CADENCE DESIGN SYSTEMS, INC. SAN JOSE, Calif., July 27, 2015 /PRNewswire/ -- Cadence Design Systems, Inc. (NASDAQ: CDNS) today announced results for the second quarter of fiscal year 2015.
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Cadence reported second quarter 2015 revenue of $416 million, compared to revenue of $379 million reported for the same period in 2014. On a GAAP basis, Cadence recognized net income of $58 million, or $0.19 per share on a diluted basis, in the second quarter of 2015, compared to net income of $23 million, or $0.08 per share on a diluted basis, for the same period in 2014.
Using the non-GAAP measure defined below, net income in the second quarter of 2015 was $85 million, or $0.27 per share on a diluted basis, as compared to net income of $64 million, or $0.21 per share on a diluted basis, for the same period in 2014.
"The second quarter was highlighted by the introduction of more innovative new products, key wins with market shaping customers and strong financial performance," said Lip-Bu Tan, president and chief executive officer. "We launched the Genus(TM) Synthesis Solution, our next-generation RTL physical synthesis engine, and the Indago(TM) Debug Platform, which uses big data techniques to speed the verification process. Cadence has now introduced more than a dozen innovative new products in the past two years."
Mr. Tan continued, "We are pleased to announce a new $1.2 billion stock repurchase program, which reflects our ongoing thoughtful review of all aspects of our business and capital structure. We are committed to enhancing shareholder value through a balanced approach that drives growth, invests in innovation and returns capital to our shareholders."
"Cadence had a strong Q2," added Geoff Ribar, senior vice president and chief financial officer. "With the announcement of our new stock repurchase program, we continue to allocate capital to the highest return opportunities by investing in profitable growth, maintaining an efficient capital structure that provides necessary flexibility to meet the needs of the business and returning capital to shareholders."
Cadence's new $1.2 billion stock repurchase program replaces its existing $450 million program. Cadence expects to repurchase $1.2 billion of its common stock over the next six quarters through the end of fiscal 2016. The actual timing and amount of repurchases will be subject to business and market conditions, corporate and regulatory requirements, acquisition opportunities and other factors. The stock repurchase program may be suspended, modified or discontinued at any time, and will be funded by U.S. cash on hand, future U.S. cash flow and additional debt.
Business Outlook
For the third quarter of 2015, the company expects total revenue in the range of $423 million to $433 million. Third quarter GAAP net income per diluted share is expected to be in the range of $0.17 to $0.19. Net income per diluted share using the non-GAAP measure defined below is expected to be in the range of $0.25 to $0.27.
For 2015, the company expects total revenue in the range of $1.685 billion to $1.715 billion. On a GAAP basis, net income per diluted share for 2015 is expected to be in the range of $0.63 to $0.69. Using the non-GAAP measure defined below, net income per diluted share for 2015 is expected to be in the range of $1.00 to $1.06.
A schedule showing a reconciliation of the business outlook from GAAP net income and diluted net income per share to non-GAAP net income and diluted net income per share is included in this release.
Audio Webcast Scheduled
Lip-Bu Tan, president and chief executive officer, and Geoff Ribar, senior vice president and chief financial officer, will host a second quarter 2015 financial results audio webcast today, July 27, 2015, at 2 p.m. (Pacific) / 5 p.m. (Eastern). Attendees are asked to register at the website at least 10 minutes prior to the scheduled webcast. An archive of the webcast will be available starting July 27, 2015 at 5 p.m. (Pacific) and ending September 18, 2015 at 5 p.m. (Pacific). Webcast access is available at www.cadence.com/company/investor_relations.
About Cadence
Cadence enables global electronic design innovation and plays an essential role in the creation of today's integrated circuits and electronics. Customers use Cadence(®) software, hardware, IP, and services to design and verify advanced semiconductors, consumer electronics, networking and telecommunications equipment, and computer systems. The company is headquartered in San Jose, California, with sales offices, design centers, and research facilities around the world to serve the global electronics industry. More information about the company and its products and services is available at www.cadence.com.
Cadence, the Cadence logo, Genus and Indago are trademarks or registered trademarks of Cadence Design Systems, Inc. All other trademarks are the property of their respective owners.
