CDNS · Cadence Design Systems, Inc.

Cadence's Q2 2026 results demonstrated broad-based strength across all business segments, driven by accelerating demand for AI-driven solutions. Revenue of $1.584 billion exceeded guidance and grew 24% year-over-year, with record backlog of $8.1 billion providing strong visibility into future revenue. Non-GAAP operating margin expanded to 45.5% from 42.8% in the prior year, reflecting operating leverage. Core EDA revenue grew 18% YoY, IP revenue grew over 40% YoY driven by a significant agreement with Intel, and System Design and Analysis revenue grew 37% YoY. Hardware delivered another record quarter with new customer additions. Management raised FY2026 guidance: revenue growth to ~19%, non-GAAP EPS to $8.10 at the midpoint, and operating cash flow to ~$2 billion. The strong cash generation supports capital returns; the company expects to repurchase approximately $200 million in Q3 and use about 50% of free cash flow for buybacks for the full year. AI Super Agents portfolio and strong customer adoption underscore Cadence's leadership in electronic system design.