# Cadence Design Systems (CDNS) — Stock CV

Cadence Design Systems is a $97.2B technology company. Revenue grew 14.7% over the last year, it keeps 24¢ of every dollar of sales as profit, and its net debt equals ~0.0 years of free cash flow. It trades at 70.5× earnings — around the middle of its own history.

> Cadence Design Systems is a provider of electronic design automation software, intellectual property, and system design and analysis products. EDA software automates and aids in the chip design process, enhancing design accuracy, productivity, and complexity in a full-flow end-to-end solution.

## Identity

- **Ticker**: CDNS
- **Sector**: Technology
- **Industry**: Services-Prepackaged Software
- **Headquarters**: SAN JOSE, CA
- **Employees**: 13 800
- **Website**: https://www.cadence.com
- **Market cap**: $97.2B
- **Last price**: $352.84
- **Financial profile**: Mixed

## Vitals (TTM)

- **Revenue**: $5.84B
- **Net income**: $1.38B
- **Free cash flow**: $1.68B
- **Net debt**: $42.4M
- **P/E**: 70.5
- **Revenue growth (YoY)**: 14.7%

## Skills (profile scores, 0–100)

| Pillar | Score |
|---|---|
| Valuation | 22 |
| Growth | 85 |
| Profitability | 90 |
| Health | 63 |
| Quality | 92 |
| Moat | 100 |

## Qualifications (beginner checklist) — 8 of 10 passed

- [x] Revenue growing — +14.7% YoY
- [x] Profitable — $1.38B TTM
- [x] Profit growing — +9.5% YoY
- [x] Generates cash — $1.68B TTM
- [x] Debt under control — ~0.0y of cash flow to repay
- [x] Established company — $97.2B market cap
- [x] Not printing shares — -2.3% shares over ~5y
- [x] Proven track record — 10/10 profitable years
- [ ] Financially stable — health score 43/100
- [ ] Valuation not extreme — P/E 70.5

## Experience (career milestones)

- **FY2025** — Best year on record: $1.11B net income
- **2024** — Cadence "quietly stepped into the supercomputer business", according to TechRadar
- **2024** — Cadence purchased BETA CAE Systems
- **2023** — Cadence purchased several businesses from Rambus in 2023
- **2021** — Cadence launched an artificial intelligence platform to streamline processor development
- **2019** — Protium X1 rack-based prototyping was introduced in 2019, which Cadence claimed supported a 1.2 billion gate SoCs at…
- **FY2018** — Became debt-free: cash now exceeds total debt
- **FY2016** — Profitable every year on record: 10 consecutive profitable years in our data
- **FY2016** — Revenue already above $1B: $1.82B in first reported year
- **FY2016** — Positive free cash flow every year since: 10-year streak
- **2015** — Cadence announced the Palladium Z1 hardware emulation platform, for verifying billion-gate designs
- **2004** — Between 2004 and 2007, Cadence purchased four companies, including the software developer Verisity
- **1999** — Cadence acquired Quickturn Design Systems in 1999, preventing a hostile takeover attempt by Mentor Graphics
- **1991** — Cadence acquired its rival Valid Logic Systems for around $200 million, its biggest acquisition yet
- **1983** — Founded in 1983 in San Jose, California, Cadence Design Systems began as an electronic design automation (EDA)…

## Strengths

- High gross margin (85.9%)
- Strongly profitable — 23.6% net margin
- Revenue growing 14.7% year over year
- Strong cash conversion — FCF is 28.8% of revenue
- Interest covered 39.1× by operating earnings

## Watch-outs

- None stand out in the data.

## Track record

| Year | Revenue | Net income | Free cash flow |
|---|---|---|---|
| FY2021 | $2.99B | $696M | $1.04B |
| FY2022 | $3.56B | $849M | $1.12B |
| FY2023 | $4.09B | $1.04B | $1.25B |
| FY2024 | $4.64B | $1.06B | $1.12B |
| FY2025 | $5.30B | $1.11B | $1.59B |

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Source: https://stockcv.com/CDNS — derived from company filings; may be delayed or incomplete. Information, not investment advice.