Document and Entity Information
Document and Entity Information | 3 Months Ended |
Mar. 31, 2018shares | |
Document and Entity Information [Abstract] | |
Entity Registrant Name | CADENCE DESIGN SYSTEMS INC |
Entity Central Index Key | 813,672 |
Document Type | 10-Q |
Document Period End Date | Mar. 31, 2018 |
Amendment Flag | false |
Document Fiscal Year Focus | 2,018 |
Document Fiscal Period Focus | Q1 |
Current Fiscal Year End Date | --12-29 |
Entity Filer Category | Large Accelerated Filer |
Entity Common Stock, Shares Outstanding | 281,906,000 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 30, 2017 |
Current Assets: | ||
Cash and cash equivalents | $ 746,968 | $ 688,087 |
Short-term investments | 5,466 | 4,455 |
Receivables, net | 225,822 | 190,426 |
Inventories | 30,090 | 33,209 |
Prepaid expenses and other | 61,597 | 63,811 |
Total current assets | 1,069,943 | 979,988 |
Property, plant and equipment, net of accumulated depreciation of $673,265 and $658,377, respectively | 249,810 | 251,342 |
Goodwill | 665,615 | 666,009 |
Acquired intangibles, net | 264,927 | 278,835 |
Long-term receivables | 9,380 | 12,239 |
Other assets | 226,998 | 230,301 |
Total assets | 2,486,673 | 2,418,714 |
Current Liabilities: | ||
Revolving credit facility | 45,000 | 85,000 |
Current portion of long-term debt | 299,826 | 0 |
Accounts payable and accrued liabilities | 210,784 | 221,101 |
Current portion of deferred revenue | 310,639 | 336,297 |
Total current liabilities | 866,249 | 642,398 |
Long-Term Liabilities: | ||
Long-term portion of deferred revenue | 56,276 | 61,513 |
Long-term debt | 344,766 | 644,369 |
Other long-term liabilities | 77,084 | 81,232 |
Total long-term liabilities | 478,126 | 787,114 |
Commitments and contingencies | ||
Stockholders' Equity: | ||
Common stock and capital in excess of par value | 1,858,692 | 1,829,950 |
Treasury stock, at cost | (1,222,151) | (1,178,121) |
Retained earnings | 499,817 | 341,003 |
Accumulated other comprehensive income (loss) | 5,940 | (3,630) |
Total stockholders’ equity | 1,142,298 | 989,202 |
Total liabilities and stockholders’ equity | $ 2,486,673 | $ 2,418,714 |
Condensed Consolidated Balance3
Condensed Consolidated Balance Sheets (Unaudited) (Parenthetical) - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 30, 2017 |
Statement of Financial Position [Abstract] | ||
Accumulated depreciation on property, plant and equipment | $ 673,265 | $ 658,377 |
Condensed Consolidated Income S
Condensed Consolidated Income Statements (Unaudited) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Apr. 01, 2017 | |
Revenue: | ||
Product and maintenance | $ 480,609 | $ 451,407 |
Services | 36,704 | 25,504 |
Total revenue | 517,313 | 476,911 |
Costs and Expenses: | ||
Cost of product and maintenance | 41,730 | 43,717 |
Cost of services | 21,479 | 18,075 |
Marketing and sales | 109,148 | 103,347 |
Research and development | 224,185 | 198,286 |
General and administrative | 33,299 | 31,816 |
Amortization of acquired intangibles | 3,630 | 3,856 |
Restructuring and other credits | (1,991) | (1,788) |
Total costs and expenses | 431,480 | 397,309 |
Income from operations | 85,833 | 79,602 |
Interest expense | (6,975) | (6,479) |
Other income (expense), net | (689) | 1,059 |
Income before provision for income taxes | 78,169 | 74,182 |
Provision for income taxes | 5,284 | 5,923 |
Net income | $ 72,885 | $ 68,259 |
Net income per share - basic (in usd per share) | $ 0.27 | $ 0.25 |
Net income per share - diluted (in usd per share) | $ 0.26 | $ 0.25 |
Weighted average common shares outstanding - basic (in shares) | 273,773 | 270,173 |
Weighted average common shares outstanding - diluted (in shares) | 281,651 | 277,736 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Comprehensive Income (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Apr. 01, 2017 | |
Statement of Comprehensive Income [Abstract] | ||
Net income | $ 72,885 | $ 68,259 |
Other comprehensive income, net of tax effects: | ||
Foreign currency translation adjustments | 12,058 | 2,389 |
Changes in unrealized holding gains or losses on available-for-sale securities, net of reclassification adjustment for realized gains and losses | 0 | 465 |
Changes in defined benefit plan liabilities | 150 | 30 |
Total other comprehensive income, net of tax effects | 12,208 | 2,884 |
Comprehensive income | $ 85,093 | $ 71,143 |
Condensed Consolidated Stateme6
Condensed Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Apr. 01, 2017 | |
Statement of Cash Flows [Abstract] | ||
Cash and cash equivalents at beginning of period | $ 688,087 | $ 465,232 |
Cash flows from operating activities: | ||
Net income | 72,885 | 68,259 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 29,389 | 28,894 |
Amortization of debt discount and fees | 292 | 350 |
Stock-based compensation | 37,901 | 27,436 |
Gain on investments, net | (1,123) | (1,228) |
Deferred income taxes | 1,363 | 1,990 |
Provisions for losses on receivables | 666 | 0 |
Other non-cash items | (43) | 1,359 |
Changes in operating assets and liabilities, net of effect of acquired businesses: | ||
Receivables | (10,988) | (22,475) |
Inventories | 2,105 | 6,000 |
Prepaid expenses and other | 8,392 | (3,777) |
Other assets | 8,152 | (3,657) |
Accounts payable and accrued liabilities | (46,956) | (46,159) |
Deferred revenue | 59,854 | 34,325 |
Other long-term liabilities | (4,242) | 1,113 |
Net cash provided by operating activities | 157,647 | 92,430 |
Cash flows from investing activities: | ||
Proceeds from the sale of available-for-sale securities | 0 | 107 |
Purchases of property, plant and equipment | (13,128) | (14,843) |
Net cash used for investing activities | (13,128) | (14,736) |
Cash flows from financing activities: | ||
Proceeds from revolving credit facility | 0 | 50,000 |
Payment on revolving credit facility | (40,000) | (50,000) |
Payment of debt issuance costs | 0 | (793) |
Proceeds from issuance of common stock | 23,339 | 22,715 |
Stock received for payment of employee taxes on vesting of restricted stock | (26,515) | (22,470) |
Payments for repurchases of common stock | (50,013) | 0 |
Change in book overdraft | (3,867) | 0 |
Net cash used for financing activities | (97,056) | (548) |
Effect of exchange rate changes on cash and cash equivalents | 11,418 | 1,750 |
Increase in cash and cash equivalents | 58,881 | 78,896 |
Cash and cash equivalents at end of period | 746,968 | 544,128 |
Supplemental cash flow information: | ||
Cash paid for interest | 2,716 | 2,219 |
Cash paid for taxes, net | $ 6,025 | $ 9,767 |
Basis of Presentation
Basis of Presentation | 3 Months Ended |
Mar. 31, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
BASIS OF PRESENTATION | BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Basis of Presentation The condensed consolidated financial statements included in this Quarterly Report on Form 10-Q have been prepared by Cadence Design Systems, Inc. (“Cadence”) without audit, pursuant to the rules and regulations of the United States Securities and Exchange Commission (the “SEC”). Certain information and footnote disclosures normally included in consolidated financial statements prepared in accordance with United States generally accepted accounting principles (“U.S. GAAP”) have been condensed or omitted pursuant to such rules and regulations. However, Cadence believes that the disclosures contained in this Quarterly Report on Form 10-Q comply with the requirements of Section 13(a) of the Securities Exchange Act of 1934, as amended, (the “Exchange Act”) for a Quarterly Report on Form 10-Q and are adequate to make the information presented not misleading. These condensed consolidated financial statements are meant to be, and should be, read in conjunction with the consolidated financial statements and the Notes thereto included in Cadence’s Annual Report on Form 10-K for the fiscal year ended December 30, 2017 . The unaudited condensed consolidated financial statements included in this Quarterly Report on Form 10-Q reflect all adjustments (which include only normal, recurring adjustments and those items discussed in these Notes) that are, in the opinion of management, necessary to state fairly the results of operations, cash flows and financial position for the periods and dates presented. The results for such periods are not necessarily indicative of the results to be expected for the full fiscal year. Management has evaluated subsequent events through the issuance date of the unaudited condensed consolidated financial statements. Use of Estimates Preparation of the condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. Comparability Effective on the first day of fiscal 2018, Cadence adopted multiple new accounting standards. Prior periods were not retrospectively restated, so the consolidated balance sheet as of December 30, 2017 and results of operations for the three months ended April 1, 2017 were prepared using accounting standards that were different than those in effect for the three months ended March 31, 2018 . Therefore, the consolidated balance sheets as of March 31, 2018 and December 30, 2017 are not directly comparable, nor are the results of operations for the three months ended March 31, 2018 and April 1, 2017 . Recently Adopted Accounting Standards Revenue from Contracts with Customers In May 2014, the Financial Accounting Standards Board (“FASB”) issued ASU 2014-09, “Revenue from Contracts with Customers (Topic 606),” which supersedes the revenue recognition requirements in “Revenue Recognition (Topic 605)” and Subtopic 985-605 “Software - Revenue Recognition.” Topic 605 and Subtopic 985-605 are collectively referred to as “Topic 605” or “prior GAAP.” Under Topic 606, revenue is recognized when a customer obtains control of promised goods or services in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. In addition, Topic 606 requires enhanced disclosures, including disclosure of the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. The FASB issued several amendments to the standard, including updates on accounting for licenses of intellectual property (“IP”) and identifying performance obligations. Cadence adopted Topic 606 on the first day of fiscal 2018 using the modified retrospective transition method. Under this method, Cadence evaluated contracts that were in effect at the beginning of fiscal 2018 as if those contracts had been accounted for under Topic 606. Cadence did not evaluate individual modifications for those periods prior to the adoption date, but the aggregate effect of all modifications as of the adoption date and such effects are provided below. Under the modified retrospective transition approach, periods prior to the adoption date were not adjusted and continue to be reported in accordance with historical, pre-Topic 606 accounting. A cumulative catch up adjustment was recorded to beginning retained earnings to reflect the impact of all existing arrangements under Topic 606. The most significant impacts of the adoption of Topic 606 are as follows: • At the adoption date, Cadence increased retained earnings by $85.4 million for uncompleted contracts for which revenue will not be recognized in future periods under Topic 606. This revenue would otherwise have been recognized in prior periods, so the beginning balance of receivables increased by $47.3 million , contract assets were established at $4.0 million , deferred revenue decreased by $57.4 million and accrued liabilities increased by $23.3 million ; • Revenue generated under Topic 606 is expected to be slightly lower than revenue would have been under Topic 605 in fiscal 2018. This is the result of a combination of factors, including the elimination of deferred revenue that, under Topic 605, would have continued to be recognized into revenue in 2018 and beyond, as well as changes in the timing of revenue recognition as discussed below. The actual effects on revenue recognized for the first quarter of fiscal 2018 are reported in the table below; and • Cadence capitalized $27.3 million of incremental sales commission costs at the adoption date directly related to obtaining customer contracts and is amortizing these costs over the life of the contract. Cadence will continue to recognize revenue over time for its time-based software arrangements, which generate a majority of total revenue. However, the reason for the similar accounting treatment is different under Topic 606 than under Topic 605. Under Topic 605, Cadence could not establish vendor specific objective evidence (“VSOE”) for its undelivered elements and therefore was not able to separate its delivered software licenses from those undelivered elements, such as technical support and unspecified (when-and-if available) update rights. Topic 606 no longer requires separability of promised goods or services, such as software licenses, technical support, or unspecified update rights on the basis of VSOE. Rather, Topic 606 requires Cadence to identify the performance obligations in the contract — that is, those promised goods and services (or bundles of promised goods or services) that are distinct — and allocate the transaction price of the contract to those performance obligations on the basis of stand-alone selling prices (“SSPs”). The transaction price allocated to each performance obligation is then recognized either at a point in time or over time using an appropriate measure of progress. Under Topic 606, Cadence has concluded that its software licenses in time-based arrangements are not distinct from each other, or from its obligation to provide unspecified software updates to the licensed software throughout the license term, because the multiple software licenses represent inputs to a single, combined offering, and timely, relevant software updates are integral to maintaining the utility of the software licenses. Cadence will recognize revenue for the combined