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x
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ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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¨
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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Delaware
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00-0000000
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(State or Other Jurisdiction of
Incorporation or Organization)
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(I.R.S. Employer
Identification No.)
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2655 Seely Avenue, Building 5, San Jose, California
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95134
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(Address of Principal Executive Offices)
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(Zip Code)
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Title of Each Class
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Names of Each Exchange on which Registered
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Common Stock, $0.01 par value per share
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NASDAQ Global Select Market
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Large accelerated filer
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x
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Accelerated filer
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o
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Non-accelerated filer
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o
(Do not check if a smaller reporting company)
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Smaller reporting company
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o
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Page
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PART I.
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Item 1.
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Item 1A.
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Item 1B.
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Item 2.
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Item 3.
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Item 4.
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PART II.
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Item 5.
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Item 6.
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Item 7.
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Management’s Discussion and Analysis of Financial Condition and Results of Operations
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Item 7A.
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Item 8.
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Item 9.
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Item 9A.
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Item 9B.
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PART III.
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Item 10.
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Item 11.
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Item 12.
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Item 13.
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Item 14.
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PART IV.
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Item 15.
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•
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Functional Verification, including Emulation and Prototyping Hardware;
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•
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Digital IC Design and Signoff;
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•
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Custom IC Design;
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•
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System Interconnect and Analysis; and
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•
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IP.
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2015
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2014
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2013
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|||||||||||||||
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(In millions, except percentages)
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|||||||||||||||||||
Product and maintenance
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$
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1,578.9
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93
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%
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$
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1,479.2
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94
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%
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$
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1,357.9
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93
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%
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Services
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123.2
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7
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%
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101.8
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6
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%
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102.2
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7
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%
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|||
Total revenue
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$
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1,702.1
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$
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1,581.0
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$
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1,460.1
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•
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licenses for software products and IP;
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•
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maintenance on software, hardware and IP products;
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•
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bookings for the sale of hardware products that have expected delivery dates after
January 2, 2016
but before
April 2, 2016
;
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•
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leases of hardware products;
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•
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licenses with payments that are outside our customary terms; and
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•
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the undelivered portion of engineering services contracts.
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•
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Functional Verification, including Emulation and Prototyping Hardware;
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•
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Digital IC Design and Signoff;
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•
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Custom IC Design;
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•
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System Interconnect and Analysis; and
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•
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IP.
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Name
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Age
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Positions and Offices
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Lip-Bu Tan
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56
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President, Chief Executive Officer and Director
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Geoffrey G. Ribar
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57
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Senior Vice President and Chief Financial Officer
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Thomas P. Beckley
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58
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Senior Vice President, Research and Development
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James J. Cowie
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51
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Senior Vice President, General Counsel and Secretary
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Anirudh Devgan
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46
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Senior Vice President, Research and Development
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Chi-Ping Hsu
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60
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Senior Vice President, Chief Strategy Officer, EDA
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Neil Zaman
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47
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Senior Vice President, Worldwide Field Operations
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•
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changes in the design and manufacturing of ICs, including migration to advanced process nodes and the introduction of three dimensional transistors, such as fin-based, multigate transistors, or FinFETs, present major challenges to the semiconductor industry, particularly in IC design, design automation, design of manufacturing equipment, and the manufacturing process itself. With migration to advanced process nodes, the industry must adapt to more complex physics and manufacturing challenges such as the need to draw features on silicon that are many times smaller than the wavelength of light used to draw the features via lithography. Models of each component’s electrical properties and behavior also become more complex as do requisite analysis, design, verification and manufacturing capabilities. Novel design tools and methodologies must be invented and enhanced quickly to remain competitive in the design of electronics in the smallest nanometer ranges;
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•
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the challenges of advanced node design are leading some customers to work with more mature, less risky manufacturing processes that may reduce their need to upgrade or enhance their EDA products and design flows;
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•
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a potential slowdown in “Moore’s Law,” which may reduce or slow the need for customers to upgrade or enhance their EDA products and design flows;
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•
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the ability to design SoCs increases the complexity of managing a design that, at the lowest level, is represented by billions of shapes on fabrication masks. In addition, SoCs typically incorporate microprocessors and digital signal processors that are programmed with software, requiring simultaneous design of the IC and the related software embedded on the IC;
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•
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with the availability of seemingly endless gate capacity, there is an increase in design reuse, or the combining of off-the-shelf design IP with custom logic to create ICs or SoCs. The unavailability of a broad range of high-quality design IP (including our own) that can be reliably incorporated into a customer’s design with our software products and services could lead to reduced demand for our products and services;
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•
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increased technological capability of the FPGA, which is a programmable logic chip, creates an alternative to IC implementation for some electronics companies. This could reduce demand for our IC implementation products and services;
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•
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a growing number of low-cost engineering services businesses could reduce the need for some IC companies to invest in EDA products; and
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•
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adoption of cloud computing technologies with accompanying new business models for an increasing number of software categories, including EDA.
