10-Q · July 28, 2026
Cadence's Q2 filing confirms strong reported growth: revenue increased 24% year over year to $1.585 billion and GAAP operating margin expanded 9 percentage points to 28%, driven by software, hardware, IP and acquisition…
Earnings analysis · 10-Q
CDNS earnings analysis
Filed October 27, 2026 · Our reading of the company's report
The latest report
Cadence delivered a strong third quarter, with revenue of $1.633 billion and EPS of $2.11, both above the provided consensus estimates. Capital-return activity was substantial, including 1,304,652 program shares…
Read full summary
Cadence delivered a strong third quarter, with revenue of $1.633 billion and EPS of $2.11, both above the provided consensus estimates. Capital-return activity was substantial, including 1,304,652 program shares repurchased and a $2.5 billion authorization increase. The principal offsets are elevated regulatory and geopolitical exposure in China, variable-rate debt, foreign-exchange volatility and continuing cybersecurity risk.
Gross and operating margin
How much of each revenue dollar the business keeps.
One point per quarterly or annual filing. Both margins are shares of that report's revenue.
How we read each report
Our analysis across the last few reports.
Our model's reading of each filing, not the share price or the market's reaction. Annual and quarterly reports each occupy one position.
Reported figures
- Earnings per share
- $2.11
What stood out
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Revenue and EPS beat consensus
Third-quarter revenue was $1.633 billion and reported EPS was $2.11, exceeding the provided consensus estimates of $1.614 billion and $1.96, respectively.
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Meaningful share repurchases
Cadence repurchased 1,304,652 shares under its publicly announced program during the quarter, with approximately $602 million remaining available at September 30, 2026.
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Repurchase authorization expanded
The Board increased the share repurchase authorization by an additional $2.5 billion on October 23, 2026, providing additional capital-return capacity.
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No material control deficiencies
Disclosure controls and procedures were concluded to be effective as of September 30, 2026, and there were no changes in internal control over financial reporting that materially affected, or were reasonably likely to materially affect, controls during the quarter.
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Currency hedge exposure declined
Foreign-currency forward contracts totaled $985.7 million at September 30, 2026, compared with $3.3 billion at December 31, 2025, reducing the notional exposure associated with the earlier acquisition-related hedge position.
What to watch
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Foreign-exchange volatility
A 10% increase in U.S. dollar rates would have increased the fair value of forward contracts by $10.0 million as of September 30, 2026, while a 10% decrease would have reduced fair value by $6.3 million, demonstrating ongoing foreign-exchange sensitivity.
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Variable-rate debt exposure
The company had $150.0 million outstanding under its variable-rate Credit Facility at September 30, 2026. Assuming full borrowing and capacity expansion, each 0.25 percentage-point rate change would affect annual interest expense by $4.4 million.
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Export-control and China exposure
The filing states that BIS export-license requirements previously negatively affected China revenue, and the company paid aggregate net penalties and forfeitures of $140.6 million during the three months ended September 30, 2025 in connection with export-control settlements.
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Uncertain trade restrictions
The suspension of expanded Entity List ownership restrictions is scheduled through November 9, 2026, while the U.S.-China trade arrangements were announced as extended through January 10, 2027; the filing states BIS had not formally extended the suspension as of the report date.
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Cybersecurity incident risk
The company disclosed that a threat actor obtained a limited amount of confidential information, including test files, configuration-setting files and source-code files, from certain IT systems; the filing states the incident caused no operational disruption and did not impact customer environments.
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Capital allocation risk
The company purchased 1,408,291 total shares during the quarter at a weighted average price of $309.53 per share, including 1,304,652 shares under the repurchase program, creating potential capital-allocation and valuation risk if market conditions deteriorate.
Management's outlook
The provided 10-Q text does not include numeric forward guidance; the previously reported 2026 outlook was provided in the October 26, 2026 earnings release rather than this filing.
Earlier filings 4
10-Q · May 1, 2026
Cadence reported robust Q1 2026 results, with revenue reaching $1.474 billion, exceeding estimates of $1.452 billion by approximately $21.3 million, reflecting a 19% year-over-year growth. Non-GAAP EPS was reported at…
10-K · February 19, 2026
Cadence frames a growth strategy around its Intelligent System Design (ISD) strategy — integrating agentic/generative AI, accelerated hardware, and expanded system-level simulation — and expanded through multiple fiscal…
10-K · February 21, 2025
Cadence positions itself around an "Intelligent System Design™ (ISD)" strategy combining Design Excellence, System Innovation and Pervasive Intelligence to capture AI-driven semiconductor and systems design demand. The…
This is our reading of a public filing, not the filing itself. Analysis can contain errors; check the source document for full context.