performance obligation, which also includes the co-terminus technical support provided to the customer, ratably over the term of the arrangement. In contrast to the similar accounting result for time-based software arrangements, revenue related to certain IP licenses will now be recognized upon delivery under Topic 606, as opposed to over time under Topic 605, because the requirement to have VSOE for undelivered elements under current accounting standards is eliminated under Topic 606. Certain perpetual software licenses will now be recognized over time under Topic 606, as opposed to upon delivery under Topic 605, because these software licenses and the when-and-if available updates provided to the customer are accounted for together as one performance obligation and recognized over time. The timing of revenue recognition for hardware and professional services is expected to remain substantially unchanged. Cadence’s overall mix of revenue recognized at a point in time versus over time is expected to remain relatively constant, with approximately 90% recognizable over time. The following table summarizes the effects of adopting Topic 606 on Cadence’s condensed consolidated balance sheet as of March 31, 2018 : As reported under Topic 606 Adjustments Balances under Prior GAAP (In thousands) Receivables, net $ 225,822 $ (18,538 ) $ 207,284 Prepaid expenses and other 61,597 (5,255 ) 56,342 Long-term receivables 9,380 569 9,949 Other assets 226,998 (11,947 ) 215,051 Accounts payable and accrued liabilities* 210,784 (40,357 ) 170,427 Current portion of deferred revenue 310,639 78,462 389,101 Long-term portion of deferred revenue 56,276 4,275 60,551 Retained earnings 499,817 (79,876 ) 419,941 Accumulated other comprehensive income 5,940 2,325 8,265 _____________ * Cadence has certain arrangements under which consideration is received from customers prior to identifying the specific goods or services to be delivered under the contract. Cadence records an accrued liability on a contract-by-contract basis at the end of each reporting period for cash consideration received. The following table summarizes the effects of adopting Topic 606 on Cadence’s condensed consolidated income statement for the three months ended March 31, 2018 : As reported under Topic 606 Adjustments Balances under Prior GAAP (In thousands, except per share amounts) Product and maintenance revenue $ 480,609 $ 6,180 $ 486,789 Services revenue 36,704 1,964 38,668 Cost of product and maintenance 41,730 (251 ) 41,479 Marketing and sales expense 109,148 (2,810 ) 106,338 Provision for income taxes 5,284 557 5,841 Net income 72,885 10,648 83,533 Net income per share - basic 0.27 0.04 0.31 Net income per share - diluted 0.26 0.04 0.30 Cadence’s net cash provided by operating activities for the three months ended March 31, 2018 did not change due to the adoption of Topic 606. The following table summarizes the effects of adopting Topic 606 on the financial statement line items of Cadence’s condensed consolidated statement of cash flows for the three months ended March 31, 2018 : As reported under Topic 606 Adjustments Balances under Prior GAAP (In thousands) Net income $ 72,885 $ 10,648 $ 83,533 Changes in operating assets and liabilities: Receivables (10,988 ) (25,638 ) (36,626 ) Prepaid expenses and other 8,392 2,026 10,418 Other assets 8,152 (1,742 ) 6,410 Accounts payable and accrued liabilities (46,956 ) (11,641 ) (58,597 ) Deferred revenue 59,854 26,347 86,201 Financial Instruments In January 2016, the FASB issued ASU 2016-01, “Financial Instruments—Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities.” Cadence adopted this standard on the first day of fiscal 2018, modifying its accounting and required disclosures for investments in equity securities, other than those accounted for using the equity method of accounting. Cadence’s marketable investments in equity securities consist of investments in a publicly-held company and are presented as short-term investments in the condensed consolidated balance sheets. Prior to the adoption of the updated standard, these investments were classified as available-for-sale, and changes in the fair value of these investments were reported in accumulated other comprehensive income (loss) in the condensed consolidated balance sheets. The new standard eliminated the available-for-sale classification for equity securities and requires changes in the fair value of these investments to be recognized through net income for the three months ended March 31, 2018 and each subsequent reporting period. Upon adoption, Cadence recorded a cumulative-effect adjustment to increase retained earnings in the amount of $2.6 million related to unrealized holding gains previously recorded in accumulated other comprehensive income (loss). In addition, Cadence recorded a gain of $1.0 million to other income (expense) in the condensed consolidated income statements for changes in the fair value of investments in marketable equity securities during the three months ended March 31, 2018 . Cadence’s non-marketable investments in equity securities consist of investments in privately-held companies and are presented as other assets in the condensed consolidated balance sheets. Prior to the adoption of the updated standard, non-marketable investments that were not accounted for using the equity method of accounting were recorded at cost, less impairment. The new standard eliminated the cost method of accounting for investments in equity securities that do not have readily determinable fair values and permits the election of a measurement alternative that allows such securities to be recorded at cost, less impairment, if any, plus or minus changes resulting from observable price changes in market-based transactions for an identical or similar investment of the same issuer. Cadence adopted the provisions of the new standard applicable to its investments in equity securities without a readily determinable fair value on a prospective basis and elected the measurement alternative for non-marketable investments previously accounted for under the cost method of accounting. Gains and losses resulting from observable price changes or impairment will be recorded through net income in the period incurred. Cadence’s non-marketable investments had a carrying value of $3.0 million as of March 31, 2018 and December 30, 2017 . During the three months ended March 31, 2018 , there were no observable price changes or impairments related to Cadence’s non-marketable investments in equity securities. Income Tax In October 2016, the FASB issued ASU 2016-16, “Income taxes (Topic 740): Intra-entity Transfers of Assets Other Than Inventory.” The new guidance requires the recognition of the income tax consequences of an intra-entity asset transfer when the transfer occurs rather than when the asset has been sold to a third party. For intra-entity transfers of inventory, the income tax effects will continue to be deferred until the inventory has been sold to a third party. Cadence adopted the new standard on the first day of fiscal 2018 using the modified retrospective transition approach and recorded a cumulative-effect adjustment to decrease retained earnings in the amount of $8.3 million . The cumulative-effect adjustment includes the write-off of income tax consequences deferred from prior intra-entity transfers involving assets other than inventory and new deferred tax assets for amounts not recognized under U.S. GAAP. We anticipate the potential for increased volatility in future effective tax rates from the adoption of this guidance. Stock-based Compensation In May 2017, the FASB issued ASU 2017-09, “Compensation—Stock Compensation (Topic 718): Scope of Modification Accounting,” that provides guidance about which changes to the terms or conditions of a share-based payment award require an entity to apply modification accounting. Cadence adopted the standard on the first day of fiscal 2018. The adoption of this standard did not impact Cadence’s condensed consolidated financial statements or the related disclosures. Retained Earnings The following table presents the cumulative effect adjustments, net of income tax effects, to beginning retained earnings for new accounting standards adopted by Cadence on the first day of fiscal 2018: Retained Earnings (In thousands) Balance, December 30, 2017, as previously reported $ 341,003 Cumulative effect adjustment from the adoption of new accounting standards: Revenue from Contracts with Customers (Topic 606) 91,640 Financial Instruments—Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities 2,638 Income taxes (Topic 740): Intra-entity Transfers of Assets Other Than Inventory (8,349 ) Balance, December 30, 2017, as adjusted 426,932 Net Income 72,885 Balance, March 31, 2018 $ 499,817 |
Debt
Debt | 3 Months Ended |
Mar. 31, 2018 | |
Debt Disclosure [Abstract] | |
DEBT | DEBT Cadence’s outstanding debt as of March 31, 2018 and December 30, 2017 was as follows: March 31, 2018 December 30, 2017 (In thousands) Principal Unamortized Discount Carrying Value Principal Unamortized Discount Carrying Value Revolving Credit Facility $ 45,000 $ — $ 45,000 $ 85,000 $ — $ 85,000 2019 Term Loan 300,000 (174 ) 299,826 300,000 (226 ) 299,774 2024 Notes 350,000 (5,234 ) 344,766 350,000 (5,405 ) 344,595 Total outstanding debt $ 695,000 $ (5,408 ) $ 689,592 $ 735,000 $ (5,631 ) $ 729,369 Revolving Credit Facility On January 30, 2017, Cadence entered into a five-year senior unsecured revolving credit facility with a group of lenders led by JPMorgan Chase Bank, N.A., as administrative agent, which replaced Cadence’s existing revolving credit facility. The credit facility provides for borrowings up to $350.0 million , with the right to request increased capacity up to an additional $250.0 million upon the receipt of lender commitments, for total maximum borrowings of $600.0 million . The credit facility expires on January 28, 2022 and has no subsidiary guarantors. Any outstanding loans drawn under the credit facility are due at maturity on January 28, 2022 . Outstanding borrowings may be paid at any time prior to maturity. Interest accrues on borrowings under the credit facility at either LIBOR plus a margin between 1.25% and 1.875% per annum or at the base rate plus a margin between 0.25% and 0.875% per annum. As of March 31, 2018 , the interest rate on Cadence’s credit facility was 2.85% . Interest is payable quarterly. A commitment fee ranging from 0.15% to 0.30% is assessed on the daily average undrawn portion of revolving commitments. The credit facility contains customary negative covenants that, among other things, restrict Cadence’s ability to incur additional indebtedness, grant liens, make certain investments (including acquisitions), dispose of certain assets and make certain payments, including share repurchases and dividends. In addition, the credit facility contains financial covenants that require Cadence to maintain a funded debt to EBITDA ratio not greater than 3.00 to 1, with a step up to 3.50 to 1 for one year following an acquisition by Cadence of at least $250.0 million that results in a pro forma leverage ratio between 2.75 to 1 and 3.25 to 1. As of March 31, 2018 , Cadence was in compliance with all financial covenants associated with the revolving credit facility. 2019 Term Loan In January 2016, Cadence entered into a $300.0 million three -year senior unsecured non-amortizing term loan facility due on January 28, 2019 (the “2019 Term Loan”) with a group of lenders led by JPMorgan Chase Bank, N.A., as administrative agent. In January 2017, Cadence amended the agreement for its 2019 Term Loan. The amendment modified the 2019 Term Loan covenants to make them consistent with the covenants in the revolving credit facility. The other material terms of the 2019 Term Loan remain unchanged. Amounts outstanding under the 2019 Term Loan initially accrue interest at a rate equal to LIBOR plus a margin of 1.125% per annum, which may increase to a rate equal to LIBOR plus a margin of up to 1.875% per annum, depending on Cadence’s leverage ratio. As of March 31, 2018 , the interest rate on Cadence’s 2019 Term Loan was 2.80% . The 2019 Term Loan contains customary negative covenants that, among other things, restrict Cadence’s ability to incur additional indebtedness, grant liens, make certain investments (including acquisitions), dispose of certain assets and make certain payments, including share repurchases and dividends. In addition, the term loan agreement contains certain financial covenants that require Cadence to maintain a funded debt to EBITDA ratio not greater than 3.00 to 1 , with a step-up to 3.50 to 1 for one year following an acquisition by Cadence of at least $250.0 million that results in a pro forma leverage ratio between 2.75 to 1 and 3.25 to 1 . As of March 31, 2018 , Cadence was in compliance with all financial covenants associated with the 2019 Term Loan. 2024 Notes In October 2014, Cadence issued $350.0 million aggregate principal amount of 4.375% Senior Notes due October 15, 2024 (the “2024 Notes”). Cadence received net proceeds of $342.4 million from the issuance of the 2024 Notes, net of a discount of $1.4 million and issuance costs of $6.2 million . Both the discount and issuance costs are being amortized to interest expense over the term of the 2024 Notes using the effective interest method. Interest is payable in cash semi-annually in April and October. The 2024 Notes are unsecured and rank equal in right of payment to all of Cadence’s existing and future senior indebtedness. Cadence may redeem the 2024 Notes, in whole or in part, at a redemption price equal to the greater of (a) 100% of the principal amount of the notes to be redeemed and (b) the sum of the present values of the remaining scheduled payments of principal and interest, plus any accrued and unpaid interest, as more particularly described in the indenture governing the 2024 Notes. The indenture governing the 2024 Notes includes customary representations, warranties and restrictive covenants, including, but not limited to, restrictions on Cadence’s ability to grant liens on assets, enter into sale and lease-back transactions, or merge, consolidate or sell assets, and also includes customary events of default. As of March 31, 2018 , Cadence was in compliance with all financial covenants associated with the 2024 Notes. |