The statements contained above regarding Cadence's second quarter 2015 financial results and Cadence's intention to repurchase shares of its common stock under its stock repurchase program, as well as the information in the Business Outlook section and the statements by Lip-Bu Tan and Geoff Ribar, are or include forward-looking statements based on current expectations or beliefs and preliminary assumptions about future events that are subject to factors and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. These forward-looking statements are subject to a number of risks, uncertainties and other factors, many of which are outside Cadence's control, including, among others: (i) Cadence's ability to compete successfully in the electronic design automation product and the commercial electronic design and methodology services industries; (ii) the success of Cadence's efforts to improve operational efficiency and growth; (iii) the mix of products and services sold and the timing of significant orders for Cadence's products; (iv) change in customer demands, including those resulting from consolidation among Cadence's customers and the possibility that the restructurings and other efforts to improve operational efficiency of Cadence's customers could result in delays in purchases of Cadence's products and services; (v) economic and industry conditions in regions in which Cadence does business; (vi) fluctuations in rates of exchange between the U.S. dollar and the currencies of other countries in which Cadence does business; (vii) capital expenditure requirements, legislative or regulatory requirements, interest rates and Cadence's ability to access capital and debt markets; (viii) the acquisition of other companies or technologies or the failure to successfully integrate and operate these companies or technologies Cadence acquires, including the potential inability to retain customers, key employees or vendors; (ix) the effects of Cadence's efforts to improve operational efficiency in its business, including strategic, customer and supplier relationships, and its ability to retain key employees; (x) events that affect the reserves or settlement assumptions Cadence may take from time to time with respect to accounts receivable, taxes, litigation or other matters; and (xi) the effects of any litigation or other proceedings to which Cadence is or may become a party.
For a detailed discussion of these and other cautionary statements related to Cadence's business, please refer to Cadence's filings with the Securities and Exchange Commission, which include Cadence's most recent reports on Form 10-K and Form 10-Q, including Cadence's future filings.
GAAP to Non-GAAP Reconciliation
Non-GAAP financial measures should not be considered as a substitute for or superior to measures of financial performance prepared in accordance with GAAP. Investors are encouraged to review the reconciliation of non-GAAP financial measures contained within this press release with their most directly comparable GAAP financial results. Investors are also encouraged to look at the GAAP results as the best measure of financial performance.
To supplement Cadence's financial results presented on a generally accepted accounting principles, or GAAP, basis, Cadence management uses non-GAAP measures that it believes are helpful in understanding Cadence's performance. One such measure is non-GAAP net income, which is a financial measure not calculated under GAAP. Non-GAAP net income is calculated by Cadence management by taking GAAP net income and excluding, as applicable, amortization of intangible assets and debt discount related to convertible notes, stock-based compensation expense, acquisition and integration-related costs including changes in fair value of contingent consideration and retention expenses for employees added from our 2013 and 2014 acquisitions, special charges (comprised of costs related to a voluntary retirement program), investment gains or losses, income or expenses related to Cadence's non-qualified deferred compensation plan, restructuring and other significant items not directly related to Cadence's core business operations, and the income tax effect of non-GAAP pre-tax adjustments. For 2015, Cadence is applying a non-GAAP income tax rate of 23 percent, down from 26 percent used in fiscal 2014, based on forecasted increases in foreign earnings that are expected to lower Cadence's long-term non-GAAP effective income tax rate.
Cadence's management uses non-GAAP net income because it excludes items that are generally not directly related to the performance of the company's core business operations and therefore provides supplemental information to Cadence's management and investors regarding the performance of the business operations, facilitates comparisons to the historical operating results and allows the review of Cadence's business from the same perspective as Cadence's management, including forecasting and budgeting.
The following tables reconcile the specific items excluded from GAAP net income and GAAP net income per diluted share in the calculation of non-GAAP net income and non-GAAP net income per diluted share for the periods shown below:
Net Income
Reconciliation Three Months Ended
------------------
July 4, 2015 June 28, 2014
------------ -------------
(unaudited)
(in thousands)
Net income on a GAAP
basis $58,160 $23,263
Amortization of
acquired intangibles 16,224 14,192
Stock-based
compensation expense 21,703 19,077
Non-qualified
deferred
compensation
expenses 37 1,047
Restructuring and
other charges
(credits) (498) (26)
Acquisition and
integration-related
costs 1,681 8,787
Special charges* - 10,357
Amortization of debt
discount on
convertible notes 2,470 4,241
Other income or
expense related to
investments and non-
qualified deferred
compensation plan
assets** (311) (1,480)
Income tax effect of
non-GAAP
adjustments (14,091) (15,849)
------- -------
Net income on a non-
GAAP basis $85,375 $63,609
======= =======
* Comprised of costs related to a
voluntary retirement program.
