The global Semiconductor IP market is experiencing dynamic transformation as it emerges as a cornerstone of innovation in the semiconductor industry. Estimated at approximately USD 7.5 billion in 2024, the market is projected to reach a value of USD 17.06 billion by 2031, expanding at a robust CAGR of 8.52% during the forecast period. This growth is largely fueled by increased adoption of connected devices, expansion of AI/ML workloads, and the growing popularity of fabless business models which rely heavily on reusable design IPs.
Semiconductor IP refers to reusable design components, often in the form of logic, memory, or interface blocks, used by integrated circuit designers to accelerate development time and reduce cost. As demand for more sophisticated electronics intensifies, semiconductor IP continues to serve as a vital enabler of cutting-edge technologies such as 5G, artificial intelligence, automotive electronics, and edge computing.
The global semiconductor IP market size was valued at USD 7,370.0 million in 2023 and is projected to grow from USD 7,920.9 million in 2024 to USD 13,882.5 million by 2031, exhibiting a CAGR of 8.35% during the forecast period.
Key Market Trends
1. Rising Adoption of AI and Edge Computing:
With artificial intelligence (AI) moving from data centers to edge devices, the need for highly efficient, low-latency semiconductor IP cores optimized for AI and ML applications is growing exponentially. IPs designed for neural network accelerators and signal processing are witnessing increasing demand.
2. Surge in IoT and Connected Devices:
The proliferation of smart devices and IoT ecosystems in both consumer and industrial applications has led to an increased need for cost-effective and low-power semiconductor solutions. IPs that support low-power connectivity and efficient processing are in high demand.
3. Shift Toward Advanced Node Technologies:
Semiconductor companies are rapidly migrating to smaller nodes such as 7nm, 5nm, and even 3nm processes. This migration increases the complexity of design, encouraging the adoption of verified and optimized IP cores to reduce time-to-market.
4. Growing Popularity of RISC-V Architecture:
The open-source RISC-V architecture is gaining traction across industries as companies look to avoid licensing costs and gain more design flexibility. This shift is opening up new opportunities for custom and modular IP development.
5. Increasing Focus on Cybersecurity:
As cyber threats grow, secure IPs with features like hardware-based encryption, secure boot, and isolation mechanisms are becoming standard. The demand for secure semiconductor IP solutions is anticipated to rise significantly across all sectors.
Market Demand Drivers
The global semiconductor IP market is being propelled by multiple demand-side factors. The need for fast prototyping and reduced development timelines in consumer electronics and mobile industries is driving the preference for off-the-shelf IP solutions. Similarly, the automotive sector's evolution toward electric vehicles (EVs) and autonomous driving capabilities is creating demand for specialized IPs in areas such as safety, connectivity, and power management.
Cloud computing, telecommunications infrastructure, and the rapid growth in data generation from edge devices also contribute to growing IP demand, particularly in high-performance computing and data center applications.
Market Segmentation
By IP Core Type:
Hard IP Cores
Soft IP Cores
Soft IP cores dominate the market due to their flexibility, reusability, and ease of integration into a variety of designs.
By Design IP Type:
Processor IP
Interface IP
Memory IP
Analog IP
Others
Processor IP holds the largest share due to its widespread application across consumer electronics, automotive, and data centers.
By Interface:
PCI Express (PCIe)
USB
MIPI
DDR
Ethernet
Others
DDR leads the segment due to widespread use in memory-intensive applications, while PCIe is expected to register the fastest growth rate.
By IP Source:
Royalty-Based IP
License-Based IP
Royalty-based IPs account for the largest market share, favored by both startups and established players for their scalability.
By End-User:
Foundries
Integrated Device Manufacturers (IDMs)
Others
By Vertical:
Consumer Electronics
Automotive
Telecommunication & Data Centers
Industrial
Healthcare
Consumer electronics dominate currently, but the automotive sector is projected to grow at the highest rate due to the surge in demand for ADAS and EV technologies.
Regional Analysis
Asia-Pacific remains the largest and fastest-growing region in the global semiconductor IP market, holding more than 40% share in 2023. This growth is attributed to strong government initiatives in countries such as China, South Korea, Taiwan, and India to support semiconductor manufacturing and R&D.
North America is expected to maintain a prominent market position due to the presence of leading IP vendors, robust semiconductor design capabilities, and significant investments in AI and 5G technologies.
Europe, led by countries like Germany and the UK, is increasingly focusing on self-reliance in semiconductor design. The region’s automotive and industrial sectors are driving demand for specialized semiconductor IP solutions for safety, power management, and communication.
Recent Developments
In September 2023, VeriSilicon announced that its dual-channel Image Signal Processor (ISP) IP was integrated into Inuitive’s NU4100 vision AI processor, enhancing performance in AR/VR, robotics, and drones.
In March 2023, eMemory Technology Inc. partnered with United Microelectronics Corporation (UMC) to qualify its RRAM IPs on UMC’s 22nm ultra-low power process, a significant step toward meeting the needs of IoT and mobile chip designers.
Synopsys, one of the global IP leaders, continues to expand its DesignWare IP portfolio, particularly in AI, automotive-grade safety, and cloud-optimized interface IPs.
Arm, a leading player in processor IPs, has expanded its collaboration with foundries to ensure compatibility of its IP cores with the latest node technologies, including 3nm and beyond.
Key Market Players
The semiconductor IP market is moderately consolidated, with a few major players dominating the space through strong R&D, partnerships, and global outreach. Leading companies include:
Arm Limited – A pioneer in CPU and GPU IPs for mobile and embedded applications.
Synopsys, Inc. – Offers a broad range of IPs including interface, processor, and memory IP.
Cadence Design Systems, Inc. – Known for high-quality analog and digital IP portfolios.
Imagination Technologies – Specializes in GPU and AI accelerator IPs.
CEVA, Inc. – Focuses on wireless and sensor processing IPs.
Lattice Semiconductor – Offers customizable IPs for FPGAs.
eMemory Technology Inc. – Specializes in embedded non-volatile memory IPs.
VeriSilicon – Provides platform-based, silicon-verified IP portfolios for SoCs.
Achronix Semiconductor Corporation – Known for its high-performance FPGA and eFPGA IPs.
Rambus – Focuses on memory interface and security IPs.
Future Outlook
The semiconductor IP market is expected to evolve rapidly, fueled by next-gen computing, automotive autonomy, and industrial automation. The rise of AI-specific chips, quantum computing preparation, and edge-based intelligence will introduce new IP requirements, compelling vendors to continuously innovate.
Moreover, geopolitical tensions and global semiconductor supply chain reforms are pushing governments and companies to focus on in-house design and IP creation, further expanding the market’s opportunity landscape.
As industries strive for greater power efficiency, performance, and design flexibility, semiconductor IP will become even more vital in reducing time-to-market, lowering R&D expenses, and enabling scalable innovation.
Conclusion
The global semiconductor IP market is set for a promising future, underpinned by its indispensable role in modern electronics design. With rapid technology cycles, the growing need for AI and IoT integration, and continuous innovation from industry players, the market offers ample opportunities for growth and transformation. Companies investing in flexible, secure, and high-performance IP solutions are poised to lead the way in shaping the next era of semiconductor innovation.
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