Cash, Cash Equivalents and Inve
Cash, Cash Equivalents and Investments | 3 Months Ended |
Mar. 31, 2018 | |
Cash, Cash Equivalents and Investments [Abstract] | |
CASH, CASH EQUIVALENTS AND INVESTMENTS | CASH, CASH EQUIVALENTS AND INVESTMENTS Cadence’s cash, cash equivalents and short-term investments at fair value as of March 31, 2018 and December 30, 2017 were as follows: As of March 31, December 30, (In thousands) Cash and cash equivalents $ 746,968 $ 688,087 Short-term investments 5,466 4,455 Cash, cash equivalents and short-term investments $ 752,434 $ 692,542 Cash and Cash Equivalents Cadence considers all highly liquid investments with original maturities of three months or less on the date of purchase to be cash equivalents. The amortized cost of Cadence’s cash equivalents approximates fair value. The following table summarizes Cadence’s cash and cash equivalents at fair value as of March 31, 2018 and December 30, 2017 : As of March 31, December 30, (In thousands) Cash and interest bearing deposits $ 302,401 $ 184,153 Money market funds 444,567 503,934 Total cash and cash equivalents $ 746,968 $ 688,087 Short-Term Investments Cadence’s short-term investments are comprised of marketable equity securities of publicly-held entities. During the three months ended March 31, 2018 , Cadence recorded a gain of $1.0 million to other income (expense) in the condensed consolidated income statements from its investments in marketable equity securities held as of March 31, 2018 . Cadence did not sell any marketable equity securities during the three months ended March 31, 2018 . |
Receivables, net
Receivables, net | 3 Months Ended |
Mar. 31, 2018 | |
Receivables [Abstract] | |
RECEIVABLES, NET | RECEIVABLES, NET Cadence’s current and long-term receivables balances as of March 31, 2018 and December 30, 2017 were as follows: As of March 31, December 30, (In thousands) Accounts receivable $ 117,065 $ 119,325 Unbilled accounts receivable 109,423 71,101 Long-term receivables 9,380 12,239 Total receivables 235,868 202,665 Less allowance for doubtful accounts (666 ) — Total receivables, net $ 235,202 $ 202,665 Cadence’s customers are primarily concentrated within the semiconductor and electronics systems industries. As of March 31, 2018 , no one customer accounted for 10% or more of Cadence’s total receivables. As of December 30, 2017 , one customer accounted for 17% of Cadence’s total receivables. |
Revenue
Revenue | 3 Months Ended |
Mar. 31, 2018 | |
Revenue from Contract with Customer [Abstract] | |
Revenue from Contract with Customer [Text Block] | REVENUE Revenue is recognized upon transfer of control of promised products or services to customers in an amount that reflects the consideration to which Cadence expects to be entitled in exchange for promised goods or services. Cadence’s performance obligations are satisfied either over time or at a point in time. Revenue from performance obligations that transferred to customers over time accounted for approximately 90% of Cadence’s total revenue for the three months ended March 31, 2018 . Product and maintenance revenue includes Cadence’s licenses of time-based and perpetual software, sales of emulation hardware, licenses of per-use IP, and the related maintenance on these licenses and sales. Service revenue includes revenue received for performing engineering services (which are generally not related to the functionality of other licensed products), customized IP on a fixed fee basis, and sales from cloud-based solutions that provide customers with software and services over a period of time. Cadence enters into contracts that can include various combinations of licenses, products and services, some of which are distinct and are accounted for as separate performance obligations. For contracts with multiple performance obligations, Cadence allocates the transaction price of the contract to each performance obligation, generally on a relative basis using its standalone selling price. The stated contract value is generally the transaction price to be allocated to the separate performance obligations. Revenue is recognized net of any taxes collected from customers that are subsequently remitted to governmental authorities. Nature of Products and Services Software Cadence’s time-based license arrangements grant customers the right to access and use all of the licensed products at the outset of an arrangement and updates are generally made available throughout the entire term of the arrangement, which is generally two to three years. Cadence’s updates provide continued access to evolving technology as customers’ designs migrate to more advanced nodes and as our customers’ technological requirements evolve. In addition, certain time-based license arrangements include remix rights and unspecified additional products that become commercially available during the term of the agreement. Payments are generally received in equal or near equal installments over the term of the agreement. As explained in Note 1, the multiple software licenses, related updates, and technical support in these time-based arrangements constitute a single, combined performance obligation and revenue is recognized over the term of the license, commencing upon the later of the effective date of the arrangement or transfer of the software license. Remix rights are not an additional promised good or service in the contract, and where unspecified additional software product rights are part of the contract with the customer, such rights are accounted for as part of the single performance obligation that includes the licenses, updates, and technical support because such rights are provided for the same period of time and have the same time-based pattern of transfer to the customer. Hardware Cadence generally has two performance obligations in arrangements involving the sale or lease of hardware products. The first performance obligation is to transfer the hardware product (which includes software integral to the functionality of the hardware product). The second performance obligation is to provide maintenance on hardware and its embedded software, which includes rights to technical support, hardware repairs and software updates that are all provided over the same term and have the same time-based pattern of transfer to the customer. Transaction price allocated to the hardware product is generally recognized as revenue at the time of delivery because the customer obtains control of the product at that point in time. Cadence has concluded that control generally transfers at that point in time because the customer has title to the hardware, physical possession, and a present obligation to pay for the hardware. Transaction price allocated to maintenance is recognized as revenue ratably over the maintenance term. Payments for hardware contracts are generally received upon delivery of the hardware product. IP Cadence generally licenses IP under nonexclusive license agreements that provide usage rights for specific designs. In addition, for certain of Cadence’s IP license agreements, royalties are collected as customers ship their own products that incorporate Cadence IP. These arrangements generally have two performance obligations — transferring the licensed IP and associated maintenance, which includes rights to technical support and software updates that are all provided over the maintenance term and have a time-based pattern of transfer to the customer. Revenue allocated to the IP license is recognized at a point in time upon the later of the delivery of the IP or the beginning of the license period and revenue allocated to the maintenance is recognized over the maintenance term. Royalties are recognized as revenue in the quarter in which the applicable Cadence customer ships its products that incorporate Cadence IP. Payments for IP contracts are generally received upon delivery of the IP. Cadence customizes certain IP and revenue related to this customization is recognized as “Services” below. Services Revenue from service contracts is recognized over time, generally using costs incurred or hours expended to measure progress. Cadence has a history of accurately estimating project status and the costs necessary to complete projects. A number of internal and external factors can affect these estimates, including labor rates, utilization and efficiency variances and specification and testing requirement changes. Payments for services are generally due upon milestones in the contract or upon consumption of the hourly resources. Cadence combines its products and technologies into five product groups related to major design activities. The following table shows the percentage of product and related maintenance revenue contributed by each of Cadence’s five product groups and services for the three months ended March 31, 2018 : Three Months Ended March 31, April 1, Functional Verification, including Emulation and Prototyping Hardware 26 % 23 % Digital IC Design and Signoff 30 % 29 % Custom IC Design 26 % 26 % System Interconnect and Analysis 9 % 10 % IP 9 % 12 % Total 100 % 100 % Revenue by product group fluctuates from period to period based on demand for products and services, and Cadence’s available resources to deliver them. Certain of Cadence’s licensing arrangements allow customers the ability to remix among software products. Cadence also has arrangements with customers that include a combination of products, with the actual product selection and number of licensed users to be determined at a later date. For these arrangements, Cadence estimates the allocation of the revenue to product groups based upon the expected usage of products. The actual usage of Cadence’s products by these customers may differ and, if that proves to be the case, the revenue allocation in the table above would differ. Significant Judgments More judgments and estimates are required under Topic 606 than were required under Topic 605. Due to the complexity of certain contracts, the actual revenue recognition treatment required under Topic 606 for the Company’s arrangements may be dependent on contract-specific terms and may vary in some instances. Cadence’s contracts with customers often include promises to transfer multiple software and/or IP licenses and services, including professional services, technical support services, and rights to unspecified updates to a customer. Determining whether licenses and services are distinct performance obligations that should be accounted for separately, or not distinct and thus accounted for together, requires significant judgment. In some arrangements, such as most of Cadence’s IP license arrangements, Cadence has concluded that the licenses and associated services are distinct from each other. In others, like Cadence’s time-based software arrangements, the licenses and certain services are not distinct from each other. As described in Note 1, Cadence’s time-based software arrangements include multiple software licenses and updates to the licensed software products, as well as technical support, and Cadence has concluded that these promised goods and services are a single, combined performance obligation. Judgment is required to determine the SSP for each distinct performance obligation. Cadence rarely licenses or sells products on a standalone basis, so Cadence is required to estimate the range of SSPs for each performance obligation. In instances where SSP is not directly observable because Cadence does not sell the license, product or service separately, Cadence determines the SSP using information that may include market conditions and other observable inputs. Cadence typically has more than one SSP for individual performance obligations due to the stratification of those items by classes of customers and circumstances. In these instances, Cadence may use information such as the size of the customer and geographic region of the customer in determining the SSP. Revenue is recognized over time for Cadence’s maintenance and professional services that are separate performance obligations, and also for Cadence’s combined performance obligations that include software licenses, updates, and technical support. For Cadence’s professional services, revenue is recognized over time, generally using costs incurred or hours expended to measure progress. Judgment is required in estimating project status and the costs necessary to complete projects. A number of internal and external factors can affect these estimates, including labor rates, utilization and efficiency variances and specification and testing requirement changes. For Cadence’s other performance obligations recognized over time, revenue is generally recognized using a time-based measure of progress reflecting generally consistent efforts to satisfy those performance obligations throughout the arrangement term. If a group of agreements are so closely related that they are, in effect, part of a single arrangement, such agreements are deemed to be one arrangement for revenue recognition purposes. Cadence exercises significant judgment to evaluate the relevant facts and circumstances in determining whether the separate agreements should be accounted for separately or as, in substance, a single arrangement. Cadence’s judgments about whether a group of contracts comprise a single arrangement can affect the allocation