CADENCE DESIGN SYSTEMS INC
For the period ended Sep 30, 2026. Filed Oct 28, 2026.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Sep 30, 2026 · Filed Oct 28, 2026
CDNS$319.92+2.7%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2026-06-30; filed 2026-07-29.
0000813672-26-000092
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsCurrent report: 10-Q
Period ended 2026-09-30; filed 2026-10-28.
0000813672-26-000121
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of OperationsThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 121 previous paragraphs and 129 current paragraphs.
66 unchanged; 50 reworded; 12 added; 5 removed; 0 previous and 1 current paragraphs rearranged.
Tables are not compared: 26 previous and 26 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (12)
Current report
•Increase in general and administrative expense related to contributions to non-profit organizations;
Current report
•Increased restructuring charges related to our 2026 Restructuring Plan; and
Current report
Revenue growth in China was primarily driven by increased demand for, and our ability to deliver, our IP and hardware offerings in that region, while growth in Japan and Other Asia was primarily driven by increased demand for software product offerings, and our ability to deliver IP offerings.
Current report
Professional services decreased during the three months ended September 30, 2026, as compared to the three months ended September 30, 2025, primarily due to a decrease in expense for acquisition-related legal services which were higher than usual during the three months ended September 30, 2025, as a result of our then-pending acquisition of the D&E business of Hexagon.
Current report
Contributions to non-profit organizations increased during the three and nine months ended September 30, 2026, as compared to the three and nine months ended September 30, 2025, primarily due to the timing of contributions to non-profit organizations, including the Cadence Giving Foundation.
Current report
Restructuring
Current report
We have initiated restructuring plans in recent years, most recently in September 2026, to better align our resources with our business strategy. Because the restructuring charges and related benefits are derived from management’s estimates made during the formulation of the restructuring plans, based on then-currently available information, our restructuring plans may not achieve the benefits anticipated on the timetable or at the level contemplated. Additional actions, including further restructuring of our operations, may be required in the future.
Current report
For additional information about our restructuring plans, see Note 9 in the notes to condensed consolidated financial statements.
Current report
During the nine months ended September 30, 2026, as compared to the nine months ended September 30, 2025, our operating margin increased, primarily due to the loss related to a contingent liability recognized during the nine months ended September 30, 2025 which reduced operating margin during that period.
Current report
Other Income (Expense), Net
Current report
Cash flows used for investing activities during the nine months ended September 30, 2026 and September 30, 2025 were as follows:
Current report
Cash flows used for financing activities during the nine months ended September 30, 2026 and September 30, 2025 were as follows:
Removed paragraphs (5)
Previous report
During the three months ended June 30, 2026, as compared to the three months ended June 30, 2025, the decrease in revenue in Other Americas was primarily driven by the timing of design services provided to our customers in that geography.
Previous report
Additionally, for the three and six months ended June 30, 2026, as compared to the three and six months ended June 30, 2025, the increase in revenue in China was partially attributable to export license requirements that were temporarily imposed by BIS on EDA Software and Technology from May to July of fiscal 2025, which impacted our ability to deliver software offerings to our customers in China.
Previous report
Other Income, Net
Previous report
Cash flows used for investing activities during the six months ended June 30, 2026 and June 30, 2025 were as follows:
Previous report
Cash flows used for financing activities during the six months ended June 30, 2026 and June 30, 2025 were as follows:
Reworded paragraphs (50)
Previous wording
Cadence® is a global technology leader that develops computational, AI-driven software, accelerated hardware, and silicon intellectual property (“IP”) products and solutions. Our customers include companies that design and manufacture semiconductors, as well as companies that design and manufacture electromechanical systems containing various types of semiconductor and other electronics. Our products and solutions empower our customers to design, verify and bring to life new and innovative products. Our mission is to empower the world’s most innovative companies to deliver extraordinary electronic products that drive the global economy and improve everyday life.
Current wording
Cadence® is a global technology leader that develops computational, AI-driven software, accelerated hardware, and silicon intellectual property (“IP”) products and solutions. Our customers include companies that design and manufacture semiconductors, as well as companies that design and manufacture electromechanical systems containing various types of semiconductors and other electronics. Our products and solutions empower our customers to design, verify and bring to life new and innovative products. Our mission is to empower the world’s most innovative companies to deliver extraordinary electronic products that drive the global economy and improve everyday life.
