Siemens agrees to buy chip debugging specialist Lauterbach
The Munich technology group is adding the maker of the TRACE32 debug and trace tools to its electronic design automation business. Lauterbach has about 170 employees and made roughly EUR 60m in revenue in 2025; the price was not disclosed.
Siemens has signed an agreement to acquire Lauterbach, a German provider of debug and trace tools for embedded software and complex system-on-chip designs, the company announced on Tuesday 10 November 2026. Financial terms were not disclosed.
Lauterbach, based near Munich, employs around 170 people, serves more than 1,200 customers and generated roughly EUR 60m in revenue in 2025, according to Siemens. The Next Web reports that the company is best known for its TRACE32 range of debugging and tracing tools. The deal is expected to close in the first half of 2027.
What Lauterbach does
Lauterbach was co-founded by the brothers Lothar and Stephan Lauterbach, beginning in 1979, to build tools for microprocessor development. Its hardware-assisted debuggers and real-time trace tools let engineers see what happens inside a chip while its software runs, and track down errors that arise from the interaction between hardware and code. According to The Next Web, the company is based in Höhenkirchen near Munich and has offices in the UK, Italy, France, Tunisia, the US, Japan and China.
Its customers are mainly in the automotive, semiconductor and telecoms industries, Siemens says. Stephan Lauterbach, the company's CTO and co-founder, and Thomas Ullmann will continue to work at Siemens after closing.
Why Siemens wants it
Siemens has built an electronic design automation (EDA) business that sells software and hardware for designing and verifying chips; The Next Web notes that it was built mainly through the purchase of Mentor Graphics in 2017. One part of that portfolio is hardware-assisted verification, systems that emulate a chip before it is manufactured so designers can test it early.
By adding Lauterbach's debugging tools, Siemens wants to combine two workflows that have been separate until now: verifying the chip hardware and debugging the software that will run on it. The company says customers would get a unified view of how complex application-specific chips and systems-on-chip behave, and could develop and verify embedded software before the physical chip is available.
"With Lauterbach, we are further extending our industry-leading EDA portfolio for semiconductor design by bringing together our premier hardware-assisted verification portfolio with its industry-leading software debugging technologies," said Cedrik Neike, member of the Siemens managing board and head of Digital Industries. He called Lauterbach "a remarkable success story, written in Germany for the global semiconductor industry".
Siemens says the growing complexity of chips and embedded software, driven by AI, software-defined vehicles, the Internet of Things, multi-core designs, cybersecurity and functional safety, is pulling hardware and software development closer together. On that basis, it expects significant revenue synergies.
Deal terms and timing
Siemens did not disclose a price, a point also noted by Quartz, citing Bloomberg. The transaction is subject to customary closing conditions and regulatory approvals, and Siemens expects it to close in the first half of 2027. Law firm Gleiss Lutz says it advised Siemens on the deal.
"By combining our debug and trace technology with Siemens' hardware-assisted verification capabilities, we are creating a powerful solution that provides developers with a unified hardware/software view," said Stephan Lauterbach. He added that the company's commitment to its customers remains unchanged.
What it means for European founders and investors
Lauterbach is an example of a type of company Europe has plenty of but rarely talks about: a founder-led, specialised technology firm that built a global customer base over more than four decades without becoming a household name. Its sale to a strategic buyer shows that deep technical niches in the chip toolchain can be very valuable, even when revenue is in the tens of millions.
The deal also fits a wider pattern. As chips become central to cars, industrial machines and AI systems, large European industrial groups are buying their way deeper into semiconductor software. For founders building developer tools, verification software or embedded AI, the message is that the natural buyers are often industrial and EDA groups rather than consumer tech platforms.
Europe's chip ecosystem is also seeing investment at the design end. Startups such as Circuit Mind, which uses AI for electronics design, and Ubitium, which is developing a universal processor, are raising money in the same space. Meanwhile, chipmakers such as Infineon are reporting strong demand from AI data centres. Siemens has also invested in other European deep tech, including a strategic investment in Skeleton Technologies. For investors, tool and software companies that sit between chip design and the finished product may become more attractive as targets.
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