Cadence expects that its corporate representatives will meet privately during the quarter with investors, the media, investment analysts and others. At these meetings, Cadence may reiterate the business outlook published in this press release. At the same time, Cadence will keep this press release, including the business outlook, publicly available on its website.

Prior to the start of the Quiet Period (described below), the public may continue to rely on the business outlook contained herein as still being Cadence’s current expectations on matters covered unless Cadence publishes a notice stating otherwise.

Beginning June 18, 2021, Cadence will observe a Quiet Period during which the business outlook as provided in this press release and the most recent Annual Report on Form 10-K and Quarterly Report on Form 10-Q no longer constitute Cadence’s current expectations. During the Quiet Period, the business outlook in these documents should be considered historical, speaking as of prior to the Quiet Period only and not subject to any update by Cadence. During the Quiet Period, Cadence’s representatives will not comment on Cadence’s business outlook, financial results or expectations. The Quiet Period will extend until Cadence’s second quarter 2021 earnings release is published, which is currently scheduled for July 26, 2021.

Cadence Design Systems, Inc.
Condensed Consolidated Balance Sheets
April 3, 2021 and January 2, 2021
(In thousands)
(Unaudited)
		April 3, 2021			January 2, 2021
Current assets:
Cash and cash equivalents		$	742,981		$	928,432
Receivables, net			388,666			338,487
Inventories			76,592			75,956
Prepaid expenses and other			141,490			135,712
Total current assets			1,349,729			1,478,587
Property, plant and equipment, net			305,089			311,125
Goodwill			912,603			782,087
Acquired intangibles, net			264,671			210,590
Deferred taxes			729,296			732,290
Other assets			437,571			436,106
Total assets		$	3,998,959		$	3,950,785
Current liabilities:
Accounts payable and accrued liabilities		$	271,241		$	349,951
Current portion of deferred revenue			521,100			446,857
Total current liabilities			792,341			796,808
Long-term liabilities:
Long-term portion of deferred revenue			92,574			107,064
Long-term debt			346,988			346,793
Other long-term liabilities			224,624			207,102
Total long-term liabilities			664,186			660,959
Stockholders' equity			2,542,432			2,493,018
Total liabilities and stockholders' equity		$	3,998,959		$	3,950,785

Cadence Design Systems, Inc.
Condensed Consolidated Income Statements
For the Three Months Ended April 3, 2021 and March 28, 2020
(In thousands, except per share amounts)
(Unaudited)
		Three Months Ended
		April 3, 2021				March 28, 2020
Revenue:
Product and maintenance		$	699,054			$	581,699
Services			36,974				36,258
Total revenue			736,028				617,957
Costs and expenses:
Cost of product and maintenance			64,906				55,446
Cost of services			19,061				19,017
Marketing and sales			132,826				125,744
Research and development			270,992				241,668
General and administrative			39,952				33,592
Amortization of acquired intangibles			4,631				4,206
Restructuring and other credits			(277	)			(1,067	)
Total costs and expenses			532,091				478,606
Income from operations			203,937				139,351
Interest expense			(4,217	)			(4,637	)
Other income (expense), net			2,701				(4,534	)
Income before provision for income taxes			202,421				130,180
Provision for income taxes			15,252				6,192
Net income		$	187,169			$	123,988
Net income per share - basic		$	0.68			$	0.45
Net income per share - diluted		$	0.67			$	0.44
Weighted average common shares outstanding - basic			274,021				273,476
Weighted average common shares outstanding - diluted			280,140				279,265

Cadence Design Systems, Inc.
Condensed Consolidated Statements of Cash Flows
For the Three Months Ended April 3, 2021 and March 28, 2020
(In thousands)
(Unaudited)
		Three Months Ended
		April 3,				March 28,
		2021				2020
Cash and cash equivalents at beginning of period		$	928,432			$	705,210
Cash flows from operating activities:
Net income			187,169				123,988
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization			36,218				33,321
Amortization of debt discount and fees			264				254
Stock-based compensation			52,596				46,482
(Gain) loss on investments, net			(1,433	)			3,215
Deferred income taxes			2,710				3,904
Provisions for losses (recoveries) on receivables			77				(77	)
ROU asset amortization and change in operating lease liabilities			(2,136	)			706
Other non-cash items			302				183
Changes in operating assets and liabilities, net of effect of acquired businesses:
Receivables			(45,927	)			26,475
Inventories			(669	)			(5,260	)
Prepaid expenses and other			(3,014	)			(4,964	)
Other assets			6,260				(8,344	)
Accounts payable and accrued liabilities			(80,769	)			(84,839	)
Deferred revenue			59,166				86,914
Other long-term liabilities			(2,372	)			(4,239	)
Net cash provided by operating activities			208,442				217,719
Cash flows from investing activities:
Purchases of property, plant and equipment			(16,968	)			(22,179	)
Cash paid in business combinations, net of cash acquired			(189,262	)			(193,820	)
Net cash used for investing activities			(206,230	)			(215,999	)
Cash flows from financing activities:
Proceeds from revolving credit facility			-				350,000
Proceeds from issuance of common stock			46,384				33,312
Stock received for payment of employee taxes on vesting of restricted stock			(56,385	)			(37,528	)
Payments for repurchases of common stock			(172,267	)			(100,022	)
Net cash provided by (used for) financing activities			(182,268	)			245,762
Effect of exchange rate changes on cash and cash equivalents			(5,395	)			(6,407	)
Increase (decrease) in cash and cash equivalents			(185,451	)			241,075
Cash and cash equivalents at end of period		$	742,981			$	946,285

