Cadence Reports Third Quarter 2016 Financial Results

Cadence Design Systems, Inc. (NASDAQ: CDNS) announced results for the third quarter 2016.

Cadence reported third quarter 2016 revenue of $446 million, compared to revenue of $434 million reported for the same period in 2015. On a GAAP basis, Cadence recognized net income of $65 million, or $0.23 per share on a diluted basis, in the third quarter of 2016, compared to net income of $78 million, or $0.25 per share on a diluted basis, for the same period in 2015.

Using the non-GAAP measure defined below, net income in the third quarter of 2016 was $85 million, or $0.30 per share on a diluted basis, as compared to net income of $89 million, or $0.28 per share on a diluted basis, for the same period in 2015.

“We continued to make progress on our System Design Enablement strategy in the third quarter, which resulted in solid financial results,” said Lip-Bu Tan, president and chief executive officer. “Our digital and signoff solutions maintained their momentum with market-shaping customers; five new systems customers, including a major aerospace company, adopted our Palladium® Z1 emulation platform; and we increased our expansion into automotive functional safety verification.”

“Our results for the third quarter reflect our relentless focus on innovation and execution,” said Geoff Ribar, senior vice president and chief financial officer. “We believe that we are well-positioned for the rest of the year as we continue to execute on our strategic priorities and return capital to shareholders. In the third quarter, we repurchased 9.6 million shares of stock, and we have now repurchased 42.5 million shares for $960 million under the current $1.2 billion program, representing approximately 15 percent of shares outstanding as of July 4, 2015.”

CFO Commentary
Commentary on the third quarter 2016 financial results by Geoff Ribar, senior vice president and chief financial officer, is available at www.cadence.com/cadence/investor_relations.

Business Outlook
For the fourth quarter of 2016, the company expects total revenue in the range of $463 million to $473 million. Fourth quarter GAAP net income per diluted share is expected to be in the range of $0.18 to $0.20. Net income per diluted share using the non-GAAP measure defined below is expected to be in the range of $0.32 to $0.34.

For 2016, the company expects total revenue in the range of $1.810 billion to $1.820 billion. On a GAAP basis, net income per diluted share for 2016 is expected to be in the range of $0.74 to $0.76. Using the non-GAAP measure defined below, net income per diluted share for 2016 is expected to be in the range of $1.19 to $1.21.

A schedule showing a reconciliation of the business outlook from GAAP net income and diluted net income per share to non-GAAP net income and diluted net income per share is included in this release.

Audio Webcast Scheduled
Lip-Bu Tan, president and chief executive officer, and Geoff Ribar, senior vice president and chief financial officer, hosted a third quarter 2016 financial results audio webcast on October 24, 2016. An archive of the webcast is available until December 16, 2016 at 5 p.m. (Pacific). Webcast access is available at www.cadence.com/cadence/investor_relations.