Cadence Design Systems, Inc. 2012 Annual Report Cadence Is a Global Technology Leader in Software, Hardware, IP, and Services for Electronic Design
Total Page:16
File Type:pdf, Size:1020Kb
Cadence Design Systems, Inc. 2012 Annual Report Cadence is a global technology leader in software, hardware, IP, and services for electronic design. By delivering critical design technology for creating, integrating, and optimizing designs, Cadence enables customers to realize silicon, SoCs, and complete systems on schedule at lower costs with higher quality. Lip-Bu Tan President and Chief Executive Officer DEAR SHAREHOLDERS: In 2012, Cadence continued to perform well, grow our business, and improve our financial performance, despite global economic challenges and uncertainty in the semiconductor industry. Revenue grew 15% to $1.33 billion, operating profitability significantly improved, and operating cash flow increased 32% to $316 million. We also strengthened the Cadence team by hiring more than 700 employees worldwide, mostly in research and development and technical support functions. In keeping with our commitment to be a technology leader, we continued to invest in our product lines and delivered significant innovations to our customers. Our challenging, rewarding, customer-focused corporate culture was the foundation to our ongoing success in 2012. Cadence thrives on solving significant SoC Realization, which includes design and consumption. This technology, along with challenges for our customers in the verification IP, is a fast-growing business for FinFET technology, holds great promise for semiconductor and electronics industries. us and represents a significant opportunity. helping extend Moore’s Law. Opportunities for Cadence to thrive are Cadence offers differentiated, high- Our financial results in 2012 reflect solid created by trends like connectivity, mobility, performance and high-quality IP serving the execution, with strong financial returns that social media, cloud computing, and the rapid-growth mobile, video, and network enabled us to invest for future growth. “internet of things.” Each new electronic markets. In 2012, the revenue for our Shareholders were rewarded for our device – from consumer to communication design IP and verification IP products performance in 2012 with shares that to computing – is a unique combination of increased by more than 30%. increased 29% in value. We ended the year silicon, SoC, software, and system Our System Realization solutions span the with $827 million in cash and short-term technology that drives demand for Cadence system design cycle, from early architectural investments, an increase of $222 million design tools and IP. level software development through system after funding increased investment in R&D, Silicon Realization includes core electronic validation, prototyping, and circuit board acquisitions, and capital expenditures. Our design automation tools for designing layout. These solutions help customers ongoing focus on efficiency led to a further integrated circuits. We are well-positioned develop software and hardware 6 percentage point increase in our GAAP in this area, with leading solutions for concurrently to meet aggressive time-to- operating margin and put us within reach mixed-signal and low-power design that market objectives. Our Palladium® XP of our longer-term profitability goals. Our serve high-growth end markets such as Verification Computing Platform achieved financial success enables us to continue mobile, consumer, and network devices. In record revenue in 2012 through increased to make investments in R&D and acquired 2012, we strengthened our digital design demand from both semiconductor technology that serve our customers and capabilities as we collaborated with leading companies and systems companies. We also drive growth. ecosystem partners at the most advanced strengthened our offerings for printed In 2012, we achieved a major milestone by 16- and 14-nanometer FinFET based process circuit board design with the acquisition of completing the transition to a highly nodes. In addition, we announced successful Sigrity, Inc., which brought us advanced ratable business model while we tapeouts of advanced processors with two tools needed to design the complex, high- strengthened and expanded our product leading silicon foundries. density circuit boards. lines and customer relationships. In 2013, 2012 marked a milestone for our industry- Our customers rely on an ecosystem of we will continue to strengthen our culture leading Virtuoso® platform for custom, partners for success. In 2012, Cadence of innovation, deliver technical excellence analog, and mixed-signal design. The vast continued to strengthen its collaboration through our design tools and IP, and work majority of our customers have now with leading fabless semiconductor closely with our customers to help them upgraded to the current version of our companies, foundries, and IP providers. In build great products. I believe we are well product architecture, and a growing addition to working with leading IP positioned to drive continuing success in number of customers are taking advantage companies and foundries on 16- and 2013 and beyond. of the tight integration between our 14-nanometer designs, we worked with a Sincerely, analog and digital design flows by adopting leading silicon foundry to develop a 3D-IC both Virtuoso for analog design and our methodology and validate it in silicon. This Encounter® platform for digital design. We technology combines several chips in a also saw significant growth in the Incisive® single package, offers increased system platform for verification in 2012, driven performance and lowers power by increasing integration and complexity Lip-Bu Tan of designs. UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K (Mark One) È ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 29, 2012 OR ‘ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to . Commission file number 0-15867 CADENCE DESIGN SYSTEMS, INC. (Exact name of registrant as specified in its charter) Delaware 77-0148231 (State or Other Jurisdiction of (I.R.S. Employer Incorporation or Organization) Identification No.) 2655 Seely Avenue, Building 5, San Jose, California 95134 (Address of Principal Executive Offices) (Zip Code) (408) 943-1234 (Registrant’s Telephone Number, including Area Code) Securities registered pursuant to Section 12(b) of the Act: Title of Each Class Names of Each Exchange on which Registered Common Stock, $0.01 par value per share NASDAQ Global Select Market Securities registered pursuant to Section 12(g) of the Act: None Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes [ X ] No [ ] Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes [ ] No [ X ] Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes [ X ] No [ ] Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes [ X ] No [ ] Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. [ ] Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer,” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (check one): Large accelerated filer [ X ] Accelerated filer [ ] Non-accelerated filer [ ] Smaller reporting company [ ] (Do not check if a smaller reporting company) Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes [ ] No [ X ] The aggregate market value of the voting and non-voting common equity held by non-affiliates computed by reference to the price at which the common equity was last sold as of the last business day of the registrant’s most recently completed second fiscal quarter ended June 30, 2012 was 3,021,086,192. On February 2, 2013, approximately 281,707,719 shares of the Registrant’s Common Stock, $0.01 par value, were outstanding. DOCUMENTS INCORPORATED BY REFERENCE Portions of the definitive proxy statement for Cadence Design Systems, Inc.’s 2013 Annual Meeting of Stockholders are incorporated by reference into Part III hereof. CADENCE DESIGN SYSTEMS, INC. ANNUAL REPORT ON FORM 10-K FOR THE FISCAL YEAR ENDED DECEMBER 29, 2012 Table of Contents Page PART I. Item 1. Business ............................................................... 1 Item 1A. Risk Factors ............................................................ 9 Item 1B. Unresolved Staff Comments ...............................................