Previous wording
Semiconductors, also referred to as integrated circuits (“ICs”), or chips, are integral components in a wide range of products across multiple industries, including both industrial and consumer end markets. As our customers tackle the challenges of designing increasingly intricate systems, they rely on our advanced AI-driven computational software, hardware, IP, and services to manage this complexity without proportional cost increases. Our products and solutions are critical for optimizing the performance, power, and area (“PPA”) of semiconductors and electronic systems while accelerating time-to-market.
Current wording
Semiconductors, also referred to as integrated circuits (“ICs”), or chips, are integral components in a wide range of products across multiple industries, including both industrial and consumer end markets. As our customers tackle the challenges of designing increasingly intricate systems, they rely on our advanced AI-driven computational software, hardware, IP, and services to manage this complexity without proportional cost increases. Our products and solutions allow our customers to optimize the performance, power, and area (“PPA”) of semiconductors and electronic systems while accelerating time-to-market.
Previous wording
On February 23, 2026, we completed our acquisition of the design and engineering (“D&E”) business of Hexagon Smart Solutions AB. This acquisition accelerates our ISD strategy by expanding our SD&A portfolio, building upon our acquisition of BETA CAE in fiscal 2024. The acquisition includes substantially all of the subsidiaries and related assets comprising Hexagon's design and engineering business. For the three and six months ended June 30, 2026, revenue associated with contracts assumed with our acquisition of the D&E business was primarily classified as product and maintenance revenue in our SD&A product category, and cost of revenue associated with these contracts was primarily classified as cost of product and maintenance in our condensed consolidated income statements.
Current wording
On February 23, 2026, we completed our acquisition of the design and engineering (“D&E”) business of Hexagon Smart Solutions AB (“Hexagon”). This acquisition accelerates our ISD strategy by expanding our SD&A portfolio, building upon our acquisition of BETA CAE in fiscal 2024. The acquisition includes substantially all of the subsidiaries and related assets comprising Hexagon's design and engineering business. For the three and nine months ended September 30, 2026, revenue associated with contracts assumed with our acquisition of the D&E business was primarily classified as product and maintenance revenue in our SD&A product category, and cost of revenue associated with these contracts was primarily classified as cost of product and maintenance in our condensed consolidated income statements.
Previous wording
Because we operate globally, our business is subject to the effects of economic downturns or recessions in the regions in which we do business, volatility in foreign currency exchange rates relative to the U.S. dollar, inflation, increased energy costs, supply chain constraints, changing interest rates, expanded trade control laws and regulations, imposition of new or higher tariffs and geopolitical conflicts.
Current wording
Because we operate globally, our business is subject to the effects of economic downturns or recessions in the regions in which we do business, volatility in foreign currency exchange rates relative to the U.S. dollar, inflation, increased energy costs, supply chain constraints, changing interest rates, expanded trade control laws and regulations, imposition of new or higher tariffs and geopolitical instability.
Previous wording
Trade control laws and regulations have been amended over the past years, including through the imposition of certain export control restrictions concerning advanced node IC production in China and the inclusion of additional Chinese technology companies on the BIS “Entity List” and regulations governing the sale of certain technologies. In furtherance of these regulations, effective September 29, 2025, BIS issued an interim final rule that extended the export restrictions imposed on entities identified on the Entity List or the Military End-User List and other certain sanctioned parties, to entities that are 50% or more owned by one or more such entities. However, on November 11, 2025, BIS published a one-year suspension of the new rule that is currently set to expire on November 9, 2026, absent a future extension. We expect the impact of these current expanded trade control laws and regulations on our business to be limited, but we will continue to monitor future developments. These laws, regulations and rules are subject to change.
