of electric power systems.

Dr. Pileggi has received numerous awards, including the ACM/IEEE A. Richard Newton Technical Impact Award in Electronic Design Automation in 2011 and the 2015 Semiconductor Industry Association (SIA) University Researcher Award.

He co-authored Electronic Circuit and System Simulation Methods, McGraw-Hill, 1995 and IC Interconnect Analysis, Kluwer, 2002, has published over 400 conference and journal papers, and holds 40 U.S. patents. He is a fellow of the IEEE.

Dr. Pileggi received his Bachelor of Science degree in Electrical Engineering and a Master of Science degree in Electrical Engineering from the University of Pittsburgh and his Ph.D. from Carnegie Mellon University.

About the Phil Kaufman Award

The Phil Kaufman Award honors individuals who have had a demonstrable impact on the field of electronic system design through technology innovations, education/mentoring, or business or industry leadership. The award was established as a tribute to Phil Kaufman, the late industry pioneer who turned innovative technologies into commercial businesses that have benefited electronic designers. The 2022 recipient was Dr. Giovanni de Micheli, Professor and Director of the Institute of Electrical Engineering and of the Integrated Systems Centre at EPF Lausanne, Switzerland.

About The ESD Alliance

The ESD Alliance, a SEMI Technology Community, represents members in the electronic system and semiconductor design ecosystem as the marketing advocate and address economic issues affecting the entire industry. We act as the central voice to communicate and promote the value of the semiconductor design ecosystem as a vital component of the global electronics industry.

Companies that are already SEMI members, can become members of the ESD Alliance by submitting a short application with no extra fee. Companies not SEMI members can apply at the same time to join the ESD Alliance. Again, no extra fee is associated with being a part of the ESD Alliance. Contact me at Bob Smith at bsmith@semi.org with questions.

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We’re hosting a webinar on the new SEMI License Server Certification Protocol and invite you to attend. The event will be held Wednesday, September 27, from 10-11:30am PDT. Registration is free of charge.

The webinar will address the challenges anyone responsible for a company’s software licensing practices and infrastructure faces. If that’s you, you will learn how use of the protocol will strengthen your license management system against unauthorized license usage (piracy).

Read the rest of ESD Alliance Hosts SEMI License Server Certification Protocol Webinar

Note: SEMI published in early July a post I wrote from a memorable discussion with John Lee, general manager and vice president of Ansys and a member of the ESD Alliance Governing Council. It’s reprinted below in its entirety.

John Lee, general manager and vice president of Ansys and a member of the ESD Alliance Governing Council, is on a quest to promote industry collaboration to solve many of the multiphysics challenges. When we talked recently, he reinforced his advocacy of open extensible platforms as a workable model for the industry. Ansys is a member of the Electronic System Design Alliance, a SEMI Technology Community.

Smith: It’s been over a year since we talked about 3D IC and bespoke silicon. Are you still seeing them as major trends? Are they changing, accelerating, slowing down or are they here to stay?

Lee: The forecast for 3D IC continues to accelerate. In fact, we expect to see a 3X increase in the number of 3D IC design starts this year over last. It started initially in areas like high-performance compute with AMD and Intel pioneering it. We now see many other markets outside of AI/ML, CPU, GPU and mobile applications. Even the more traditional manufacturers are doing 3D IC designs.

From a foundry standpoint, TSMC has been talking about CoWoS for 10 years. We see the largest number of 2.5D and 3D IC tape-outs going through TSMC, but now Samsung and Intel are starting programs that will be a big service to the industry. 3D IC is here to stay and brings challenges that need to be solved.
Read the rest of It Will Take a Village to Solve Multiphysics

Note: My Q&A discussion with Maheen Hamid of Breker Verification Systems below appeared earlier this week on Semiwiki.

Maheen Hamid, a member of the ESD Alliance (a SEMI Technology Community) Governing Council and a member of SEMI’s North America Advisory Board, is an astute business executive. Together with her husband Adnan Hamid, they founded Breker Verification Systems, a company developing test synthesis solutions. She serves today as COO and CFO.

We recently talked about her journey into the tech industry, how she’s able to leverage her MBA and her thoughts on leadership. We finished our conversation discussing the industry trends she is seeing and how Breker is reacting to those trends.

Smith: What’s on your mind these days?

Hamid: Any executive is always concerned with growing the business while optimizing investment opportunities. The tactics are dynamic with changing trends, but the strategic ambition is static.

A long-term high-profile customer who has been familiar with the evolution of Breker recently said that he couldn’t imagine taping out a chip without using Breker solutions. If I had to pick any one thing that keeps me up at night, that is: How do I get all my customers to say exactly this?

Introducing innovative approaches for novel capabilities is challenging in a mature market entrenched with legacy methodologies. We observe a growing convergence with unmet needs with test synthesis solutions across various verticals and design processes. Due to the initiative supported by Accellera since 2015, Portable Stimulus has become a desired solution space, especially with developing needs in generative AI applications, RISC-V, and leading-edge applications requiring increased compute power. Some of those applications are in healthcare such as genomic sequencing and cancer treatment, aerospace and various simulations in research labs.

Breker is helping push the boundaries of verification technologies for complex chips. In line with our customer-centric, forward-looking positioning, I am focused on bringing agility to how we respond to the diverse demands of our users.

