CADENCE DESIGN SYSTEMS INCCDNS

CADENCE DESIGN SYSTEMS INC Segments Disclosure

10-KFiled Feb 19, 20263 min read
SEGMENT REPORTING
Segment reporting is based on the “management approach,” following the method that management organizes the company’s reportable segments for which separate financial information is made available to, and evaluated regularly by, the chief operating decision maker in allocating resources and in assessing performance. Cadence operates as one operating segment. Cadence’s chief operating decision maker (“CODM”) is its CEO. The CODM makes decisions on resource allocation and assesses performance of the business based on Cadence’s consolidated results, including net income.
For additional information on Cadence’s revenue, including the nature and timing of revenue from contracts with customers, see Note 3 in the notes to consolidated financial statements. The following table presents revenue, significant expenses and net income for fiscal 2025, 2024 and 2023:
 202520242023
 (In thousands)
Revenue
5,296,759 4,641,264 4,089,986 
Costs and Expenses:
Salary, benefits and other employee-related costs
2,132,023 1,936,542 1,754,223 
Stock based compensation
455,175 391,219 325,611 
Manufacturing costs
376,610 330,903 232,012 
Facilities and other infrastructure costs
192,719 174,102 156,977 
Depreciation and amortization
227,828 196,935 145,292 
Professional services
169,290 153,439 117,752 
Loss related to contingent liability (1)
128,545 8,322 — 
Restructuring
29,194 23,765 11,013 
Other segment items (2)
48,375 16,703 58,632 
Interest income(101,584)(62,484)(29,637)
Interest expense116,541 75,999 36,185 
Provision for income taxes413,155 340,335 240,782 
Net income$1,108,888 $1,055,484 $1,041,144 
_____________
(1) For information regarding the loss related to a contingent liability, see Note 18 in the notes to the consolidated financial statements.
(2) Other segment items includes direct costs for advertising, marketing events, travel, entertainment, bad debt and other operating expense categories that are not considered significant individually. It also includes non-operating expenses such as gains and losses on investments, foreign currency and other non-operating expenses that are not considered significant individually.
Outside the United States, Cadence markets and supports its products and services primarily through its subsidiaries. Revenue is attributed to geography based upon the country in which the product is used, or services are delivered. Long-lived assets are attributed to geography based on the country where the assets are located.
The following table presents a summary of revenue by geography for fiscal 2025, 2024 and 2023:
 202520242023
 (In thousands)
Americas:
United States$2,310,965 $2,159,703 $1,694,529 
Other Americas168,349 93,101 65,259 
Total Americas2,479,314 2,252,804 1,759,788 
Asia:
China679,971 573,096 679,538 
Other Asia1,005,232 855,919 766,409 
Total Asia1,685,203 1,429,015 1,445,947 
Europe, Middle East and Africa790,569 699,241 655,078 
Japan341,673 260,204 229,173 
Total$5,296,759 $4,641,264 $4,089,986 
The following table presents a summary of long-lived assets by geography as of December 31, 2025, December 31, 2024, and December 31, 2023: 
 As of
 December 31,
2025		December 31,
2024		December 31,
2023
 (In thousands)
Americas:
United States$439,902 $412,339 $383,807 
Other Americas10,114 7,437 10,219 
Total Americas450,016 419,776 394,026 
Asia:
China23,014 22,929 29,598 
Other Asia110,844 83,951 71,365 
Total Asia133,858 106,880 100,963 
Europe, Middle East and Africa105,015 73,551 56,449 
Japan4,079 4,183 2,572 
Total$692,968 $604,390 $554,010 

Historical Timeline

Fiscal YearFiled
2025Feb 19, 2026Showing above
2024Feb 21, 2025
2023Feb 14, 2024
2022Feb 22, 2022
2021Feb 22, 2021
2019Feb 24, 2020
2018Feb 27, 2019
2017Feb 20, 2018
2016Feb 18, 2016

About Segments Disclosures

Segment disclosures break a company into its reportable operating units, revealing revenue, profit, and asset allocation that consolidated financial statements obscure. Under ASC 280, segments must match how the chief operating decision maker views the business, providing a window into internal management structure and resource allocation priorities.

Key signals: compare segment margins to identify which units drive profitability and which destroy value. Watch for changes in the number of reportable segments — segment aggregation or disaggregation often coincides with strategic shifts or attempts to obscure declining performance. Intersegment elimination patterns reveal internal pricing practices. The reconciliation between segment totals and consolidated figures exposes corporate overhead allocation and unallocated items. Geographic revenue concentration highlights regulatory and currency exposure. Compare segment-level capital expenditure against segment revenue to assess where management is investing for future growth versus harvesting existing assets.

Other Available Disclosures

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