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•
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the failure to realize anticipated benefits such as cost savings and revenue enhancements;
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overlapping customers and product sets that impact our ability to maintain revenue at historical rates;
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•
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the failure to integrate and manage acquired products and businesses effectively;
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•
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the failure to retain key employees of the acquired company or business;
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difficulties in combining previously separate companies or businesses into a single unit;
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the substantial diversion of management’s attention from day-to-day business when evaluating and negotiating these transactions and integrating an acquired company or business;
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the discovery, after completion of the acquisition, of unanticipated liabilities assumed from the acquired company, business or assets, such that we cannot realize the anticipated value of the acquisition;
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difficulties related to integrating the products of an acquired company or business in, for example, distribution, engineering, licensing models or customer support areas;
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unanticipated costs;
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customer dissatisfaction with existing license agreements with us, possibly dissuading customers from licensing or buying products acquired by us after the expiration date of the existing license; or
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the failure to understand, compete and operate effectively in markets where we have limited experience.
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•
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the development by others of competitive EDA products or platforms and engineering services, possibly resulting in a shift of customer preferences away from our products and services and significantly decreased revenue;
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aggressive pricing competition by some of our competitors may cause us to lose our competitive position, which could result in lower revenues or profitability and could adversely impact our ability to realize the revenue and profitability forecasts for our software or emulation and prototyping hardware systems products;
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the challenges of developing (or acquiring externally developed) technology solutions, including hardware and IP offerings, that are adequate and competitive in meeting the rapidly evolving requirements of next-generation design challenges;
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the low cost of entry in EDA;
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intense competition to attract acquisition targets, possibly making it more difficult for us to acquire companies or technologies at an acceptable price, or at all;
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•
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the combination of our EDA competitors or collaboration among many EDA companies to deliver more comprehensive offerings than they could individually; and
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decisions by electronics manufacturers to perform engineering services or IP development internally, rather than purchase these services from outside vendors due to budget constraints or excess engineering capacity.
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•
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changes in tax laws or the interpretation of such tax laws in the United States, Ireland, Hungary, the United Kingdom, China or other international locations where we have operations;
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earnings being lower than anticipated in countries where we are taxed at lower rates as compared to the United States federal and state statutory tax rates;
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•
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an increase in expenses not deductible for tax purposes, including certain stock-based compensation and impairment of goodwill;
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•
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changes in the valuation allowance against our deferred tax assets;
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•
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changes in judgment from the evaluation of new information that results in a recognition, derecognition or change in measurement of a tax position taken in a prior period;
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•
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increases to interest or penalty expenses classified in the financial statements as income taxes;
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•
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new accounting standards or interpretations of such standards;
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•
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a change in our decision to indefinitely reinvest foreign earnings outside the United States; or
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results of tax examinations by the Internal Revenue Service, or IRS, state, and foreign tax authorities.
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•
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quarterly or annual operating or financial results or forecasts that fail to meet or are inconsistent with earlier projections or the expectations of our securities analysts or investors;
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•
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changes in our forecasted bookings, revenue, earnings or operating cash flow estimates;
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•
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an increase in our debt or other liabilities;
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•
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market conditions in the IC, electronics systems and semiconductor industries;
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•
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announcements of a restructuring plan;
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•
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changes in management;
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•
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repurchases of shares of our common stock or changes to plans to repurchase shares of our common stock;
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•
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a gain or loss of a significant customer or market segment share;
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•
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litigation; and
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•
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announcements of new products or acquisitions of new technologies by us, our competitors or our customers.
