Cadence Design Systems, Inc. (also written as cādence ) is a technology company based in San Jose, California. The company originally focused on creating software for designing electronic components used in semiconductors. Today, it develops software and hardware for designing products such as integrated circuits, systems on chips (SoCs), and printed circuit boards. It also creates tools for modeling large molecules, which help scientists develop medicines. Additionally, the company provides licensed intellectual property for use in electronics, aerospace, defense, and automotive industries.
History
Cadence Design Systems was founded in 1983 in San Jose, California. It began as an electronic design automation (EDA) company called Solomon Design Automation (SDA). SDA was co-founded by James Solomon, Richard Newton, and Alberto Sangiovanni-Vincentelli. Cadence was created when SDA merged with ECAD, a public company co-founded by Ping Chao, Glen Antle, and Paul Huang in 1982. The merger of SDA and ECAD officially formed Cadence Design Systems in 1988. Joseph Costello became the CEO and president of the new company. After the merger, Cadence began trading on the New York Stock Exchange, and Costello oversaw additional mergers and acquisitions.
In 1989, Cadence acquired Gateway Design Automation for $72 million. In 1990, it acquired Automated Systems Inc., adding board design to its existing chip design software. In 1991, Cadence acquired Valid Logic Systems for about $200 million, its largest acquisition at the time. The combined company had revenues of $390 million, according to the New York Times.
In 1996, Cadence acquired High Level Design Systems. At that time, Cadence had 3,300 employees and $742 million in annual revenue. In 1997, Joe Costello resigned as CEO, and Jack Harding took over. In 1999, Ray Bingham became CEO. Cadence purchased Ambit Design Systems for $260 million in 1998 and OrCAD Systems in 1999. In 1999, it also acquired Quickturn Design Systems, preventing a hostile takeover by Mentor Graphics.
Between 2001 and 2003, under the guidance of executives like Jim Hogan and Penny Herscher, Cadence acquired several implementation tools, including Silicon Perspective, Verplex, and Celestry Design. These acquisitions were partly to compete with Synopsys, a major rival after its 2001 purchase of Avanti. In 2004, Mike Fister became CEO and president, with Ray Bingham as chairman. Donald L. Lucas remained on the board. From 2004 to 2007, Cadence acquired four companies, including Verisity, and spent $1 billion on stock buybacks in 2006.
In 2007, Cadence announced a new chip-making process that laid wires diagonally, horizontally, and vertically. At that time, Cadence had a market value of about $6.4 billion. That year, the company was rumored to be in talks with Kohlberg Kravis Roberts and Blackstone Group about a possible sale. In 2008, Cadence withdrew a $1.6 billion offer to buy Mentor Graphics. That same year, Lip-Bu Tan became acting CEO after Mike Fister resigned. In 2009, Tan was confirmed as president and CEO. In 2011, Cadence acquired Altos Design Automation. Later acquisitions included Cosmic Circuits and Tensilica in 2013, Forte Design Systems in 2014, and AWR Corporation in 2019.
In 2021, Cadence had 9,300 employees and $3 billion in annual revenue. Most revenue came from licensing software and intellectual property. In April 2021, after a Washington Post report linked Cadence and Synopsys technology to China’s military efforts, U.S. legislators asked the Department of Commerce to tighten export controls. In December 2021, Anirudh Devgan became president and CEO, succeeding Lip-Bu Tan, who became executive chairman and left the board in 2023. In 2021, Cadence launched an artificial intelligence platform to improve processor development.
By 2022, 40% of Cadence’s revenue came from systems-oriented customers, who needed products tailored for industries that use chips. Cadence also designed customized chips for clients, using third-party manufacturers like Taiwan Semiconductor Manufacturing, a practice that grew due to global chip shortages. In late 2022, Cadence had clients like Tesla and Apple Inc. In September 2022, it acquired OpenEye Scientific Software for $500 million, rebranding it as OpenEye Cadence Molecular Sciences. OpenEye signed Pfizer as a client in October 2023.
In 2023, Cadence purchased several businesses from Rambus. In February 2024, Cadence unveiled the M1, its own supercomputer for computational fluid dynamics and AI, marking its entry into the supercomputer business. In June 2024, it acquired BETA CAE Systems.
In January 2025, Cadence announced the acquisition of Secure-IC, an embedded security IP provider, expected to close by mid-2025. In mid-2025, the Trump administration paused licenses for exporting American EDA software to China, including Cadence products. In July 2025, Cadence pleaded guilty to violating U.S. export controls and paid $140 million.
On September 4, 2025, Cadence announced it would acquire Hexagon AB’s design and engineering business for €2.7 billion ($3.16 billion). The deal included Hexagon’s MSC Software business, which provides engineering simulation and analysis tools.
Products
Cadence Design Systems was originally known for creating software that helps design electronic systems. Today, the company develops software, hardware, and intellectual property (IP) used to design chips, chiplet-style products, and printed circuit boards. It also sells hardware systems that run its chip design software.
The company provides tools for analyzing electromagnetics, thermal effects, and fluid dynamics in industries like high-tech electronics, aerospace, defense, and automotive. In 2023, it was reported to specialize in products for areas such as artificial intelligence and machine learning, cloud computing, 3D technology, and AI-powered data analysis. Its tools are used in fields like hyperscale computing, 5G communications, automotive, mobile, aerospace, consumer products, industrial systems, and healthcare.