** Includes, as applicable, equity in
losses or income from
investments, write-down of
investments, gains or losses on
sale of investments and gains or
losses on non-qualified deferred
compensation plan assets recorded
in other income or expense.
Diluted Net Income per
Share Reconciliation Three Months Ended
------------------
July 4, 2015 June 28, 2014
------------ -------------
(unaudited)
(in thousands, except
per share data)
Diluted net income per
share on a GAAP basis $0.19 $0.08
Amortization of acquired
intangibles 0.05 0.05
Stock-based
compensation expense 0.07 0.06
Non-qualified deferred
compensation expenses - -
Restructuring and other
charges (credits) - -
Acquisition and
integration-related
costs - 0.03
Special charges* - 0.03
Amortization of debt
discount on convertible
notes 0.01 0.01
Other income or expense
related to investments
and non-qualified
deferred compensation
plan assets** - -
Income tax effect of
non-GAAP adjustments (0.05) (0.05)
----- -----
Diluted net income per
share on a non-GAAP
basis $0.27 $0.21
===== =====
Shares used in
calculation of diluted
net income per share -
GAAP*** 313,665 305,755
Shares used in
calculation of diluted
net income per share -
non-GAAP*** 313,665 305,755
* Comprised of costs related to a
voluntary retirement program.
** Includes, as applicable, equity in
losses or income from
investments, write-down of
investments, gains or losses on
sale of investments and gains or
losses on non-qualified deferred
compensation plan assets recorded
in other income or expense.
*** Shares used in the calculation of
GAAP net income per share are
expected to be the same as shares
used in the calculation of non-
GAAP net income per share, except
when the company reports a GAAP
net loss and non-GAAP net
income, or GAAP net income and a
non-GAAP net loss.
Cadence expects that its corporate representatives will meet privately during the quarter with investors, the media, investment analysts and others. At these meetings, Cadence may reiterate the business outlook published in this press release. At the same time, Cadence will keep this press release, including the business outlook, publicly available on its website.
Prior to the start of the Quiet Period (described below), the public may continue to rely on the business outlook contained herein as still being Cadence's current expectations on matters covered unless Cadence publishes a notice stating otherwise.
Beginning September 18, 2015, Cadence will observe a Quiet Period during which the business outlook as provided in this press release and the most recent Annual Report on Form 10-K and Quarterly Report on Form 10-Q no longer constitute the company's current expectations. During the Quiet Period, the business outlook in these documents should be considered historical, speaking as of prior to the Quiet Period only and not subject to any update by the company. During the Quiet Period, Cadence's representatives will not comment on Cadence's business outlook, financial results or expectations. The Quiet Period will extend until the day when Cadence's third quarter 2015 earnings release is published, which is currently scheduled for October 26, 2015.
For more information, please contact:
Investors and Shareholders
Alan Lindstrom
Cadence Design Systems, Inc.
408-944-7100
investor_relations@cadence.com
Media and Industry Analysts
Mark Plungy
Cadence Design Systems, Inc.
408-944-7039
publicrelations@cadence.com
Cadence Design Systems, Inc.
Condensed Consolidated Balance Sheets
July 4, 2015 and January 3, 2015
(In thousands)
(Unaudited)
July 4, 2015 January 3, 2015
------------ ---------------
Current assets:
Cash and cash
equivalents $647,851 $932,161
Short-term
investments 96,560 90,445
Receivables,
net 131,325 122,492
Inventories 62,172 56,394
2015 notes
hedges - 523,930
Prepaid
expenses and
other 129,320 126,313
Total current assets 1,067,228 1,851,735
Property, plant and equipment,
net of accumulated
depreciation
of $569,202
and
$552,551,
respectively 229,838 230,112
Goodwill 553,831 553,767
Acquired intangibles, net of
accumulated amortization of
$185,382 and $154,814, respectively 328,338 360,932
Long-term receivables 1,628 3,644
Other assets 199,790 209,366
-------
Total assets $2,380,653 $3,209,556
========== ==========
Current liabilities:
Convertible
notes $ - $342,499
2015 notes
embedded
conversion
derivative - 523,930
Accounts
payable and
accrued
liabilities 202,794 225,375
Current
portion of
deferred
revenue 324,569 301,287
Total current liabilities 527,363 1,393,091
------- ---------
Long-term liabilities:
Long-term
portion of
deferred
revenue 36,402 54,726
Long-term
debt 348,733 348,676
Other long-
term
liabilities 70,940 79,489
Total long-term
liabilities 456,075 482,891
------- -------
Stockholders' equity 1,397,215 1,333,574
Total liabilities and
stockholders' equity $2,380,653 $3,209,556
========== ==========
Cadence Design Systems, Inc.
