China’s ‘rising star’ in chip design software program cuts as much as half its workforce amid market headwinds
A number one Chinese language chip design software program start-up is slashing as a lot as half of its workforce, casting a shadow over Beijing’s efforts to attain tech self-sufficiency, in response to three individuals accustomed to the matter.
X-Epic, established in 2020 with a mission to develop indigenous digital design automation (EDA) instruments to interrupt the monopoly of US corporations, began slicing jobs this week throughout totally different departments, together with its core analysis and growth unit, in response to sources accustomed to the state of affairs who declined to be recognized as they aren’t authorised to speak to media.
The corporate, which is privately owned, didn’t instantly reply to a request for touch upon Wednesday. Whereas it doesn’t disclose particulars of its enterprise operations, Pitchbook information confirmed that the agency had a workforce of about 400 working in workplaces in Nanjing, Beijing, Shanghai, Chengdu and Shenzhen, as of March 2023.
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The beginning-up was based in March 2020 by Wang Libin, a former engineer from US EDA big Cadence Design Techniques. X-Epic, which stands for “accelerating EDA pioneer innovation centre”, had raised US$121.7 million as of March 2023, in response to PitchBook. It counts HongShan (previously Sequoia Capital China), Matrix Companions China, China Info and Communication Know-how Group as buyers.
Wang Libin, the founder X-Epic. Picture: Handout alt=Wang Libin, the founder X-Epic. Picture: Handout>
The firm is a rising star among local EDA firms, and was included on the provincial Nanjing authorities’s record of favoured modern start-ups in Could. X-Epic and different Chinese language EDA corporations like Empyrean Know-how are working to develop software program instruments for sophisticated chip designs, a discipline lengthy dominated by Cadence, Synopsys and Mentor Graphics – three US corporations, though Mentor is now owned by European big Siemens.
The reliance on imported EDA software program and mental property constitutes certainly one of China’s greatest vulnerabilities within the semiconductor worth chain, together with {hardware} bottlenecks within the space of lithography machines.
US tech sanctions, imposed over nationwide safety issues, embody each {hardware} and software program features of EDA. Washington first restricted China’s entry to the know-how in August 2022, when it prohibited gate all-around, or GAA-capable, EDA software program from being exported to international locations together with China. This posed long-term challenges for Chinese language chip makers in adopting extra superior processes such because the 3-nanometre node, and within the growth of high-performance computing or AI chips.
Semiconductors are seen on a printed circuit board on this illustration image taken February 17, 2023. Picture: Reuters alt=Semiconductors are seen on a printed circuit board on this illustration image taken February 17, 2023. Picture: Reuters>
Nevertheless, mastering EDA know-how at house has seen sluggish progress. The large three international distributors collectively management about 70 per cent of China’s EDA market, with Beijing-based Empyrean Know-how, the largest Chinese language participant, trailing with a 7 per cent market share, in response to information from consultancy JW Insights.
Chinese language EDA corporations noticed their enterprise sluggish within the first quarter amid broader market headwinds after China’s semiconductor gross sales fell 14 per cent final yr, the steepest decline of all markets on the planet. Empyrean noticed its first-quarter web income drop 64 per cent yr on yr to 7.7 million yuan (US$1.1 million) because of elevated analysis and growth spending, in response to the corporate’s monetary studies issued in April.
The worth of China’s EDA market is predicted to achieve 18.5 billion yuan subsequent yr, up from 9.3 billion yuan in 2020, in response to the China Semiconductor Business Affiliation.
This text initially appeared within the South China Morning Post (SCMP), essentially the most authoritative voice reporting on China and Asia for greater than a century. For extra SCMP tales, please discover the SCMP app or go to the SCMP’s Facebook and Twitter pages. Copyright © 2024 South China Morning Publish Publishers Ltd. All rights reserved.
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