[News] SK hynix Reportedly Weighs Suspension of Chinese EDA Software Amid Expected U.S. Restrictions

According to a report from Korean Economic Daily, citing industry sources, SK hynix has initiated an urgent review of Chinese semiconductor Electronic Design Automation (EDA) software anticipating that the U.S. may impose restrictions on South Korean semiconductor firms using Chinese software.

One of the main reasons behind SK Hynix’s move, as highlighted by the report, is the U.S. government’s recent decision to designate Empyrean Korea, the South Korean branch of Chinese EDA firm Empyrean, as a restricted entity for trade.

The report indicates that industry predictions suggest SK hynix will likely halt the use of Chinese EDA software to avoid straining relations with the U.S., a key player in the global semiconductor market. The relatively low reliance on Chinese EDA software within SK hynix’s overall operations reinforces this expectation, as the report notes.

According to the company, SK hynix is reviewing whether to extend the contracts on the use of the tools ahead of their expiration. The adoption of the tools was part of the company’s broader efforts to diversity suppliers and the use has been to a limited extent only.

Meanwhile, Samsung Electronics, which has been utilizing Chinese EDA solutions from Empyrean, Primarius, and Entasys since 2022, is also expected to take a similar course of action, as mentioned in the report.

The Rise of Chinese EDA Companies

The report highlights that the EDA market is predominantly dominated by American companies such as Synopsys, Cadence, and Siemens EDA.

According to TrendForce, Synopsys, Cadence, and Siemens EDA account for 32%, 29%, and 13% of the market, respectively, in 2024, for a total 74% market share.

However, in recent years, China has been increasing its presence in the market by developing cost-effective EDA solutions, as the report points out. Chinese firms such as Empyrean, Primarius, and Entasys have emerged as key players in this segment.

Samsung Electronics and SK hynix, which have traditionally relied on American EDA software, have recently started using Chinese alternatives as well. This shift, as indicated by the report, was primarily driven by aggressive sales efforts from Chinese firms, which, facing export restrictions to the U.S., sought to expand their business with Samsung and SK hynix.

Moreover, as noted by another report from The Korean Economic Daily, citing industry sources, the development of an EDA ecosystem in South Korea is relatively slow. While South Korea leads the global HBM market, there is currently no EDA technology in the country capable of integrating AI and HBM.

China’s EDA Giant Empyrean Cedes Control to State-Owned Firm After U.S. Blacklist

Notably, according to a report from the South China Morning Post, a week after Empyrean Technology was added to the U.S. blacklist of chip export controls, the Chinese chip design software developer ceded control to its largest state-owned shareholder, China Electronics Corporation (CEC).

The South China Morning Post report highlights that Empyrean Technology, supported by China’s push to localize its semiconductor supply chain, now holds a modest 5% share of China’s EDA market.

Read more

• [News] China’s Semiconductor Equipment Industry Booming, Self-Sufficiency to Reach 50% by 2025?
• [News] China’s EDA Giant Empyrean Technology Shifts Control to State-Owned Company after U.S. Blacklist
• [News] SK hynix at Full Throttle for HBM Expansion with Engineers Reportedly Set for M15X Fab in March

(Photo credit: SK hynix)