Read the rest of Shared Vision Unifying Factor for Business Success Says Maheen Hamid of Breker Verification Systems

As the curtain goes up on the 60th Design Automation Conference (DAC), I’m pleased to share that the Electronic System Design (ESD) industry revenue increased to $3,951.1 million in the first quarter of 2023. That’s 12% growth from $3,527.7 million in the first quarter of 2022, according to results compiled in the Electronic Design Market Data (EDMD) report from the ESD Alliance, a SEMI Technology Community. The report also showed the four-quarter moving average was 12.6%, a percentage based on comparisons for the most recent four quarters to the prior four.

Double-digit gains were posted as well with increases in all product categories and geographic regions. Product categories that reported double-digit increases include Computer Aided Engineering, IC Physical Design and Verification, Printed Circuit Board and Multi-Chip Module (PCM and MCM), and Services.

Digging further into the statistics, companies tracked in the EDMD report employed 57,696 people globally in Q1 2023, a 12.9% jump over the Q1 2022 headcount of 51,093 and up 4.5% compared to Q4 2022.

Computer-Aided Engineering (CAE) revenue rose 15.1% to $1,434.1 million with the four-quarter moving average increasing 18.6% while IC Physical Design and Verification revenue jumped 24.6% to $675.8 million, as the four-quarter moving average for the category increased 14.6%.  PCB and MCM revenue increased 25.6% to $368.4 million with the four-quarter moving average rising 15.7%. Semiconductor Intellectual Property (SIP) revenue increased 0.4% to $1,330.6 million as the four-quarter moving average grew 5.7%. Services revenue increased 17.2% to $142.2 million and its four-quarter moving average rose 16.8%.

A look at the regions by revenue highlights the Americas as the largest reporting region by revenue, procuring $1,698.2 million of products and services in Q1 2023, a 12.7% increase. The four-quarter moving average for the Americas rose 12.5%. Europe, Middle East, and Africa (EMEA) secured $530.1 million of products and services in Q1 2023, a 21.6% increase, growing the four-quarter moving average to 9.6%.  Japan’s procurement of products and services increased 4.3% to $272.7 million for a 2.3% four-quarter moving average. And finally, Asia Pacific obtained $1,449.9 million of products and services in Q1 2023, a 9.6% increase and four-quarter moving growth of 16%.

About the EDMD Report

The ESD Alliance Electronic Design Market Data report presents Electronic Design Automation (EDA), SIP and services industry revenue data quarterly. Both public and private companies contribute data to the quarterly report available from SEMI and published approximately three months after quarter close. EDMD report data is segmented as follows:

For information about SEMI market research reports, visit the SEMI Market Research Reports and Databases Catalog.

Learn More About the ESD Alliance

I’m at DAC and SEMICON West this week and available to answer questions about the EDMD and why your company should become an ESD Alliance member. We offer a range of programs in addition to the quarterly EDMD and represent members in the electronic system and semiconductor design ecosystem that addresses technical, marketing, economic and legislative issues affecting the entire industry. We act as the central voice to communicate and promote the value of the semiconductor design ecosystem as a vital component of the global electronics industry.

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Note: Many thanks to EE Times Europe for publishing my viewpoint last week “Industry Organizations Are the Mainstay of the Semiconductor Ecosystem.” It seems fitting to repost it here as SEMICON West (a SEMI event) and the collocated Design Automation Conference open next week.

A recent conversation with a colleague took us down a path on the importance of industry organizations. His company does not belong to any, and he wondered if it should. The short answer is “absolutely.” I quickly drew him in by explaining the value of belonging to industry organizations for semiconductor companies large and small, startup, emerging and public.

It’s not one-way, however. Industry organizations serve an important role, perhaps now more than ever, in the world of geopolitics, the U.S. CHIPS Act and the EU Chips Act and other similar efforts in global geographies. A semiconductor industry organization’s mission is global advocacy and serving as a central voice for the industry. In one example, the organization represents the interests of the semiconductor industry’s design, manufacturing and supply chain throughout the global electronics industry. Another describes its global advocacy as a focus on taxes; trade; legislation; technology; environment, health and safety (EHS); and workforce development (more below).

By joining an industry organization, companies and their executives show their commitment to being good corporate citizens. They also need to be more connected to their ecosystem, including both industry peers and customers, and that can be accomplished through networking events, technical conferences and high-level summits. What better way to socialize and engage with other thought leaders and become a visible industry player? Sales groups often support belonging because events hosted by industry organizations present informal access to potential customers and partners.

Read the rest of The Importance of Industry Organizations

Note: I had the chance to talk with Handel Jones of IBS soon after his book “When AI Rules The World: China, the U.S. and the Race to Control a Smart Planet” was published. My conversation was captured in a Q&A blog post that appeared on SEMI’s website. It’s now time for another look at his insightful and fascinating comments.

Handel Jones, CEO of International Business Strategies (IBS) and a well-known, longtime strategic analyst and commentator covering the semiconductor industry, authored the recently published book – When AI Rules The World: China, the U.S. and the Race to Control a Smart Planet.

Smith: The book starts off with the statement that China is way ahead in artificial intelligence (AI) and that the U.S. is dangerously behind. Can you summarize the main reasons this has happened?

Jones: AI is heavily dependent on connectivity bandwidth, and China is ahead of the U.S. in 5G connectivity. In addition, China is making extensive use of AI for 3D facial recognition, which is making transactions more efficient, and the mass market for 3D facial recognition is resulting in large improvements in the technology. The 3D facial recognition technology is being used in military applications, including drones, and other areas that require image recognition. This is one example of where China is moving ahead of the U.S. Other areas include adoption of digital currency, autonomous transportation, quantum computing, battery technology, smart robots, and health monitoring.

Read the rest of IBS’ Handel Jones on “When AI Rules The World”