CIMdata PLM Industry Summary Online Archive

25 April 2007

Financial News

Cadence Reports Q1 Revenue Up 11% Over Q1 2006

Cadence Design Systems, Inc. reported first quarter 2007 revenue of $365 million, an increase of 11 percent over the $328 million reported for the same period in 2006. On a GAAP basis, Cadence recognized net income of $44 million, or $0.15 per share on a diluted basis, in the first quarter of 2007, compared to $22 million, or $0.07 per share on a diluted basis, in the same period in 2006.

In addition to using GAAP results in evaluating Cadence's business, management believes it is useful to measure results using a non-GAAP measure of net income, which excludes, as applicable, amortization of intangible assets, stock-based compensation expense, in-process research and development charges, integration and acquisition-related costs, gains and expenses related to non-qualified deferred compensation plan assets, executive severance payments, restructuring charges, losses on extinguishment of debt, and equity in losses (income) from investments. Non-GAAP net income is adjusted by the amount of additional taxes or tax benefit that the company would accrue if it used non-GAAP results instead of GAAP results to calculate the company's tax liability. See "GAAP to non-GAAP Reconciliation" below for further information on the non-GAAP measure.

Using this non-GAAP measure, net income in the first quarter of 2007 was $75 million, or $0.26 per share on a diluted basis, as compared to $66 million, or $0.21 per share on a diluted basis, in the same period in 2006.

"We saw strong growth in our core business in the first quarter led by our digital platform, and we continued to build the foundations for expansion into adjacent markets," said Mike Fister, president and CEO of Cadence.

"The first quarter was characterized by continued consistent execution against our objectives to demonstrate growth and achieve our operating targets," added Bill Porter, executive vice president and chief financial officer.

The following statements are based on current expectations. These statements are forward looking, and actual results may differ materially. These statements do not include the impact of any mergers, acquisitions or other business combinations completed after Mar. 31, 2007.

Click here for the Q1 2007 Financial Schedules

Business Outlook

For the second quarter of 2007, the company expects total revenue in the range of $375 million to $385 million. Second quarter GAAP earnings per diluted share are expected to be in the range of $0.17 to $0.19. Diluted earnings per share using the non-GAAP measure defined below are expected to be in the range of $0.28 to $0.30.

For the full year 2007, the company expects total revenue in the range of $1.580 billion to $1.630 billion. On a GAAP basis, net income per diluted share for fiscal 2007 is expected to be in the range of $0.84 to $0.92. Using the non-GAAP measure defined below, diluted earnings per share for fiscal 2007 are expected to be in the range of $1.27 to $1.35.

A schedule showing a reconciliation of the business outlook from GAAP net income and diluted net income per share to the non-GAAP net income and diluted net income per share is included with this release.

Audio Webcast Scheduled

Fister and Porter will host a first quarter 2007 financial results audio webcast today, Apr. 25, 2007, at 2 p.m. (Pacific) / 5 p.m. (Eastern). An archive of the webcast will be available starting Apr. 25, 2007, at 5 p.m. Pacific time and ending at 5 p.m. Pacific time on May 2, 2007. Webcast access is available at http://www.cadence.com/company/investor_relations .

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