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pay damages (including the potential for treble damages), license fees or royalties (including royalties for past periods) to the party claiming infringement;
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stop licensing products or providing services that use the challenged intellectual property;
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•
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obtain a license from the owner of the infringed intellectual property to sell or use the relevant technology, which license may not be available on reasonable terms, or at all; or
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redesign the challenged technology, which could be time consuming and costly, or impossible.
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•
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the adoption or expansion of government trade restrictions, including tariffs and other trade barriers;
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•
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limitations on repatriation of earnings;
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•
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limitations on the conversion of foreign currencies;
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•
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reduced protection of intellectual property rights in some countries;
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•
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performance of national economies, including, for example, an economic slowdown in China;
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•
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longer collection periods for receivables and greater difficulty in collecting accounts receivable;
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•
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difficulties in managing foreign operations;
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•
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political and economic instability;
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•
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unexpected changes in regulatory requirements;
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•
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inability to continue to offer competitive compensation in certain growing regions;
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•
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differing employment practices and labor issues;
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•
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United States’ and other governments’ licensing requirements for exports, which may lengthen the sales cycle or restrict or prohibit the sale or licensing of certain products; and
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•
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variations in costs or expenses associated with our international operations, including as a result of changes in foreign tax laws or devaluation of the U.S. dollar relative to other foreign currencies.
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•
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loss of customers;
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•
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loss of market share;
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•
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damage to our reputation;
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•
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failure to attract new customers or achieve market acceptance;
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•
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diversion of development resources to resolve the problem;
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•
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loss of or delay in revenue;
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•
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increased service costs; and
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•
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the timing of customers’ competitive evaluation processes; or
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•
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customers’ budgetary constraints and budget cycles.
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•
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Our certificate of incorporation allows our Board of Directors to issue, at any time and without stockholder approval, preferred stock with such terms as it may determine. No shares of preferred stock are currently outstanding. However, the rights of holders of any of our preferred stock that may be issued in the future may be superior to the rights of holders of our common stock.
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•
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Section 203 of the Delaware General Corporation Law generally prohibits a Delaware corporation from engaging in any business combination with a person owning 15% or more of its voting stock, or who is affiliated with the corporation and owned 15% or more of its voting stock at any time within three years prior to the proposed business combination, for a period of three years from the date the person became a 15% owner, unless specified conditions are met.
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•
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making it more difficult for us to satisfy our obligations to service our debt as described above;
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•
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limiting our ability to obtain additional financing to fund future working capital, capital expenditures,
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•
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requiring a substantial portion of our cash flows to be dedicated to debt service payments instead of other
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•
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utilizing large portions of our U.S. cash to service our debt obligations because those payments are made in the United States, which may require us to repatriate cash from outside the United States and incur unanticipated or unfavorable tax expenses;
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•
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increasing our vulnerability to general adverse economic and industry conditions;
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•
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exposing us to the risk of increased interest rates as certain of our borrowings, including borrowings under
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•
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limiting our flexibility in planning for and reacting to changes in the industry in which we compete;
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•
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placing us at a disadvantage compared to other, less leveraged competitors and competitors that have greater access to capital resources; and
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•
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increasing our cost of borrowing.
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•
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incur additional indebtedness and guarantee indebtedness;
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•
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pay dividends or make other distributions or repurchase or redeem capital stock;
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•
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prepay, redeem or repurchase certain debt;
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•
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issue certain preferred stock or similar equity securities;
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•
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make certain investments;
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•
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sell assets;
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•
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incur liens;
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•
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enter into sale and leaseback transactions;
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•
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enter into transactions with affiliates;
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•
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alter the businesses we conduct;
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•
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enter into agreements restricting our subsidiaries’ ability to pay dividends; and
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•
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consolidate, merge or sell all or substantially all of our assets.
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•
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limited in how we conduct our business;
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•
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unable to raise additional debt or equity financing to operate during general economic or business downturns; or
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•
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unable to compete effectively or to take advantage of new business opportunities.
