The Investor
27 Oct 2026, 09:47
Cadence Rises 3.2% Premarket as Q3 Revenue Jumps 22% and 2026 Outlook Is Raised
Cadence Design Systems (NASDAQ: CDNS) shares rose about 3.2% in premarket trading after the company reported strong third-quarter 2026 growth, record backlog and a higher full-year outlook.
Revenue increased 22% year over year to $1.633 billion, while non-GAAP diluted EPS rose to $2.11 from $1.93. Recurring revenue grew 18%, and quarter-end backlog reached a record $8.2 billion, including $4.2 billion expected to be recognized over the next 12 months.
Growth was broad-based. Core EDA revenue increased 20%, IP revenue rose 24% and System Design and Analysis revenue climbed 30%. Cadence also said its AI Super Agents now have more than 100 active customer engagements, while its newly launched Maestro models are being deployed for chip and system design workflows.
Management raised its 2026 revenue growth outlook to about 21%, with revenue now expected between $6.387 billion and $6.417 billion. Non-GAAP EPS guidance was also lifted to $8.37-$8.43, or about $8.40 at the midpoint.
One softer area was profitability, with non-GAAP operating margin declining to 44.1% from 47.6% a year earlier. However, strong revenue growth, record backlog and higher guidance appear to be outweighing that pressure.
The 3.2% premarket gain therefore appears to reflect investor confidence in Cadence’s accelerating AI-related demand, strong visibility and raised full-year expectations.
Cadence Design Systems (NASDAQ: CDNS) shares rose about 3.2% in premarket trading after the company reported strong third-quarter 2026 growth, record backlog and a higher full-year outlook.
Revenue increased 22% year over year to $1.633 billion, while non-GAAP diluted EPS rose to $2.11 from $1.93. Recurring revenue grew 18%, and quarter-end backlog reached a record $8.2 billion, including $4.2 billion expected to be recognized over the next 12 months.
Growth was broad-based. Core EDA revenue increased 20%, IP revenue rose 24% and System Design and Analysis revenue climbed 30%. Cadence also said its AI Super Agents now have more than 100 active customer engagements, while its newly launched Maestro models are being deployed for chip and system design workflows.
Management raised its 2026 revenue growth outlook to about 21%, with revenue now expected between $6.387 billion and $6.417 billion. Non-GAAP EPS guidance was also lifted to $8.37-$8.43, or about $8.40 at the midpoint.
One softer area was profitability, with non-GAAP operating margin declining to 44.1% from 47.6% a year earlier. However, strong revenue growth, record backlog and higher guidance appear to be outweighing that pressure.
The 3.2% premarket gain therefore appears to reflect investor confidence in Cadence’s accelerating AI-related demand, strong visibility and raised full-year expectations.
