Cadence increases annual predictions about the demand of the design software, but tariff fear continues

(Reuters) -Cadence Design Systems on Monday increased its annual revenue and profit forecasts and bet on the resilient demand for its chip design software of semiconducting in the midst of an AI boom, but tariff -led concerns about the China business has a shadow. The increased demand for fast and complicated artificial intelligence processors has benefited the business, which provides software for designing chips and computer systems that help manage the complex programs. AI processor leader Nvidia and iPhone manufacturer Apple are among Cadence’s customers. Cadence now expects 2025 revenue in the $ 5.15 billion to $ 5.23 billion. This is higher than the previous forecast of $ 5.14 billion to $ 5.22 billion. Analysts expected an average of $ 5.19 billion, according to the data compiled by LSEG “We have not yet seen any change in customers’ behavior as they continue to invest in R&D for their next generations,” CEO Anirudh Devgan said in a statement. The company increased its forecast for annual adjusted profits per share to a range of $ 6.73 to $ 6.83, higher than the preceding forecast of between $ 6.65 and $ 6.75. However, China market voltage has dropped more than 1% in extensive trade, with the Sino-American trade war injuring revenue from its key market. China sales accounted for about 11% of total turnover in the first quarter, of 12% in the previous year. The annual revenue from China would be flat at the center of the forecast, a company manager said during a call to earnings. Managers, with analysts’ questions about the impact of rates, have tried to end the fear of any hit on sales. “Software and services are not, you know, subject to rates,” a company manager said. “We do not believe that the rates, given our diversified supply chain, will also have an impact on our hardware business …. we continue to monitor the situation.” Cadence reported revenue from the first quarter of $ 1.24 billion, in accordance with estimates, while the adjusted profit of $ 1.57 per share of $ 1.49 was adjusted. The forecast for income and profit in the second quarter was also in line with street expectations. (Reporting by Arsheya Bajwa in Bengaluru and Stephen Nellis in San Francisco; editing by Sriraj Kalluvila) first published: 29 Apr 2025, 03:58 am Ist