Cover Page
Cover Page | 3 Months Ended |
Mar. 31, 2023 shares | |
Cover [Abstract] | |
Document Type | 10-Q |
Document Quarterly Report | true |
Document Period End Date | Mar. 31, 2023 |
Document Transition Report | false |
Entity File Number | 000-15867 |
Entity Registrant Name | CADENCE DESIGN SYSTEMS, INC. |
Entity Incorporation, State or Country Code | DE |
Entity Tax Identification Number | 00-0000000 |
Entity Address, Address Line One | 2655 Seely Avenue, Building 5, |
Entity Address, City or Town | San Jose, |
Entity Address, State or Province | CA |
Entity Address, Postal Zip Code | 95134 |
City Area Code | (408) |
Local Phone Number | 943-1234 |
Entity Current Reporting Status | Yes |
Entity Interactive Data Current | Yes |
Entity Filer Category | Large Accelerated Filer |
Entity Small Business | false |
Entity Emerging Growth Company | false |
Entity Shell Company | false |
Title of 12(b) Security | Common Stock, $0.01 par value per share |
Trading Symbol | CDNS |
Security Exchange Name | NASDAQ |
Entity Common Stock, Shares Outstanding | 272,684,000 |
Entity Central Index Key | 0000813672 |
Amendment Flag | false |
Document Fiscal Year Focus | 2023 |
Document Fiscal Period Focus | Q1 |
Current Fiscal Year End Date | --12-31 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Current assets: | ||
Cash and cash equivalents | $ 916,963 | $ 882,325 |
Receivables, net | 488,237 | 486,710 |
Inventories | 127,566 | 128,005 |
Prepaid expenses and other | 165,778 | 209,727 |
Total current assets | 1,698,544 | 1,706,767 |
Property, plant and equipment, net | 372,956 | 371,451 |
Goodwill | 1,377,625 | 1,374,268 |
Acquired intangibles, net | 341,738 | 354,617 |
Deferred taxes | 864,750 | 853,691 |
Other assets | 516,006 | 476,277 |
Total assets | 5,171,619 | 5,137,071 |
Current liabilities: | ||
Revolving credit facility | 30,000 | 100,000 |
Accounts payable and accrued liabilities | 430,135 | 557,158 |
Current portion of deferred revenue | 721,246 | 690,538 |
Total current liabilities | 1,181,381 | 1,347,696 |
Long-term liabilities: | ||
Long-term portion of deferred revenue | 102,515 | 91,524 |
Long-term debt | 648,301 | 648,078 |
Other long-term liabilities | 298,546 | 304,660 |
Total long-term liabilities | 1,049,362 | 1,044,262 |
Commitments and contingencies | ||
Stockholders’ equity: | ||
Common stock and capital in excess of par value | 2,878,749 | 2,765,673 |
Treasury stock, at cost | (3,987,528) | (3,824,163) |
Retained earnings | 4,137,044 | 3,895,240 |
Accumulated other comprehensive loss | (87,389) | (91,637) |
Total stockholders’ equity | 2,940,876 | 2,745,113 |
Total liabilities and stockholders’ equity | $ 5,171,619 | $ 5,137,071 |
Condensed Consolidated Income S
Condensed Consolidated Income Statements - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Apr. 02, 2022 | |
Revenues [Abstract] | ||
Revenue | $ 1,021,690 | $ 901,766 |
Costs and Expenses: | ||
Marketing and sales | 166,666 | 140,186 |
Research and development | 350,295 | 290,895 |
General and administrative | 53,527 | 48,937 |
Amortization of acquired intangibles | 4,267 | 4,964 |
Restructuring | 0 | 12 |
Total costs and expenses | 699,227 | 582,837 |
Income from operations | 322,463 | 318,929 |
Interest expense | (9,260) | (4,108) |
Other income (expense), net | 8,284 | (4,900) |
Income before provision for income taxes | 321,487 | 309,921 |
Provision for income taxes | 79,683 | 74,586 |
Net income | $ 241,804 | $ 235,335 |
Net income per share - basic (usd per share) | $ 0.90 | $ 0.86 |
Net Income per share - diluted (usd per share) | $ 0.89 | $ 0.85 |
Weighted average common shares outstanding - basic (in shares) | 269,501 | 272,431 |
Weighted average common shares outstanding - diluted (in shares) | 273,159 | 276,918 |
Product and maintenance [Member] | ||
Revenues [Abstract] | ||
Revenue | $ 963,742 | $ 846,244 |
Costs and Expenses: | ||
Cost of sales | 100,238 | 72,795 |
Service [Member] | ||
Revenues [Abstract] | ||
Revenue | 57,948 | 55,522 |
Costs and Expenses: | ||
Cost of sales | $ 24,234 | $ 25,048 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Apr. 02, 2022 | |
Statement of Comprehensive Income [Abstract] | ||
Net income | $ 241,804 | $ 235,335 |
Other comprehensive income (loss), net of tax effects: | ||
Foreign currency translation adjustments | 3,955 | (14,774) |
Changes in defined benefit plan liabilities | 263 | 166 |
Unrealized gain on investments | 30 | 0 |
Total other comprehensive income (loss), net of tax effects | 4,248 | (14,608) |
Comprehensive income | $ 246,052 | $ 220,727 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Stockholders' Equity - USD ($) shares in Thousands, $ in Thousands | Total | Common Stock [Member] | Common Stock, Par Value and Capital in Excess of Par | Treasury Stock | Retained Earnings | Accumulated Other Comprehensive Loss |
Beginning balance at Jan. 01, 2022 | $ 2,740,675 | $ 2,467,701 | $ (2,740,003) | $ 3,046,288 | $ (33,311) | |
Beginning balance, shares at Jan. 01, 2022 | 276,796 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income | 235,335 | 235,335 | ||||
Other comprehensive loss, net of taxes | $ (14,608) | (14,608) | ||||
Purchase of treasury stock, shares | (1,566) | (1,566) | ||||
Purchase of treasury stock | $ (250,016) | (250,016) | ||||
Issuance of common stock and reissuance of treasury stock under equity incentive plans, net of forfeitures, shares | 874 | |||||
Issuance of common stock and reissuance of treasury stock under equity incentive plans, net of forfeitures | 45,671 | 31,402 | 14,269 | |||
Stock received for payment of employee taxes on vesting of restricted stock, shares | (345) | |||||
Stock received for payment of employee taxes on vesting of restricted stock | (56,343) | (6,365) | (49,978) | |||
Stock-based compensation expense | 59,469 | 59,469 | ||||
Ending balance at Apr. 02, 2022 | 2,760,183 | 2,552,207 | (3,025,728) | 3,281,623 | (47,919) | |
Ending balance, shares at Apr. 02, 2022 | 275,759 | |||||
Beginning balance at Dec. 31, 2022 | 2,745,113 | 2,765,673 | (3,824,163) | 3,895,240 | (91,637) | |
Beginning balance, shares at Dec. 31, 2022 | 272,675 | |||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net income | 241,804 | 241,804 | ||||
Other comprehensive loss, net of taxes | $ 4,248 | 4,248 | ||||
Purchase of treasury stock, shares | (668) | (668) | ||||
Purchase of treasury stock | $ (125,010) | (125,010) | ||||
Issuance of common stock and reissuance of treasury stock under equity incentive plans, net of forfeitures, shares | 972 | |||||
Issuance of common stock and reissuance of treasury stock under equity incentive plans, net of forfeitures | 68,145 | 47,246 | 20,899 | |||
Stock received for payment of employee taxes on vesting of restricted stock, shares | (295) | |||||
Stock received for payment of employee taxes on vesting of restricted stock | (67,712) | (8,458) | (59,254) | |||
Stock-based compensation expense | 74,288 | 74,288 | ||||
Ending balance at Mar. 31, 2023 | $ 2,940,876 | $ 2,878,749 | $ (3,987,528) | $ 4,137,044 | $ (87,389) | |
Ending balance, shares at Mar. 31, 2023 | 272,684 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Apr. 02, 2022 | |
Statement of Cash Flows [Abstract] | ||
Cash and cash equivalents at beginning of period | $ 882,325 | $ 1,088,940 |
Cash flows from operating activities: | ||
Net income | 241,804 | 235,335 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 34,400 | 34,825 |
Amortization of debt discount and fees | 311 | 268 |
Stock-based compensation | 74,288 | 59,469 |
(Gain) loss on investments, net | (123) | 2,038 |
Deferred income taxes | (11,640) | (24,920) |
Provisions for losses (recoveries) on receivables | 214 | (344) |
ROU asset amortization and change in operating lease liabilities | (1,392) | 926 |
Other non-cash items | 99 | 88 |
Changes in operating assets and liabilities, net of effect of acquired businesses: | ||
Receivables | (8,719) | (28,426) |
Inventories | 399 | 4,580 |
Prepaid expenses and other | 56,212 | 44,419 |
Other assets | (42,084) | 11,588 |
Accounts payable and accrued liabilities | (117,915) | (58,203) |
Deferred revenue | 40,650 | 56,225 |
Other long-term liabilities | 897 | (1,260) |
Net cash provided by operating activities | 267,401 | 336,608 |
Cash flows from investing activities: | ||
Purchases of investments | (9,055) | (1,000) |
Proceeds from the sale of investments | 102 | 0 |
