Cadence raises 2026 revenue and profit outlook on AI chip-design demand

Cadence Design Systems raised its annual revenue and profit forecasts, citing strong demand for its AI-powered chip and system design software, Reuters reported. Shares rose more than 5% in extended trading. The company now expects 2026 revenue between $6.26 billion and $6.34 billion, up from a prior range of $6.13 billion to $6.23 billion, above the LSEG analyst average of $6.21 billion. Annual adjusted profit is expected at $8.05 to $8.15 per share, up from $7.85 to $7.95 and above the $7.96 estimate. Second-quarter revenue rose 24.2% to $1.584 billion, largely in line with estimates, with adjusted profit of $2.11 per share versus estimates of $2.05. Quarter-end backlog stood at $8.1 billion, with $4.2 billion expected as revenue within 12 months. Customers include Nvidia and Apple. Earlier in the month, Cadence launched AuraStack, an AI agent that lets engineers describe goals in plain language and use the company's tools to lay out and virtually test circuit designs.