(Reuters) – Cadans Design Systems predicts its annual turnover and profit below estimates of analysts on Tuesday, in a sign of a soft demand for his chip design software while customers sharpen the expenses in a heavy economy.
Shares of San Jose, California -based company, fell by 5% in longer trade.
The company, which counts the British chip designer Arm Holdings, Nvidia and Maker Tesla of the electric vehicles among its customers, makes software for designing everything, from chips to jet engines. It also sells computer systems that are designed to perform that complex software.
Analysts at Berenberg have said that the demand and customer budgets for the system design and analysis products from Cadans would be filled in in 2025 because of the ongoing industry in the automotive end market.
China is good for a equipment part of Cadans’ affairs. Further restrictions from the US government on the sale of semiconductor technology to Chinese entities could make its activities from the country meaningfully reduce, they said in a memorandum in January.
The market share of Cadans in the highly concentrated industry is also threatened by the proposed buy-out of rival Synopsys of Engineering software company Ansys in a cash cash-and-stock deal of $ 35 billion.
The company expects its tax 2025 to be between $ 5.14 billion and $ 5.22 billion, compared to the average estimate of analysts of $ 5.25 billion, according to data collected by LSEG.
Cadans predicts its annual profit, excluding items, in the range of $ 6.65 to $ 6.75 per share, also under the estimate of $ 6.83 per share.
Turnover was $ 1.36 billion for the quarter ending on December 31, an increase of 26.8% compared to the year earlier.
Exclusive items earned the company $ 1.88 per share in the fourth quarter, compared to the estimate of $ 1.82.
(Reporting by Juby Babu in Mexico City; Edit by Shilpi Majumdar)
