Shares of Cadence Design Systems (NASDAQ:CDNS) jumped on Tuesday after the provider of design solutions for integrated circuits and electronic devices reported its first-quarter results. The company beat analyst estimates for both revenue and earnings, and it provided guidance that came in above analyst expectations. As of 1 p.m. EDT, the stock was up about 9.5%.
Cadence reported first-quarter revenue of $517.3 million, up 8.5% year over year and $12 million above the average analyst estimate. Product and maintenance revenue was $480.6 million, up 6.5% year over year, while services revenue was $36.7 million, up 43.9%.
Non-GAAP net income came in at $0.40 per share, $0.03 higher than analysts were expecting. Under the old revenue reporting rules used during the prior-year period, non-GAAP EPS would have been $0.44, up from $0.32 during the first quarter of 2017.
"The Data-Driven Economy is being propelled by key technology waves of mobile, cloud/datacenter, edge computing, automotive, and most significantly machine learning, all driving increasing design activity. This is driving broad-based customer demand for our innovative System Design Enablement solutions that, along with strong execution, contributed to our excellent financial performance in the first quarter," said CEO Lip-Bu Tan.
Cadence expects to report second-quarter revenue between $510 million and $520 million, compared to analyst expectations of $505.5 million. Second-quarter non-GAAP EPS is expected between $0.39 and $0.41, above the $0.38 analysts were expecting.
For the full year, Cadence sees revenue between $2.055 billion and $2.085 billion, and non-GAAP EPS between $1.57 and $1.65. The consensus analyst estimate for full-year revenue was $2.04 billion.
With a solid first-quarter report, shares of Cadence have regained some ground lost since the beginning of the year. An analyst upgrade from Needham helped the stock along on Tuesday, but it still has a ways to go before reclaiming its 52-week high.