Purchases of property, plant and equipment | (26,719) | (18,130) |
Purchases of intangible assets | 0 | 750 |
Net cash used for investing activities | (35,672) | (19,880) |
Cash flows from financing activities: | ||
Proceeds from revolving credit facility | 50,000 | 0 |
Payments on revolving credit facility | (120,000) | 0 |
Proceeds from issuance of common stock | 65,370 | 45,673 |
Stock received for payment of employee taxes on vesting of restricted stock | (67,712) | (56,343) |
Payments for repurchases of common stock | (125,010) | (250,016) |
Net cash used for financing activities | (197,352) | (260,686) |
Effect of exchange rate changes on cash and cash equivalents | 261 | (10,230) |
Increase in cash and cash equivalents | 34,638 | 45,812 |
Cash and cash equivalents at end of period | 916,963 | 1,134,752 |
Supplemental cash flow information: | ||
Cash paid for interest | 5,142 | 158 |
Cash paid for income taxes, net | $ 19,814 | $ 10,018 |
Basis of Presentation and Summa
Basis of Presentation and Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
BASIS OF PRESENTATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 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 31, 2022. 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. Certain prior period balances have been reclassified to conform to the current period presentation. Management has evaluated subsequent events through the issuance date of the unaudited condensed consolidated financial statements. Fiscal Year End In fiscal 2022, Cadence’s Board of Directors approved a change in its fiscal year end from the Saturday closest to December 31 of each year to December 31 of each year. The fiscal year change became effective with Cadence’s 2023 fiscal year, which began on January 1, 2023. Cadence’s fiscal quarters now end on March 31, June 30, and September 30. No transition report is required in connection with this change. 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. Despite continued uncertainty and disruption in the global economy and financial markets, Cadence is not aware of any specific event or circumstance that would require an update to its estimates or judgments or a revision of the carrying value of its assets or liabilities as of April 24, 2023, the date of issuance of this Quarterly Report on Form 10-Q. These estimates may change, as new events or developments occur and additional information is obtained. Actual results could differ materially from these estimates under different assumptions or conditions. Recently Adopted Accounting Standards There have been no recent accounting standard updates that are material or potentially material to Cadence. |
Revenue
Revenue | 3 Months Ended |
Mar. 31, 2023 | |
Revenue from Contract with Customer [Abstract] | |
REVENUE | REVENUE Cadence groups its products and services into five categories related to major design activities. The following table shows the percentage of revenue contributed by each of Cadence’s five product categories for the three months ended March 31, 2023 and April 2, 2022: Three Months Ended March 31, April 2, Custom Integrated Circuit (“IC”) Design and Simulation 20 % 22 % Digital IC Design and Signoff 25 % 27 % Functional Verification, including Emulation and Prototyping Hardware* 32 % 28 % Intellectual Property (“IP”) 11 % 13 % System Design and Analysis 12 % 10 % Total 100 % 100 % _____________ * Includes immaterial amount of revenue accounted for under leasing arrangements. Cadence generates revenue from contracts with customers and applies judgment in identifying and evaluating any terms and conditions in contracts which may impact revenue recognition. 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 categories based upon the expected usage of products. Revenue by product category fluctuates from period to period based on demand for products and services, and Cadence’s available resources to deliver them. No single customer accounted for 10% or more of total revenue during the three months ended March 31, 2023 or April 2, 2022. Approximately 85% of Cadence’s annual revenue is characterized as recurring revenue. Recurring revenue includes revenue recognized over time from Cadence’s software arrangements, services, royalties, maintenance on IP licenses and hardware, and operating leases of hardware. Recurring revenue also includes revenue recognized at varying points in time over the term of other arrangements with non-cancelable commitments, whereby the customer commits to a fixed dollar amount over a specified period of time that can be used to purchase from a list of products or services. These arrangements do not meet the definition of a revenue contract until the customer executes a separate selection form to identify the products and services that they are purchasing. Each separate selection form under the arrangement is treated as an individual contract and accounted for based on the respective performance obligations. The remainder of Cadence’s revenue is recognized at a point in time and is characterized as up-front revenue. Up-front revenue is primarily generated by sales of emulation and prototyping hardware and individual IP licenses. The percentage of Cadence’s recurring and up-front revenue is impacted by delivery of hardware and IP products to its customers in any single fiscal period. The following table shows the percentage of Cadence’s revenue that is classified as recurring or up-front for the three months ended March 31, 2023 and April 2, 2022: Three Months Ended March 31, April 2, Revenue recognized over time 77 % 81 % Revenue from arrangements with non-cancelable commitments 3 % 2 % Recurring revenue 80 % 83 % Up-front revenue 20 % 17 % Total 100 % 100 % Significant Judgments Cadence’s contracts with customers often include promises to transfer to a customer multiple software and/or IP licenses and services, including professional services, technical support services, and rights to unspecified updates. 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. 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. The accounting for contracts with multiple performance obligations requires the contract’s transaction price to be allocated to each distinct performance obligation based on relative stand-alone selling price (“SSP”). Judgment is required to determine the SSP for each distinct performance obligation because Cadence rarely licenses or sells products on a standalone basis. In instances where the SSP is not directly observable because Cadence does not sell the license, product or service separately, Cadence determines the SSP using information that maximizes the use of observable inputs and may include market conditions. 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 combined performance obligations that include software licenses, updates, technical support and maintenance that are separate performance obligations with the same term. 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 a 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 sheets. For certain software, hardware and IP agreements with payment plans, Cadence records an unbilled receivable related to revenue recognized upon transfer of control because it has an unconditional right to invoice and receive payment in the future related to those transferred products or services. Cadence records a contract asset when revenue is recognized prior to invoicing and Cadence does not have the unconditional right to invoice or retains performance risk with respect to that performance obligation. Cadence records 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. The contract assets indicated below are included in prepaid expenses and other in the condensed consolidated balance sheets and primarily relate to Cadence’s rights to consideration for work completed but not billed as of the balance sheet date 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, 2023 and December 31, 2022 were as follows: As of March 31, December 31, (In thousands) Contract assets $ 17,167 $ 22,766 Deferred revenue 823,761 782,062 Cadence recognized revenue of $363.2 million during the three months ended March 31, 2023, and $281.6 million during the three months ended April 2, 2022, that was included in the deferred revenue balance at the beginning of each respective fiscal year. All other activity in deferred revenue is due to the timing of invoices in relation to the timing of revenue as described above. 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. Remaining Performance Obligations 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. Cadence has elected to exclude the potential future royalty receipts from the remaining performance obligations. Contracted but unsatisfied performance obligations were approximately $5.4 billion as of March 31, 2023, which included $0.4 billion of non-cancelable commitments from customers where actual product selection and quantities of specific products or services are to be determined by customers at a later date. As of March 31, 2023, Cadence expected to recognize 55% of the contracted but unsatisfied performance obligations, excluding non-cancelable commitments, as revenue over the next 12 months. Cadence recognized revenue of $15.2 million during the three months ended March 31, 2023, and $12.2 million during the three months ended April 2, 2022, from performance obligations satisfied in previous periods. These amounts represent royalties earned during the period and exclude 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. |
