Cadence Reports Q3 2009 Financial Results

2nd November 2009

ES Admin

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Cadence reported third quarter 2009 revenue of $216 million, compared to revenue of $232 million reported for the same period in 2008. On a GAAP basis, Cadence recognized a net loss of $14 million, or $(0.05) per share on a diluted basis, in the third quarter of 2009, compared to a net loss of $171 million, or $(0.67) per share on a diluted basis in the same period in 2008.

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 or net loss, which excludes, as applicable, amortization of intangible assets, stock-based compensation expense, in-process research and development charges, costs related to a withdrawn acquisition proposal and losses on the sale of shares of the target company stock, integration and acquisition-related costs, gains or losses and expenses or credits related to non-qualified deferred compensation plan assets, executive severance costs, restructuring charges and credits, amortization of discount on convertible notes, equity in losses (income) from investments, write-down of investments, impairment charges related to goodwill, intangible assets and fixed assets, and losses related to the liquidation of a subsidiary. Non-GAAP net income or net loss 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 third quarter of 2009 was $7 million, or $0.03 per share on a diluted basis, as compared to a net loss of $23 million, or $(0.09) per share on a diluted basis, in the same period in 2008.

The increased level of R&D engagement with customers is well received, and we are winning with technologies that address our customers' need for better design productivity, increased predictability of schedule and results, and faster time-to-market, said Lip-Bu Tan, president and chief executive officer.

Added Kevin S. Palatnik, senior vice president and chief financial officer, Third quarter results represent strong operational execution by the Cadence team. Sequential revenue growth met expectations, operating profitability improved significantly and we ended the quarter with more than $570 million in cash.