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2015
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High
|
|
Low
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||||
Fourth Quarter
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$
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23.30
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$
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19.35
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Third Quarter
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21.86
|
|
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18.13
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||
Second Quarter
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20.51
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17.77
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First Quarter
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18.86
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|
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16.52
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||
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|
||||
2014
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|
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|
||||
Fourth Quarter
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$
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19.54
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$
|
15.50
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Third Quarter
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18.25
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|
|
16.25
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Second Quarter
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17.55
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13.63
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||
First Quarter
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16.25
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13.59
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||||||
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1/1/2011
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12/31/2011
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12/29/2012
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12/28/2013
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1/3/2015
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1/2/2016
|
|
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|
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||||||
Cadence Design Systems, Inc.
|
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100.00
|
|
|
125.91
|
|
|
162.71
|
|
|
168.64
|
|
|
227.97
|
|
|
251.94
|
|
NASDAQ Composite
|
|
100.00
|
|
|
100.53
|
|
|
116.92
|
|
|
166.19
|
|
|
188.78
|
|
|
199.95
|
|
S&P 400 Information Technology
|
|
100.00
|
|
|
92.59
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|
|
110.13
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|
|
146.56
|
|
|
152.18
|
|
|
156.98
|
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Authorization Date
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|
Amount
|
|
Remaining Authorization
|
||||
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|
(In thousands)
|
||||||
February 2008
|
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$
|
500,000
|
|
|
$
|
—
|
|
August 2008
|
|
500,000
|
|
|
381,083
|
|
||
July 2015
|
|
578,804
|
|
|
578,804
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|
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Total remaining authorization
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|
$
|
959,887
|
|
Period
|
Total Number
of Shares
Purchased
(1)
|
|
Average
Price Paid
Per Share
|
|
Total Number of
Shares Purchased
as Part of
Publicly Announced
Plan or Program
|
|
Maximum Dollar
Value of Shares that
May Yet
Be Purchased Under
Publicly Announced
Plan or Program
(1)
(In millions)
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||||||
October 4, 2015 – November 7, 2015
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2,127,853
|
|
|
$
|
21.61
|
|
|
2,107,277
|
|
|
$
|
1,034.4
|
|
November 8, 2015 – December 5, 2015
|
1,753,499
|
|
|
$
|
22.38
|
|
|
1,709,992
|
|
|
$
|
996.1
|
|
December 6, 2015 – January 2, 2016
|
1,707,507
|
|
|
$
|
21.40
|
|
|
1,692,714
|
|
|
$
|
959.9
|
|
Total
|
5,588,859
|
|
|
$
|
21.79
|
|
|
5,509,983
|
|
|
|
(1)
|
Shares purchased that were not part of our publicly announced repurchase programs represent employee surrender of shares of restricted stock to satisfy employee income tax withholding obligations due upon vesting, and do not reduce the dollar value that may yet be purchased under our publicly announced repurchase programs.
|
|
2015
|
|
2014
|
|
2013
|
|
2012
|
|
2011
|
||||||||||
|
(In millions, except per share amounts)
|
||||||||||||||||||
Revenue
|
$
|
1,702.1
|
|
|
$
|
1,580.9
|
|
|
$
|
1,460.1
|
|
|
$
|
1,326.4
|
|
|
$
|
1,149.8
|
|
Income from operations
|
285.4
|
|
|
206.6
|
|
|
189.0
|
|
|
211.7
|
|
|
120.4
|
|
|||||
Net income
(1) (2)
|
252.4
|
|
|
158.9
|
|
|
164.2
|
|
|
439.9
|
|
|
72.2
|
|
|||||
Net income per share-diluted
(1) (2)
|
0.81
|
|
|
0.52
|
|
|
0.56
|
|
|
1.57
|
|
|
0.27
|
|
|||||
Total assets
(3)
|
2,351.0
|
|
|
3,209.6
|
|
|
2,428.6
|
|
|
2,287.0
|
|
|
1,761.3
|
|
|||||
Debt
(3)
|
348.8
|
|
|
691.2
|
|
|
324.8
|
|
|
447.0
|
|
|
426.0
|
|
|||||
Stockholders’ equity
(4)
|
1,376.1
|
|
|
1,333.6
|
|
|
1,156.1
|
|
|
915.2
|
|
|
411.1
|
|
•
|
increased product and maintenance revenue, primarily because of increased demand for our software, emulation and prototyping hardware, services and IP offerings;
|
•
|
continued investment in research and development and technical customer support;
|
•
|
the effect on our operating expenses of favorable changes in foreign currency exchange rates; and
|
•
|
increased stock-based compensation.
|
•
|
competitiveness of our technology; and
|
•
|
size, duration, timing, terms and type of:
|
◦
|
contract renewals with existing customers;
|
◦
|
additional sales to existing customers; and
|
◦
|
sales to new customers.