Condensed Consolidated Income Statements
For the Three and Six Months Ended July 4, 2015 and June 28, 2014
(In thousands, except per share amounts)
(Unaudited)
Three Months Ended Six Months Ended
------------------ ----------------
July 4, 2015 June 28, 2014 July 4, 2015 June 28, 2014
------------ ------------- ------------ -------------
Revenue:
Product and
maintenance $384,951 $354,468 $768,588 $711,818
Services 30,932 24,320 58,661 45,520
Total revenue 415,883 378,788 827,249 757,338
------- ------- ------- -------
Costs and expenses:
Cost of product
and maintenance 31,715 37,707 73,774 79,904
Cost of services 20,040 16,706 38,566 31,608
Marketing and
sales 96,662 98,611 196,930 196,934
Research and
development 157,974 152,672 320,970 299,138
General and
administrative 27,467 32,042 55,109 60,786
Amortization of
acquired
intangibles 6,119 5,579 12,350 10,789
Restructuring and
other charges
(credits) (498) (26) 3,861 370
Total costs
and expenses 339,479 343,291 701,560 679,529
------- ------- ------- -------
Income from operations 76,404 35,497 125,689 77,809
Interest expense (8,180) (7,369) (19,934) (14,637)
Other income, net 1,347 1,635 6,128 5,017
Income before provision for
income taxes 69,571 29,763 111,883 68,189
Provision for
income taxes 11,411 6,500 17,464 11,856
Net income $58,160 $23,263 $94,419 $56,333
======= ======= ======= =======
Net income per share - basic $0.20 $0.08 $0.33 $0.20
===== ===== ===== =====
Net income per share - diluted $0.19 $0.08 $0.30 $0.19
===== ===== ===== =====
Weighted average common shares outstanding -
basic 285,297 283,344 284,910 282,480
======= ======= ======= =======
Weighted average common shares outstanding -
diluted 313,665 305,755 312,756 303,395
======= ======= ======= =======
Cadence Design Systems, Inc.
Condensed Consolidated Statements of Cash Flows
For the Six Months Ended July 4, 2015 and June 28, 2014
(In thousands)
(Unaudited)
Six Months Ended
----------------
July 4, June 28,
2015 2014
---- ----
Cash and cash equivalents
at beginning of period $932,161 $536,260
Cash flows from operating
activities:
Net income 94,419 56,333
Adjustments to reconcile
net income to net cash
provided by operating
activities:
Depreciation and
amortization 58,963 53,609
Amortization of debt
discount and fees 8,971 9,814
Stock-based compensation 43,564 37,941
Gain on investments, net (1,590) (5,128)
Deferred income taxes 7,097 4,778
Other non-cash items 1,142 3,694
Changes in operating assets
and liabilities, net of
effect of acquired
businesses:
Receivables (8,078) 5,336
Inventories (6,243) (12,266)
Prepaid expenses and other (8,036) (13,602)
Other assets 1,117 (1,273)
Accounts payable and
accrued liabilities (20,653) (13,550)
Deferred revenue 5,827 (23,740)
Other long-term
liabilities (8,058) (4,983)
Net cash provided by
operating activities 168,442 96,963
------- ------
Cash flows from investing
activities:
Purchases of available-
for-sale securities (59,516) (77,490)
Proceeds from the sale of
available-for-sale
securities 37,586 54,601
Proceeds from the maturity
of available-for-sale
securities 15,600 23,799
Proceeds from the sale of
long-term investments 2,293 -
Purchases of property,
plant and equipment (24,067) (17,715)
Cash paid in business
combinations and asset
acquisitions, net of cash
acquired - (163,685)
Net cash used for investing
activities (28,104) (180,490)
------- --------
Cash flows from financing
activities:
Proceeds from revolving
credit facility - 100,000
Payment of convertible
notes (349,999) -
Payment of convertible
notes embedded conversion
derivative liability (530,643) -
Proceeds from convertible
notes hedges 530,643 -
Payment of acquisition-
related contingent
consideration - (1,835)
Excess tax benefits from
stock-based compensation 10,097 2,642
Proceeds from issuance of
common stock 38,167 36,482
Stock received for payment
of employee taxes on
vesting of restricted
stock (15,814) (12,292)
Payments for repurchases of
common stock (93,076) (25,032)
Net cash provided by (used
for) financing activities (410,625) 99,965
-------- ------
Effect of exchange rate
changes on cash and cash
equivalents (14,023) 4,718
------- -----
Increase (decrease) in cash
and cash equivalents (284,310) 21,156
-------- ------
Cash and cash equivalents
at end of period $647,851 $557,416
======== ========
Cadence Design Systems, Inc.