Cadence Design Systems, Inc.
(Unaudited)
Revenue Mix by Geography (% of Total Revenue)
		2020										2021
GEOGRAPHY		Q1		Q2		Q3		Q4		Year		Q1
Americas		43%		44%		42%		41%		42%		46%
China		13%		12%		17%		17%		15%		12%
Other Asia		18%		19%		19%		18%		18%		18%
Europe, Middle East and Africa		19%		18%		16%		17%		18%		18%
Japan		7%		7%		6%		7%		7%		6%
Total		100%		100%		100%		100%		100%		100%
Revenue Mix by Product Category (% of Total Revenue)
		2020										2021
PRODUCT CATEGORY		Q1		Q2		Q3		Q4		Year		Q1
Custom IC Design and Simulation		25%		24%		24%		26%		25%		23%
Digital IC Design and Signoff		29%		28%		27%		31%		29%		27%
Functional Verification, including Emulation and Prototyping Hardware		23%		24%		23%		19%		22%		26%
IP		14%		14%		15%		13%		14%		14%
System Design and Analysis		9%		10%		11%		11%		10%		10%
Total		100%		100%		100%		100%		100%		100%

Cadence Design Systems, Inc.
Impact of Non-GAAP Adjustments on Forward Looking Operating Margin
As of April 26, 2021
(Unaudited)
		Three Months Ending		Year Ending
		July 3, 2021		January 1, 2022
		Forecast		Forecast
GAAP operating margin as a percent of total revenue		~22%		23% - 24%
Reconciling items to non-GAAP operating margin as a percent of total revenue:
Stock-based compensation expense		7%		8%
Amortization of acquired intangibles		2%		2%
Acquisition and integration-related costs		1%		1%
Restructuring and other charges (credits)		0%		0%
Non-qualified deferred compensation expenses		0%		0%
Special charges*		4%		1%
Non-GAAP operating margin as a percent of total revenue�nbsp;		~36%		35% - 36%

�nbsp;		The non-GAAP measures presented in the table above should not be considered a substitute for financial results and measures determined or calculated in accordance with GAAP.
*		Comprised of costs related to a voluntary retirement program.

Cadence Design Systems, Inc.
Impact of Non-GAAP Adjustments on Forward Looking Diluted Net Income Per Share
As of April 26, 2021
(Unaudited)
		Three Months Ending		Year Ending
		July 3, 2021		January 1, 2022
		Forecast		Forecast
Diluted net income per share on a GAAP basis		$0.44 to $0.48		$2.01 to $2.09
Stock-based compensation expense		0.19		0.79
Amortization of acquired intangibles		0.06		0.24
Acquisition and integration-related costs		0.02		0.08
Non-qualified deferred compensation expenses		-		0.01
Special charges*		0.09		0.09
Other income or expense related to investments and non-qualified deferred compensation plan assets**		-		(0.01)
Income tax effect of non-GAAP adjustments		(0.06)		(0.22)
Diluted net income per share on a non-GAAP basis�nbsp;		$0.74 to $0.78		$2.99 to $3.07
Cadence Design Systems, Inc.
Impact of Non-GAAP Adjustments on Forward Looking Net Income
As of April 26, 2021
(Unaudited)
		Three Months Ending		Year Ending
		July 3, 2021		January 1, 2022
($ in millions)		Forecast		Forecast
Net income on a GAAP basis		$122 to $133		$563 to $586
Stock-based compensation expense		53		222
Amortization of acquired intangibles		17		67
Acquisition and integration-related costs		6		21
Non-qualified deferred compensation expenses		-		2
Special charges*		26		26
Other income or expense related to investments and non-qualified deferred compensation plan assets**		-		(3)
Income tax effect of non-GAAP adjustments		(17)		(60)
Net income on a non-GAAP basis�nbsp;		$207 to $218		$838 to $861

�nbsp;		The non-GAAP measures presented in the table above should not be considered a substitute for financial results and measures determined or calculated in accordance with GAAP.
*		Comprised of costs related to a voluntary retirement program.
**		Includes, as applicable, equity in losses or income from investments, write-down of investments, gains or losses on investments and gains or losses on non-qualified deferred compensation plan assets recorded in other income or expense.

« Previous Page 1 | 2 | 3 | 4  Next Page »