|
|
|
|
|
|
Change
|
||||||||||||||||||||
|
2015
|
|
2014
|
|
2013
|
|
2015 vs. 2014
|
|
2014 vs. 2013
|
||||||||||||||||
|
(In millions, except percentages)
|
||||||||||||||||||||||||
Product and maintenance
|
$
|
1,578.9
|
|
|
$
|
1,479.2
|
|
|
$
|
1,357.9
|
|
|
$
|
99.7
|
|
|
7
|
%
|
|
$
|
121.3
|
|
|
9
|
%
|
Services
|
123.2
|
|
|
101.8
|
|
|
102.2
|
|
|
21.4
|
|
|
21
|
%
|
|
(0.4
|
)
|
|
—
|
%
|
|||||
Total revenue
|
$
|
1,702.1
|
|
|
$
|
1,581.0
|
|
|
$
|
1,460.1
|
|
|
$
|
121.1
|
|
|
8
|
%
|
|
$
|
120.9
|
|
|
8
|
%
|
|
|
|
|
|
Change
|
||||||||||||||||||||
|
2015
|
|
2014
|
|
2013
|
|
2015 vs. 2014
|
|
2014 vs. 2013
|
||||||||||||||||
|
(In millions, except percentages)
|
||||||||||||||||||||||||
United States
|
$
|
782.4
|
|
|
$
|
696.6
|
|
|
$
|
648.7
|
|
|
$
|
85.8
|
|
|
12
|
%
|
|
$
|
47.9
|
|
|
7
|
%
|
Other Americas
|
26.0
|
|
|
23.4
|
|
|
22.9
|
|
|
2.6
|
|
|
11
|
%
|
|
0.5
|
|
2
|
%
|
||||||
Asia
|
413.6
|
|
|
360.3
|
|
|
289.1
|
|
|
53.3
|
|
|
15
|
%
|
|
71.2
|
|
25
|
%
|
||||||
Europe, Middle East and Africa
|
316.7
|
|
|
328.7
|
|
|
303.6
|
|
|
(12.0
|
)
|
|
(4
|
)%
|
|
25.1
|
|
8
|
%
|
||||||
Japan
|
163.4
|
|
|
172.0
|
|
|
195.8
|
|
|
(8.6
|
)
|
|
(5
|
)%
|
|
(23.8
|
)
|
|
(12
|
)%
|
|||||
Total revenue
|
$
|
1,702.1
|
|
|
$
|
1,581.0
|
|
|
$
|
1,460.1
|
|
|
$
|
121.1
|
|
|
8
|
%
|
|
$
|
120.9
|
|
|
8
|
%
|
|
2015
|
|
2014
|
|
2013
|
|||
United States
|
46
|
%
|
|
44
|
%
|
|
44
|
%
|
Other Americas
|
1
|
%
|
|
1
|
%
|
|
2
|
%
|
Asia
|
24
|
%
|
|
23
|
%
|
|
20
|
%
|
Europe, Middle East and Africa
|
19
|
%
|
|
21
|
%
|
|
21
|
%
|
Japan
|
10
|
%
|
|
11
|
%
|
|
13
|
%
|
Total
|
100
|
%
|
|
100
|
%
|
|
100
|
%
|
|
|
|
|
|
Change
|
||||||||||||||||||||
|
2015
|
|
2014
|
|
2013
|
|
2015 vs. 2014
|
|
2014 vs. 2013
|
||||||||||||||||
|
(In millions, except percentages)
|
||||||||||||||||||||||||
Product and maintenance
|
$
|
155.7
|
|
|
$
|
156.3
|
|
|
$
|
132.2
|
|
|
$
|
(0.6
|
)
|
|
—
|
%
|
|
$
|
24.1
|
|
|
18
|
%
|
Services
|
82.8
|
|
|
67.4
|
|
|
68.0
|
|
|
15.4
|
|
|
23
|
%
|
|
(0.6
|
)
|
|
(1
|
)%
|
|||||
Total cost of revenue
|
$
|
238.5
|
|
|
$
|
223.7
|
|
|
$
|
200.2
|
|
|
$
|
14.8
|
|
|
7
|
%
|
|
$
|
23.5
|
|
|
12
|
%
|
|
2015
|
|
2014
|
|
2013
|
|||
Product and maintenance
|
10
|
%
|
|
11
|
%
|
|
10
|
%
|
Services
|
67
|
%
|
|
66
|
%
|
|
67
|
%
|
|
|
|
|
|
|
|
Change
|
||||||||||||||||||
|
2015
