Cadence Design Systems, a maker of electronic design automation software, late Monday topped analyst estimates for the first quarter but guided well below views for the current quarter. CDNS stock dropped in extended trading.
The San Jose, Calif.-based company earned an adjusted $1.17 a share on sales of $1.01 billion in the March quarter. Analysts polled by FactSet had expected earnings of $1.13 a share on sales of $1 billion. However, on a year-over-year basis, Cadence earnings fell 9% while sales dipped 1%.
It was the company's first decline in earnings on a year-over-year basis in nine quarters. Worse still, it was the company's first drop in quarterly sales in more than eight years.
For the current quarter, Cadence expects to earn an adjusted $1.22 a share on sales of $1.04 billion. That's based on the midpoint of its guidance. Analysts had been looking for earnings of $1.43 a share on sales of $1.11 billion in the second quarter. In the year-earlier period, Cadence earned an adjusted $1.22 a share on sales of $977 million.
CDNS Stock Takes A Tumble
"I am pleased that we delivered record Q1 bookings and achieved record Q1 backlog of approximately $6 billion," Chief Financial Officer John Wall said in a news release.
In after-hours trading on the stock market today, CDNS stock fell 9.3% to 258.60. During the regular session Monday, CDNS stock rose 1.7% to close at 285.02.
For the full year, Cadence now expects to earn an adjusted $5.93 a share on sales of $4.59 billion. That's based on the midpoint of its raised outlook. Those figures matched the estimates of analysts polled by FactSet. Last year, Cadence earned an adjusted $5.15 a share on sales of $4.09 billion.
Cadence Makes Pair Of Deals
In the first quarter, Cadence made two major acquisitions.
On Jan. 8, Cadence announced it had acquired Invecas, a provider of design engineering, embedded software and system-level solutions. Terms of the transaction were not disclosed.
On March 5, Cadence said it planned to buy BETA CAE Systems International, a system analysis platform provider of multi-domain, engineering simulation solutions. The cash-and-stock deal was worth $1.24 billion.
CDNS stock is on two IBD stock lists: Long-Term Leaders and Tech Leaders.
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