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Cadence Reports Third Quarter 2026 Financial Results
Raising 2026 Revenue Growth Outlook to 21% and Non-GAAP EPS to $8.40
Q3 Recurring Revenue Up 18% YoY, Record Backlog of $8.2 Billion
SAN JOSE, Calif., October 26, 2026–(BUSINESS WIRE)–Cadence (Nasdaq: CDNS) today announced results for the third quarter of 2026.
Third Quarter 2026 Financial Results
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Revenue of $1.633 billion, compared to revenue of $1.339 billion in Q3 2025
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GAAP operating margin of 26.2%, compared to 31.8% in Q3 2025
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Non-GAAP operating margin of 44.1%, compared to 47.6% in Q3 2025
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GAAP diluted net income per share of $1.05, compared to $1.05 in Q3 2025
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Non-GAAP diluted net income per share of $2.11, compared to $1.93 in Q3 2025
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Cadence used $400 million to repurchase Cadence shares. Underscoring Cadence’s continued commitment to returning capital to shareholders, Cadence’s Board of Directors has authorized an additional $2.5 billion for Cadence’s share repurchase program.
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Quarter-end backlog was $8.2 billion and revenue expected to be recognized in the next 12 months from remaining performance obligations was $4.2 billion.
“Cadence delivered an outstanding third quarter. With broad-based business momentum, expanding technology leadership and a record backlog, we are raising our 2026 revenue outlook to 21% year-over-year growth,” said Anirudh Devgan, president and chief executive officer. “With the launch of Maestro, our portfolio of domain specialized AI models for chip and system design, and the accelerating deployment of our AI Super Agents, Cadence is exceptionally well positioned to capitalize on the transformational Agentic AI opportunity.”
“Q3 revenue grew 22% year-over-year, with strong double-digit growth across all product categories, driven by growing momentum from AI-driven designs,” said John Wall, senior vice president and chief financial officer. “With record backlog of $8.2 billion and continued strength in recurring revenue, we are poised to deliver a strong 2026.”
Commentary on the third quarter of 2026 financial results by John Wall, senior vice president and chief financial officer, is available at www.cadence.com/cadence/investor_relations.
For fiscal year 2026, the company expects:
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Revenue in the range of $6.387 billion to $6.417 billion
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GAAP operating margin in the range of 28.2% to 29.2%
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Non-GAAP operating margin in the range of 44.2% to 45.2%
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GAAP diluted net income per share in the range of $4.84 to $4.90
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Non-GAAP diluted net income per share in the range of $8.37 to $8.43
The company utilizes a long-term projected non-GAAP tax rate, which reflects currently available information, as well as other factors and assumptions. The non-GAAP tax rate is subject to change for a variety of reasons, including the rapidly evolving global tax environment, significant changes in the company’s geographic earnings mix, or other changes to the company’s strategy or business operations. The company expects to use the current normalized non-GAAP tax rate through fiscal 2026 but will re-evaluate this rate periodically for significant items that may materially affect its projections.