|
|
2014
|
|
2013
|
|
2015 vs. 2014
|
|
2014 vs. 2013
|
||||||||||||||||
|
(In millions, except percentages)
|
||||||||||||||||||||||||
Product and maintenance-related costs
|
$
|
115.2
|
|
|
$
|
119.4
|
|
|
$
|
108.2
|
|
|
$
|
(4.2
|
)
|
|
(4
|
)%
|
|
$
|
11.2
|
|
|
10
|
%
|
Amortization of acquired intangibles
|
40.5
|
|
|
36.9
|
|
|
24.0
|
|
|
3.6
|
|
|
10
|
%
|
|
12.9
|
|
|
54
|
%
|
|||||
Total cost of product and maintenance
|
$
|
155.7
|
|
|
$
|
156.3
|
|
|
$
|
132.2
|
|
|
$
|
(0.6
|
)
|
|
—
|
%
|
|
$
|
24.1
|
|
|
18
|
%
|
|
Change
|
||||||
|
2015 vs. 2014
|
|
2014 vs. 2013
|
||||
|
(In millions)
|
||||||
Emulation and prototyping hardware costs
|
$
|
(5.1
|
)
|
|
$
|
10.2
|
|
Other items
|
0.9
|
|
|
1.0
|
|
||
|
$
|
(4.2
|
)
|
|
$
|
11.2
|
|
|
|
|
|
|
|
|
Change
|
||||||||||||||||||
|
2015
|
|
2014
|
|
2013
|
|
2015 vs. 2014
|
|
2014 vs. 2013
|
||||||||||||||||
|
(In millions, except percentages)
|
||||||||||||||||||||||||
Marketing and sales
|
$
|
402.4
|
|
|
$
|
399.7
|
|
|
$
|
378.2
|
|
|
$
|
2.7
|
|
|
1
|
%
|
|
$
|
21.5
|
|
|
6
|
%
|
Research and development
|
637.6
|
|
|
603.0
|
|
|
534.0
|
|
|
34.6
|
|
|
6
|
%
|
|
69.0
|
|
|
13
|
%
|
|||||
General and administrative
|
110.0
|
|
|
113.6
|
|
|
121.3
|
|
|
(3.6
|
)
|
|
(3
|
)%
|
|
(7.7
|
)
|
|
(6
|
)%
|
|||||
|
$
|
1,150.0
|
|
|
$
|
1,116.3
|
|
|
$
|
1,033.5
|
|
|
$
|
33.7
|
|
|
3
|
%
|
|
$
|
82.8
|
|
|
8
|
%
|
|
2015
|
|
2014
|
|
2013
|
|||
Marketing and sales
|
24
|
%
|
|
25
|
%
|
|
26
|
%
|
Research and development
|
37
|
%
|
|
38
|
%
|
|
37
|
%
|
General and administrative
|
6
|
%
|
|
7
|
%
|
|
8
|
%
|
Operating expenses
|
68
|
%
|
|
71
|
%
|
|
71
|
%
|
|
Change
|
||||||
|
2015 vs. 2014
|
|
2014 vs. 2013
|
||||
|
(In millions)
|
||||||
Salary, benefits and other employee-related costs
|
$
|
0.9
|
|
|
$
|
19.1
|
|
Stock-based compensation
|
1.1
|
|
|
4.9
|
|
||
Other items
|
0.7
|
|
|
(2.5
|
)
|
||
|
$
|
2.7
|
|
|
$
|
21.5
|
|
|
Change
|
||||||
|
2015 vs. 2014
|
|
2014 vs. 2013
|
||||
|
(In millions)
|
||||||
Materials and other pre-production costs
|
$
|
10.0
|
|
|
$
|
(0.4
|
)
|
Facilities and other infrastructure costs
|
8.9
|
|
|
1.9
|
|
||
Salary, benefits and other employee-related costs
|
6.6
|
|
|
40.1
|
|
||
Stock-based compensation
|
6.6
|
|
|
10.2
|
|
||
Software license and maintenance costs
|
5.4
|
|
|
2.4
|
|
||
Professional services
|
2.4
