Software engineering Market

Increase in adoption of IoT and 3D printing to fuel market growth

The increase in the use of digital technologies such as the Internet of Things (IoT), artificial intelligence (AI), machine learning (ML), automation, cloud, and others in designing products aids in enhancing product quality and durability. Furthermore, to minimize product development time & cost, users are adopting computer-aided engineering solutions that are expected to drive market growth. The evolving engineering modes such as building information modeling (BIM), 3D printing, and concurrent engineering is expected to influence the computer-aided software engineering trend. 3D printing is a form of additive manufacturing that enables users to print any object as a 3-D image.

This technology aids in minimizing production costs and assists in developing new methods of production. Moreover, the ease of use and unlimited customization capabilities are the major factors influencing the 3D printing market, which is further anticipated to positively impact the market.

Furthermore, 3D printing is gaining importance in several industry verticals such as consumer electronics, aerospace & defense, automotive, and healthcare. For instance, 3D printing in the sector has resulted in more robust and customized surgical tools, medical devices, and lab equipment such as eyeglasses, drug delivery devices, hearing aids, exoskeletons, and others. Moreover, additive manufacturing methods also improve the patient-specific and prosthetics implants in dental and orthopedic surgeries, which is increasing the need for computer-aided engineering solutions.

Further, the Introduction of new solutions and other strategic alliances by the key player creates a lucrative demand for the market. For instance, in May 2022, Intel announced the launch of Intel VTune Profiler to escalate system performance, application performance, and system configuration for cloud, HPC, IoT, storage, media, and more. It aids users in tuning the performance of the complete application. Therefore, the aforementioned factors, such as an increase in the adoption of IoT and 3D adoption, are expected to boost the computer-aided software engineering market revenue growth.

The Global Software Engineering Market Industry is significantly influenced by advancements in cloud computing technologies. The shift towards cloud-based solutions allows organizations to enhance scalability, flexibility, and cost-effectiveness in their software development processes. As businesses increasingly adopt cloud platforms, the demand for cloud-native applications rises, fostering innovation and collaboration. This transition is expected to contribute to the market's growth, with projections indicating a market size of 173.9 USD Billion by 2035. The integration of cloud services into software engineering practices not only streamlines development but also enhances accessibility, enabling teams to work efficiently from diverse locations.

The Global Software Engineering Market Industry is profoundly impacted by the emergence of artificial intelligence technologies. AI-driven solutions are transforming software development processes, enabling automation, predictive analytics, and enhanced decision-making capabilities. As organizations strive to leverage AI for competitive advantage, the demand for software engineers skilled in AI technologies is on the rise. This trend is indicative of a broader shift towards intelligent software solutions that can adapt to user needs and optimize performance. The integration of AI into software engineering practices is expected to play a crucial role in shaping the future of the industry, fostering innovation and efficiency.

The Global Software Engineering Market Industry experiences a notable surge in demand for software solutions across various sectors. As organizations increasingly rely on digital transformation, the need for custom software applications becomes paramount. In 2024, the market is projected to reach 65.7 USD Billion, driven by the necessity for enhanced operational efficiency and customer engagement. Industries such as healthcare, finance, and retail are particularly focused on leveraging software to streamline processes and improve service delivery. This trend indicates a robust growth trajectory, as businesses seek innovative solutions to remain competitive in an evolving landscape.

The Global Software Engineering Market Industry is witnessing a heightened focus on cybersecurity measures as organizations prioritize data protection and risk management. With the rise in cyber threats, businesses are compelled to invest in secure software solutions that safeguard sensitive information. This trend is likely to drive the demand for software engineering services that incorporate robust security features. As a result, the industry is expected to grow at a CAGR of 9.25% from 2025 to 2035. Companies are increasingly seeking software engineers who specialize in cybersecurity, reflecting the critical need for secure software development practices in today's digital landscape.

The Global Software Engineering Market Industry is increasingly adopting agile development methodologies to enhance project management and delivery timelines. Agile practices promote iterative development, collaboration, and responsiveness to changing requirements, which are essential in today's fast-paced business environment. Organizations are recognizing the benefits of agile frameworks, leading to a shift in software engineering practices. This trend is likely to contribute to the market's growth, as companies seek to improve their software development processes. The emphasis on agility in software engineering reflects a broader movement towards more adaptive and customer-centric approaches in the industry.

By Region, the study provides market insights into North America, Europe, Asia-Pacific, and the Rest of the World. The North American software engineering market is expected to grow at a significant CAGR during the study period, accounting for USD 22.76 billion in 2021. Many companies in the North America such as ANSYS Inc, Altair Engineering Inc, Dassault Systems, and Bentley Systems Inc, among others put a robust emphasis on digital revolution and are frequently considered among the initial adopters of next-gen technologies, such as IoT, Artificial Intelligence (AI), automation, and cloud.

The continual implementation of these technologies by companies in the region is fueling the market in the region. Major investments in software and services by large companies, along with the adoption of new technologies across industries, have contributed to the revenue growth of the regional market.

Moreover, the major countries covered in the market report include the United States, Germany, Canada, France, the United Kingdom, Italy, Spain, India, Japan, Australia, China, South Korea, and Brazil.

Figure 3: Software Engineering Market Region, 2024-2030 (USD Billion)

Source: Secondary Research, Primary Research, Market Research Future Database, and Analyst Review

The European software engineering market is the world's second-largest. The presence of key market players across European countries is further expected to boost the market. Similarly, the automotive industry is the key industry across Europe, and this is likely to fuel the computer-aided engineering demand. The increasing developers of virtual vehicles and connected car providers are significantly investing in reliable engineering tools in optimizing the production cost. Further, the UK software engineering market held the largest market share, and the German software engineering market was the fastest-growing market in the European region.

The Asia Pacific software engineering market is expected to grow at the fastest CAGR during the forecast period due to increasing government spending on manufacturing industry development and increasing the capacity for producing renewable energy. Moreover, the region has shown a rebound in the sales and manufacturing sector, considering the increase in hardware and device demand. Moreover, China’s software engineering market held the largest market share, and the Indian software engineering market was the fastest-growing market in Asia-Pacific.

The rapid adoption of new technologies, such as cloud computing, mobile devices, and big data analytics, by organizations seeking to improve their competitiveness. Growing demand for mobility and data portability drives the need for data-centric solutions and business software. Market players are pursuing several growth strategies to remain competitive in the industry, such as alliances, strategic contracts and collaborations, mergers & acquisitions, and developing new products.

The low code app development platform is a key trend gaining popularity in the software engineering industry. Low code development is an approach of software development to optimize the development process and speed up the delivery of the software, thus helping the enterprises to automate every step of the application of the product lifecycle.

Salesforce Inc is an American cloud-based software company provides customer relationship management software and applications focused on sales, customer service, marketing automation, analytics, and application development. For instance, in June 2021, Salesforce, a US-based software company, released a powerful set of low-code development tools that allow everyone within an organization, to create and ship apps on a single platform. The platform includes interactive app development and automation, along with the new elastic computing, identity management, AI-driven data protection, and DevOps capabilities to help teams drive business outcomes faster.

In January 2021, Cognizant, a US-based information technology services and consulting company, acquired Magenic Technologies for an undisclosed amount. The acquisition is expected to enable Cognizant to enhance its capabilities in software development and cloud modernization along with Cognizant's software product engineering footprint. Magenic Technologies is a US-based custom software development services company.