of consideration to the distinct performance obligations, which could have an effect on results of operations for the periods involved. Cadence is required to estimate the total consideration expected to be received from contracts with customers. In limited circumstances, the consideration expected to be received is variable based on the specific terms of the contract or based on Cadence’s expectations of the term of the contract. Generally, Cadence has not experienced significant returns or refunds to customers. These estimates require significant judgment and the change in these estimates could have an effect on its results of operations during the periods involved. Contract Balances The timing of revenue recognition may differ from the timing of invoicing to customers and these timing differences result in receivables, contract assets, or contract liabilities (deferred revenue) on Cadence’s condensed consolidated balance sheet. Cadence records a contract asset when revenue is recognized prior to invoicing, or deferred revenue when revenue is recognized subsequent to invoicing. For Cadence’s time-based software agreements, customers are generally invoiced in equal, quarterly amounts, although some customers prefer to be invoiced in single or annual amounts. For certain hardware and IP agreements with payment plans, Cadence records a receivable related to revenue recognized upon delivery because it has an unconditional right to invoice and receive payment in the future related to those deliveries. The contract assets indicated below are presented as prepaid expenses and other in the condensed consolidated balance sheet and primarily relate to Cadence’s rights to consideration for work completed but not billed as of March 31, 2018 on services and customized IP contracts. The contract assets are transferred to receivables when the rights become unconditional, usually upon completion of a milestone. Cadence’s contract balances as of March 31, 2018 were as follows: As of March 31, December 30, As Adjusted (In thousands) Contract assets $ 6,077 $ 3,964 Deferred revenue 366,915 336,060 During the three months ended March 31, 2018 , Cadence recognized $142.6 million of revenue that was included in the deferred revenue balance, as adjusted for Topic 606, at the beginning of the period. All other activity in deferred revenue is due to the timing of invoices in relation to the timing of revenue as described above. Revenue allocated to remaining performance obligations represents the transaction price allocated to the performance obligations that are unsatisfied, or partially unsatisfied, which includes unearned revenue and amounts that will be invoiced and recognized as revenue in future periods. The Company has elected to exclude the future royalty payments from the remaining performance obligations. Contracted but unsatisfied performance obligations were approximately $2.6 billion as of March 31, 2018 , of which Cadence expects to recognize approximately 60% of the revenue over the next 12 months and the remainder thereafter. Payment terms and conditions vary by contract type, although terms generally include a requirement of payment within 30 to 60 days. In instances where the timing of revenue recognition differs from the timing of invoicing, Cadence has determined that its contracts generally do not include a significant financing component. The primary purpose of invoicing terms is to provide customers with simplified and predictable ways of purchasing Cadence’s products and services, and not to facilitate financing arrangements. The amount of revenue recognized in the three months ended March 31, 2018 from performance obligations satisfied in previous periods was $6.2 million . This amount represents royalties earned during the period and excludes contracts with nonrefundable prepaid royalties. Nonrefundable prepaid royalties are recognized upon delivery of the IP because Cadence’s right to the consideration is not contingent upon customers’ future shipments. Deferred Sales Commissions Cadence records an asset for the incremental costs of obtaining a contract with a customer, including direct sales commissions that are earned upon execution of the contract. Cadence uses the portfolio method to recognize the amortization expense related to these capitalized costs related to initial contracts and renewals and such expense is recognized over a period associated with the revenue of the related portfolio, which is generally two to three years for Cadence’s software arrangements and upon delivery for its hardware and IP arrangements. Incremental costs related to initial contracts and renewals are amortized over the same period because the commissions paid on both the initial contract and renewals are commensurate with one another. Total capitalized costs as of March 31, 2018 were $24.5 million and are included in other assets in Cadence’s condensed consolidated balance sheet. Amortization of these assets was $5.2 million during the three months ended March 31, 2018 and is included in sales and marketing expense in Cadence’s condensed consolidated income statement. |
Income Taxes
Income Taxes | 3 Months Ended |
Mar. 31, 2018 | |
Income Taxes Disclosure [Abstract] | |
Income Tax Disclosure [Text Block] | INCOME TAXES Cadence’s provision for income taxes of $5.3 million for the three months ended March 31, 2018 primarily resulted from the federal income tax effects of the U.S. Tax Cuts and Jobs Act (the “Tax Act)” and state and foreign income taxes on anticipated fiscal 2018 income, partially offset by $8.7 million of tax benefit related to stock-based compensation that vested or was exercised during the period. The Tax Act was enacted in December 2017 and included several new tax provisions related to the taxation of foreign earnings and a reduction in the federal corporation income tax rate from 35% to 21% as of January 1, 2018. Cadence reduced its provisional estimate for the fiscal 2017 deemed repatriation transition tax by $2.6 million during the three months ended March 31, 2018 based on its continuing analysis of the earnings and cash balances of foreign subsidiaries and the additional guidance issued by the applicable tax authorities. Cadence has not yet completed the accounting for the fiscal 2017 effects of the Tax Act because of the complexity and ambiguity of certain of its tax and accounting effects. Cadence expects to refine and complete the accounting for the Tax Act during the remainder of fiscal 2018 as it obtains, prepares and analyzes additional information in accordance with Staff Accounting Bulletin No. 118. For further discussion regarding the income tax effects of the Tax Act, see Note 6 in the notes to consolidated financial statements in Cadence’s Annual Report on Form 10-K for the fiscal year ended December 30, 2017. Cadence adopted ASU 2016-16, “Income taxes (Topic 740): Intra-entity Transfers of Assets Other Than Inventory” during the three months ended March 31, 2018, which required all income tax effects of intra-entity transfers of assets other than inventory to be recognized in the condensed consolidated income statement when the transfer occurs. For intra-entity transfers of inventory, the income tax effects will continue to be deferred until the inventory has been sold to a third party. For further discussion regarding new accounting standards, see Note 1 in the notes to condensed consolidated financial statements under the heading “Recently Adopted Accounting Standards.” |
Stock Based Compensation
Stock Based Compensation | 3 Months Ended |
Mar. 31, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
STOCK-BASED COMPENSATION | STOCK-BASED COMPENSATION Stock-based compensation expense is reflected in Cadence’s condensed consolidated income statements for the three months ended March 31, 2018 and April 1, 2017 as follows: Three Months Ended March 31, April 1, (In thousands) Cost of product and maintenance $ 590 $ 529 Cost of services 863 761 Marketing and sales 7,614 6,008 Research and development 23,235 15,482 General and administrative 5,599 4,656 Total stock-based compensation expense $ 37,901 $ 27,436 Cadence had total unrecognized compensation expense related to stock option and restricted stock grants of $261.8 million as of March 31, 2018 , which will be recognized over the remaining vesting period. The remaining weighted-average vesting period of unvested awards is 2.1 years . |
Goodwill and Acquired Intangibl
Goodwill and Acquired Intangibles | 3 Months Ended |
Mar. 31, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
GOODWILL AND ACQUIRED INTANGIBLES | GOODWILL AND ACQUIRED INTANGIBLES Goodwill The changes in the carrying amount of goodwill during the three months ended March 31, 2018 were as follows: Gross Carrying Amount (In thousands) Balance as of December 30, 2017 $ 666,009 Effect of foreign currency translation (394 ) Balance as of March 31, 2018 $ 665,615 Acquired Intangibles, Net Acquired intangibles as of March 31, 2018 were as follows, excluding intangibles that were fully amortized as of December 30, 2017 : Gross Carrying Amount Accumulated Amortization Acquired Intangibles, Net (In thousands) Existing technology $ 331,162 $ (197,877 ) $ 133,285 Agreements and relationships 146,565 (89,725 ) 56,840 Tradenames, trademarks and patents 10,718 (7,416 ) 3,302 Total acquired intangibles with definite lives 488,445 (295,018 ) 193,427 In-process technology 71,500 — 71,500 Total acquired intangibles $ 559,945 $ (295,018 ) $ 264,927 In-process technology as of March 31, 2018 consisted of acquired projects that, if completed, will contribute to Cadence's design IP offerings. As of March 31, 2018, these projects were expected to be completed in nine to twelve months. During the three months ended March 31, 2018 , there were no transfers from in-process technology to existing technology. Acquired intangibles as of December 30, 2017 were as follows, excluding intangibles that were fully amortized as of December 31, 2016 : Gross Carrying Amount Accumulated Amortization Acquired Intangibles, Net (In thousands) Existing technology $ 342,810 $ (199,529 ) $ 143,281 Agreements and relationships 151,063 (90,675 ) 60,388 Tradenames, trademarks and patents 10,918 (7,252 ) 3,666 Total acquired intangibles with definite lives 504,791 (297,456 ) 207,335 In-process technology 71,500 — 71,500 Total acquired intangibles $ 576,291 $ (297,456 ) $ 278,835 Amortization expense from existing technology and maintenance agreements is included in cost of product and maintenance. Amortization of acquired intangibles for the three months ended March 31, 2018 and April 1, 2017 was as follows: Three Months Ended March 31, April 1, (In thousands) Cost of product and maintenance $ 10,277 $ 10,578 Amortization of acquired intangibles 3,630 3,856 Total amortization of acquired intangibles $ 13,907 $ 14,434 Estimated amortization expense for intangible assets with definite lives for the following five fiscal years and thereafter is as follows: (In thousands) 2018 – remaining period $ 39,446 2019 46,234 2020 40,619 2021 36,115 2022 17,810 Thereafter 13,203 Total estimated amortization expense $ 193,427 |
Restructuring and Other Charges
Restructuring and Other Charges | 3 Months Ended |
Mar. 31, 2018 | |
Restructuring and Related Activities [Abstract] | |
RESTRUCTURING AND OTHER CHARGES | RESTRUCTURING AND OTHER CHARGES Cadence has initiated restructuring plans in an effort to better align its resources with its business strategy. These restructuring plans have primarily been comprised of severance payments and termination benefits related to headcount reductions, estimated lease losses related to facilities vacated under the restructuring plans and charges related to assets abandoned as part of the restructuring plans. During the three months ended March 31, 2018 , Cadence revised certain estimates made in connection with its prior restructuring plans and recorded credits of approximately $2.0 million . As of March 31, 2018 , total liabilities related to prior restructuring plans were $4.8 million . Cadence expects to make cash payments for severance and related benefits for the prior restructuring plans through the first quarter of fiscal 2019. The following table presents activity relating to Cadence’s restructuring plans during the three months ended March 31, 2018 : Severance and Benefits Excess Facilities Total (In thousands) Balance, December 30, 2017 $ 13,535 $ 249 $ 13,784 Restructuring and other credits (1,948 ) (43 ) (1,991 ) Cash payments (6,813 ) (206 ) (7,019 ) Effect of foreign currency translation (10 ) — (10 ) Balance, March 31, 2018 $ 4,764 $ — $ 4,764 The remaining liability for Cadence’s restructuring plans is recorded in accounts payable and accrued liabilities in the condensed consolidated balance sheet. |
Net Income per Share
Net Income per Share | 3 Months Ended |
Mar. 31, 2018 | |
Earnings Per Share [Abstract] | |
NET INCOME PER SHARE | NET INCOME PER SHARE Basic net income per share is computed by dividing net income during the period by the weighted average number of shares of common stock outstanding during that period, less unvested restricted stock awards. Diluted net income per share is impacted by equity instruments considered to be potential common shares, if dilutive, computed using the treasury stock method of accounting. The calculations for basic and diluted net income per share for the three months ended March 31, 2018 and April 1, 2017 are as follows: Three Months Ended March 31, April 1, (In thousands, except per share amounts) Net income $ 72,885 $ 68,259 Weighted average common shares used to calculate basic net income per share 273,773 270,173 Stock-based awards 7,878 7,563 Weighted average common shares used to calculate diluted net income per share 281,651 277,736 Net income per share - basic $ 0.27 $ 0.25 Net income per share - diluted $ 0.26 $ 0.25 The following table presents shares of Cadence’s common stock outstanding for the three months ended March 31, 2018 and April 1, 2017 that were excluded from the computation of diluted net income per share because the effect of including these shares in the computation of diluted net income per share would have been anti-dilutive: Three Months Ended March 31, April 1, (In thousands) Long-term performance-based stock awards 150 232 Options to purchase shares of common stock 416 391 Non-vested shares of restricted stock 279 161 Total potential common shares excluded 845 784 |