(Unaudited)
Revenue Mix by
Geography (% of
Total Revenue)
2014 2015
---- ----
GEOGRAPHY Q1 Q2 Q3 Q4 Year Q1 Q2
--------- --- --- --- --- ---- --- ---
Americas 45% 44% 46% 47% 45% 47% 48%
Asia 23% 23% 22% 22% 23% 24% 23%
Europe, Middle East
and Africa 20% 22% 21% 21% 21% 19% 20%
Japan 12% 11% 11% 10% 11% 10% 9%
Total 100% 100% 100% 100% 100% 100% 100%
Revenue Mix by
Product Group (%
of Total Revenue)
2014 2015
---- ----
PRODUCT GROUP Q1 Q2 Q3 Q4 Year Q1 Q2
------------- --- --- --- --- ---- --- ---
Functional
Verification,
including
Emulation Hardware 23% 21% 23% 21% 22% 23% 21%
Digital IC Design
and Signoff 30% 30% 29% 28% 29% 28% 29%
Custom IC Design 27% 28% 27% 28% 27% 27% 27%
System Interconnect
and Analysis 10% 11% 10% 11% 11% 11% 11%
IP 10% 10% 11% 12% 11% 11% 12%
Total 100% 100% 100% 100% 100% 100% 100%
Cadence Design Systems, Inc.
As of July 27, 2015
Impact of Non-GAAP Adjustments on Forward Looking Diluted Net Income Per Share
(Unaudited)
Three Months Ending Year Ending
October 3, 2015 January 2, 2016
Forecast Forecast
-------- --------
Diluted net income per share on a
GAAP basis $0.17 to $0.19 $0.63 to $0.69
Amortization of acquired intangibles 0.05 0.21
Stock-based compensation expense 0.08 0.30
Non-qualified deferred compensation
expenses - -
Restructuring and other charges - 0.01
Acquisition and integration-related costs - 0.02
Amortization of debt discount on
convertible notes - 0.02
Other income or expense related to
investments and non-qualified deferred
compensation plan assets*
- -
Income tax effect of non-GAAP adjustments (0.05) (0.19)
Diluted net income per share on a
non-GAAP basis** $0.25 to $0.27 $1.00 to $1.06
============== ==============
**The non-GAAP measures presented in the table
above should not be considered a substitute
for financial results and measures determined
or calculated in accordance with GAAP.
* Includes, as applicable, equity in losses or
income from investments, write-down of
investments, gains or losses on sale of
investments and gains or losses on non-
qualified deferred compensation plan assets
recorded in other income or expense.
Cadence Design Systems, Inc.
As of July 27, 2015
Impact of Non-GAAP Adjustments on Forward Looking Net Income
(Unaudited)
Three Months Ending Year Ending
October 3, 2015 January 2, 2016
($ in millions) Forecast Forecast
-------- --------
Net income on a GAAP basis $52 to $58 $195 to $214
Amortization of acquired intangibles 16 64
Stock-based compensation expense 24 93
Non-qualified deferred compensation
expenses - 1
Restructuring and other charges - 4
Acquisition and integration-related costs 1 8
Amortization of debt discount on
convertible notes - 7
Other income or expense related to
investments and non-qualified deferred
compensation plan assets*
- (2)
Income tax effect of non-GAAP adjustments (15) (59)
Net income on a non-GAAP basis** $78 to $84 $311 to $330
========== ============
**The non-GAAP measures presented in the table
above should not be considered a substitute
for financial results and measures determined
or calculated in accordance with GAAP.
* Includes, as applicable, equity in losses or
income from investments, write-down of
investments, gains or losses on sale of
investments and gains or losses on non-
qualified deferred compensation plan assets
recorded in other income or expense.
Cadence Design Systems, Inc.