Receivables, net
Receivables, net | 3 Months Ended |
Mar. 31, 2023 | |
Receivables [Abstract] | |
RECEIVABLES, NET | RECEIVABLES, NET Cadence’s current and long-term receivables balances as of March 31, 2023 and December 31, 2022 were as follows: As of March 31, December 31, (In thousands) Accounts receivable $ 346,968 $ 314,666 Unbilled accounts receivable 143,773 174,334 Long-term receivables 9,994 2,735 Total receivables 500,735 491,735 Less allowance for doubtful accounts (2,504) (2,290) Total receivables, net $ 498,231 $ 489,445 |
Debt
Debt | 3 Months Ended |
Mar. 31, 2023 | |
Debt Disclosure [Abstract] | |
DEBT | DEBT Cadence’s outstanding debt as of March 31, 2023 and December 31, 2022 was as follows: March 31, 2023 December 31, 2022 (In thousands) Principal Unamortized Discount Carrying Value Principal Unamortized Discount Carrying Value Revolving Credit Facility $ 30,000 $ — $ 30,000 $ 100,000 $ — $ 100,000 2024 Notes 350,000 (1,368) 348,632 350,000 (1,581) 348,419 2025 Term Loan 300,000 (331) 299,669 300,000 (341) 299,659 Total outstanding debt $ 680,000 $ (1,699) $ 678,301 $ 750,000 $ (1,922) $ 748,078 Revolving Credit Facility In June 2021, Cadence entered into a five-year senior unsecured revolving credit facility with a group of lenders led by Bank of America, N.A., as administrative agent (the “2021 Credit Facility”). In September 2022, Cadence amended the 2021 Credit Facility to, among other things, allow Cadence to change its fiscal year to match the calendar year commencing in 2023 and change the interest rate benchmark for loans under the 2021 Credit Facility from the London Inter-Bank Offered Rate (“LIBOR”) to Term Secured Overnight Financing Rate (“SOFR”). The material terms of the 2021 Credit Facility otherwise remain unchanged. The 2021 Credit Facility provides for borrowings up to $700.0 million, with the right to request increased capacity up to an additional $350.0 million upon the receipt of lender commitments, for total maximum borrowings of $1.05 billion. The 2021 Credit Facility expires on June 30, 2026. Any outstanding loans drawn under the 2021 Credit Facility are due at maturity on June 30, 2026, subject to an option to extend the maturity date. Outstanding borrowings may be repaid at any time prior to maturity. Debt issuance costs of $1.3 million were recorded to other assets in Cadence’s condensed consolidated balance sheet at the inception of the agreement and are being amortized to interest expense over the term of the 2021 Credit Facility. Interest accrues on borrowings under the 2021 Credit Facility at a rate equal to, at Cadence’s option, either (1) SOFR plus a margin between 0.750% and 1.250% per annum, determined by reference to the credit rating of Cadence’s unsecured debt, plus a SOFR adjustment of 0.10% or (2) the base rate plus a margin between 0.000% and 0.250% per annum, determined by reference to the credit rating of Cadence’s unsecured debt. As of March 31, 2023, the interest rate on the 2021 Credit Facility was 5.73%. Interest is payable quarterly. A commitment fee ranging from 0.070% to 0.175% is assessed on the daily average undrawn portion of revolving commitments. Borrowings bear interest at what is estimated to be current market rates of interest. Accordingly, the carrying value of the 2021 Credit Facility approximates fair value. The 2021 Credit Facility contains customary negative covenants that, among other things, restrict Cadence’s ability to incur additional indebtedness, grant liens and make certain asset dispositions. In addition, the 2021 Credit Facility contains financial covenants that require Cadence to maintain a funded debt to EBITDA ratio not greater than 3.25 to 1, with a step up to 3.75 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 3.00 to 1 and 3.50 to 1. As of March 31, 2023, Cadence was in compliance with all financial covenants associated with the 2021 Credit Facility. 2024 Notes In October 2014, Cadence issued a $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. The fair value of the 2024 Notes was approximately $347.0 million as of March 31, 2023. 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. 2025 Term Loan In September 2022, Cadence entered into a $300.0 million three-year senior non-amortizing term loan facility due on September 7, 2025 with a group of lenders led by Bank of America, N.A., as administrative agent (the “2025 Term Loan”). The 2025 Term Loan is unsecured and ranks equal in right of payment to all of Cadence’s unsecured indebtedness. Proceeds from the loan were used to fund Cadence’s acquisition of OpenEye Scientific Software, Inc. Debt issuance costs associated with the 2025 Term Loan were not material. Amounts outstanding under the 2025 Term Loan accrue interest at a rate equal to, at Cadence’s option, either (1) Term SOFR plus a margin between 0.625% and 1.125% per annum, determined by reference to the credit rating of Cadence’s unsecured debt, plus a SOFR adjustment of 0.10% or (2) base rate plus a margin between 0.000% and 0.125% per annum, determined by reference to the credit rating of Cadence’s unsecured debt. As of March 31, 2023, the interest rate on the 2025 Term Loan was 5.80%. Interest is payable quarterly. Borrowings bear interest at what is estimated to be current market rates of interest. Accordingly, the carrying value of the 2025 Term Loan approximates fair value. The 2025 Term Loan contains customary negative covenants that, among other things, restrict Cadence’s ability to incur additional indebtedness, grant liens and make certain asset dispositions. In addition, the 2025 Term Loan contains a financial covenant that requires Cadence to maintain a funded debt to EBITDA ratio not greater than 3.25 to 1, with a step-up to 3.75 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 3.00 to 1 and 3.50 to 1. As of March 31, 2023, Cadence was in compliance with all financial covenants associated with the 2025 Term Loan. |
Goodwill and Acquired Intangibl
Goodwill and Acquired Intangibles | 3 Months Ended |
Mar. 31, 2023 | |