Cadence creates technologies for designing custom integrated circuits. For example, its Virtuoso Studio includes tools for designing custom circuits. In 2019, Cadence introduced Spectre X, a tool that allows users to run complex simulations across many computers to improve speed. It also offers AWR, a tool for designing radio frequency and millimeter wave products used in communications, aerospace, defense, semiconductors, computers, and consumer electronics.
Cadence provides tools for digital design and verification, such as Genus, Innovus, Tempus, and Voltus. In 2020, it combined Innovus with Genus Synthesis to improve efficiency. Stratus is a tool that creates circuit designs from code written in C, C++, or SystemC. Other tools include Conformal Equivalence Checker, Joules RTL Power Solution, Quantus Extraction Solution, and Modus DFT Software Solution.
Cadence develops tools for verifying chip designs. JasperGold is a verification tool first introduced in 2003 and updated with machine learning in 2019. vManager tracks verification processes. Perspec System Verifier, introduced in 2014, helps verify system-level designs and later became compatible with industry standards. Xcelium, launched in 2017, is a parallel simulator that uses multiple computer cores for faster performance.
In 2015, Cadence released the Palladium Z1 hardware emulation platform to test complex chip designs. This platform was based on technology acquired from Quickturn in 1998. In 2021, it launched Palladium Z2, an improved version of Z1.
The Protium FPGA prototyping platform was introduced in 2014, followed by Protium S1 in 2017, which uses advanced FPGA chips. Protium X1, launched in 2019, supports large chip designs. Protium X2, introduced in 2021, offers faster performance and greater capacity than X1.
Cadence provides intellectual property (SIP) blocks for chip design, including interfaces, memory, and data processing units. It also creates tools for verifying chips, such as simulators and formal verification systems. Tensilica DSP processors, used for tasks like audio, vision, and AI, were introduced in 2019. In 2021, Cadence launched the Tensilica AI Platform to improve AI chip development.
Cadence offers tools for designing printed circuit boards (PCBs) and chip packages. The Allegro Platform helps design circuits, packages, and PCBs on a large scale. OrCAD/PSpice is used by smaller design teams. OrbitIO helps plan and optimize chip layouts. InspectAR uses augmented reality to label and map circuit board designs.
Cadence provides tools for system analysis, such as Sigrity, which checks signal integrity, power, and heat. Clarity, introduced in 2019, uses 3D modeling for electromagnetic analysis. Celsius, launched in 2019, uses advanced methods to analyze heat. Cascade Technologies offers tools for fluid dynamics analysis. Fidelity Pointwise, acquired in 2021, helps create models for fluid simulations.
In 2021, Cadence acquired tools from NUMECA, used in industries like automotive and aerospace. Fidelity (formerly OMNIS) is a tool for fluid dynamics, modeling, and optimization. Cadence Reality is a platform that creates digital models of designs or factories.
In 2024, Cadence launched the Millennium M1 platform, combining hardware and software to create digital twins. This platform is based on its earlier Fidelity CFD tools.
Cadence’s OpenEye Scientific division provides software for molecular modeling used by pharmaceutical and biotechnology companies. Orion is a cloud-based service. OpenEye’s headquarters is in Santa Fe, New Mexico.
In 2023, Cadence was reported to be developing tools for AI chip design and using AI in its own software. Cerebrus, released in 2021, uses machine learning to optimize chip design. In 2022, Cadence introduced Optimality, a system design tool compatible with other tools. Microsoft used this system early. In 2023, Cadence launched ChipGPT, a tool that helps companies design custom chips with AI assistance.
Recognition
In 2016, former Cadence CEO Lip-Bu Tan was given the Dr. Morris Chang Exemplary Leadership Award by the Global Semiconductor Alliance. In 2019, Investor's Business Daily placed Cadence Design Systems at #5 on its list of 50 Best Environmental, Social, and Governance (ESG) Companies. In 2020, Cadence was listed at #45 on People magazine's Companies that Care list. Fortune magazine included Cadence on its 100 Best Companies to Work For list for the sixth year in a row in 2020. In 2021, Anirudh Devgan received the IEEE/SEMI Phil Kaufman award, and in 2022, he was inducted into the National Academy of Engineering.
Sponsorship
In May 2022, the Formula 1 racing team McLaren signed a long-term partnership agreement with Cadence. In April 2023, Cadence formed a technology partnership with the San Francisco 49ers to improve energy efficiency at Levi's Stadium. This agreement also granted Cadence the right to name the team's mobile application.
Controversies
In July 2025, Cadence Design Systems admitted guilt to criminal charges and agreed to pay more than $140 million in total fines and penalties for illegally sending semiconductor design technology to China's National University of Defense Technology (NUDT), a military university controlled by China's Central Military Commission. The U.S. Department of Justice and Bureau of Industry and Security reported that Cadence's Chinese branch intentionally sold electronic design automation (EDA) hardware, software, and semiconductor design technology worth over $45 million to NUDT between 2015 and 2021. This occurred even though NUDT was added to the U.S. Entity List in February 2015 because the university used American technology to build supercomputers "believed to support nuclear explosive simulation and military simulation activities."
The violations included employees at Cadence's Chinese branch using intermediary companies, such as Central South CAD Center (CSCC) and later Phytium Technology, to hide the sales to the restricted military university. Company messages showed that Cadence China employees were told to refer to NUDT only in Chinese characters and use "CSCC" in English communications because "the subject [was] too sensitive." The Department of Justice stated that Cadence received only partial credit for cooperating because the company "failed to voluntarily disclose the misconduct" and did not fully help with interviews of employees in China, leading to the company being placed on three years of corporate probation.