Cadence Design Systems Stock Drops on Weak Q2 Guidance Despite Q1 Earnings Beat

Shares of Cadence Design Systems tumbled in after-hours trading as the company's second-quarter outlook fell short of analyst expectations.

Cadence Design Systems reported a Q1 profit of $1.17 per share, surpassing estimates but issued a lower-than-expected Q2 guidance with earnings projected between $1.20 and $1.24 per share.
The company's Q2 revenue forecast of $1.03 billion to $1.05 billion also missed analyst expectations, which were set at $1.11 billion.
Despite the weak Q2 outlook, Cadence revised its full-year revenue forecast slightly upwards, indicating stronger performance expected in the latter half of the year.
Cadence's stock experienced a significant drop in after-hours trading, reflecting investor concerns over the disappointing Q2 guidance.
The company emphasized positive feedback on its new generation of design and verification tools, although this did not alleviate immediate market concerns.