Stock Repurchase Program
Stock Repurchase Program | 3 Months Ended |
Mar. 31, 2018 | |
Class of Stock Disclosures [Abstract] | |
STOCK REPURCHASE PROGRAM | STOCK REPURCHASE PROGRAM In January 2017, Cadence’s Board of Directors authorized the repurchase of shares of Cadence’s common stock with a value of up to $525.0 million in the aggregate. The actual timing and amount of repurchases are subject to business and market conditions, corporate and regulatory requirements, acquisition opportunities and other factors. As of March 31, 2018 , $375.0 million remained available to repurchase shares of Cadence common stock under the current authorization. The shares repurchased under Cadence’s repurchase authorizations and the total cost of repurchased shares, including commissions, during the three months ended March 31, 2018 and April 1, 2017 were as follows: Three Months Ended March 31, April 1, (In thousands) Shares repurchased 1,289 — Total cost of repurchased shares $ 50,013 $ — |
Fair Value
Fair Value | 3 Months Ended |
Mar. 31, 2018 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE | FAIR VALUE Inputs to valuation techniques are observable or unobservable. Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect Cadence’s market assumptions. These two types of inputs have created the following fair value hierarchy: • Level 1 – Quoted prices for identical instruments in active markets; • Level 2 – Quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-derived valuations in which all significant inputs and significant value drivers are observable in active markets; and • Level 3 – Valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable. This hierarchy requires Cadence to minimize the use of unobservable inputs and to use observable market data, if available, when determining fair value. Cadence recognizes transfers between levels of the hierarchy based on the fair values of the respective financial instruments at the end of the reporting period in which the transfer occurred. There were no transfers between levels of the fair value hierarchy during the three months ended March 31, 2018 . On a quarterly basis, Cadence measures at fair value certain financial assets and liabilities. The fair value of financial assets and liabilities was determined using the following levels of inputs as of March 31, 2018 and December 30, 2017 : Fair Value Measurements as of March 31, 2018 Total Level 1 Level 2 Level 3 (In thousands) Assets Cash equivalents: Money market funds $ 444,567 $ 444,567 $ — $ — Short-term investments: Marketable equity securities 5,466 5,466 — — Trading securities held in Non-Qualified Deferred Compensation (“NQDC”) trust 26,709 26,709 — — Total Assets $ 476,742 $ 476,742 $ — $ — Total Level 1 Level 2 Level 3 (In thousands) Liabilities Foreign currency exchange contracts $ 754 $ — $ 754 $ — Fair Value Measurements as of December 30, 2017 Total Level 1 Level 2 Level 3 (In thousands) Assets Cash equivalents: Money market funds $ 503,934 $ 503,934 $ — $ — Short-term investments: Marketable equity securities 4,455 4,455 — — Trading securities held in NQDC trust 31,473 31,473 — — Foreign currency exchange contracts 2,937 — 2,937 — Total Assets $ 542,799 $ 539,862 $ 2,937 $ — As of December 30, 2017, Cadence did not have any financial liabilities requiring a recurring fair value measurement. |
Contingencies
Contingencies | 3 Months Ended |
Mar. 31, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
CONTINGENCIES | CONTINGENCIES Legal Proceedings From time to time, Cadence is involved in various disputes and litigation that arise in the ordinary course of business. These include disputes and lawsuits related to intellectual property, indemnification obligations, mergers and acquisitions, licensing, contracts, distribution arrangements and employee relations matters. At least quarterly, Cadence reviews the status of each significant matter and assesses its potential financial exposure. If the potential loss from any claim or legal proceeding is considered probable and the amount or the range of loss can be estimated, Cadence accrues a liability for the estimated loss. Legal proceedings are subject to uncertainties, and the outcomes are difficult to predict. Because of such uncertainties, accruals are based on Cadence’s judgments using the information available at the time. As additional information becomes available, Cadence reassesses the potential liability related to pending claims and litigation matters and may revise estimates. Other Contingencies Cadence provides its customers with a warranty on sales of hardware products, generally for a 90 -day period. Cadence did not incur any significant costs related to warranty obligations during the three months ended March 31, 2018 and April 1, 2017 . Cadence’s product license and services agreements typically include a limited indemnification provision for claims from third parties relating to Cadence’s intellectual property. If the potential loss from any indemnification claim is considered probable and the amount or the range of loss can be estimated, Cadence accrues a liability for the estimated loss. The indemnification is generally limited to the amount paid by the customer. Cadence did not incur any significant losses from indemnification claims during the three months ended March 31, 2018 and April 1, 2017 . |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Loss | 3 Months Ended |
Mar. 31, 2018 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |
OTHER COMPREHENSIVE LOSS | ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS) Cadence’s accumulated other comprehensive income (loss) is comprised of the aggregate impact of foreign currency translation gains and losses and changes in defined benefit plan liabilities and is presented in Cadence's condensed consolidated statements of comprehensive income. Aggregate changes in unrealized holding gains on available-for-sale securities net of reclassifications for realized gains and losses were also included through December 30, 2017. On the first day of fiscal 2018, Cadence reclassified unrealized holding gains on available-for-sale securities to retained earnings in connection with the adoption of ASU 2016-1, “Financial Instruments—Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities.” For additional information regarding the adoption of this accounting standard, refer to Note 1 under the heading “Recently Adopted Accounting Standards.” Accumulated other comprehensive income (loss) was comprised of the following as of March 31, 2018 and December 30, 2017 : As of March 31, December 30, (In thousands) Foreign currency translation gain (loss) $ 9,082 $ (2,976 ) Changes in defined benefit plan liabilities (3,142 ) (3,292 ) Unrealized holding gains on available-for-sale securities — 2,638 Total accumulated other comprehensive income (loss) $ 5,940 $ (3,630 ) For the three months ended March 31, 2018 and April 1, 2017 there were no significant amounts reclassified from accumulated other comprehensive income (loss) to net income. |
Segment Reporting
Segment Reporting | 3 Months Ended |
Mar. 31, 2018 | |
Segment Reporting [Abstract] | |
SEGMENT REPORTING | SEGMENT REPORTING Segment reporting is based on the “management approach,” following the method that management organizes the company’s reportable segments for which separate financial information is made available to, and evaluated regularly by, the chief operating decision maker in allocating resources and in assessing performance. Cadence’s chief operating decision maker is its CEO, who reviews Cadence’s consolidated results as one operating segment. In making operating decisions, the CEO primarily considers consolidated financial information, accompanied by disaggregated information about revenues by geographic region. Outside the United States, Cadence markets and supports its products and services primarily through its subsidiaries. Revenue is attributed to geography based upon the country in which the product is used or services are delivered. Long-lived assets are attributed to geography based on the country where the assets are located. The following table presents a summary of revenue by geography for the three months ended March 31, 2018 and April 1, 2017 : Three Months Ended March 31, April 1, (In thousands) Americas: United States $ 224,803 $ 205,435 Other Americas 7,666 7,755 Total Americas 232,469 213,190 Asia 139,947 122,423 Europe, Middle East and Africa 104,708 98,321 Japan 40,189 42,977 Total $ 517,313 $ 476,911 The following table presents a summary of long-lived assets by geography as of March 31, 2018 and December 30, 2017 : As of March 31, December 30, (In thousands) Americas: United States $ 196,628 $ 198,744 Other Americas 629 611 Total Americas 197,257 199,355 Asia 38,030 37,678 Europe, Middle East and Africa 13,856 13,615 Japan 667 694 Total $ 249,810 $ 251,342 |
Basis of Presentation (Policies
Basis of Presentation (Policies) | 3 Months Ended |
Mar. 31, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Preparation of the condensed consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the condensed consolidated financial statements and the reported amounts of revenue and expenses during the reporting period. Actual results could differ from those estimates. |
Cash and Cash Equivalents and Short Term Investments | Cadence considers all highly liquid investments with original maturities of three months or less on the date of purchase to be cash equivalents. |
Fair Value of Financial Instruments | Inputs to valuation techniques are observable or unobservable. Observable inputs reflect market data obtained from independent sources, while unobservable inputs reflect Cadence’s market assumptions. These two types of inputs have created the following fair value hierarchy: • Level 1 – Quoted prices for identical instruments in active markets; • Level 2 – Quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-derived valuations in which all significant inputs and significant value drivers are observable in active markets; and • Level 3 – Valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable. This hierarchy requires Cadence to minimize the use of unobservable inputs and to use observable market data, if available, when determining fair value. Cadence recognizes transfers between levels of the hierarchy based on the fair values of the respective financial instruments at the end of the reporting period in which the transfer occurred. There were no transfers between levels of the fair value hierarchy during the three months ended March 31, 2018 . |
Contingencies | At least quarterly, Cadence reviews the status of each significant matter and assesses its potential financial exposure. If the potential loss from any claim or legal proceeding is considered probable and the amount or the range of loss can be estimated, Cadence accrues a liability for the estimated loss. Legal proceedings are subject to uncertainties, and the outcomes are difficult to predict. Because of such uncertainties, accruals are based on Cadence’s judgments using the information available at the time. As additional information becomes available, Cadence reassesses the potential liability related to pending claims and litigation matters and may revise estimates. |
Basis of Presentation and Summa
Basis of Presentation and Summary of Significant Accounting Policies New Accounting Standards (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Summary of the effects of the adoption of Topic 606 | The following table summarizes the effects of adopting Topic 606 on Cadence’s condensed consolidated balance sheet as of March 31, 2018 : As reported under Topic 606 Adjustments Balances under Prior GAAP (In thousands) Receivables, net $ 225,822 $ (18,538 ) $ 207,284 Prepaid expenses and other 61,597 (5,255 ) 56,342 Long-term receivables 9,380 569 9,949 Other assets 226,998 (11,947 ) 215,051 Accounts payable and accrued liabilities* 210,784 (40,357 ) 170,427 Current portion of deferred revenue 310,639 78,462 389,101 Long-term portion of deferred revenue 56,276 4,275 60,551 Retained earnings 499,817 (79,876 ) 419,941 Accumulated other comprehensive income 5,940 2,325 8,265 _____________ * Cadence has certain arrangements under which consideration is received from customers prior to identifying the specific goods or services to be delivered under the contract. Cadence records an accrued liability on a contract-by-contract basis at the end of each reporting period for cash consideration received. The following table summarizes the effects of adopting Topic 606 on Cadence’s condensed consolidated income statement for the three months ended March 31, 2018 : As reported under Topic 606 Adjustments Balances under Prior GAAP (In thousands, except per share amounts) Product and maintenance revenue $ 480,609 $ 6,180 $ 486,789 Services revenue 36,704 1,964 38,668 Cost of product and maintenance 41,730 (251 ) 41,479 Marketing and sales expense 109,148 (2,810 ) 106,338 Provision for income taxes 5,284 557 5,841 Net income 72,885 10,648 83,533 Net income per share - basic 0.27 0.04 0.31 Net income per share - diluted 0.26 0.04 0.30 Cadence’s net cash provided by operating activities for the three months ended March 31, 2018 did not change due to the adoption of Topic 606. The following table summarizes the effects of adopting Topic 606 on the financial statement line items of Cadence’s condensed consolidated statement of cash flows for the three months ended March 31, 2018 : As reported under Topic 606 Adjustments Balances under Prior GAAP (In thousands) Net income $ 72,885 $ 10,648 $ 83,533 Changes in operating assets and liabilities: Receivables (10,988 ) (25,638 ) (36,626 ) Prepaid expenses and other 8,392 2,026 10,418 Other assets 8,152 (1,742 ) 6,410 Accounts payable and accrued liabilities (46,956 ) (11,641 ) (58,597 ) Deferred revenue 59,854 26,347 86,201 |
