Cadence's downbeat fourth-quarter forecast signals weakness in chip industry

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- Cadence Design Systems forecast fourth-quarter revenue and adjusted profit below Wall Street estimates on Monday, as slower R&D spending by semiconductor firms navigating a tough economy weighs on the chip design software provider.A slower-than-expected chip industry recovery has a cascading impact on firms like Cadence, which makes software tools and hardware that help produce blueprints for chips before they are mass manufactured.

The company's costs have also risen as it has had to invest into integrating generative AI capabilities into its own software tools. The company's costs rose 13.8% in the third quarter ended Sept. 30.

 

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