Chip design software maker Cadence forecasts annual profit below estimate, shares down

(Reuters) – Cadence Design Systems predicts its annual income and profit under the calculations of analysts, on the soft demand of its chip design software, as customers tighten their costs in a difficult economy.

San Jose, the shares of the California company were extended by 5% expanded trade.

The company, which counts British Chip Designer Arm Holdings, NVIDIA and electric vehicle, teacher among its customers, making software from chips to plane engines. It also sells computing systems designed to launch this complex software.

Analysts in Beriberg said the requirement and customer budgets would weaken the design and analysis of the CADENCE system throughout 2025 due to the decline in industry in the automobile market.

China is the material part of cadence business. Further restrictions from the US government on the sale of semiconductor technologies can significantly reduce its business from the country in January.

The market share of Cadence in a highly concentrated industry threatens the proposed “Engineering Software” Ansys in a $ 35 billion cash transaction by competing Synopsis.

The company expects $ 5.14 billion to $ 5.14 billion and $ 5.22 billion, compared to the average assessment of $ 5.25 billion analysts according to LSEG.

Cadence predicts its annual profit, except for items in $ 6.65 for one share, as well as less than $ 6.83.

During the quarter that ended on December 31, its income amounted to $ 1.36 billion, increased by 26.8% compared to the previous year.

In the fourth quarter, the company is excluded $ 1.88 per share with estimating $ 1.82.

(Reports by Juby Babu in Mexico; Editing Shilpi Majumdar)