Schedule of the cumulative effect of the change on retained earnings | The following table presents the cumulative effect adjustments, net of income tax effects, to beginning retained earnings for new accounting standards adopted by Cadence on the first day of fiscal 2018: Retained Earnings (In thousands) Balance, December 30, 2017, as previously reported $ 341,003 Cumulative effect adjustment from the adoption of new accounting standards: Revenue from Contracts with Customers (Topic 606) 91,640 Financial Instruments—Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities 2,638 Income taxes (Topic 740): Intra-entity Transfers of Assets Other Than Inventory (8,349 ) Balance, December 30, 2017, as adjusted 426,932 Net Income 72,885 Balance, March 31, 2018 $ 499,817 |
Debt (Tables)
Debt (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Debt Disclosure [Abstract] | |
Summary of debt outstanding | Cadence’s outstanding debt as of March 31, 2018 and December 30, 2017 was as follows: March 31, 2018 December 30, 2017 (In thousands) Principal Unamortized Discount Carrying Value Principal Unamortized Discount Carrying Value Revolving Credit Facility $ 45,000 $ — $ 45,000 $ 85,000 $ — $ 85,000 2019 Term Loan 300,000 (174 ) 299,826 300,000 (226 ) 299,774 2024 Notes 350,000 (5,234 ) 344,766 350,000 (5,405 ) 344,595 Total outstanding debt $ 695,000 $ (5,408 ) $ 689,592 $ 735,000 $ (5,631 ) $ 729,369 |
Cash, Cash Equivalents and In25
Cash, Cash Equivalents and Investments (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Cash, Cash Equivalents and Investments [Abstract] | |
Summary of cash, cash equivalents and short-term investments | Cadence’s cash, cash equivalents and short-term investments at fair value as of March 31, 2018 and December 30, 2017 were as follows: As of March 31, December 30, (In thousands) Cash and cash equivalents $ 746,968 $ 688,087 Short-term investments 5,466 4,455 Cash, cash equivalents and short-term investments $ 752,434 $ 692,542 |
Summary of cash and cash equivalents | The following table summarizes Cadence’s cash and cash equivalents at fair value as of March 31, 2018 and December 30, 2017 : As of March 31, December 30, (In thousands) Cash and interest bearing deposits $ 302,401 $ 184,153 Money market funds 444,567 503,934 Total cash and cash equivalents $ 746,968 $ 688,087 |
Receivables, net (Tables)
Receivables, net (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Receivables [Abstract] | |
Current and long-term accounts receivable balances | Cadence’s current and long-term receivables balances as of March 31, 2018 and December 30, 2017 were as follows: As of March 31, December 30, (In thousands) Accounts receivable $ 117,065 $ 119,325 Unbilled accounts receivable 109,423 71,101 Long-term receivables 9,380 12,239 Total receivables 235,868 202,665 Less allowance for doubtful accounts (666 ) — Total receivables, net $ 235,202 $ 202,665 |
Revenue Revenue (Tables)
Revenue Revenue (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Revenue from Contract with Customer [Abstract] | |
Revenue from External Customers by Products and Services | The following table shows the percentage of product and related maintenance revenue contributed by each of Cadence’s five product groups and services for the three months ended March 31, 2018 : Three Months Ended March 31, April 1, Functional Verification, including Emulation and Prototyping Hardware 26 % 23 % Digital IC Design and Signoff 30 % 29 % Custom IC Design 26 % 26 % System Interconnect and Analysis 9 % 10 % IP 9 % 12 % Total 100 % 100 % |
Contract Balances | Cadence’s contract balances as of March 31, 2018 were as follows: As of March 31, December 30, As Adjusted (In thousands) Contract assets $ 6,077 $ 3,964 Deferred revenue 366,915 336,060 |
Stock Based Compensation (Table
Stock Based Compensation (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stock-based compensation expense and allocation by cost [Table Text Block] | Stock-based compensation expense is reflected in Cadence’s condensed consolidated income statements for the three months ended March 31, 2018 and April 1, 2017 as follows: Three Months Ended March 31, April 1, (In thousands) Cost of product and maintenance $ 590 $ 529 Cost of services 863 761 Marketing and sales 7,614 6,008 Research and development 23,235 15,482 General and administrative 5,599 4,656 Total stock-based compensation expense $ 37,901 $ 27,436 |
Goodwill and Acquired Intangi29
Goodwill and Acquired Intangibles (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Changes in the carrying amount of goodwill | The changes in the carrying amount of goodwill during the three months ended March 31, 2018 were as follows: Gross Carrying Amount (In thousands) Balance as of December 30, 2017 $ 666,009 Effect of foreign currency translation (394 ) Balance as of March 31, 2018 $ 665,615 |
Schedule of acquired intangibles with finite and indefinite lives (excluding goodwill) | Acquired intangibles as of March 31, 2018 were as follows, excluding intangibles that were fully amortized as of December 30, 2017 : Gross Carrying Amount Accumulated Amortization Acquired Intangibles, Net (In thousands) Existing technology $ 331,162 $ (197,877 ) $ 133,285 Agreements and relationships 146,565 (89,725 ) 56,840 Tradenames, trademarks and patents 10,718 (7,416 ) 3,302 Total acquired intangibles with definite lives 488,445 (295,018 ) 193,427 In-process technology 71,500 — 71,500 Total acquired intangibles $ 559,945 $ (295,018 ) $ 264,927 Acquired intangibles as of December 30, 2017 were as follows, excluding intangibles that were fully amortized as of December 31, 2016 : Gross Carrying Amount Accumulated Amortization Acquired Intangibles, Net (In thousands) Existing technology $ 342,810 $ (199,529 ) $ 143,281 Agreements and relationships 151,063 (90,675 ) 60,388 Tradenames, trademarks and patents 10,918 (7,252 ) 3,666 Total acquired intangibles with definite lives 504,791 (297,456 ) 207,335 In-process technology 71,500 — 71,500 Total acquired intangibles $ 576,291 $ (297,456 ) $ 278,835 |
Amortization of acquired intangibles | Amortization of acquired intangibles for the three months ended March 31, 2018 and April 1, 2017 was as follows: Three Months Ended March 31, April 1, (In thousands) Cost of product and maintenance $ 10,277 $ 10,578 Amortization of acquired intangibles 3,630 3,856 Total amortization of acquired intangibles $ 13,907 $ 14,434 |
Estimated amortization expense | Estimated amortization expense for intangible assets with definite lives for the following five fiscal years and thereafter is as follows: (In thousands) 2018 – remaining period $ 39,446 2019 46,234 2020 40,619 2021 36,115 2022 17,810 Thereafter 13,203 Total estimated amortization expense $ 193,427 |
Restructuring and Other Charg30
Restructuring and Other Charges (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Restructuring and Related Activities [Abstract] | |
Restructuring reserve rollforward by major type of cost | The following table presents activity relating to Cadence’s restructuring plans during the three months ended March 31, 2018 : Severance and Benefits Excess Facilities Total (In thousands) Balance, December 30, 2017 $ 13,535 $ 249 $ 13,784 Restructuring and other credits (1,948 ) (43 ) (1,991 ) Cash payments (6,813 ) (206 ) (7,019 ) Effect of foreign currency translation (10 ) — (10 ) Balance, March 31, 2018 $ 4,764 $ — $ 4,764 |
Net Income Per Share (Tables)
Net Income Per Share (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Earnings Per Share [Abstract] | |
Basic and diluted net income per share | The calculations for basic and diluted net income per share for the three months ended March 31, 2018 and April 1, 2017 are as follows: Three Months Ended March 31, April 1, (In thousands, except per share amounts) Net income $ 72,885 $ 68,259 Weighted average common shares used to calculate basic net income per share 273,773 270,173 Stock-based awards 7,878 7,563 Weighted average common shares used to calculate diluted net income per share 281,651 277,736 Net income per share - basic $ 0.27 $ 0.25 Net income per share - diluted $ 0.26 $ 0.25 |
Potential shares of Cadence's common stock excluded | The following table presents shares of Cadence’s common stock outstanding for the three months ended March 31, 2018 and April 1, 2017 that were excluded from the computation of diluted net income per share because the effect of including these shares in the computation of diluted net income per share would have been anti-dilutive: Three Months Ended March 31, April 1, (In thousands) Long-term performance-based stock awards 150 232 Options to purchase shares of common stock 416 391 Non-vested shares of restricted stock 279 161 Total potential common shares excluded 845 784 |
Stock Repurchase Program (Table
Stock Repurchase Program (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Class of Stock Disclosures [Abstract] | |
Shares repurchased and the total cost of shares repurchased | The shares repurchased under Cadence’s repurchase authorizations and the total cost of repurchased shares, including commissions, during the three months ended March 31, 2018 and April 1, 2017 were as follows: Three Months Ended March 31, April 1, (In thousands) Shares repurchased 1,289 — Total cost of repurchased shares $ 50,013 $ — |
Fair Value (Tables)
Fair Value (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Fair Value Disclosures [Abstract] | |
Fair value of financial assets and liabilities | The fair value of financial assets and liabilities was determined using the following levels of inputs as of March 31, 2018 and December 30, 2017 : Fair Value Measurements as of March 31, 2018 Total Level 1 Level 2 Level 3 (In thousands) Assets Cash equivalents: Money market funds $ 444,567 $ 444,567 $ — $ — Short-term investments: Marketable equity securities 5,466 5,466 — — Trading securities held in Non-Qualified Deferred Compensation (“NQDC”) trust 26,709 26,709 — — Total Assets $ 476,742 $ 476,742 $ — $ — Total Level 1 Level 2 Level 3 (In thousands) Liabilities Foreign currency exchange contracts $ 754 $ — $ 754 $ — Fair Value Measurements as of December 30, 2017 Total Level 1 Level 2 Level 3 (In thousands) Assets Cash equivalents: Money market funds $ 503,934 $ 503,934 $ — $ — Short-term investments: Marketable equity securities 4,455 4,455 — — Trading securities held in NQDC trust 31,473 31,473 — — Foreign currency exchange contracts 2,937 — 2,937 — Total Assets $ 542,799 $ 539,862 $ 2,937 $ — As of December 30, 2017, Cadence did not have any financial liabilities requiring a recurring fair value measurement. |
Accumulated Other Comprehensi34
Accumulated Other Comprehensive Loss (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |
Accumulated other comprehensive loss, net of tax | Accumulated other comprehensive income (loss) was comprised of the following as of March 31, 2018 and December 30, 2017 : As of March 31, December 30, (In thousands) Foreign currency translation gain (loss) $ 9,082 $ (2,976 ) Changes in defined benefit plan liabilities (3,142 ) (3,292 ) Unrealized holding gains on available-for-sale securities — 2,638 Total accumulated other comprehensive income (loss) $ 5,940 $ (3,630 ) |
Segment Reporting (Tables)
Segment Reporting (Tables) | 3 Months Ended |
Mar. 31, 2018 | |
Segment Reporting [Abstract] | |
Summary of revenue by geography | The following table presents a summary of revenue by geography for the three months ended March 31, 2018 and April 1, 2017 : Three Months Ended March 31, April 1, (In thousands) Americas: United States $ 224,803 $ 205,435 Other Americas 7,666 7,755 Total Americas 232,469 213,190 Asia 139,947 122,423 Europe, Middle East and Africa 104,708 98,321 Japan 40,189 42,977 Total $ 517,313 $ 476,911 |
Summary of long-lived assets by geography | The following table presents a summary of long-lived assets by geography as of March 31, 2018 and December 30, 2017 : As of March 31, December 30, (In thousands) Americas: United States $ 196,628 $ 198,744 Other Americas 629 611 Total Americas 197,257 199,355 Asia 38,030 37,678 Europe, Middle East and Africa 13,856 13,615 Japan 667 694 Total $ 249,810 $ 251,342 |
Basis of Presentation and Sum36
Basis of Presentation and Summary of Significant Accounting Policies New Accounting Standards (Details Textual) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2018 | Dec. 31, 2017 | Dec. 30, 2017 | |
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||
Retained earnings | $ 499,817 | $ 426,932 | $ 341,003 |
Receivables, net | 225,822 | 190,426 | |
Contract assets | 6,077 | 3,964 | |
Current portion of deferred revenue | 310,639 | 336,297 | |
Accounts payable and accrued liabilities | $ 210,784 | $ 221,101 | |
Percentage of revenue mix recognizable over time | 90.00% | ||
Accounting Standards Update 2016-16 | |||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||
Retained earnings | (8,349) | ||
Accounting Standards Update 2014-09 | |||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||
Retained earnings | 91,640 | ||
Accounting Standards Update 2014-09 | Adjustments | |||
Revenue, Initial Application Period Cumulative Effect Transition [Line Items] | |||
Retained earnings | $ (79,876) | 85,400 | |