Current wording
Trade control laws and regulations have been amended over the past years, including through the imposition of certain export control restrictions concerning advanced node IC production in China and the inclusion of additional Chinese technology companies on the BIS “Entity List” and regulations governing the sale of certain technologies. In furtherance of these regulations, effective September 29, 2025, BIS issued an interim final rule that extended the export restrictions imposed on entities identified on the Entity List or the Military End-User List and other certain sanctioned parties, to entities that are 50% or more owned by one or more such entities. However, BIS subsequently suspended the rule for one year, through November 9, 2026. In September 2026, the United States and China announced an extension of their trade arrangements through January 10, 2027, which is expected to extend the suspension; however, as of the date of this Quarterly Report, BIS has not formally extended the suspension. These laws, regulations and rules are subject to change.
Previous wording
In addition, U.S. President Trump has imposed new and higher U.S. tariffs on imports from many countries, including China, Canada and Mexico. In February 2026, the U.S. Supreme Court struck down tariffs previously imposed under the International Emergency Economic Powers Act. However, tariffs imposed pursuant to other statutes remain in effect, and the administration has announced new tariff measures under alternative legal authorities and has continued to implement and pursue significant changes to U.S. trade policies, treaties and tariffs and conduct investigations on imports from foreign countries. In response, China and other countries have announced retaliatory tariffs on imports of U.S. goods and other countermeasures, though certain retaliatory measures have been suspended pursuant to bilateral negotiations and trade framework agreements. We are monitoring these developments, including any pauses, escalations, exemptions, court rulings, refunds, replacements and new investigations, with respect to the threatened or imposed tariffs and trade policy, and will continue to assess their potential impact on our business either directly, such as on our hardware business and cost of imported components, or due to downstream effects on our customers and the broader economy.
Current wording
In addition, U.S. President Trump has imposed new and higher U.S. tariffs on imports from many countries, including China, Canada and Mexico. In February 2026, the U.S. Supreme Court struck down tariffs previously imposed under the International Emergency Economic Powers Act. However, tariffs imposed pursuant to other statutes remain in effect, and the administration has announced new tariff measures under alternative legal authorities and has continued to implement and pursue significant changes to U.S. trade policies, treaties and tariffs and conduct investigations on imports from foreign countries. In response, China, Canada and other countries have announced retaliatory tariffs on imports of U.S. goods and other countermeasures, though certain retaliatory measures have been suspended pursuant to bilateral negotiations and trade framework agreements. We are monitoring these developments, including any pauses, escalations, exemptions, court rulings, refunds, replacements and new investigations, with respect to the threatened or imposed tariffs and trade policy, and will continue to assess their potential impact on our business either directly, such as on our hardware business and cost of imported components, or due to downstream effects on our customers and the broader economy.
Previous wording
Our financial results reflect the following for the three and six months ended June 30, 2026 compared to the three and six months ended June 30, 2025 (unless otherwise stated):
Current wording
Our financial results reflect the following for the three and nine months ended September 30, 2026 compared to the three and nine months ended September 30, 2025 (unless otherwise stated):
Previous wording
•Increased amortization of acquired intangibles from our recent acquisitions; and
Current wording
•Increased amortization of acquired intangibles from our recent acquisitions;
Previous wording
The following table shows the percentage of our revenue that is classified as recurring or up-front for the three and six months ended June 30, 2026 and June 30, 2025:
Current wording
The following table shows the percentage of our revenue that is classified as recurring or up-front for the three and nine months ended September 30, 2026 and September 30, 2025:
Previous wording
The following table shows our revenue for the six months ended June 30, 2026 and June 30, 2025 and the change in revenue between periods:
Current wording
The following table shows our revenue for the nine months ended September 30, 2026 and September 30, 2025 and the change in revenue between periods:
Previous wording
Product and maintenance revenue increased during the three and six months ended June 30, 2026, as compared to the three and six months ended June 30, 2025, due to growth in revenue from our software, hardware and IP product offerings as a result of existing customers’ continued investment in complex designs for their products.
Current wording
Product and maintenance revenue increased during the three and nine months ended September 30, 2026, as compared to the three and nine months ended September 30, 2025, due to growth in revenue from our software, hardware and IP product offerings as a result of existing customers’ continued investment in complex designs for their products.
Previous wording
No single customer accounted for 10% or more of total revenue during the three and six months ended June 30, 2026 or June 30, 2025.
Current wording
No single customer accounted for 10% or more of total revenue during the three and nine months ended September 30, 2026 or September 30, 2025.
