Global semiconductor revenue growth moderated to 15.1% or $124.2 billion in Q3 2018 vs. Q3 2017 (SIA), following 20.5% & 20% growth in Q2 & Q1 2018 respectively. Gartner is forecasting 14.4% full year growth in semiconductor revenue to $481 billion for 2018.
Meanwhile, revenues in the EDA market grew steadily, with Synopsys growing quarterly revenues by 14.1% Q3* 2018 vs Q3* 2017 to $795.1M, while Cadence reported 9.7% growth to $532.5M:
For comparison, the % growth rates in the previous quarter, Q2* 2018 versus Q2* 2017 were Synopsys 12.1%, Cadence 8.2%, ESD Alliance 8.2% and semiconductor 20.5%.
Examining the delta in revenue growth in dollars, Synopsys and Cadence’s Q3* 2018 vs Q3* 2017 revenues increased by $98.5M and $47.1M respectively, surpassing their prior mid-point guidance by $6.2M and $17.5M respectively:
Guidance for the next quarter
The EDA companies’ own guidance (mid-point) for Q4* 2018 equates to percentage revenue growth as follows: Synopsys: 3.0% ($23.1M growth to $792.5M – transitioning to ASC 606 rules); Cadence 9.6% growth ($48.3M growth to $550M – according to ASC 606 reporting rules):
In summary, Q3 2018 global semiconductor revenue growth moderated to 15.1% or $124.2 Billion, while Synopsys revenues grew by 14.1% and Cadence by 9.7%. The EDA companies own guidance for Q4* 2018 is for more moderate growth: Synopsys to grow revenues by 3.0% and Cadence by 9.6%.
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* Based on each company’s reported financial quarterly data which most closely match that calendar quarter.