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, 2023 were as follows: Gross Carrying (In thousands) Balance as of December 31, 2022 $ 1,374,268 Effect of foreign currency translation 3,357 Balance as of March 31, 2023 $ 1,377,625 Acquired Intangibles, Net Acquired intangibles as of March 31, 2023 were as follows, excluding intangibles that were fully amortized as of December 31, 2022: Gross Carrying Accumulated Acquired (In thousands) Existing technology $ 300,259 $ (108,476) $ 191,783 Agreements and relationships 181,995 (48,664) 133,331 Tradenames, trademarks and patents 13,058 (3,234) 9,824 Total acquired intangibles with definite lives 495,312 (160,374) 334,938 In-process technology 6,800 — 6,800 Total acquired intangibles $ 502,112 $ (160,374) $ 341,738 In-process technology as of March 31, 2023 consisted of acquired projects that, if completed, will contribute to Cadence’s existing product offerings. As of March 31, 2023, these projects were expected to be completed during the fourth quarter of fiscal 2023. During the three months ended March 31, 2023, there were no transfers from in-process technology to existing technology. Acquired intangibles as of December 31, 2022 were as follows, excluding intangibles that were fully amortized as of January 1, 2022: Gross Carrying Accumulated Acquired (In thousands) Existing technology $ 479,796 $ (278,851) $ 200,945 Agreements and relationships 274,624 (137,847) 136,777 Tradenames, trademarks and patents 12,979 (2,884) 10,095 Total acquired intangibles with definite lives $ 767,399 $ (419,582) $ 347,817 In-process technology 6,800 — 6,800 Total acquired intangibles $ 774,199 $ (419,582) $ 354,617 Amortization expense from existing technology and maintenance agreements is included in cost of product and maintenance. Amortization expense for the three months ended March 31, 2023 and April 2, 2022 by condensed consolidated income statement caption was as follows: Three Months Ended March 31, April 2, (In thousands) Cost of product and maintenance $ 10,260 $ 11,971 Amortization of acquired intangibles 4,267 4,964 Total amortization of acquired intangibles $ 14,527 $ 16,935 As of March 31, 2023, the estimated amortization expense for intangible assets with definite lives was as follows for the following five fiscal years and thereafter: (In thousands) 2023 - remaining period $ 44,102 2024 57,059 2025 44,352 2026 38,567 2027 36,113 2028 33,491 Thereafter 81,254 Total estimated amortization expense $ 334,938 |
Stock Based Compensation
Stock Based Compensation | 3 Months Ended |
Mar. 31, 2023 | |
Share-Based Payment Arrangement [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, 2023 and April 2, 2022 as follows: Three Months Ended March 31, April 2, (In thousands) Cost of product and maintenance $ 1,066 $ 830 Cost of services 1,357 1,050 Marketing and sales 15,091 11,757 Research and development 44,322 35,122 General and administrative 12,452 10,710 Total stock-based compensation expense $ 74,288 $ 59,469 |
Stock Repurchase Program
Stock Repurchase Program | 3 Months Ended |
Mar. 31, 2023 | |
Class of Stock Disclosures [Abstract] | |
STOCK REPURCHASE PROGRAM | STOCK REPURCHASE PROGRAM In August 2022, Cadence’s Board of Directors increased the prior authorization to repurchase shares of Cadence common stock by authorizing an additional $1.0 billion. The actual timing and amount of repurchases are subject to business and market conditions, corporate and regulatory requirements, stock price, acquisition opportunities and other factors. As of March 31, 2023, approximately $952.0 million of Cadence’s share repurchase authorization remained available to repurchase shares of Cadence common stock. The shares repurchased under Cadence’s repurchase authorizations and the total cost of repurchased shares, including commissions, during the three months ended March 31, 2023 and April 2, 2022 were as follows: Three Months Ended March 31, April 2, (In thousands) Shares repurchased 668 1,566 Total cost of repurchased shares $ 125,010 $ 250,016 |
Net Income Per Share
Net Income Per Share | 3 Months Ended |
Mar. 31, 2023 | |
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, 2023 and April 2, 2022 are as follows: Three Months Ended March 31, April 2, (In thousands, except per share amounts) Net income $ 241,804 $ 235,335 Weighted average common shares used to calculate basic net income per share 269,501 272,431 Stock-based awards 3,658 4,487 Weighted average common shares used to calculate diluted net income per share 273,159 276,918 Net income per share - basic $ 0.90 $ 0.86 Net income per share - diluted $ 0.89 $ 0.85 The following table presents shares of Cadence’s common stock outstanding for the three months ended March 31, 2023 and April 2, 2022 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 2, (In thousands) Long-term market-based awards 1,826 1,035 Options to purchase shares of common stock 332 663 Non-vested shares of restricted stock 50 82 Total potential common shares excluded 2,208 1,780 |
Fair Value
Fair Value | 3 Months Ended |
Mar. 31, 2023 | |
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, 2023. 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, 2023 and December 31, 2022: Fair Value Measurements as of March 31, 2023 Total Level 1 Level 2 Level 3 (In thousands) Assets Cash equivalents: Money market funds $ 555,088 $ 555,088 $ — $ — Marketable securities: Marketable equity securities 4,747 4,747 — — Mortgage-backed and asset-backed securities 8,983 — 8,983 — Securities held in Non-Qualified Deferred Compensation (“NQDC”) trust 60,134 60,134 — — Total Assets $ 628,952 $ 619,969 $ 8,983 $ — Total Level 1 Level 2 Level 3 (In thousands) Liabilities Foreign currency exchange contracts $ 573 $ — $ 573 $ — Total Liabilities $ 573 $ — $ 573 $ — Fair Value Measurements as of December 31, 2022 Total Level 1 Level 2 Level 3 (In thousands) Assets Cash equivalents: Money market funds $ 548,373 $ 548,373 $ — $ — Marketable equity securities 4,490 4,490 — — Securities held in NQDC trust 55,605 55,605 — — Foreign currency exchange contracts 5,306 — 5,306 — Total Assets $ 613,774 $ 608,468 $ 5,306 $ — As of December 31, 2022, Cadence did not have any financial liabilities requiring a recurring fair value measurement. Level 1 Measurements Cadence’s cash equivalents held in money market funds, marketable equity securities and the trading securities held in Cadence’s NQDC trust are measured at fair value using Level 1 inputs. Level 2 Measurements The valuation techniques used to determine the fair value of Cadence’s investments in marketable debt securities, foreign currency forward exchange contracts and 2024 Notes are classified within Level 2 of the fair value hierarchy. For additional information relating to Cadence’s debt arrangements, see Note 4 in the notes to condensed consolidated financial statements. |
Inventory
Inventory | 3 Months Ended |
Mar. 31, 2023 | |
Inventory Disclosure [Abstract] | |
INVENTORY | INVENTORY Cadence’s inventory balances as of March 31, 2023 and December 31, 2022 were as follows: As of March 31, December 31, (In thousands) Inventories: Raw materials $ 117,975 $ 113,982 Finished goods 9,591 14,023 Total inventories $ 127,566 $ 128,005 |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
COMMITMENTS AND CONTINGENCIES | COMMITMENTS AND 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 legal proceedings related to intellectual property, indemnification obligations, mergers and acquisitions, licensing, contracts, customers, products, distribution and other commercial 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 best 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 . Tax Proceedings In December 2022, Cadence received a tax audit assessment of approximately $49 million from the Korea taxing authorities for years 2017-2019. The tax audit assessment is primarily related to value-added taxes (“VAT"). Cadence is required to pay these assessed taxes, prior to being allowed to contest or litigate the assessment in administrative and judicial proceedings. The assessment was paid by Cadence in January 2023 and recorded as a component of other assets in the condensed consolidated balance sheets. Payment of this amount is not an admission that Cadence is subject to such taxes, and Cadence continues to defend its position vigorously. Cadence did not record a reserve for this contingency as of March 31, 2023 or December 31, 2022 as Cadence does not believe a loss is probable because it believes it will ultimately prevail in full. The entire dispute resolution process may take from one to eight years. 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, 2023 and April 2, 2022. 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. In connection with a litigation campaign launched by Bell Semiconductor LLC (“Bell Semi”), a patent monetization entity, some customers have requested defense and indemnification against claims of patent infringement asserted by Bell Semi in various district court litigation and at the U.S. International Trade Commission. Bell Semi alleges that the customers’ use of one or more features of certain Cadence products infringes one or more of six patents held by Bell Semi. Cadence has offered to defend some of its customers consistent with the terms of its license agreements. Cadence is unable to estimate the potential impact of these commitments on the future results of operations at this time. Cadence did not incur any material losses from indemnification claims during the three months ended March 31, 2023 and April 2, 2022. |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Loss | 3 Months Ended |
