Cadence Design Systems Inc (NASDAQ:CDNS) stock fell 3.53% (As on April 28, 11:20:09 AM UTC-4, Source: Google Finance) after the company reported robust financial results for Q1 2026, surpassing analyst expectations. The company raised its full-year 2026 guidance. IP business continued its strong momentum with 22% year-over-year revenue growth, driven by accelerating demand of AI, HPC, and automotive workloads. The core EDA business delivered another strong quarter, with revenue growing 18% year-over-year. The system design and analysis business delivered 18% year-over-year revenue growth as AI-driven multiphysics simulation and 3D IC become essential to addressing growing system challenges. First quarter bookings were ahead of expectations, resulting in a record backlog of $8 billion. Non-GAAP operating margin was 44.7%. The cash balance was $1.407 billion, while the principal value of debt outstanding was $2.925 billion. Operating cash flow was $356 million. DSOs were 67 days.
Moreover, at CadenceLIVE Silicon Valley 2026, the company took a major step towards fully autonomous chip design, pioneering the industry’s most advanced and comprehensive agentic full-flow platform. The company has introduced AgentStack, the head agent framework for the AI super agents, which enables knowledge sharing across the design flow and extend autonomous designs from chips to 3D IC to systems. the company has introduced two new breakthrough AI super agents, ViraStack for analog and custom design and InnoStack for digital implementation and sign-off. Further, the company has announced a strategic collaboration with Google to optimize the ChipStack AI super agent with Gemini on Google Cloud. In Q1, the company furthered the long-standing partnership with MediaTek through a wide-ranging expansion across the new agentic AI offerings and core EDA, 3D IC, and system analysis solutions.
CDNS in the first quarter of FY 26 has reported the adjusted earnings per share of $1.96, beating the analysts’ estimates for the adjusted earnings per share of $1.88, according to the Zacks Consensus Estimate. The company had reported the adjusted revenue growth of 19 percent to $1.47 billion in the first quarter of FY 26, beating the analysts’ estimates for revenue by 1.69%.
Cadence has raised its full-year 2026 revenue guidance to $6.125 billion – $6.225 billion, with a midpoint of $6.175 billion, and expects to achieve the Rule of 60 for the first time. The company anticipates a Non-GAAP operating margin in the range of 43.5%-44.5% and a Non-GAAP EPS of $7.85 – $7.95. Operating cash flow is expected to be in the range of $1.875 billion-$1.975 billion.