Previous wording
The following table shows revenue by geographic region for the three and six months ended June 30, 2026 and June 30, 2025 and the change in revenue between periods:
Current wording
The following table shows revenue by geographic region for the three and nine months ended September 30, 2026 and September 30, 2025 and the change in revenue between periods:
Previous wording
During the three months ended June 30, 2026, as compared to the three months ended June 30, 2025, revenue growth in the United States, China, Japan, Other Asia and EMEA was primarily driven by growth in revenue from our software product offerings and by increased demand for, and our ability to deliver, our IP offerings to our customers in these geographies. Our ability to deliver our hardware offerings also contributed to period over period revenue growth in China, Other Asia and EMEA.
Current wording
During the three months ended September 30, 2026, as compared to the three months ended September 30, 2025, our ability to deliver our hardware offerings and increased demand for our software offerings were the primary drivers of revenue growth in the United States and EMEA.
Previous wording
During the six months ended June 30, 2026, as compared to the six months ended June 30, 2025, revenue from our software product offerings contributed to growth in each of our six geographies. Revenue growth in the United States, Other Americas, China, Japan and EMEA also benefited from increased customer demand for, and our ability to deliver, our hardware product offerings to our customers in these geographies. Our ability to deliver our IP offerings also contributed to period over period revenue growth in Other Americas, China, Japan, Other Asia and EMEA.
Current wording
During the nine months ended September 30, 2026, as compared to the nine months ended September 30, 2025, revenue from our software product offerings contributed to growth in each of our six geographies. During the same period, customer demand for, and our ability to deliver, our hardware product offerings to our customers, contributed to growth in the United States, China, Japan and EMEA. Our ability to deliver our IP offerings also contributed to period over period revenue growth in China, Japan, Other Asia and EMEA.
Previous wording
The changes in product and maintenance-related costs for the three and six months ended June 30, 2026, as compared to the three and six months ended June 30, 2025, were due to the following:
Current wording
The changes in product and maintenance-related costs for the three and nine months ended September 30, 2026, as compared to the three and nine months ended September 30, 2025, were due to the following:
Previous wording
Amortization of acquired intangibles included in cost of product and maintenance may fluctuate from period to period depending on the timing of newly acquired assets relative to assets becoming fully amortized in any given period. The increase in amortization of intangibles during the three and six months ended June 30, 2026, as compared to the three and six months ended June 30, 2025, is primarily due to definite-lived intangible assets acquired with our acquisition of the D&E business.
Current wording
Amortization of acquired intangibles included in cost of product and maintenance may fluctuate from period to period depending on the timing of newly acquired assets relative to assets becoming fully amortized in any given period. The increase in amortization of intangibles during the three and nine months ended September 30, 2026, as compared to the three and nine months ended September 30, 2025, is primarily due to definite-lived intangible assets acquired with our acquisition of the D&E business.
Previous wording
Our operating expenses include marketing and sales, research and development, and general and administrative expenses. Factors that tend to cause our operating expenses to fluctuate include changes in the number of employees due to hiring and acquisitions, industry trends for salary and other employee benefits, the timing and nature of restricted stock grants, foreign exchange rate movements, acquisition-related costs, and volatility in variable compensation programs that are driven by operating results. We expect our operating expenses will increase during the remainder of fiscal 2026, as compared to fiscal 2025, due to our recent acquisitions.
Current wording
Our operating expenses include marketing and sales, research and development, and general and administrative expenses. Factors that tend to cause our operating expenses to fluctuate include changes in the number of employees due to hiring and acquisitions, industry trends for salary and other employee benefits, the timing and nature of restricted stock grants, foreign exchange rate movements, acquisition-related costs, volatility in variable compensation programs that are driven by operating results, and contributions to non-profit organizations. Our operating expenses have increased during fiscal 2026, as compared to fiscal 2025, primarily due to our recent acquisition of the D&E business from Hexagon.