Mar. 31, 2023 | |
Other Comprehensive Income (Loss), Net of Tax [Abstract] | |
ACCUMULATED OTHER COMPREHENSIVE LOSS | ACCUMULATED OTHER COMPREHENSIVE LOSS Cadence’s accumulated other comprehensive loss is comprised of the aggregate impact of foreign currency translation gains and losses, changes in defined benefit plan liabilities and unrealized gains and losses on investments, and is presented in Cadence’s condensed consolidated statements of comprehensive income. Accumulated other comprehensive loss was comprised of the following as of March 31, 2023 and December 31, 2022: As of March 31, December 31, (In thousands) Foreign currency translation loss $ (81,908) $ (85,863) Changes in defined benefit plan liabilities (5,511) (5,774) Unrealized gain on investments 30 — Total accumulated other comprehensive loss $ (87,389) $ (91,637) For the three months ended March 31, 2023 and April 2, 2022, there were no significant amounts related to foreign currency translation loss, changes in defined benefit plan liabilities or unrealized gains and losses on investments reclassified from accumulated other comprehensive loss to net income. |
Segment Reporting
Segment Reporting | 3 Months Ended |
Mar. 31, 2023 | |
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, 2023 and April 2, 2022: Three Months Ended March 31, April 2, (In thousands) Americas: United States $ 434,346 $ 413,538 Other Americas 16,118 11,802 Total Americas 450,464 425,340 Asia: China 177,556 139,966 Other Asia 183,962 158,674 Total Asia 361,518 298,640 Europe, Middle East and Africa 154,270 130,634 Japan 55,438 47,152 Total $ 1,021,690 $ 901,766 The following table presents a summary of long-lived assets by geography as of March 31, 2023 and December 31, 2022: As of March 31, December 31, (In thousands) Americas: United States $ 346,662 $ 347,822 Other Americas 7,948 7,548 Total Americas 354,610 355,370 Asia: China 49,330 51,667 Other Asia 72,538 73,329 Total Asia 121,868 124,996 Europe, Middle East and Africa 55,017 56,959 Japan 3,973 4,505 Total $ 535,468 $ 541,830 |
Basis of Presentation and Sum_2
Basis of Presentation and Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
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. |
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. |
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. |
Contingencies | From time to time, Cadence is involved in various disputes and litigation that arise in the ordinary course of business. These include disputes and legal proceedings related to intellectual property, indemnification obligations, mergers and acquisitions, licensing, contracts, customers, products, distribution and other commercial 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 best 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 . |
Revenue (Tables)
Revenue (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Revenue from Contract with Customer [Abstract] | |
Revenue from external customers by product category | The following table shows the percentage of revenue contributed by each of Cadence’s five product categories for the three months ended March 31, 2023 and April 2, 2022: Three Months Ended March 31, April 2, Custom Integrated Circuit (“IC”) Design and Simulation 20 % 22 % Digital IC Design and Signoff 25 % 27 % Functional Verification, including Emulation and Prototyping Hardware* 32 % 28 % Intellectual Property (“IP”) 11 % 13 % System Design and Analysis 12 % 10 % Total 100 % 100 % _____________ * Includes immaterial amount of revenue accounted for under leasing arrangements. |
Disaggregation of revenue | The following table shows the percentage of Cadence’s revenue that is classified as recurring or up-front for the three months ended March 31, 2023 and April 2, 2022: Three Months Ended March 31, April 2, Revenue recognized over time 77 % 81 % Revenue from arrangements with non-cancelable commitments 3 % 2 % Recurring revenue 80 % 83 % Up-front revenue 20 % 17 % Total 100 % 100 % |
Contract balances | Cadence’s contract balances as of March 31, 2023 and December 31, 2022 were as follows: As of March 31, December 31, (In thousands) Contract assets $ 17,167 $ 22,766 Deferred revenue 823,761 782,062 |
Receivables, net (Tables)
Receivables, net (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Receivables [Abstract] | |
Current and long-term accounts receivable balances | Cadence’s current and long-term receivables balances as of March 31, 2023 and December 31, 2022 were as follows: As of March 31, December 31, (In thousands) Accounts receivable $ 346,968 $ 314,666 Unbilled accounts receivable 143,773 174,334 Long-term receivables 9,994 2,735 Total receivables 500,735 491,735 Less allowance for doubtful accounts (2,504) (2,290) Total receivables, net $ 498,231 $ 489,445 |
Debt (Tables)
Debt (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Debt Disclosure [Abstract] | |
Summary of debt outstanding | Cadence’s outstanding debt as of March 31, 2023 and December 31, 2022 was as follows: March 31, 2023 December 31, 2022 (In thousands) Principal Unamortized Discount Carrying Value Principal Unamortized Discount Carrying Value Revolving Credit Facility $ 30,000 $ — $ 30,000 $ 100,000 $ — $ 100,000 2024 Notes 350,000 (1,368) 348,632 350,000 (1,581) 348,419 2025 Term Loan 300,000 (331) 299,669 300,000 (341) 299,659 Total outstanding debt $ 680,000 $ (1,699) $ 678,301 $ 750,000 $ (1,922) $ 748,078 |
Goodwill and Acquired Intangi_2
Goodwill and Acquired Intangibles (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
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, 2023 were as follows: Gross Carrying (In thousands) Balance as of December 31, 2022 $ 1,374,268 Effect of foreign currency translation 3,357 Balance as of March 31, 2023 $ 1,377,625 |
Schedule of acquired intangibles with finite and indefinite lives (excluding goodwill) | Acquired intangibles as of March 31, 2023 were as follows, excluding intangibles that were fully amortized as of December 31, 2022: Gross Carrying Accumulated Acquired (In thousands) Existing technology $ 300,259 $ (108,476) $ 191,783 Agreements and relationships 181,995 (48,664) 133,331 Tradenames, trademarks and patents 13,058 (3,234) 9,824 Total acquired intangibles with definite lives 495,312 (160,374) 334,938 In-process technology 6,800 — 6,800 Total acquired intangibles $ 502,112 $ (160,374) $ 341,738 In-process technology as of March 31, 2023 consisted of acquired projects that, if completed, will contribute to Cadence’s existing product offerings. As of March 31, 2023, these projects were expected to be completed during the fourth quarter of fiscal 2023. During the three months ended March 31, 2023, there were no transfers from in-process technology to existing technology. Acquired intangibles as of December 31, 2022 were as follows, excluding intangibles that were fully amortized as of January 1, 2022: Gross Carrying Accumulated Acquired (In thousands) Existing technology $ 479,796 $ (278,851) $ 200,945 Agreements and relationships 274,624 (137,847) 136,777 Tradenames, trademarks and patents 12,979 (2,884) 10,095 Total acquired intangibles with definite lives $ 767,399 $ (419,582) $ 347,817 In-process technology 6,800 — 6,800 Total acquired intangibles $ 774,199 $ (419,582) $ 354,617 |
Amortization of acquired intangibles | Amortization expense for the three months ended March 31, 2023 and April 2, 2022 by condensed consolidated income statement caption was as follows: Three Months Ended March 31, April 2, (In thousands) Cost of product and maintenance $ 10,260 $ 11,971 Amortization of acquired intangibles 4,267 4,964 Total amortization of acquired intangibles $ 14,527 $ 16,935 |
Estimated amortization expense | As of March 31, 2023, the estimated amortization expense for intangible assets with definite lives was as follows for the following five fiscal years and thereafter: (In thousands) 2023 - remaining period $ 44,102 2024 57,059 2025 44,352 2026 38,567 2027 36,113 2028 33,491 Thereafter 81,254 Total estimated amortization expense $ 334,938 |
Stock-Based Compensation (Table