Receivables, net | (18,538) | 47,300 | |
Contract assets | 4,000 | ||
Current portion of deferred revenue | 78,462 | 57,400 | |
Accounts payable and accrued liabilities | $ (40,357) | 23,300 | |
Deferred sales commission | $ 27,300 |
Basis of Presentation and Sum37
Basis of Presentation and Summary of Significant Accounting Policies New Accounting Standards (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | |||
Mar. 31, 2018 | Apr. 01, 2017 | Dec. 31, 2017 | Dec. 30, 2017 | |
Statement of Financial Position [Abstract] | ||||
Receivables, net | $ 225,822 | $ 190,426 | ||
Prepaid expenses and other | 61,597 | 63,811 | ||
Long-term receivables | 9,380 | 12,239 | ||
Other assets | 226,998 | 230,301 | ||
Accounts payable and accrued liabilities | 210,784 | 221,101 | ||
Current portion of deferred revenue | 310,639 | 336,297 | ||
Long-term portion of deferred revenue | 56,276 | 61,513 | ||
Retained earnings | 499,817 | $ 426,932 | 341,003 | |
Accumulated other comprehensive income | 5,940 | $ (3,630) | ||
Income Statement [Abstract] | ||||
Product and maintenance revenue | 480,609 | $ 451,407 | ||
Services revenue | 36,704 | 25,504 | ||
Cost of product and maintenance | 41,730 | 43,717 | ||
Marketing and sales expense | 109,148 | 103,347 | ||
Provision for income taxes | 5,284 | 5,923 | ||
Net income | $ 72,885 | $ 68,259 | ||
Net income per share - basic (in usd per share) | $ 0.27 | $ 0.25 | ||
Net income per share - diluted (in usd per share) | $ 0.26 | $ 0.25 | ||
Net Cash Provided by (Used in) Operating Activities [Abstract] | ||||
Net income | $ 72,885 | $ 68,259 | ||
Receivables | (10,988) | (22,475) | ||
Prepaid expenses and other | 8,392 | (3,777) | ||
Other assets | 8,152 | (3,657) | ||
Accounts payable and accrued liabilities | (46,956) | (46,159) | ||
Deferred revenue | 59,854 | $ 34,325 | ||
Balances under Prior GAAP | ||||
Statement of Financial Position [Abstract] | ||||
Receivables, net | 207,284 | |||
Prepaid expenses and other | 56,342 | |||
Long-term receivables | 9,949 | |||
Other assets | 215,051 | |||
Accounts payable and accrued liabilities | 170,427 | |||
Current portion of deferred revenue | 389,101 | |||
Long-term portion of deferred revenue | 60,551 | |||
Retained earnings | 419,941 | |||
Accumulated other comprehensive income | 8,265 | |||
Income Statement [Abstract] | ||||
Product and maintenance revenue | 486,789 | |||
Services revenue | 38,668 | |||
Cost of product and maintenance | 41,479 | |||
Marketing and sales expense | 106,338 | |||
Provision for income taxes | 5,841 | |||
Net income | $ 83,533 | |||
Net income per share - basic (in usd per share) | $ 0.31 | |||
Net income per share - diluted (in usd per share) | $ 0.30 | |||
Net Cash Provided by (Used in) Operating Activities [Abstract] | ||||
Net income | $ 83,533 | |||
Receivables | (36,626) | |||
Prepaid expenses and other | 10,418 | |||
Other assets | 6,410 | |||
Accounts payable and accrued liabilities | (58,597) | |||
Deferred revenue | 86,201 | |||
Accounting Standards Update 2014-09 | ||||
Statement of Financial Position [Abstract] | ||||
Retained earnings | 91,640 | |||
Accounting Standards Update 2014-09 | Adjustments | ||||
Statement of Financial Position [Abstract] | ||||
Receivables, net | (18,538) | 47,300 | ||
Prepaid expenses and other | (5,255) | |||
Long-term receivables | 569 | |||
Other assets | (11,947) | |||
Accounts payable and accrued liabilities | (40,357) | 23,300 | ||
Current portion of deferred revenue | 78,462 | 57,400 | ||
Long-term portion of deferred revenue | 4,275 | |||
Retained earnings | (79,876) | $ 85,400 | ||
Accumulated other comprehensive income | 2,325 | |||
Income Statement [Abstract] | ||||
Product and maintenance revenue | 6,180 | |||
Services revenue | 1,964 | |||
Cost of product and maintenance | (251) | |||
Marketing and sales expense | (2,810) | |||
Provision for income taxes | 557 | |||
Net income | $ 10,648 | |||
Net income per share - basic (in usd per share) | $ 0.04 | |||
Net income per share - diluted (in usd per share) | $ 0.04 | |||
Net Cash Provided by (Used in) Operating Activities [Abstract] | ||||
Net income | $ 10,648 | |||
Receivables | (25,638) | |||
Prepaid expenses and other | 2,026 | |||
Other assets | (1,742) | |||
Accounts payable and accrued liabilities | (11,641) | |||
Deferred revenue | $ 26,347 |
Basis of Presentation and Sum38
Basis of Presentation and Summary of Significant Accounting Policies Investments (Details) - USD ($) $ in Thousands | 3 Months Ended | |||
Mar. 31, 2018 | Apr. 01, 2017 | Dec. 31, 2017 | Dec. 30, 2017 | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Retained earnings | $ 499,817 | $ 426,932 | $ 341,003 | |
Gain on investments, net | (1,123) | $ (1,228) | ||
Non-marketable investments | 3,000 | |||
Net income | 72,885 | $ 68,259 | ||
Accounting Standards Update 2016-01 | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Retained earnings | 2,638 | |||
Accounting Standards Update 2016-16 | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Retained earnings | (8,349) | |||
Accounting Standards Update 2014-09 | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Retained earnings | $ 91,640 | |||
Marketable Equity Securities | ||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||
Gain on investments, net | $ (1,000) |
Debt (Details)
Debt (Details) - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 30, 2017 | Jan. 28, 2016 | Oct. 09, 2014 |
Debt Instrument [Line Items] | ||||
Principal | $ 695,000 | $ 735,000 | ||
Unamortized discount and debt issuance costs | (5,408) | (5,631) | ||
Line of Credit, Current | 45,000 | 85,000 | ||
Carrying value | 344,766 | 644,369 | ||
Carrying value | 689,592 | 729,369 | ||
Revolving Credit Facility [Member] | ||||
Debt Instrument [Line Items] | ||||
Principal | 45,000 | 85,000 | ||
Line of Credit, Current | 45,000 | 85,000 | ||
Long-term Debt [Member] | Term Loan Due 2019 [Member] | ||||
Debt Instrument [Line Items] | ||||
Principal | 300,000 | 300,000 | $ 300,000 | |
Unamortized discount and debt issuance costs | (174) | (226) | ||
Carrying value | 299,826 | 299,774 | ||
Senior Notes [Member] | Senior Notes Due 2024 [Member] | ||||
Debt Instrument [Line Items] | ||||
Principal | 350,000 | 350,000 | $ 350,000 | |
Unamortized discount and debt issuance costs | (5,234) | (5,405) | $ (1,400) | |
Carrying value | $ 344,766 | $ 344,595 |
Debt Credit Facility (Details T
Debt Credit Facility (Details Textual) $ in Millions | 3 Months Ended |
Mar. 31, 2018USD ($) | |
Revolving Credit Facility [Member] | |
Line of Credit Facility [Line Items] | |
Credit facility, current borrowing capacity | $ 350 |
Credit facility additional borrowing capacity available | 250 |
Credit facility, maximum borrowing capacity | $ 600 |
Credit facility, maturity date | Jan. 28, 2022 |
Credit facility, interest rate at period end | 2.85% |
Minimum [Member] | Revolving Credit Facility [Member] | |
Line of Credit Facility [Line Items] | |
Credit facility, commitment fee percentage | 0.15% |
Maximum [Member] | Revolving Credit Facility [Member] | |
Line of Credit Facility [Line Items] | |
Credit facility, commitment fee percentage | 0.30% |
London Interbank Offered Rate (LIBOR) [Member] | Minimum [Member] | Revolving Credit Facility [Member] | |
Line of Credit Facility [Line Items] | |
Credit facility, interest rate spread | 1.25% |
London Interbank Offered Rate (LIBOR) [Member] | Maximum [Member] | Revolving Credit Facility [Member] | |
Line of Credit Facility [Line Items] | |
Credit facility, interest rate spread | 1.875% |
Base Rate [Member] | Minimum [Member] | Revolving Credit Facility [Member] | |
Line of Credit Facility [Line Items] | |
Credit facility, interest rate spread | 0.25% |
Base Rate [Member] | Maximum [Member] | Revolving Credit Facility [Member] | |
Line of Credit Facility [Line Items] | |
Credit facility, interest rate spread | 0.875% |
Revolving Credit Facility [Member] | |
Line of Credit Facility [Line Items] | |
Credit facility, covenant, debt to EBITDA ratio | 3 |
Credit facility, covenant, debt to EBITDA ratio after step up triggered by acquisition | 3.50 |
Credit facility, covenant, required business acquisition consideration, minimum | $ 250 |
Revolving Credit Facility [Member] | Minimum [Member] | |
Line of Credit Facility [Line Items] | |
Credit facility, covenant, pro forma leverage ratio | 2.75 |
Revolving Credit Facility [Member] | Maximum [Member] | |
Line of Credit Facility [Line Items] | |
Credit facility, covenant, pro forma leverage ratio | 3.25 |
Debt (Details Textual)
Debt (Details Textual) $ in Thousands | Jan. 28, 2016USD ($) | Oct. 09, 2014USD ($) | Mar. 31, 2018USD ($) | Dec. 30, 2017USD ($) |
Debt Instrument [Line Items] | ||||
Unamortized discount | $ 5,408 | $ 5,631 | ||
Long-term Debt [Member] | Term Loan Due 2019 [Member] | ||||
Debt Instrument [Line Items] | ||||
Aggregate principal amount, issued | $ 300,000 | $ 300,000 | 300,000 | |
Debt instrument, term | 3 years | |||
Debt instrument, maturity date | Jan. 28, 2019 | |||
Debt instrument, covenant, debt to EBITDA ratio | 3 | |||
Debt instrument, covenant, debt to EBITDA ratio after step up triggered by acquisition | 3.50 | |||
Debt instrument, covenant, required business acquisition consideration, minimum | $ 250,000 | |||
Unamortized discount | $ 174 | 226 | ||
Long-term Debt [Member] | Term Loan Due 2019 [Member] | London Interbank Offered Rate (LIBOR) [Member] | ||||
Debt Instrument [Line Items] | ||||
Debt instrument, interest rate at period end | 2.80% | |||
Long-term Debt [Member] | Term Loan Due 2019 [Member] | Minimum [Member] | ||||
Debt Instrument [Line Items] | ||||
Debt instrument, covenant, pro forma leverage ratio | 2.75 | |||
Long-term Debt [Member] | Term Loan Due 2019 [Member] | Minimum [Member] | London Interbank Offered Rate (LIBOR) [Member] | ||||
Debt Instrument [Line Items] | ||||
Debt instrument, interest rate spread | 1.125% | |||
Long-term Debt [Member] | Term Loan Due 2019 [Member] | Maximum [Member] | ||||
Debt Instrument [Line Items] | ||||
Debt instrument, covenant, pro forma leverage ratio | 3.25 | |||
Long-term Debt [Member] | Term Loan Due 2019 [Member] | Maximum [Member] | London Interbank Offered Rate (LIBOR) [Member] | ||||
Debt Instrument [Line Items] | ||||
Debt instrument, interest rate spread | 1.875% | |||
Senior Notes [Member] | Senior Notes Due 2024 [Member] | ||||
Debt Instrument [Line Items] | ||||
Aggregate principal amount, issued | $ 350,000 | $ 350,000 | 350,000 | |
Stated interest rate of Senior Notes | 4.375% | |||
Proceeds from Senior Notes, net | $ 342,400 | |||
Unamortized discount | 1,400 | $ 5,234 | $ 5,405 | |
Debt issuance costs | $ 6,200 |
Cash, Cash Equivalents and In42
Cash, Cash Equivalents and Investments (Details) - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 30, 2017 | Apr. 01, 2017 | Dec. 31, 2016 |
Cash, Cash Equivalents and Investments [Abstract] | ||||
Cash and cash equivalents | $ 746,968 | $ 688,087 | $ 544,128 | $ 465,232 |
Short-term investments | 5,466 | 4,455 | ||
Cash, cash equivalents, and short-term investments | $ 752,434 | $ 692,542 |
Cash, Cash Equivalents and In43
Cash, Cash Equivalents and Investments (Details 1) - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 30, 2017 | Apr. 01, 2017 | Dec. 31, 2016 |
Classified as cash and cash equivalents | ||||
Cash | $ 302,401 | $ 184,153 | ||
Money market funds | 444,567 | 503,934 | ||
Total cash and cash equivalents | $ 746,968 | $ 688,087 | $ 544,128 | $ 465,232 |
Cash, Cash Equivalents and In44
Cash, Cash Equivalents and Investments Cash, Cash Equivalents and Investments (Details 2) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Apr. 01, 2017 | |
Schedule of Available-for-sale Securities [Line Items] | ||
Gain (Loss) on Investments | $ 1,123 | $ 1,228 |
Marketable Equity Securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Gain (Loss) on Investments | $ 1,000 |
Receivables, net (Details)
Receivables, net (Details) - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 30, 2017 |
Current and long-term receivables balances | ||
Accounts receivable | $ 117,065 | $ 119,325 |
Unbilled accounts receivable | 109,423 | 71,101 |
Long-term receivables | 9,380 | 12,239 |
Total receivables | 235,868 | 202,665 |
Less allowance for doubtful accounts | (666) | 0 |
Total receivables, net | $ 235,202 | $ 202,665 |
Receivables, net (Details Textu
Receivables, net (Details Textual) - Customer | Mar. 31, 2018 | Dec. 30, 2017 |
Accounts Receivable and Allowances for Doubtful Accounts (Textual) [Abstract] | ||
Percentage of receivables, net attributable to single customer | 10.00% | |
Number of customers with receivables balance greater than ten percent of total balance | 0 | 1 |
Revenue Revenue (Details Textua
Revenue Revenue (Details Textuals) $ in Millions | 3 Months Ended |
Mar. 31, 2018USD ($) | |
Revenue from Contract with Customer [Abstract] | |
Percentage of revenue mix recognizable over time | 90.00% |
Revenue recognized from deferred revenue during the period | $ 142.6 |
Unsatisfied performance obligations | $ 2,600 |
Percent of remaining performance obligations, current | 60.00% |
Revenue recognized from satisfaction of performance obligations | $ 6.2 |
Capitalized contract costs, net | 24.5 |
Amortization of capitalized contract costs | $ 5.2 |
Revenue Revenue (Details)
Revenue Revenue (Details) | 3 Months Ended | |
Mar. 31, 2018 | Apr. 01, 2017 | |
Revenue from External Customer [Line Items] | ||
Percentage of product and maintenance revenue by product group | 100.00% | 100.00% |
Functional Verification, including Emulation and Prototyping Hardware | ||
Revenue from External Customer [Line Items] | ||
Percentage of product and maintenance revenue by product group | 26.00% | 23.00% |
Digital IC Design and Signoff | ||
Revenue from External Customer [Line Items] | ||
Percentage of product and maintenance revenue by product group | 30.00% | 29.00% |
Custom IC Design | ||