Previous wording
Our operating expenses for the three and six months ended June 30, 2026 and June 30, 2025 were as follows:
Current wording
Our operating expenses for the three and nine months ended September 30, 2026 and September 30, 2025 were as follows:
Previous wording
Our operating expenses, as a percentage of total revenue, for the three and six months ended June 30, 2026 and June 30, 2025 were as follows:
Current wording
Our operating expenses, as a percentage of total revenue, for the three and nine months ended September 30, 2026 and September 30, 2025 were as follows:
Previous wording
The increase in marketing and sales expense for the three and six months ended June 30, 2026, as compared to the three and six months ended June 30, 2025, was due to the following:
Current wording
The increase in marketing and sales expense for the three and nine months ended September 30, 2026, as compared to the three and nine months ended September 30, 2025, was due to the following:
Previous wording
Salary, benefits and other employee-related costs and stock-based compensation included in marketing and sales expense increased during the three and six months ended June 30, 2026, as compared to the three and six months ended June 30, 2025, primarily due to our continued investment in attracting and retaining talent dedicated to technical sales support, including additional headcount from acquisitions. We expect to continue attracting and retaining talent dedicated to technical sales support through hiring and acquisitions.
Current wording
Salary, benefits and other employee-related costs and stock-based compensation included in marketing and sales expense increased during the three and nine months ended September 30, 2026, as compared to the three and nine months ended September 30, 2025, primarily due to our continued investment in attracting and retaining talent dedicated to technical sales support, including additional headcount from acquisitions. We expect to continue attracting and retaining talent dedicated to technical sales support through hiring and acquisitions.
Previous wording
The increase in research and development expense for the three and six months ended June 30, 2026, as compared to the three and six months ended June 30, 2025, was due to the following:
Current wording
The increase in research and development expense for the three and nine months ended September 30, 2026, as compared to the three and nine months ended September 30, 2025, was due to the following:
Previous wording
Salary, benefits and other employee-related costs and stock-based compensation included in research and development expense increased during the three and six months ended June 30, 2026, as compared to the three and six months ended June 30, 2025, primarily due to our continued investment in attracting and retaining talent for research and development activities, including additional headcount from acquisitions.
Current wording
Salary, benefits and other employee-related costs and stock-based compensation included in research and development expense increased during the three and nine months ended September 30, 2026, as compared to the three and nine months ended September 30, 2025, primarily due to our continued investment in attracting and retaining talent for research and development activities, including additional headcount from acquisitions.
Previous wording
Facilities and other infrastructure costs included in research and development expense increased during the three and six months ended June 30, 2026, as compared to the three and six months ended June 30, 2025, primarily due to our growing workforce. We expect to continue attracting and retaining talent dedicated to research and development activities through hiring and acquisitions.
Current wording
Facilities and other infrastructure costs included in research and development expense increased during the three and nine months ended September 30, 2026, as compared to the three and nine months ended September 30, 2025, primarily due to our growing workforce. We expect to continue attracting and retaining talent dedicated to research and development activities through hiring and acquisitions.
Previous wording
The changes in general and administrative expense for the three and six months ended June 30, 2026, as compared to the three and six months ended June 30, 2025, were due to the following:
Current wording
The changes in general and administrative expense for the three and nine months ended September 30, 2026, as compared to the three and nine months ended September 30, 2025, were due to the following:
Previous wording
Professional services increased during the three and six months ended June 30, 2026, as compared to the three and six months ended June 30, 2025, primarily due to increased consulting services associated with acquisition-related activities. We expect to continue to utilize professional services as we continue to acquire and integrate companies and businesses.
Current wording
Professional services increased during the nine months ended September 30, 2026, as compared to the nine months ended September 30, 2025, primarily due to increased consulting services associated with integration activities related to our recent acquisitions. We expect to continue to utilize professional services as we continue to acquire and integrate companies and businesses.
Previous wording
Salary, benefits and other employee-related costs and stock-based compensation included in general and administrative expense increased during the three and six months ended June 30, 2026, as compared to the three and six months ended June 30, 2025, primarily due to headcount from acquisitions and incremental expense from equity awards granted to certain members of senior management.
Current wording
Salary, benefits and other employee-related costs and stock-based compensation included in general and administrative expense increased during the three and nine months ended September 30, 2026, as compared to the three and nine months ended September 30, 2025, primarily due to headcount from acquisitions and incremental expense from equity awards granted to certain members of senior management.
