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About Cadence Design Systems, Inc.

You can get into a rhythm when designing an integrated circuit or an entire device with Cadence Design Systems. The company makes electronic design automation (EDA) software as well as hardware for putting together electronic systems. Customers use Cadence products to design integrated circuits (ICs), printed circuit boards (PCBs), smartphones, laptop computers, gaming systems, and more. The company offer software, hardware, services and reusable IC design blocks, which are commonly referred to as intellectual property ("IP"). The company also provides maintenance and support, and design and methodology consulting services. Its verification tools test designs before production. International customers account for nearly 60% of the company's sales.


Cadence Design Systems has five product areas, each making a robust contribution to total revenue. Digital IC Design and Signoff delivers some 30% of the company's revenue.

Digital IC design and signoff offerings are used to create logical representations of a digital circuit or an IC that can be verified for correctness prior to implementation. Its logic design offering is comprised of logic synthesis, test and equivalence checking capabilities.

Functional verification products are used by customers to verify that the circuitry or the software they have designed will perform as intended. Verification takes place during and after custom and analog design, and before manufacturing the circuitry, significantly reducing the risk of discovering a costly error in the completed product. Its Verification Suite includes four primary verification engines, starting with the JasperGold, Formal Verification Platform, and Xcelium. This segment generates about 25% of the company's revenue.

Custom IC design and simulation offerings are used by customers to create schematic and physical representations of circuits down to the transistor level for analog, mixed-signal, custom digital, memory and RF designs. These representations are verified using simulation tools optimized for each type of design, including the design capture environment, simulation and IC layout within the Virtuoso custom design platform. This segment accounts for some 25% of the company's sales.

Other segment includes System interconnect and Analysis (nearly 10% of the company's sales) and IP (about 15% of the company's sales).

The company sells hardware for emulation and prototyping and it relies on contractors to make, assemble, and test those products. Contractors also handle system integration and testing of Cadence's prototyping products based on Field-Programmable Gate Array (FPGA) technology.

Geographic Reach

With its main headquarters in California, Cadence Design Systems has placed regional headquarters near customers in China, India, UK, and Japan. Overall, the company operates its business in more than 20 countries.

The US is Cadence's largest single market, accounting for more than 40% of sales. Customers in Asia (including Japan) account more than 25% of sales, and European customers, including Middle East and Africa account for about 20%.

Sales and Marketing

Cadence market its products and provide services to existing and prospective customers through a direct sales force consisting of sales people and applications engineers. The company also promote products and services through advertising, marketing automation, trade shows, public relations and the internet. Internationally, the company market its products and services through subsidiaries as well as third-party distributor to license their products and services to certain customers in Japan.

The company's advertising expenses were $8.4 million, $7.6 million and $7.4 million for 2019, 2018 and 2017, respectively.

Financial Performance

Cadence Design Systems' revenue has been rising consistently. It has a 37% growth between 2015 and 2019.

In 2019, Cadence's revenue grew by 9% from $2.1 billion to $2.3 billion. This growth was primarily due to the $206 million increase in product and maintenance revenue.

Net income nearly tripled (186% growth) from $345.8 million in 2018 to $989 million in 2019.

Cash and cash equivalents totaled $705.2 billion. Operating activities generated $729.6 billion while investing and financing activities used $105.7 billion and $443.9 billion, respectively.


Cadence's strategy, which it calls Intelligent System Design, provides the technologies necessary for customers to develop and optimize a complete and functional electronic product. The company addresses the challenges posed by the needs and trends of electronic systems companies as well as semiconductor companies delivering greater portions of these systems. The development of electronic products, or their sub-components, is complex and requires many engineers using our solutions with specialized knowledge and skill.

The second layer of Cadence's strategy centers on system innovation. It includes tools and services used for system design of the packages that encapsulate the ICs and the PCBs, system simulation which includes electromagnetic, electro-thermal and other multi-physics analysis necessary as part of optimizing the full system's performance, Radio Frequency ("RF") and microwave systems, and embedded software.

The third layer of the company's strategy is enabling pervasive intelligence in new electronics. It starts with providing solutions and services to develop AI-enhanced systems and includes machine learning and deep learning capabilities being added to the Cadence technology portfolio to make IP and tools more automated and to produce optimized results faster, supported by cloud access to address the growing computation needs of customers.

Mergers and Acquisitions

In 2020, Cadence Design Systems, Inc. acquired AWR Corporation, headquartered in California, from National Instruments Corporation. The addition of AWR's technologies and talent will further expand Cadence's reach into 5G RF communications and support system innovation for the aerospace and defense, automotive and wireless market segments. Terms of the transaction were not disclosed.

That same year, Cadence also acquired New Jersey-based, Integrand Software, Inc. ("Integrand"), a company that provides electronic design software used to design high frequency, RF and mixed-signal complex integrated circuits (ICs) for the global semiconductor and electronics industries. Terms were not disclosed.

Company Background

Cadence Design Systems arose from the 1988 merger of software firms ECAD (formed in 1982) and SDA Systems (founded 1983). The stock market crash of 1987 helped propel SDA Systems, an EDA company that gave up its planned IPO in the wake of the crash, into its merger with ECAD, which was publicly held, to form Cadence Design. Private venture capital investor and SDA chairman Donald Lucas became chairman of Cadence. Joe Costello, the young, charismatic, and tall (6-foot-7) president and COO of SDA, was named president and CEO of Cadence. It became the world's leading electronic design automation (EDA) software supplier by enlarging and improving the range of software it developed in-house and via such acquisitions as Tangent Systems (1989) and Valid Logic Systems (1991).

The company grew through a series of acquisitions. Cadence concluded long-running litigation with Avant! (after Avant! was acquired by Synopsys) with a $265 million payment to Cadence.

Cadence Design Systems, Inc.

2655 Seely Ave Bldg 5
San Jose, CA 95134-1931
Phone: 1 (408) 943-1234

Firm Stats

Employer Type: Publicly Owned
Stock Symbol: CDNS
Stock Exchange: , NASDAQ
Chairman: John B. Shoven
President and CEO: Lip-Bu Tan
SVP Worldwide Field Operations: Neil Zaman
Employees (This Location): 700
Employees (All Locations): 8,100

Major Office Locations

San Jose, CA

Other Locations

Berkeley, CA
Irvine, CA
Pleasanton, CA
San Jose, CA
Denver, CO
Chelmsford, MA
Rochester, MN
Saint Paul, MN
Cary, NC
Portland, OR
Pittsburgh, PA
Austin, TX
Plano, TX
Sandy, UT
Bellevue, WA
Bengaluru, India
Ghaziabad, India
Hyderabad, India
Mumbai, India
New Delhi, India
Noida, India