Cadence Reports First Quarter 2019 Financial Results

SAN JOSE, Calif. -- April 22, 2019 -- Cadence Design Systems, Inc. (NASDAQ: CDNS) today announced results for the first quarter of 2019.

Cadence reported first quarter 2019 revenue of $577 million, compared to revenue of $517 million reported for the same period in 2018. On a GAAP basis, Cadence achieved operating margin of 22 percent and recognized net income of $121 million, or $0.43 per share on a diluted basis, in the first quarter of 2019, compared to operating margin of 17 percent and net income of $73 million, or $0.26 per share on a diluted basis, for the same period in 2018.

Using the non-GAAP measure defined below, operating margin for the first quarter of 2019 was 32 percent and net income was $152 million, or $0.54 per share on a diluted basis, compared to operating margin of 28 percent and net income of $113 million, or $0.40 per share on a diluted basis, for the same period in 2018.

“Cadence achieved excellent operating results for the first quarter delivering 11 percent revenue growth and 32 percent non-GAAP operating margin. Our business is mission critical to silicon development, which is the cornerstone of all design activity,” said Lip-Bu Tan, chief executive officer. “We announced Clarity^™ 3D Solver, our first product in the System Analysis space, as we introduced the next phase of our System Design Enablement strategy to provide more capabilities and value to customers and expand our TAM.”

“I’m pleased with our financial discipline and continued broad-based growth,” said John Wall, senior vice president and chief financial officer. “We are raising our outlook for the year as technology trends like AI and 5G continue to drive strong design activity across all lines of our business.”

CFO Commentary
Commentary on the first quarter 2019 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 2019, the company expects total revenue in the range of $575 million to $585 million. Second quarter GAAP operating margin is expected to be in the range of 21 percent to 22 percent and GAAP net income per diluted share is expected to be in the range of $0.34 to $0.36. Using the non-GAAP measure defined below, operating margin is expected to be in the range of 31 percent to 32 percent and net income per diluted share is expected to be in the range of $0.52 to $0.54.

For 2019, the company expects total revenue in the range of $2.305 billion to $2.335 billion. On a GAAP basis, operating margin is expected to be approximately 21 percent and net income per diluted share for 2019 is expected to be in the range of $1.39 to $1.47. Using the non-GAAP measure defined below, operating margin for 2019 is expected to be approximately 31 percent and net income per diluted share for 2019 is expected to be in the range of $2.04 to $2.12.

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 2019 Financial Schedules.

Audio Webcast Scheduled
Lip-Bu Tan, chief executive officer, and John Wall, senior vice president and chief financial officer, will host the first quarter 2019 financial results audio webcast today, April 22, 2019, 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 22, 2019 at 5 p.m. (Pacific) and ending June 14, 2019 at 5 p.m. (Pacific). Webcast access is available at www.cadence.com/cadence/investor_relations.

About Cadence
Cadence enables electronic systems and semiconductor companies to create the innovative end products that are transforming the way people live, work and play. Cadence^® software, hardware and semiconductor IP are used by customers to deliver products to market faster. The company’s System Design Enablement strategy helps customers develop differentiated products—from chips to boards to systems—in mobile, consumer, cloud datacenter, automotive, aerospace, IoT, industrial and other market segments. Cadence is listed as one of Fortune Magazine's 100 Best Companies to Work For. Learn more at www.cadence.com.

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