Previous wording
Operating margin represents income from operations as a percentage of total revenue. Our operating margin for the three and six months ended June 30, 2026 and the three and six months ended June 30, 2025 was as follows:
Current wording
Operating margin represents income from operations as a percentage of total revenue. Our operating margin for the three and nine months ended September 30, 2026 and the three and nine months ended September 30, 2025 was as follows:
Previous wording
Our operating margin may fluctuate from period to period depending on the mix of products and services sold during each period, the timing and magnitude of restructuring plans and other significant, infrequent expenses. During the three and six months ended June 30, 2026, as compared to the three and six months ended June 30, 2025, our operating margin increased, primarily due to the loss related to a contingent liability recognized during the three and six months ended June 30, 2025, partially offset by incremental expenses from our recent acquisitions, including amortization of acquired intangibles, that exceed incremental revenue for the periods presented.
Current wording
During the three months ended September 30, 2026, as compared to the three months ended September 30, 2025, our operating margin decreased, primarily due to incremental operating expenses from our recent acquisitions, including amortization of acquired intangibles, that exceeded incremental revenue, an increased expense for contributions made to non-profit organizations, and the mix of products and services sold during each period.
Previous wording
Interest expense increased during the three and six months ended June 30, 2026, as compared to the three and six months ended June 30, 2025, primarily due to incremental interest expense related to borrowings under our revolving credit facility at various times during the periods presented. For additional information relating to our debt arrangements, see Note 5 in the notes to condensed consolidated financial statements.
Current wording
Interest expense increased during the three and nine months ended September 30, 2026, as compared to the three and nine months ended September 30, 2025, primarily due to incremental interest expense related to borrowings under our revolving credit facility at various times during the periods presented. For additional information relating to our debt arrangements, see Note 5 in the notes to condensed consolidated financial statements.
Previous wording
Other income, net consists primarily of interest earned on cash, cash equivalents and investments in debt securities, realized and unrealized gains and losses from our investments in equity securities of other companies, gains and losses from investments held in the Nonqualified Deferred Compensation (“NQDC”) trust and foreign exchange gains and losses. Other income, net may fluctuate from period to period based on levels of cash deposits, gains and losses from the sale of investments, changes in the fair value of our marketable equity securities and movements in exchange gains and losses.
Current wording
Other income (expense), net consists primarily of interest earned on cash, cash equivalents and investments in debt securities, realized and unrealized gains and losses from our investments in equity securities of other companies, gains and losses from investments held in the Nonqualified Deferred Compensation (“NQDC”) trust and foreign exchange gains and losses. Other income (expense), net may fluctuate from period to period based on levels of cash deposits, gains and losses from the sale of investments, changes in the fair value of our marketable equity securities and movements in exchange gains and losses.
Previous wording
For additional information about other income, net, see Note 9 in the notes to condensed consolidated financial statements.
Current wording
For additional information about other income (expense), net, see Note 10 in the notes to condensed consolidated financial statements.
Previous wording
The following table presents the provision for income taxes and the effective tax rate for the three and six months ended June 30, 2026 and June 30, 2025:
Current wording
The following table presents the provision for income taxes and the effective tax rate for the three and nine months ended September 30, 2026 and September 30, 2025:
Previous wording
Our provision for income taxes for the three and six months ended June 30, 2026 was primarily attributable to federal, state and foreign income taxes on our anticipated fiscal 2026 income. We also recognized tax benefits of $3.1 million and $16.7 million related to stock-based compensation that vested or was exercised during the respective periods. The increase in our provision for income taxes during the three and six months ended June 30, 2026, as compared to the three and six months ended June 30, 2025, was primarily attributable to an increase in our earnings.
Current wording
Our provision for income taxes for the three and nine months ended September 30, 2026 was primarily attributable to federal, state and foreign income taxes on our anticipated fiscal 2026 income. We also recognized tax benefits of $6.7 million and $23.4 million related to stock-based compensation that vested or was exercised during the respective periods. The increase in our provision for income taxes during the three and nine months ended September 30, 2026, as compared to the three and nine months ended September 30, 2025, was primarily attributable to an increase in our earnings.
Previous wording
Our provision for income taxes for the three and six months ended June 30, 2025 was primarily attributable to federal, state and foreign income taxes on our then anticipated fiscal 2025 income. We also recognized tax benefits of $2.8 million and $21.4 million related to stock-based compensation that vested or was exercised during the respective periods.
