On December 12, the Shanghai headquarters of the China Economic Information Agency officially released the “Insights into the Development of China’s Semiconductor IP Industry” at the 2025 Semiconductor IP Industry Seminar. The report indicates that the global semiconductor IP industry has entered a rapid development phase. Although the localization exploration of China’s semiconductor IP started late, it is developing rapidly. Supported by policy backing, capital investment, and industry chain collaboration, Chinese semiconductor IP companies are entering a fast track of development.
As the upstream of the chip industry chain, semiconductor IP is a key element driving innovation and development in the semiconductor industry. The semiconductor IP industry emerged to meet the rapid iteration and cost control needs of chip design companies during the development of the semiconductor industry. Especially since the beginning of the 21st century, with the iterative upgrades of global smart devices and network technologies, the semiconductor IP industry has experienced explosive growth. Data shows that the global semiconductor IP market size will reach $8.49 billion in 2024, with an average annual compound growth rate of 16.78% over the past five years, demonstrating strong market vitality and development potential.
According to the industry insight system data from the Shanghai headquarters of the China Economic Information Agency, currently, companies engaged in semiconductor IP business are mainly concentrated in the Yangtze River Delta region. Shanghai, as an important source of semiconductor and integrated circuit development, is home to nearly one-third of the semiconductor IP companies in mainland China.
Pan Haiping (left), Chairman of the China Economic Information Agency, and Jiang Wei (right), Secretary of the Party Committee of the Shanghai headquarters of the China Economic Information Agency and Chairman of the China Financial Information Center, jointly released the “Insights into the Development of China’s Semiconductor IP Industry”.
With the continuous evolution of semiconductor technology and the ongoing development of application scenarios, the semiconductor IP industry is undergoing dual drives of technological innovation and market transformation. In particular, the emergence of new process technologies, chiplet technology transformations, and the wave of domestic substitution and industrial ecological competition have had a profound impact on the IP industry. New process node technologies are advancing the evolution of advanced semiconductor processes, chiplets will drive the productization and efficient reuse of IP, and the open-source model of Reduced Instruction Set Computer (RISC-V) creates new opportunities for the development of domestic semiconductors. Interface IP will lead the continuous expansion of the semiconductor IP industry. It is predicted that by 2029, the global semiconductor IP market size will rise to $14.35 billion, with interface IP becoming a major growth engine due to its widespread application in fields such as artificial intelligence.
Zeng Keqiang, co-founder and chairman of domestic semiconductor IP company Xinyaohui Technology, stated that the development of artificial intelligence relies on large models. With the development and application of large models, the exponential growth of model parameters directly drives the explosive increase in computing power demand. Interface IP is the “invisible pillar” of AI computing power, and the speed of technological iteration will exceed Moore’s Law. In the next decade, interface IP will define the competitiveness of AI chips, determining the efficiency of computing power transmission and system capabilities. In the era of artificial intelligence, high-speed interface IP has become the most urgently needed and rapidly growing key area in the market.
The report shows that the global semiconductor IP market is still dominated by international giants such as ARM and Synopsys. Although the demand for semiconductor IP in the Chinese market accounts for nearly 30%, the self-sufficiency rate of domestic IP is only 8.52%, indicating a low level of self-sufficiency. In recent years, domestic companies have been enhancing their market share through competitive advantages in niche markets and accelerating their independent research and development efforts to actively break through technological bottlenecks. However, due to the relatively short development time, they still face many challenges in terms of technological accumulation and ecological construction.
It is noteworthy that as the complexity of chip design and R&D costs rise exponentially, domestic semiconductor IP manufacturers are accelerating the construction of a complete ecological network system. Building an integrated ecosystem of “IP-chip-application” and deeply collaborating with upstream and downstream of the industry chain has become a key path for domestic semiconductor IP companies to build core competitiveness.
To better promote the healthy development of the domestic semiconductor IP industry, the report suggests that a combination of policy support should be established to address the key pain points of the low self-sufficiency rate of domestic semiconductor IP; promote vertical integration and ecological co-construction of the semiconductor industry chain, encouraging deep collaboration between chip design, manufacturing, testing, and IP companies to create an integrated ecosystem of “IP-chip-terminal”; and companies should leverage their own advantages to pursue differentiated development. (Gao Shaohua, Zhou Xilun, Zhao Feiyin, Ye)
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