Supplemental Reconciliation of Certain GAAP to Non-GAAP Measures
For the Three Months Ended July 4, 2015
(In thousands)
(Unaudited)
Three Months Ended
July 4, 2015
------------
GAAP Adjustments Non-GAAP*
Revenue:
Product and maintenance $384,951 $ - $384,951
Services 30,932 - 30,932
------
Total revenue 415,883 - 415,883
------- --- -------
Costs and expenses:
Cost of product and maintenance 31,715 (10,660) (A) 21,055
Cost of services 20,040 (810) (A) 19,230
Marketing and sales 96,662 (5,338) (A) 91,324
Research and development 157,974 (12,974) (A) 145,000
General and administrative 27,467 (3,744) (A) 23,723
Amortization of acquired intangibles 6,119 (6,119) (A) -
Restructuring and other charges
(credits) (498) 498 -
-----
Total costs and expenses 339,479 (39,147) 300,332
------- ------- -------
Income from operations 76,404 39,147 115,551
Interest expense (8,180) 2,470 (B) (5,710)
Other income, net 1,347 (311) (C) 1,036
----- ---
Income before provision for income taxes 69,571 41,306 110,877
Provision for income taxes 11,411 14,091 (D) 25,502
------ ---
Net income $58,160 $27,215 $85,375
======= ======= =======
* The non-GAAP measures presented in the table above should not be considered a substitute for financial results and measures determined or calculated in accordance with GAAP.
Notes:
(A) For the three months ended July 4, 2015, adjustments to GAAP are as follows for the line items specified:
Amortization of Stock-based Non-qualified Acquisition and Total
acquired compensation deferred integration-related adjustments
intangibles expense compensation costs
expenses (credits)
---
Cost of product and maintenance $10,105 $558 $(3) $ - $10,660
Cost of services - 815 (5) - 810
Marketing and sales - 5,236 (12) 114 5,338
Research and development - 11,401 22 1,551 12,974
General and administrative - 3,693 35 16 3,744
Amortization of acquired intangibles 6,119 - - - 6,119
Total $16,224 $21,703 $37 $1,681 $39,645
===== =======
(B) Amortization of debt discount related to convertible notes
(C) Other income or expense related to investments and non-qualified deferred compensation plan assets
(D) Income tax effect of non-GAAP adjustments
Cadence Design Systems, Inc.
Supplemental Reconciliation of Certain GAAP to Non-GAAP Measures
For the Three Months Ended June 28, 2014
(In thousands)
(Unaudited)
Three Months Ended
June 28, 2014
-------------
GAAP Adjustments Non-GAAP*
Revenue:
Product and maintenance $354,468 $ - $354,468
Services 24,320 - 24,320
------
Total revenue 378,788 - 378,788
------- --- -------
Costs and expenses:
Cost of product and maintenance 37,707 (9,504) (E) 28,203
Cost of services 16,706 (1,384) (E) 15,322
Marketing and sales 98,611 (6,992) (E) 91,619
Research and development 152,672 (21,177) (E) 131,495
General and administrative 32,042 (8,824) (E) 23,218
Amortization of acquired intangibles 5,579 (5,579) (E) -
Restructuring and other charges
(credits) (26) 26 -
----
Total costs and expenses 343,291 (53,434) 289,857
------- ------- -------
Income from operations 35,497 53,434 88,931
Interest expense (7,369) 4,241 (F) (3,128)
Other income, net 1,635 (1,480) (G) 155
----- ---
Income before provision for income taxes 29,763 56,195 85,958
Provision for income taxes 6,500 15,849 (H) 22,349
----- ---
Net income $23,263 $40,346 $63,609
======= ======= =======
* The non-GAAP measures presented in the table above should not be considered a substitute for financial results and measures determined or calculated in accordance with GAAP.
Notes:
(E) For the three months ended June 28, 2014, adjustments to GAAP are as follows for the line items specified:
Amortization of Stock-based Non-qualified Acquisition and Special Total
acquired compensation deferred integration- charges (I) adjustments
intangibles expense compensation related costs
expenses
--------
Cost of product and maintenance $8,613 $485 $5 $ - $401 $9,504
Cost of services - 709 8 - 667 1,384
Marketing and sales - 4,560 20 499 1,913 6,992
Research and development - 9,701 642 4,980 5,854 21,177
General and administrative - 3,622 372 3,308 1,522 8,824
Amortization of acquired intangibles 5,579 - - - - 5,579
Total $14,192 $19,077 $1,047 $8,787 $10,357 $53,460
===== =======
(F) Amortization of debt discount related to convertible notes
(G) Other income or expense related to investments and non-qualified deferred compensation plan assets
(H) Income tax effect of non-GAAP adjustments
(I) Comprised of costs related to a voluntary retirement program
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SOURCE Cadence Design Systems, Inc.