Current wording
Our provision for income taxes for the three and nine months ended September 30, 2025 was primarily attributable to federal, state and foreign income taxes on our then-anticipated fiscal 2025 income. We also recognized tax benefits of $15.1 million and $36.6 million related to stock-based compensation that vested or was exercised during the respective periods.
Previous wording
Our future effective tax rates may also be materially impacted by tax amounts associated with our foreign earnings at rates different from the United States federal statutory rate, research credits, the tax impact of stock-based compensation, accounting for uncertain tax positions, business combinations, closure of statutes of limitations or settlement of tax audits and changes in tax law. A significant amount of our foreign earnings is generated by our subsidiaries organized in Ireland and Hungary. Our future effective tax rates may be adversely affected if our earnings were to be lower in countries where we have lower statutory tax rates relative to earnings in countries where we have higher statutory tax rates. We currently expect that our fiscal 2026 effective tax rate will be approximately 26%. We expect that our quarterly effective tax rates will vary from our fiscal 2026 effective tax rate as a result of recognizing the income tax effects of stock-based awards in the quarterly periods that the awards vest or are settled and other items that we cannot anticipate. For additional discussion about how our effective tax rate could be affected by various risks, see the “Risk Factors” section in our Annual Report.
Current wording
Our future effective tax rates may also be materially impacted by tax amounts associated with our foreign earnings at rates different from the United States federal statutory rate, research credits, the tax impact of stock-based compensation, accounting for uncertain tax positions, business combinations, closure of statutes of limitations or settlement of tax audits and changes in tax law. A significant amount of our foreign earnings is generated by our subsidiaries organized in Ireland and Hungary. Our future effective tax rates may be adversely affected if our earnings were to be lower in countries where we have lower statutory tax rates relative to earnings in countries where we have higher statutory tax rates. We currently expect that our fiscal 2026 effective tax rate will be approximately 27%. We expect that our quarterly effective tax rates will vary from our fiscal 2026 effective tax rate as a result of recognizing the income tax effects of stock-based awards in the quarterly periods that the awards vest or are settled and other items that we cannot anticipate. For additional discussion about how our effective tax rate could be affected by various risks, see the “Risk Factors” section in our Annual Report.
Previous wording
As of June 30, 2026, our principal sources of liquidity consisted of $1.4 billion of cash and cash equivalents as compared to $3.0 billion as of December 31, 2025.
Current wording
As of September 30, 2026, our principal sources of liquidity consisted of $1.5 billion of cash and cash equivalents as compared to $3.0 billion as of December 31, 2025.
Previous wording
Our primary sources of cash and cash equivalents during the six months ended June 30, 2026 were cash generated from operations, proceeds from our revolving credit facility, proceeds from the sale and maturity of investments and proceeds from the issuance of common stock resulting from stock purchases under our employee stock purchase plan and stock options exercised during the period.
Current wording
Our primary sources of cash and cash equivalents during the nine months ended September 30, 2026 were cash generated from operations, proceeds from our revolving credit facility, proceeds from the sale and maturity of investments and proceeds from the issuance of common stock resulting from stock purchases under our employee stock purchase plan and stock options exercised during the period.
Previous wording
Our primary uses of cash and cash equivalents during the six months ended June 30, 2026 were payments related to business combinations, operating costs and expenses, payments on our revolving credit facility, repurchases of our common stock, payment of employee taxes on vesting of restricted stock, purchases of property, plant and equipment and purchases of investments.
Current wording
Our primary uses of cash and cash equivalents during the nine months ended September 30, 2026 were payments related to business combinations, operating costs and expenses, repurchases of our common stock, payments on our revolving credit facility, payment of employee taxes on vesting of restricted stock, taxes, purchases of property, plant and equipment and purchases of investments.
Showing the first 40 of 50 pairs. Open the source sections for the rest.
Rearranged current paragraphs (1)
Current report — wording carried from elsewhere
Our operating margin may fluctuate from period to period depending on the mix of products and services sold during each period, the timing and magnitude of restructuring plans and other significant, infrequent expenses.