Revenue from External Customer [Line Items] | ||
Percentage of product and maintenance revenue by product group | 26.00% | 26.00% |
System Interconnect and Analysis | ||
Revenue from External Customer [Line Items] | ||
Percentage of product and maintenance revenue by product group | 9.00% | 10.00% |
IP | ||
Revenue from External Customer [Line Items] | ||
Percentage of product and maintenance revenue by product group | 9.00% | 12.00% |
Revenue Revenue (Details 1)
Revenue Revenue (Details 1) - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 30, 2017 |
Revenue from Contract with Customer [Abstract] | ||
Contract assets | $ 6,077 | $ 3,964 |
Deferred revenue | $ 366,915 | $ 336,060 |
Income Taxes (Details Textual)
Income Taxes (Details Textual) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||
Mar. 31, 2018 | Apr. 01, 2017 | Dec. 29, 2018 | Dec. 30, 2017 | |
Additional Income Taxes (Textual) [Abstract] | ||||
Provision for income taxes | $ 5,284 | $ 5,923 | ||
Excess Tax Benefit of Stock-Based Compensation, Component of Provision for Income Taxes | 8,700 | |||
United States statutory federal income tax rate | 35.00% | |||
Effective Income Tax Rate Reconciliation, Repatriation of Foreign Earnings, Amount | $ 2,600 | |||
Scenario, Forecast [Member] | ||||
Additional Income Taxes (Textual) [Abstract] | ||||
United States statutory federal income tax rate | 21.00% |
Stock Based Compensation (Detai
Stock Based Compensation (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Apr. 01, 2017 | |
Share-based compensation expense and allocation by cost [Line Items] | ||
Share-based Compensation | $ 37,901 | $ 27,436 |
Cost of product and maintenance | ||
Share-based compensation expense and allocation by cost [Line Items] | ||
Share-based Compensation | 590 | 529 |
Cost of services | ||
Share-based compensation expense and allocation by cost [Line Items] | ||
Share-based Compensation | 863 | 761 |
Marketing and sales | ||
Share-based compensation expense and allocation by cost [Line Items] | ||
Share-based Compensation | 7,614 | 6,008 |
Research and development | ||
Share-based compensation expense and allocation by cost [Line Items] | ||
Share-based Compensation | 23,235 | 15,482 |
General and administrative | ||
Share-based compensation expense and allocation by cost [Line Items] | ||
Share-based Compensation | $ 5,599 | $ 4,656 |
Stock Based Compensation (Det52
Stock Based Compensation (Details Textual) - Stock option and restricted stock grants [Member] $ in Millions | 3 Months Ended |
Mar. 31, 2018USD ($) | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Total unrecognized compensation expense | $ 261.8 |
Weighted-average vesting period over which unrecognized compensation expense will be recognized | 2 years 1 month 6 days |
Goodwill and Acquired Intangi53
Goodwill and Acquired Intangibles (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2018USD ($) | |
Changes in the carrying amount of goodwill | |
Balance as of December 30, 2017 | $ 666,009 |
Effect of foreign currency translation | (394) |
Balance as of March 31, 2018 | $ 665,615 |
Goodwill and Acquired Intangi54
Goodwill and Acquired Intangibles (Details 1) - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 30, 2017 |
Acquired intangibles with finite lives, excluding intangibles fully amortized at end of prior fiscal year | ||
Gross carrying amount | $ 488,445 | $ 504,791 |
Accumulated amortization | (295,018) | (297,456) |
Acquired intangibles, net | 193,427 | 207,335 |
In-process technology | 71,500 | 71,500 |
Intangible Assets, Gross (Excluding Goodwill) | 559,945 | 576,291 |
Intangible Assets, Net (Excluding Goodwill) | 264,927 | 278,835 |
Existing Technology [Member] | ||
Acquired intangibles with finite lives, excluding intangibles fully amortized at end of prior fiscal year | ||
Gross carrying amount | 331,162 | 342,810 |
Accumulated amortization | (197,877) | (199,529) |
Acquired intangibles, net | 133,285 | 143,281 |
Agreements and Relationships [Member] | ||
Acquired intangibles with finite lives, excluding intangibles fully amortized at end of prior fiscal year | ||
Gross carrying amount | 146,565 | 151,063 |
Accumulated amortization | (89,725) | (90,675) |
Acquired intangibles, net | 56,840 | 60,388 |
Tradenames Trademarks And Patents [Member] | ||
Acquired intangibles with finite lives, excluding intangibles fully amortized at end of prior fiscal year | ||
Gross carrying amount | 10,718 | 10,918 |
Accumulated amortization | (7,416) | (7,252) |
Acquired intangibles, net | $ 3,302 | $ 3,666 |
Goodwill and Acquired Intangi55
Goodwill and Acquired Intangibles (Details 2) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Apr. 01, 2017 | |
Amortization of acquired intangibles | ||
Cost of product and maintenance | $ 10,277 | $ 10,578 |
Amortization of acquired intangibles | 3,630 | 3,856 |
Total amortization of acquired intangibles | $ 13,907 | $ 14,434 |
Goodwill and Acquired Intangi56
Goodwill and Acquired Intangibles (Details 3) - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 30, 2017 |
Estimated amortization expense | ||
2018 – remaining period | $ 39,446 | |
2,018 | 46,234 | |
2,019 | 40,619 | |
2,020 | 36,115 | |
2,021 | 17,810 | |
Thereafter | 13,203 | |
Acquired intangibles, net | $ 193,427 | $ 207,335 |
Restructuring and Other Charg57
Restructuring and Other Charges (Details Textual) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Dec. 30, 2017 | |
Restructuring Cost and Reserve [Line Items] | ||
Restructuring reserve | $ 4,764 | $ 13,784 |
Prior Restructuring Plans [Member] | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring and other credits | (1,991) | |
Restructuring reserve | 4,800 | |
Accounts Payable and Accrued Liabilities [Member] | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring reserve | $ 4,764 |
Restructuring and Other Charg58
Restructuring and Other Charges (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Apr. 01, 2017 | |
Restructuring Cost and Reserve [Line Items] | ||
Beginning balance | $ 13,784 | |
Restructuring and other credits | (1,991) | $ (1,788) |
Cash payments | (7,019) | |
Effect of foreign currency translation | (10) | |
Ending balance | 4,764 | |
Employee Severance and Benefits [Member] | ||
Restructuring Cost and Reserve [Line Items] | ||
Beginning balance | 13,535 | |
Cash payments | (6,813) | |
Effect of foreign currency translation | (10) | |
Ending balance | 4,764 | |
Excess Facilities [Member] | ||
Restructuring Cost and Reserve [Line Items] | ||
Beginning balance | 249 | |
Cash payments | (206) | |
Effect of foreign currency translation | 0 | |
Ending balance | 0 | |
Prior restructuring plans [Member] | ||
Restructuring Cost and Reserve [Line Items] | ||
Ending balance | 4,800 | |
Restructuring and other credits | (1,991) | |
Prior restructuring plans [Member] | Employee Severance and Benefits [Member] | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring and other credits | (1,948) | |
Prior restructuring plans [Member] | Excess Facilities [Member] | ||
Restructuring Cost and Reserve [Line Items] | ||
Restructuring and other credits | $ (43) |
Net Income Per Share (Details)
Net Income Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Apr. 01, 2017 | |
Earnings Per Share, Basic and Diluted [Abstract] | ||
Net income | $ 72,885 | $ 68,259 |
Weighted-average common shares used to calculate basic net income per share (in shares) | 273,773 | 270,173 |
Stock-based awards | 7,878 | 7,563 |
Weighted average common shares used to calculate diluted net income per share (in shares) | 281,651 | 277,736 |
Net income per share - basic (in usd per share) | $ 0.27 | $ 0.25 |
Net income per share - diluted (in usd per share) | $ 0.26 | $ 0.25 |
Net Income Per Share (Details 1
Net Income Per Share (Details 1) - shares shares in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Apr. 01, 2017 | |
Potential shares of Cadence's common stock excluded | ||
Total potential common shares excluded | 845 | 784 |
Long-term performance-based stock awards | ||
Potential shares of Cadence's common stock excluded | ||
Total potential common shares excluded | 150 | 232 |
Options to purchase shares of common stock | ||
Potential shares of Cadence's common stock excluded | ||
Total potential common shares excluded | 416 | 391 |
Non-vested shares of restricted stock | ||
Potential shares of Cadence's common stock excluded | ||
Total potential common shares excluded | 279 | 161 |
Stock Repurchase Program (Detai
Stock Repurchase Program (Details) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | ||
Mar. 31, 2018 | Apr. 01, 2017 | Jan. 31, 2017 | |
Class of Stock Disclosures [Abstract] | |||
Authorized amount | $ 525,000 | ||
Remaining authorized repurchase amount | $ 375,000 | ||
Shares repurchased | 1,289 | 0 | |
Total cost of repurchased shares | $ 50,013 | $ 0 |
Fair Value (Details)
Fair Value (Details) - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 30, 2017 |
Short-term investments: | ||
Trading securities held in Non-Qualified Deferred Compensation plan, or NQDC | $ 26,709 | $ 31,473 |
Foreign Currency Contract, Asset, Fair Value Disclosure | 2,937 | |
Total Assets | 476,742 | 542,799 |
Liabilities | ||
Foreign currency exchange contracts | 754 | |
Marketable Equity Securities | ||
Short-term investments: | ||
Available-for-sale securities | 5,466 | 4,455 |
Money market funds [Member] | ||
Assets | ||
Cash equivalents | 444,567 | 503,934 |
Fair Value Measurements, Level 1 [Member] | ||
Short-term investments: | ||
Trading securities held in Non-Qualified Deferred Compensation plan, or NQDC | 26,709 | 31,473 |
Foreign Currency Contract, Asset, Fair Value Disclosure | 0 | |
Total Assets | 476,742 | 539,862 |
Liabilities | ||
Foreign currency exchange contracts | 0 | |
Fair Value Measurements, Level 1 [Member] | Marketable Equity Securities | ||
Short-term investments: | ||
Available-for-sale securities | 5,466 | 4,455 |
Fair Value Measurements, Level 1 [Member] | Money market funds [Member] | ||
Assets | ||
Cash equivalents | 444,567 | 503,934 |
Fair Value Measurements, Level 2 [Member] | ||
Short-term investments: | ||
Trading securities held in Non-Qualified Deferred Compensation plan, or NQDC | 0 | 0 |
Foreign Currency Contract, Asset, Fair Value Disclosure | 2,937 | |
Total Assets | 0 | 2,937 |
Liabilities | ||
Foreign currency exchange contracts | 754 | |
Fair Value Measurements, Level 2 [Member] | Marketable Equity Securities | ||
Short-term investments: | ||
Available-for-sale securities | 0 | 0 |
Fair Value Measurements, Level 2 [Member] | Money market funds [Member] | ||
Assets | ||
Cash equivalents | 0 | 0 |
Fair Value Measurements, Level 3 [Member] | ||
Short-term investments: | ||
Trading securities held in Non-Qualified Deferred Compensation plan, or NQDC | 0 | 0 |
Foreign Currency Contract, Asset, Fair Value Disclosure | 0 | |
Total Assets | 0 | 0 |
Liabilities | ||
Foreign currency exchange contracts | 0 | |
Fair Value Measurements, Level 3 [Member] | Marketable Equity Securities | ||
Short-term investments: | ||
Available-for-sale securities | 0 | 0 |
Fair Value Measurements, Level 3 [Member] | Money market funds [Member] | ||
Assets | ||
Cash equivalents | $ 0 | $ 0 |
Contingencies (Details Textual)
Contingencies (Details Textual) | 3 Months Ended |
Mar. 31, 2018 | |
Contingencies (Textual) [Abstract] | |
General period of warranty on sales of hardware products | 90 days |
Accumulated Other Comprehensi64
Accumulated Other Comprehensive Loss (Details) - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 30, 2017 |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | ||
Foreign currency translation gain (loss) | $ 9,082 | $ (2,976) |
Changes in defined benefit plan liabilities | (3,142) | (3,292) |
Unrealized holding gains on available-for-sale securities | 0 | 2,638 |
Total accumulated other comprehensive income (loss) | $ 5,940 | $ (3,630) |
Segment Reporting (Details)
Segment Reporting (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2018 | Apr. 01, 2017 | |
Americas: | ||
Total Americas | $ 232,469 | $ 213,190 |
Total revenue | 517,313 | 476,911 |
United States [Member] | ||
Entity Wide Disclosure on Geographic Areas Revenue from External Customers | ||
Geographic areas, revenue from external customers | 224,803 | 205,435 |
Other Americas [Member] | ||
Entity Wide Disclosure on Geographic Areas Revenue from External Customers | ||
Geographic areas, revenue from external customers | 7,666 | 7,755 |
Asia [Member] | ||
Entity Wide Disclosure on Geographic Areas Revenue from External Customers | ||
Geographic areas, revenue from external customers | 139,947 | 122,423 |
EMEA [Member] | ||
Entity Wide Disclosure on Geographic Areas Revenue from External Customers | ||
Geographic areas, revenue from external customers | 104,708 | 98,321 |
Japan [Member] | ||
Entity Wide Disclosure on Geographic Areas Revenue from External Customers | ||
Geographic areas, revenue from external customers | $ 40,189 | $ 42,977 |
Segment Reporting (Details 1)
Segment Reporting (Details 1) - USD ($) $ in Thousands | Mar. 31, 2018 | Dec. 30, 2017 |
Americas: | ||
Total Americas | $ 197,257 | $ 199,355 |
Total long-lived assets | 249,810 | 251,342 |
United States [Member] | ||
Summary of long-lived assets by geography | ||
Long-Lived Assets in Individual Foreign Countries | 196,628 | 198,744 |
Other Americas [Member] | ||
Summary of long-lived assets by geography | ||
Long-Lived Assets in Individual Foreign Countries | 629 | 611 |
Asia [Member] | ||
Summary of long-lived assets by geography | ||
Long-Lived Assets in Individual Foreign Countries | 38,030 | 37,678 |
EMEA [Member] | ||
Summary of long-lived assets by geography | ||
Long-Lived Assets in Individual Foreign Countries | 13,856 | 13,615 |
Japan [Member] | ||
Summary of long-lived assets by geography | ||
Long-Lived Assets in Individual Foreign Countries | $ 667 | $ 694 |