The Semiconductor Intellectual Property (IP) market is poised for significant growth as the demand for custom, high-performance, and power-efficient chips continues to rise. Semiconductor IP, which consists of pre-designed functional blocks licensed to chipmakers, plays a crucial role in accelerating chip development, reducing costs, and enhancing innovation. In 2025 and beyond, several key drivers will shape the growth and evolution of this dynamic market.

According to Stratview Research, the semiconductor IP market was estimated at USD 5.58 billion in 2022 and is likely to grow at a CAGR of 5.72% during 2023-2028 to reach USD 7.74 billion in 2028.

1. Growth in AI, IoT, and Edge Computing

The increasing adoption of artificial intelligence (AI), Internet of Things (IoT), and edge computing is driving demand for specialized semiconductor IP. AI-powered devices require high-speed processing, machine learning accelerators, and low-power computing, making customized IP cores essential for chipmakers.

2. Expansion of the 5G and Wireless Communication Industry

The rollout of 5G networks and next-generation wireless technologies is fueling demand for radio frequency (RF) and signal processing IP. Semiconductor companies are investing in advanced wireless communication protocols, network-on-chip (NoC) designs, and low-latency architectures to support seamless connectivity.

3. Rise of Custom and Domain-Specific Chips

As general-purpose processors struggle to keep up with performance demands, industries are shifting towards custom ASICs (Application-Specific Integrated Circuits) and SoCs (System-on-Chips). Semiconductor IP enables the rapid development of domain-specific chips for automotive, healthcare, and industrial automation applications.

4. Increasing Complexity of Semiconductor Design

Modern semiconductor designs are becoming more complex, requiring high-performance computing (HPC), embedded security, and multi-core processing capabilities. Companies rely on pre-verified IP blocks to simplify chip design, ensuring faster time-to-market while maintaining reliability.

5. Adoption of RISC-V and Open-Source IP

The RISC-V architecture is gaining traction as an alternative to proprietary processor architectures like ARM and x86. RISC-V offers flexibility, cost savings, and customization, leading to increased adoption in AI chips, embedded systems, and IoT applications.

6. Growth of Automotive Semiconductor Market

The automotive industry is embracing electrification, autonomous driving, and connected vehicle technology, driving demand for automotive-grade semiconductor IP. Companies are focusing on functional safety, AI-powered vision systems, and real-time processing cores to meet stringent regulatory and performance requirements.

Conclusion

The Semiconductor IP market will continue to grow in 2025 and beyond, driven by AI, 5G, edge computing, automotive advancements, and open-source architectures. As the semiconductor industry evolves, the role of IP licensing and innovation will be more critical than ever in shaping the future of computing and digital transformation.