(Reuters) -Cadence Design Systems raised its forecasts for annual revenue and profit on Monday, betting on resilient demand for its chip design software from semiconductor makers looking to boost production to capitalize on the AI boom.
Elevated demand for speedy and complex artificial intelligence processors has benefited the company, which provides software for designing chips and computing systems that help run that complex programs.
AI processor leader Nvidia and iPhone maker Apple are among Cadence’s customers.
Cadence now expects 2025 revenue in the range of $5.15 billion to $5.23 billion. This is up from its prior forecast of $5.14 billion to $5.22 billion. Analysts on average were expecting $5.19 billion, according to data compiled by LSEG
“We haven’t seen any change in customers’ behavior at this time, as they continue investing in R&D for their next-gen designs,” CEO Anirudh Devgan said in a statement.
The company raised its forecast for annual adjusted profit per share to a range of $6.73 to $6.83, up from its prior forecast of between $6.65 and $6.75.
However, its shares fell more than 1% in extended trading, with the Sino-U.S. trade war hurting revenue from its key market.
Sales to China accounted for about 11% of total revenue in the first quarter, down from 12% in the year-ago period.
Revenue from China has fallen as a contributor to total sales over the last few years, primarily due to a decrease in sales of its hardware and IP offerings, the company had said in its annual filing.
Cadence’s revenue being more heavily dependent on research and development spending could also cushion it against the impact of the global trade uncertainty stemming from tariffs.
The company reported first-quarter revenue of $1.24 billion, in line with estimates, while adjusted profit of $1.57 per share beat estimates of $1.49.
(Reporting by Arsheeya Bajwa in Bengaluru and Stephen Nellis in San Francisco; Editing by Sriraj Kalluvila)
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