Cadence Design Systems (NASDAQ: CDNS) is a dominant player in a vital part of the semiconductor industry. It provides electronic design automation (EDA) software, which is critical for designing semiconductors. Without access to cutting-edge EDA software, developing cutting-edge artificial intelligence (AI) semiconductors is essentially impossible.
Together, analysts believe Cadence and Synopsys (NASDAQ: SNPS) hold more than two-thirds of the EDA software market. The two also provide semiconductor intellectual property (IP), which acts as basic building blocks for semiconductor design.
