Cadence Reports First Quarter 2020 Financial Results

SAN JOSE, Calif., 20 Apr 2020 -- Cadence Design Systems, Inc. (Nasdaq: CDNS) today announced results for the first quarter of 2020.

Cadence reported first quarter 2020 revenue of $618 million, compared to revenue of $577 million reported for the same period in 2019. On a GAAP basis, Cadence achieved operating margin of 23 percent and recognized net income of $124 million, or $0.44 per share on a diluted basis, in the first quarter of 2020, compared to operating margin of 22 percent and net income of $121 million, or $0.43 per share on a diluted basis, for the same period in 2019.

Using the non-GAAP measure defined below, operating margin for the first quarter of 2020 was 32 percent and net income was $166 million, or $0.60 per share on a diluted basis, compared to operating margin of 32 percent and net income of $152 million, or $0.54 per share on a diluted basis, for the same period in 2019.

“I am pleased to report that in a difficult environment we have continued to deliver on our strategy and commitments, leading to excellent financial results for the first quarter of 2020, and we are reaffirming our 10 percent revenue growth guidance for the year,” said Lip-Bu Tan, chief executive officer. “We are going through truly unprecedented times and our first priority is ensuring the safety and well-being of our employees, customers and communities. From a business continuity perspective, our infrastructure, collaboration platforms and tight communication have enabled us to maintain a high level of productivity, and our R&D innovation projects and customer deliverables continue to track well.”

“Cadence met or exceeded its key financial metrics for the first quarter despite some disruption caused by the COVID-19 pandemic,” said John Wall, senior vice president and chief financial officer. “The vast majority of our team are effectively working from home, including our sales and application engineering teams that have adapted well to this new work model as they continue to engage productively with customers on the business, training and support fronts.”

CFO Commentary

Commentary on the first quarter 2020 financial results by John Wall, senior vice president and chief financial officer, is available at www.cadence.com/cadence/investor_relations.

Business Outlook

For the second quarter of 2020, the company expects total revenue in the range of $580 million to $600 million. Second quarter GAAP operating margin is expected to be approximately 18 percent and GAAP net income per diluted share is expected to be in the range of $0.28 to $0.32. Using the non-GAAP measure defined below, operating margin is expected to be approximately 30 percent and net income per diluted share is expected to be in the range of $0.50 to $0.54.

For 2020, the company expects total revenue in the range of $2.545 billion to $2.585 billion. On a GAAP basis, operating margin is expected to be in the range of 21 percent to 22 percent and net income per diluted share for 2020 is expected to be in the range of $1.58 to $1.68. Using the non-GAAP measure defined below, operating margin for 2020 is expected to be in the range of 32 percent to 33 percent and net income per diluted share for 2020 is expected to be in the range of $2.40 to $2.50.

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

Click here for the Q1 2020 Financial Schedules.

udio Webcast Scheduled

Lip-Bu Tan, chief executive officer, and John Wall, senior vice president and chief financial officer, will host the first quarter 2020 financial results audio webcast today, April 20, 2020, at 2 p.m. (Pacific) / 5 p.m. (Eastern). Attendees are asked to register at the website at least 10 minutes prior to the scheduled webcast. An archive of the webcast will be available starting April 20, 2020 at 5 p.m. (Pacific) and ending June 12, 2020 at 5 p.m. (Pacific). Webcast access is available at www.cadence.com/cadence/investor_relations.

About Cadence

Cadence is a pivotal leader in electronic design, building upon more than 30 years of computational software expertise. The company applies its underlying Intelligent System Design strategy to deliver software, hardware and IP that turn design concepts into reality. Cadence customers are the world’s most innovative companies, delivering extraordinary electronic products from chips to boards to systems for the most dynamic market applications including consumer, hyperscale computing, 5G communications, automotive, aerospace, industrial and health. For six years in a row, Fortune Magazine has named Cadence one of the 100 Best Companies to Work For. Learn more at cadence.com.