Acquisition-related tax benefit boosts Cadence

SAN FRANCISCO—EDA vendor Cadence Design Systems Inc. again reported quarterly results Wednesday (July 28) that topped analyst expectations, with management reporting that business improved across all regions of the globe.

Cadence (San Jose, Calif.) posted second quarter revenue of $227 million, up 8 percent compared with the second quarter of 2009.

The company posted a net income of $49 million, or 19 cents per share, in accordance with generally accepted accounting principles (GAAP), including $67 million in acquisition-related income tax benefits, Cadence said. In the year-ago quarter, Cadence posted a GAAP net loss of $74 million, or 29 cents per diluted share.

On a pro-forma basis, excluding charges, Cadence recorded a net income of $18 million, or 7 cents per share, including the reversal of $10 million in bad debt reserves. The company recorded a pro forma net loss of $13 million, or 5 cents per share, in the year-ago period.

Consensus analyst expectations called for Cadence to post second quarter sales of $221 million and a pro forma net income of 3 cents per share, according to Yahoo Finance.

"Business improved for us in all geographies, and the combination of stronger business performance and a lower expense base helped improve our top and bottom lines," said Kevin Palatnik, Cadence senior vice president and chief financial officer, in a statement.

Cadence said it expects third quarter revenue to be between $225 million and $235 million. The company expects to post a GAAP net loss of 6 to 8 cents per share in the third quarter.

For the full year 2010, Cadence expects revenue to be between $900 million and $925 million, the company said.