Stock-Based Compensation (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Stock-based compensation expense and allocation by cost | Stock-based compensation expense is reflected in Cadence’s condensed consolidated income statements for the three months ended March 31, 2023 and April 2, 2022 as follows: Three Months Ended March 31, April 2, (In thousands) Cost of product and maintenance $ 1,066 $ 830 Cost of services 1,357 1,050 Marketing and sales 15,091 11,757 Research and development 44,322 35,122 General and administrative 12,452 10,710 Total stock-based compensation expense $ 74,288 $ 59,469 |
Stock Repurchase Program (Table
Stock Repurchase Program (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
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, 2023 and April 2, 2022 were as follows: Three Months Ended March 31, April 2, (In thousands) Shares repurchased 668 1,566 Total cost of repurchased shares $ 125,010 $ 250,016 |
Net Income Per Share (Tables)
Net Income Per Share (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
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, 2023 and April 2, 2022 are as follows: Three Months Ended March 31, April 2, (In thousands, except per share amounts) Net income $ 241,804 $ 235,335 Weighted average common shares used to calculate basic net income per share 269,501 272,431 Stock-based awards 3,658 4,487 Weighted average common shares used to calculate diluted net income per share 273,159 276,918 Net income per share - basic $ 0.90 $ 0.86 Net income per share - diluted $ 0.89 $ 0.85 |
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, 2023 and April 2, 2022 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 2, (In thousands) Long-term market-based awards 1,826 1,035 Options to purchase shares of common stock 332 663 Non-vested shares of restricted stock 50 82 Total potential common shares excluded 2,208 1,780 |
Fair Value (Tables)
Fair Value (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
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, 2023 and December 31, 2022: Fair Value Measurements as of March 31, 2023 Total Level 1 Level 2 Level 3 (In thousands) Assets Cash equivalents: Money market funds $ 555,088 $ 555,088 $ — $ — Marketable securities: Marketable equity securities 4,747 4,747 — — Mortgage-backed and asset-backed securities 8,983 — 8,983 — Securities held in Non-Qualified Deferred Compensation (“NQDC”) trust 60,134 60,134 — — Total Assets $ 628,952 $ 619,969 $ 8,983 $ — Total Level 1 Level 2 Level 3 (In thousands) Liabilities Foreign currency exchange contracts $ 573 $ — $ 573 $ — Total Liabilities $ 573 $ — $ 573 $ — Fair Value Measurements as of December 31, 2022 Total Level 1 Level 2 Level 3 (In thousands) Assets Cash equivalents: Money market funds $ 548,373 $ 548,373 $ — $ — Marketable equity securities 4,490 4,490 — — Securities held in NQDC trust 55,605 55,605 — — Foreign currency exchange contracts 5,306 — 5,306 — Total Assets $ 613,774 $ 608,468 $ 5,306 $ — As of December 31, 2022, Cadence did not have any financial liabilities requiring a recurring fair value measurement. |
Inventory (Tables)
Inventory (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Inventory Disclosure [Abstract] | |
Schedule of inventory | Cadence’s inventory balances as of March 31, 2023 and December 31, 2022 were as follows: As of March 31, December 31, (In thousands) Inventories: Raw materials $ 117,975 $ 113,982 Finished goods 9,591 14,023 Total inventories $ 127,566 $ 128,005 |
Accumulated Other Comprehensi_2
Accumulated Other Comprehensive Loss (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
Other Comprehensive Income (Loss), Net of Tax [Abstract] | |
Accumulated other comprehensive loss, net of tax | Accumulated other comprehensive loss was comprised of the following as of March 31, 2023 and December 31, 2022: As of March 31, December 31, (In thousands) Foreign currency translation loss $ (81,908) $ (85,863) Changes in defined benefit plan liabilities (5,511) (5,774) Unrealized gain on investments 30 — Total accumulated other comprehensive loss $ (87,389) $ (91,637) |
Segment Reporting (Tables)
Segment Reporting (Tables) | 3 Months Ended |
Mar. 31, 2023 | |
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, 2023 and April 2, 2022: Three Months Ended March 31, April 2, (In thousands) Americas: United States $ 434,346 $ 413,538 Other Americas 16,118 11,802 Total Americas 450,464 425,340 Asia: China 177,556 139,966 Other Asia 183,962 158,674 Total Asia 361,518 298,640 Europe, Middle East and Africa 154,270 130,634 Japan 55,438 47,152 Total $ 1,021,690 $ 901,766 |
Summary of long-lived assets by geography | The following table presents a summary of long-lived assets by geography as of March 31, 2023 and December 31, 2022: As of March 31, December 31, (In thousands) Americas: United States $ 346,662 $ 347,822 Other Americas 7,948 7,548 Total Americas 354,610 355,370 Asia: China 49,330 51,667 Other Asia 72,538 73,329 Total Asia 121,868 124,996 Europe, Middle East and Africa 55,017 56,959 Japan 3,973 4,505 Total $ 535,468 $ 541,830 |
Revenue (Details)
Revenue (Details) | 3 Months Ended | ||
Mar. 31, 2023 | Apr. 02, 2022 | ||
Revenue from External Customer [Line Items] | |||
Percentage of product and maintenance revenue by product group | 100% | 100% | |
Custom Integrated Circuit (“IC”) Design and Simulation | |||
Revenue from External Customer [Line Items] | |||
Percentage of product and maintenance revenue by product group | 20% | 22% | |
Digital IC Design and Signoff | |||
Revenue from External Customer [Line Items] | |||
Percentage of product and maintenance revenue by product group | 25% | 27% | |
Functional Verification, including Emulation and Prototyping Hardware* | |||
Revenue from External Customer [Line Items] | |||
Percentage of product and maintenance revenue by product group | [1] | 32% | 28% |
Intellectual Property (“IP”) | |||
Revenue from External Customer [Line Items] | |||
Percentage of product and maintenance revenue by product group | 11% | 13% | |
System Design and Analysis | |||
Revenue from External Customer [Line Items] | |||
Percentage of product and maintenance revenue by product group | 12% | 10% | |
[1]Includes immaterial amount of revenue accounted for under leasing arrangements. |
Revenue (Details 1)
Revenue (Details 1) | 3 Months Ended | |
Mar. 31, 2023 | Apr. 02, 2022 | |
Disaggregation of Revenue [Line Items] | ||
Revenue from contract with customer, timing of goods or service | 100% | 100% |
Transferred over Time | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contract with customer, timing of goods or service | 80% | 83% |
Transferred over Time | Single performance obligation | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contract with customer, timing of goods or service | 77% | 81% |
Transferred over Time | Multiple performance obligations | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contract with customer, timing of goods or service | 3% | 2% |
Transferred at Point in Time | ||
Disaggregation of Revenue [Line Items] | ||
Revenue from contract with customer, timing of goods or service | 20% | 17% |
Revenue (Details 2)
Revenue (Details 2) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Revenue from Contract with Customer [Abstract] | ||
Contract assets | $ 17,167 | $ 22,766 |
Deferred revenue | $ 823,761 | $ 782,062 |
Revenue (Details Textual)
Revenue (Details Textual) - USD ($) $ in Millions | 3 Months Ended | |
Mar. 31, 2023 | Apr. 02, 2022 | |
Revenue from Contract with Customer [Abstract] | ||
Revenue recognized from deferred revenue during the period | $ 363.2 | $ 281.6 |
Remaining performance obligations | 5,400 | |
Non-cancellable commitments from customers included in remaining performance obligations | $ 400 | |
Percent of remaining performance obligations, current | 55% | |
Revenue recognized from satisfaction of performance obligations | $ 15.2 | $ 12.2 |
Receivables, net (Details)
Receivables, net (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Current and long-term receivables balances | ||
Accounts receivable | $ 346,968 | $ 314,666 |
Unbilled accounts receivable | 143,773 | 174,334 |
Long-term receivables | 9,994 | 2,735 |
Total receivables | 500,735 | 491,735 |
Less allowance for doubtful accounts | (2,504) | (2,290) |
Total receivables, net | $ 498,231 | $ 489,445 |
Debt (Details)
Debt (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 | Sep. 07, 2022 | Oct. 09, 2014 |
Debt Instrument [Line Items] | ||||
