Cadence Q3 Revenue Climbs 22% as Company Raises 2026 Outlook

Cadence Design Systems posted $1.633 billion in third-quarter revenue, up 22% from a year earlier, and raised its fiscal 2026 targets after both revenue and non-GAAP earnings per share exceeded the company’s prior forecast ranges.

Revenue for the quarter ended Sept. 30 compared with $1.339 billion a year earlier. Non-GAAP diluted EPS was $2.11, versus $1.93 in the year-earlier quarter. GAAP diluted EPS was $1.05, unchanged year over year.

The revenue result was $8 million above the upper end of Cadence’s prior Q3 range of $1.595 billion to $1.625 billion. Non-GAAP EPS topped the previous range of $2.01 to $2.07 by 4 cents at the high end.

Cadence now expects fiscal 2026 revenue of $6.387 billion to $6.417 billion, up from its previous forecast of $6.260 billion to $6.340 billion. Its non-GAAP EPS outlook increased to $8.37 to $8.43, from $8.05 to $8.15. The company outlined those revised targets earlier Monday alongside its Maestro portfolio announcement.

Revenue increased year over year by 20% in core electronic design automation, 24% in intellectual property and 30% in System Design and Analysis. Cadence sells software, hardware and intellectual property used in semiconductor and system design. Its backlog stood at $8.2 billion at quarter-end, including $4.2 billion in remaining performance obligations expected to be recognized as revenue over the next 12 months.

“Q3 revenue grew 22% year-over-year, with strong double-digit growth across all product categories,” Chief Financial Officer John Wall said.

Cadence presents non-GAAP results as supplemental measures alongside GAAP results. The non-GAAP measure excludes specified items, including stock-based compensation, acquired-intangible amortization and acquisition-related costs.