Companies /Technology
Cadence Design Systems Inc
NASDAQ: CDNS Software - Application
$330.55
▼ $3.65 (−1.09%) today
Markets open · 1:20pm ET

Cadence Design Systems (CDNS) Q2 2025 Earnings

Reported Jul 28, 2025, 4:03pm ET · SEC source
$1.65
Beat +5.77%
EPS · est. $1.56
$1.3B
Beat +1.94%
Revenue · est. $1.3B
−5.4%
Trailing market
CDNS vs S&P since report
5 quarters
Consecutive EPS beats

How Did CDNS Stock React to Q2 2025 Earnings?

% change · around the report
−8%−4%0+4%Jul 28Jul 29report 4:03pm ETearnings−0.2%+2.6%
−8%−4%0+4%Jul 28Jul 29earnings−0.2%+2.6%
CDNS +2.6%S&P 500 −0.2%
−8%−4%0+4%Jul 28Jul 29report 4:03pm ETearnings−0.1%+2.6%
−8%−4%0+4%Jul 28Jul 29earnings−0.1%+2.6%
CDNS +2.6%NASDAQ −0.1%
−4%0+4%Jul 28Aug 5report 4:03pm ETearnings−1.4%+1.8%
−4%0+4%Jul 28Aug 5earnings−1.4%+1.8%
CDNS +1.8%S&P 500 −1.4%
−4%0+4%Jul 28Aug 5report 4:03pm ETearnings−1.7%+1.8%
−4%0+4%Jul 28Aug 5earnings−1.7%+1.8%
CDNS +1.8%NASDAQ −1.7%
+9.74%
Day of report
+1.30%
Next session
−1.57%
One week
−3.27%
30 days

S&P 500 over the same 30 days: +2.15%.

Did CDNS Beat Earnings? Q2 2025 Results

Yes. Cadence Design Systems reported Q2 2025 earnings of $1.65 a share on Jul 28, 2025, beating the $1.56 consensus estimate by 5.8%. Revenue was $1.3B against a $1.3B estimate.

Cadence Design Systems delivered a <a href="https://247wallst.com/investing/2025/07/28/live-will-cadence-design-systems-jump-after-releasing-q2-earnings/">strong beat-and-raise quarter</a> in Q2 2025, reporting revenue of $1.28 billion, up 20.3% year over year and ahead of the $1.25 billion consensus, while non-GAAP EPS of $1.65 cleared the $1.56 estimate by 5.88%. The broad-based strength was driven by double-digit growth across all three product segments, with System Design & Analysis climbing 35% year over year, the IP business growing more than 25%, and Core EDA contributing a solid 16% gain, together more than offsetting a reduction in China revenue, which fell to 9% of total sales from 12% a year ago following new export restrictions. GAAP results were weighed down by a $140.60 million DOJ and Bureau of Industry and Security settlement charge, which analysts had flagged as a known overhang on the stock. Looking ahead, Cadence raised its full-year 2025 revenue outlook by $50 million at the midpoint to $5.21 billion to $5.27 billion, implying 12% to 14% growth, and lifted non-GAAP EPS guidance to $6.85 to $6.95, signaling continued confidence in demand for its electronic design automation platform.

Key Takeaways
  • 20% year-over-year revenue growth driven by broad-based strength across all businesses
  • Core EDA delivered 16% YoY revenue growth driven by AI portfolio proliferation
  • IP business delivered more than 25% YoY revenue growth from broadening silicon solutions portfolio
  • System Design & Analysis achieved 35% YoY revenue growth driven by multi-physics analysis platform and AI-driven optimization
  • Stronger than expected bookings highlighting strategic relevance of AI-driven portfolio

“Cadence delivered an exceptional Q2, with 20% year-over-year revenue growth and stronger than expected bookings. This highlighted the strategic relevance of our AI-driven portfolio and the depth of our customer relationships.”

Cadence Design Systems CEO, on the earnings call

What Was Cadence Design Systems's Outlook in Q2 2025?

Cadence raised its full-year 2025 outlook: revenue of $5.21B-$5.27B (up $50M at midpoint, implying 12%-14% YoY growth), non-GAAP EPS of $6.85-$6.95, GAAP EPS of $3.97-$4.07, non-GAAP operating margin of 43.5%-44.5%, and operating cash flow of $1.65B-$1.75B (up $50M at midpoint). For Q3 2025, the company expects revenue of $1.305B-$1.335B (7%-10% YoY growth), non-GAAP EPS of $1.75-$1.81, GAAP EPS of $1.14-$1.20, and non-GAAP operating margin of 45%-46%. The company expects approximately $140M in reduced cash tax payments from the One Big Beautiful Bill Act's immediate R&D expensing provision. Cadence plans to use approximately $200M for share repurchases in Q3 and at least 50% of free cash flow for buybacks for the full year.

CDNS YoY Financials

Q2 2025 vs Q2 2024 · SEC filings Q2 2024 Q2 2025
$0$400.0M$800.0M$1.2B$1.1B$1.3BRevenue$921.4M$1.1BGross Profit$293.9M$241.8MOperating Income$229.5M$160.1MNet Income
$0$400.0M$800.0M$1.2BRevenueGross ProfitOperating IncomeNet Income
CDNS income statement, Q2 2025 versus Q2 2024
Metric Q2 2025 Q2 2024 Year over year
Revenue $1.3B $1.1B +20.3%
Gross Profit $1.1B $921.4M +18.4%
Operating Income $241.8M $293.9M −17.7%
Net Income $160.1M $229.5M −30.3%

CDNS Revenue by Segment

Product and Maintenance$1.2B
Core EDA$905.6M+16.0%
System Design and Analysis$204.1M+35.0%
Semiconductor IP$165.8M
Services$104.9M

CDNS Revenue by Geography

Americas$625.0M
Asia Pacific$242.3M
China$114.8M
EMEA$204.1M
Japan$89.3M

Figures from SEC filings and company reports. Not investment advice.