Remaining Principal Amount Of Debt Outstanding | $ 680,000 | $ 750,000 | ||
Unamortized discount | 1,699 | 1,922 | ||
Carrying Value | 30,000 | 100,000 | ||
Carrying Value | 648,301 | 648,078 | ||
Carrying Value Of Debt Outstanding | 678,301 | 748,078 | ||
Senior Notes Due 2024 [Member] | Senior Notes [Member] | ||||
Debt Instrument [Line Items] | ||||
Principal | 350,000 | 350,000 | $ 350,000 | |
Unamortized discount | 1,368 | 1,581 | $ 1,400 | |
Carrying Value | 348,632 | 348,419 | ||
Term Loan Due Twenty-Twenty Five | ||||
Debt Instrument [Line Items] | ||||
Principal | $ 300,000 | |||
Term Loan Due Twenty-Twenty Five | Notes Payable to Banks | ||||
Debt Instrument [Line Items] | ||||
Principal | 300,000 | 300,000 | ||
Unamortized discount | 331 | 341 | ||
Carrying Value | 299,669 | 299,659 | ||
Revolving Credit Facility [Member] | ||||
Debt Instrument [Line Items] | ||||
Principal | 30,000 | 100,000 | ||
Carrying Value | $ 30,000 | $ 100,000 |
Debt Credit Facility (Details T
Debt Credit Facility (Details Textual) $ in Millions | 3 Months Ended |
Mar. 31, 2023 USD ($) | |
Revolving Credit Facility [Member] | |
Line of Credit Facility [Line Items] | |
Credit facility, current borrowing capacity | $ 700 |
Credit facility additional borrowing capacity available | 350 |
Credit facility, maximum borrowing capacity | $ 1,050 |
Credit facility, maturity date | Jun. 30, 2026 |
Payment of debt issuance costs | $ 1.3 |
Credit facility, interest rate at period end | 5.73% |
Credit facility, covenant, debt to EBITDA ratio after step up triggered by acquisition | 3.75 |
Credit facility, covenant, required business acquisition consideration, minimum | $ 250 |
Minimum [Member] | Revolving Credit Facility [Member] | |
Line of Credit Facility [Line Items] | |
Credit facility, commitment fee percentage | 0.07% |
Credit facility, covenant, pro forma leverage ratio | 3 |
Maximum [Member] | Revolving Credit Facility [Member] | |
Line of Credit Facility [Line Items] | |
Credit facility, commitment fee percentage | 0.175% |
Credit facility, covenant, pro forma leverage ratio | 3.50 |
Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate | Minimum [Member] | Revolving Credit Facility [Member] | |
Line of Credit Facility [Line Items] | |
Credit facility, interest rate spread | 0.75% |
Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate | Maximum [Member] | Revolving Credit Facility [Member] | |
Line of Credit Facility [Line Items] | |
Credit facility, interest rate spread | 1.25% |
Term Secured Overnight Financing Rate (SOFR) | Revolving Credit Facility [Member] | |
Line of Credit Facility [Line Items] | |
Debt instrument, basis spread on variable rate, additional interest | 0.10% |
Base Rate [Member] | Minimum [Member] | Revolving Credit Facility [Member] | |
Line of Credit Facility [Line Items] | |
Credit facility, interest rate spread | 0% |
Base Rate [Member] | Maximum [Member] | Revolving Credit Facility [Member] | |
Line of Credit Facility [Line Items] | |
Credit facility, interest rate spread | 0.25% |
Revolving Credit Facility [Member] | |
Line of Credit Facility [Line Items] | |
Credit facility, covenant, debt to EBITDA ratio | 3.25 |
Debt (Details Textual)
Debt (Details Textual) - USD ($) $ in Thousands | 3 Months Ended | |||
Oct. 09, 2014 | Mar. 31, 2023 | Dec. 31, 2022 | Sep. 07, 2022 | |
Debt Instrument [Line Items] | ||||
Unamortized discount | $ 1,699 | $ 1,922 | ||
Term Loan Due Twenty-Twenty Five | ||||
Debt Instrument [Line Items] | ||||
Aggregate principal amount, issued | $ 300,000 | |||
Debt instrument, interest rate at period end | 5.80% | |||
Debt instrument, covenant, debt to EBITDA ratio | 3.25 | |||
Debt instrument, covenant, debt to EBITDA ratio after step up triggered by acquisition | 3.75 | |||
Debt instrument, covenant, required business acquisition consideration, minimum | $ 250,000 | |||
Term Loan Due Twenty-Twenty Five | Term Secured Overnight Financing Rate (SOFR) | ||||
Debt Instrument [Line Items] | ||||
Debt instrument, basis spread on variable rate, additional interest | 0.10% | |||
Term Loan Due Twenty-Twenty Five | Maximum [Member] | ||||
Debt Instrument [Line Items] | ||||
Debt instrument, covenant, pro forma leverage ratio | 3.50 | |||
Term Loan Due Twenty-Twenty Five | Maximum [Member] | Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate | ||||
Debt Instrument [Line Items] | ||||
Credit facility, interest rate spread | 1.125% | |||
Term Loan Due Twenty-Twenty Five | Maximum [Member] | Base Rate [Member] | ||||
Debt Instrument [Line Items] | ||||
Credit facility, interest rate spread | 0.125% | |||
Term Loan Due Twenty-Twenty Five | Minimum [Member] | ||||
Debt Instrument [Line Items] | ||||
Debt instrument, covenant, pro forma leverage ratio | 3 | |||
Term Loan Due Twenty-Twenty Five | Minimum [Member] | Secured Overnight Financing Rate (SOFR) Overnight Index Swap Rate | ||||
Debt Instrument [Line Items] | ||||
Credit facility, interest rate spread | 0.625% | |||
Term Loan Due Twenty-Twenty Five | Minimum [Member] | Base Rate [Member] | ||||
Debt Instrument [Line Items] | ||||
Credit facility, interest rate spread | 0% | |||
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 | 1,368 | $ 1,581 | |
Debt issuance costs | $ 6,200 | |||
Fair value of the 2024 Notes | $ 347,000 |
Goodwill and Acquired Intangi_3
Goodwill and Acquired Intangibles (Details) $ in Thousands | 3 Months Ended |
Mar. 31, 2023 USD ($) | |
Changes in the carrying amount of goodwill | |
Balance at beginning of period | $ 1,374,268 |
Effect of foreign currency translation | 3,357 |
Balance at end of period | $ 1,377,625 |
Goodwill and Acquired Intangi_4
Goodwill and Acquired Intangibles (Details 1) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Acquired intangibles with finite lives, excluding intangibles fully amortized at end of prior fiscal year | ||
Gross carrying amount | $ 495,312 | $ 767,399 |
Accumulated amortization | (160,374) | (419,582) |
Total acquired intangibles with definite lives | 334,938 | 347,817 |
In-process technology | 6,800 | 6,800 |
Intangible assets, gross carrying amount (excluding goodwill) | 502,112 | 774,199 |
Acquired intangibles, net | 341,738 | 354,617 |
Existing Technology [Member] | ||
Acquired intangibles with finite lives, excluding intangibles fully amortized at end of prior fiscal year | ||
Gross carrying amount | 300,259 | 479,796 |
Accumulated amortization | (108,476) | (278,851) |
Total acquired intangibles with definite lives | 191,783 | 200,945 |
Agreements and Relationships [Member] | ||
Acquired intangibles with finite lives, excluding intangibles fully amortized at end of prior fiscal year | ||
Gross carrying amount | 181,995 | 274,624 |
Accumulated amortization | (48,664) | (137,847) |
Total acquired intangibles with definite lives | 133,331 | 136,777 |
Tradenames Trademarks And Patents [Member] | ||
Acquired intangibles with finite lives, excluding intangibles fully amortized at end of prior fiscal year | ||
Gross carrying amount | 13,058 | 12,979 |
Accumulated amortization | (3,234) | (2,884) |
Total acquired intangibles with definite lives | $ 9,824 | $ 10,095 |
Goodwill and Acquired Intangi_5
Goodwill and Acquired Intangibles (Details 2) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Apr. 02, 2022 | |
Amortization of acquired intangibles | ||
Cost of product and maintenance | $ 10,260 | $ 11,971 |
Amortization of acquired intangibles | 4,267 | 4,964 |
Total amortization of acquired intangibles | $ 14,527 | $ 16,935 |
Goodwill and Acquired Intangi_6
Goodwill and Acquired Intangibles (Details 3) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Estimated amortization expense | ||
2023 - remaining period | $ 44,102 | |
2024 | 57,059 | |
2025 | 44,352 | |
2026 | 38,567 | |
2027 | 36,113 | |
2028 | 33,491 | |
Thereafter | 81,254 | |
Total acquired intangibles with definite lives | $ 334,938 | $ 347,817 |
Stock-Based Compensation (Detai
Stock-Based Compensation (Details Textual) - Stock option and restricted stock grants [Member] $ in Millions | 3 Months Ended |
Mar. 31, 2023 USD ($) | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Total unrecognized compensation expense | $ 514.2 |
Weighted-average vesting period over which unrecognized compensation expense will be recognized | 2 years 2 months 12 days |
Stock-Based Compensation (Det_2
Stock-Based Compensation (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Apr. 02, 2022 | |
