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The Bureau of Industry and Security (BIS) of the U.S. Department of Commerce has rescinded export license requirements for Cadence Design Systems, Inc. (NASDAQ:CDNS), a leading technology company with an $84.9 billion market cap and impressive 85.86% gross profit margins, related to certain electronic design automation (EDA) software and technology when dealing with parties in China or Chinese military end users. The change took effect Wednesday, according to a statement in a press release based on the company’s SEC filing.
Previously, on May 23, BIS had informed Cadence that a license was required for the export, re-export, or in-country transfer of EDA software and technology classified under Export Control Classification Numbers 3D991 and 3E991 on the Commerce Control List, specifically when a party to the transaction was located in China or identified as a Chinese military end user, regardless of location. The company’s strong financial position, with a current ratio of 3.07 and revenue growth of 19.55% over the last twelve months, suggests it’s well-positioned to handle regulatory changes.
On Wednesday, Cadence was notified by BIS that these license requirements were rescinded effective immediately. The company stated that it is in the process of restoring access to the affected EDA software and technology for its customers in accordance with the updated U.S. export regulations. According to InvestingPro analysis, Cadence currently appears overvalued compared to its Fair Value, though it maintains a "GREAT" financial health score with 14+ additional ProTips available for subscribers.
Cadence’s common stock is listed on the Nasdaq Global Select Market under the symbol CDNS.
All information is based on a press release statement contained in the company’s SEC filing.
In other recent news, Cadence Design Systems has reported several key developments. The company has expanded its collaboration with Samsung (KS:005930) Foundry through a new multi-year intellectual property agreement aimed at advancing AI-driven design flows for cutting-edge process nodes. This partnership will enhance Cadence’s memory and interface IP solutions for Samsung’s advanced nodes, targeting high-performance computing applications. Additionally, Cadence announced it will offer its engineering design solutions on a new industrial AI cloud, developed in collaboration with NVIDIA (NASDAQ:NVDA), which promises significantly faster performance for various applications.
Cadence also introduced the Tensilica NeuroEdge 130 AI Co-Processor, designed to boost neural processing unit performance in system-on-chip applications while reducing power consumption. Furthermore, the company unveiled its Millennium M2000 Supercomputer, integrated with NVIDIA technology, to enhance simulation speeds and efficiency across multiple sectors, including electronic design automation and drug discovery. In regulatory news, Cadence is seeking clarification from the U.S. Department of Commerce regarding new export controls to China, which require licenses for certain software and technology transactions. Despite these regulatory challenges, Cadence continues to experience strong global business momentum.
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