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EDA revenue growth returns, says EDAC

Posted: 29 Sep 2003 ?? ?Print Version ?Bookmark and Share

Keywords:eda? mss? cae? pcb? ic physical design?

For the first time in over a year, the EDA industry has returned to positive year-over-year revenue growth, according to the EDA Consortium's Market Statistics Service (MSS). Total industry revenue for Q2 of 2003 was $946 million, up 8 percent over Q2 of 2002, according to a recently released MSS report.

The last quarter to show year-over-year revenue growth was Q4 of 2001. For all of 2002, EDAC numbers showed a 7 percent revenue decline.

Wally Rhines, EDAC chairman and Mentor Graphics CEO, said that Q2 2003 growth made up for a 6 percent year-over-year revenue decline in Q1 of 2003. "The return to revenue growth in the second quarter means that 2003 year to date revenues have now slightly exceeded year to date revenues for 2002," said Rhines.

Year-to-date revenue for the first two quarters of 2003 is $1,854 million, one percent higher than the $1,837 reported in 1H of 2002. Further, Q2 2003 was the second consecutive quarter of sequential revenue growth.

In Q2 2003, the EDA industry showed improvements in the categories of product and maintenance revenues, CAE, PCB, IC physical design and verification, and silicon intellectual property, according to MSS.

The report shows that EDA product and maintenance revenue (excluding consulting and other services) totaled $883 million in Q2 of 2003, 10 percent more than a year ago.

Revenue for PCB and multi-chip module (MCM) layout was $85 million for the quarter, 17 percent higher than $73 million in the same period last year, according to the report.

IC Physical Design & Verification revenue totaled $285 million for the quarter, up 6 percent from the $269 million in revenue from Q2 last year.

Computer-Aided Engineering (CAE), the largest tool category in EDA, generated revenue totaling $457 million in Q2 2003, a 4 percent increase over $437 million in the same period in 2002.

MSS also said that revenue for semiconductor intellectual property (SIP) more than doubled in Q2 2003 to $57 million, compared to $26 million during the same period in 2002, due in part to the inclusion of new companies in the EDAC numbers.

Rhines noted that the addition of new IP companies accounted for $13 million more added to the report. He said this does not affect the total revenue numbers reported by MSS because at least one EDA company, which would have reported revenues in the same range, did not give MSS their revenue data in time to make the report.

Rhines also noted that the hardware emulation category grew 30 percent year-over-year. "We see the emulation category as a leading indicator of a recovery," said Rhines.

But while emulation picked up during the quarter, design services continued to decline, with MSS reporting that EDA services revenue was $63 million in Q2 2003, 11 percent less than $71 million in Q2 2002. Rhines also noted that synthesis was flat, year over year.

By region, Japan led all regions for revenue growth in Q2 2003, surging ahead 61 percent over Q2 last year to reach $183 million, versus $114 million a year ago. Revenue from Japan comprised 19 percent of the worldwide total in Q2 2003. Rhines said this is largely due to a resurgence in the consumer electronics business in Japan.

The North American region, which represents the largest customer base in EDA, had a slight return to growth after revenue decreases in four of the last five quarters. The EDA industry sold $501 million of EDA products and services to North American companies in Q2 2003, slightly more than $499 million in Q2 2002, according to the report.

However, Western Europe, EDA's second largest sales region, bought $169 million worth of EDA products and services in Q2 2003, 11 percent less than it did in Q2 2002 when it purchased $190 million worth of products and services.

- Michael Santarini

EE Times

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