Share-based compensation expense and allocation by cost [Line Items] | ||
Stock-based compensation expense | $ 74,288 | $ 59,469 |
Cost of product and maintenance | ||
Share-based compensation expense and allocation by cost [Line Items] | ||
Stock-based compensation expense | 1,066 | 830 |
Cost of services | ||
Share-based compensation expense and allocation by cost [Line Items] | ||
Stock-based compensation expense | 1,357 | 1,050 |
Marketing and sales | ||
Share-based compensation expense and allocation by cost [Line Items] | ||
Stock-based compensation expense | 15,091 | 11,757 |
Research and development | ||
Share-based compensation expense and allocation by cost [Line Items] | ||
Stock-based compensation expense | 44,322 | 35,122 |
General and administrative | ||
Share-based compensation expense and allocation by cost [Line Items] | ||
Stock-based compensation expense | $ 12,452 | $ 10,710 |
Stock Repurchase Program (Detai
Stock Repurchase Program (Details) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Apr. 02, 2022 | |
Class of Stock Disclosures [Abstract] | ||
Shares repurchased | 668 | 1,566 |
Total cost of repurchased shares | $ 125,010 | $ 250,016 |
Stock Repurchase Program (Det_2
Stock Repurchase Program (Details Textuals) - USD ($) $ in Millions | Mar. 31, 2023 | Aug. 15, 2022 |
Stock repurchase program | ||
Additional authorized repurchase amount | $ 1,000 | |
Stock repurchase program, remaining authorized repurchase amount | $ 952 |
Net Income Per Share (Details)
Net Income Per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Apr. 02, 2022 | |
Earnings Per Share, Basic and Diluted [Abstract] | ||
Net income | $ 241,804 | $ 235,335 |
Weighted average common shares used to calculate basic net income per share | 269,501 | 272,431 |
Stock-based awards | 3,658 | 4,487 |
Weighted average common shares used to calculate diluted net income per share (in shares) | 273,159 | 276,918 |
Net income per share - basic (usd per share) | $ 0.90 | $ 0.86 |
Net income per share - diluted (usd per share) | $ 0.89 | $ 0.85 |
Net Income Per Share (Details 1
Net Income Per Share (Details 1) - shares shares in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Apr. 02, 2022 | |
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 2,208 | 1,780 |
Long-term market-based awards | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 1,826 | 1,035 |
Options to purchase shares of common stock | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 332 | 663 |
Non-vested shares of restricted stock | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 50 | 82 |
Fair Value (Details)
Fair Value (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Assets | ||
Marketable equity securities | $ 4,747 | $ 4,490 |
Securities held in Non-Qualified Deferred Compensation trust, or NQDC | 60,134 | 55,605 |
Foreign currency exchange contracts | 5,306 | |
Total Assets | 628,952 | 613,774 |
Liabilities | ||
Foreign currency exchange contracts | 573 | |
Total Liabilities | 573 | |
Mortgage-Backed Securities, Issued by US Government Sponsored Enterprises | ||
Assets | ||
Mortgage-backed and asset-backed securities | 8,983 | |
Money Market Funds | ||
Assets | ||
Money market funds | 555,088 | 548,373 |
Fair Value Measurements, Level 1 [Member] | ||
Assets | ||
Marketable equity securities | 4,747 | 4,490 |
Securities held in Non-Qualified Deferred Compensation trust, or NQDC | 60,134 | 55,605 |
Foreign currency exchange contracts | 0 | |
Total Assets | 619,969 | 608,468 |
Liabilities | ||
Foreign currency exchange contracts | 0 | |
Total Liabilities | 0 | |
Fair Value Measurements, Level 1 [Member] | Mortgage-Backed Securities, Issued by US Government Sponsored Enterprises | ||
Assets | ||
Mortgage-backed and asset-backed securities | 0 | |
Fair Value Measurements, Level 1 [Member] | Money Market Funds | ||
Assets | ||
Money market funds | 555,088 | 548,373 |
Fair Value Measurements, Level 2 [Member] | ||
Assets | ||
Marketable equity securities | 0 | 0 |
Securities held in Non-Qualified Deferred Compensation trust, or NQDC | 0 | 0 |
Foreign currency exchange contracts | 5,306 | |
Total Assets | 8,983 | 5,306 |
Liabilities | ||
Foreign currency exchange contracts | 573 | |
Total Liabilities | 573 | |
Fair Value Measurements, Level 2 [Member] | Mortgage-Backed Securities, Issued by US Government Sponsored Enterprises | ||
Assets | ||
Mortgage-backed and asset-backed securities | 8,983 | |
Fair Value Measurements, Level 2 [Member] | Money Market Funds | ||
Assets | ||
Money market funds | 0 | 0 |
Fair Value Measurements, Level 3 [Member] | ||
Assets | ||
Marketable equity securities | 0 | 0 |
Securities held in Non-Qualified Deferred Compensation trust, or NQDC | 0 | 0 |
Foreign currency exchange contracts | 0 | |
Total Assets | 0 | 0 |
Liabilities | ||
Foreign currency exchange contracts | 0 | |
Total Liabilities | 0 | |
Fair Value Measurements, Level 3 [Member] | Mortgage-Backed Securities, Issued by US Government Sponsored Enterprises | ||
Assets | ||
Mortgage-backed and asset-backed securities | 0 | |
Fair Value Measurements, Level 3 [Member] | Money Market Funds | ||
Assets | ||
Money market funds | $ 0 | $ 0 |
Inventory (Details)
Inventory (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Inventory Disclosure [Abstract] | ||
Raw materials | $ 117,975 | $ 113,982 |
Finished goods | 9,591 | 14,023 |
Total inventories | $ 127,566 | $ 128,005 |
Commitments and Contingencies (
Commitments and Contingencies (Details) $ in Thousands | Dec. 31, 2022 USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
Tax audit assessment | $ 49,000 |
Accumulated Other Comprehensi_3
Accumulated Other Comprehensive Loss (Details) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Accumulated other comprehensive income | ||
Foreign currency translation loss | $ (81,908) | $ (85,863) |
Changes in defined benefit plan liabilities | (5,511) | (5,774) |
Unrealized gain on investments | 30 | 0 |
Total accumulated other comprehensive loss | $ (87,389) | $ (91,637) |
Segment Reporting (Details)
Segment Reporting (Details) - USD ($) $ in Thousands | 3 Months Ended | |
Mar. 31, 2023 | Apr. 02, 2022 | |
Segment reporting [Line Items] | ||
Total revenue | $ 1,021,690 | $ 901,766 |
United States [Member] | ||
Segment reporting [Line Items] | ||
Total revenue | 434,346 | 413,538 |
Other Americas [Member] | ||
Segment reporting [Line Items] | ||
Total revenue | 16,118 | 11,802 |
Americas [Member] | ||
Segment reporting [Line Items] | ||
Total revenue | 450,464 | 425,340 |
China [Member] | ||
Segment reporting [Line Items] | ||
Total revenue | 177,556 | 139,966 |
Other Asia [Member] | ||
Segment reporting [Line Items] | ||
Total revenue | 183,962 | 158,674 |
Asia [Member] | ||
Segment reporting [Line Items] | ||
Total revenue | 361,518 | 298,640 |
EMEA [Member] | ||
Segment reporting [Line Items] | ||
Total revenue | 154,270 | 130,634 |
Japan [Member] | ||
Segment reporting [Line Items] | ||
Total revenue | $ 55,438 | $ 47,152 |
Segment Reporting (Details 1)
Segment Reporting (Details 1) - USD ($) $ in Thousands | Mar. 31, 2023 | Dec. 31, 2022 |
Summary of long-lived assets by geography | ||
Long-lived assets in individual foreign countries | $ 535,468 | $ 541,830 |
United States [Member] | ||
Summary of long-lived assets by geography | ||
Long-lived assets in individual foreign countries | 346,662 | 347,822 |
Other Americas [Member] | ||
Summary of long-lived assets by geography | ||
Long-lived assets in individual foreign countries | 7,948 | 7,548 |
Americas [Member] | ||
Summary of long-lived assets by geography | ||
Long-lived assets in individual foreign countries | 354,610 | 355,370 |
China [Member] | ||
Summary of long-lived assets by geography | ||
Long-lived assets in individual foreign countries | 49,330 | 51,667 |
Other Asia [Member] | ||
Summary of long-lived assets by geography | ||
Long-lived assets in individual foreign countries | 72,538 | 73,329 |
Asia [Member] | ||
Summary of long-lived assets by geography | ||
Long-lived assets in individual foreign countries | 121,868 | 124,996 |
EMEA [Member] | ||
Summary of long-lived assets by geography | ||
Long-lived assets in individual foreign countries | 55,017 | 56,959 |
Japan [Member] | ||
Summary of long-lived assets by geography | ||
Long-lived assets in individual foreign countries | $ 3,973 | $ 4,505 |