|
|
|
4.8
|
|
||
Severance and other termination costs
|
(5.9
|
)
|
|
5.9
|
|
||
Other items
|
0.6
|
|
|
4.1
|
|
||
|
$
|
34.6
|
|
|
$
|
69.0
|
|
|
Change
|
||||||
|
2015 vs. 2014
|
|
2014 vs. 2013
|
||||
|
(In millions)
|
||||||
Professional services
|
$
|
(5.5
|
)
|
|
$
|
(0.5
|
)
|
Salary, benefits and other employee-related costs
|
(0.6
|
)
|
|
(6.0
|
)
|
||
Other items
|
2.5
|
|
|
(1.2
|
)
|
||
|
$
|
(3.6
|
)
|
|
$
|
(7.7
|
)
|
|
|
|
|
|
|
|
Change
|
||||||||||||||||||
|
2015
|
|
2014
|
|
2013
|
|
2015 vs. 2014
|
|
2014 vs. 2013
|
||||||||||||||||
|
(In millions, except percentages)
|
||||||||||||||||||||||||
Amortization of acquired intangibles
|
$
|
23.7
|
|
|
$
|
24.0
|
|
|
$
|
19.4
|
|
|
$
|
(0.3
|
)
|
|
(1
|
)%
|
|
$
|
4.6
|
|
|
24
|
%
|
|
Change
|
||||||
|
2015 vs. 2014
|
|
2014 vs. 2013
|
||||
|
(In millions)
|
||||||
Increase due to additions of acquired intangibles
|
$
|
0.7
|
|
|
$
|
7.1
|
|
Decrease due to completed amortization of acquired intangibles
|
(1.0
|
)
|
|
(2.5
|
)
|
||
|
$
|
(0.3
|
)
|
|
$
|
4.6
|
|
|
Severance
and
Benefits
|
|
Excess
Facilities
|
|
Other
|
|
Total
|
||||||||
|
(In millions)
|
||||||||||||||
Fiscal 2015
|
$
|
3.6
|
|
|
$
|
1.1
|
|
|
$
|
(0.2
|
)
|
|
$
|
4.5
|
|
Fiscal 2014
|
$
|
8.0
|
|
|
$
|
(0.9
|
)
|
|
$
|
3.2
|
|
|
$
|
10.3
|
|
Fiscal 2013
|
$
|
17.6
|
|
|
$
|
0.1
|
|
|
$
|
0.3
|
|
|
$
|
18.0
|
|
|
2015
|
|
2014
|
|
2013
|
||||||
|
(In millions)
|
||||||||||
Contractual cash interest expense:
|
|
|
|
|
|
||||||
2013 Notes
|
—
|
|
|
—
|
|
|
2.1
|
|
|||
2015 Notes
|
3.0
|
|
|
9.3
|
|
|
9.2
|
|
|||
2024 Notes
|
15.3
|
|
|
3.6
|
|
|
—
|
|
|||
Revolving credit facility
|
0.5
|
|
|
0.7
|
|
|
1.1
|
|
|||
Amortization of debt discount:
|
|
|
|
|
|
||||||
2013 Notes
|
—
|
|
|
—
|
|
|
6.4
|
|
|||
2015 Notes
|
7.5
|
|
|
17.7
|
|
|
16.0
|
|
|||
2024 Notes
|
0.1
|
|
|
—
|
|
|
—
|
|
|||
Amortization of deferred financing costs:
|
|
|
|
|
|
||||||
2013 Notes
|
—
|
|
|
—
|
|
|
0.4
|
|
|||
2015 Notes
|
1.0
|
|
|
2.4
|
|
|
2.2
|
|
|||
2024 Notes
|
0.5
|
|
|
0.1
|
|
|
—
|
|
|||
Other
|
0.4
|
|
|
0.3
|
|
|
0.2
|
|
|||
Total interest expense
|
$
|
28.3
|
|
|
$
|
34.1
|
|
|
$
|
37.6
|
|
|
2015
|
|
2014
|
|
2013
|
||||||
|
(In millions, except percentages)
|
||||||||||
Provision (benefit) for income taxes
|
$
|
15.2
|
|
|
$
|
22.1
|
|
|
$
|
(5.2
|
)
|
Effective tax rate
|
5.7
|
%
|
|
12.2
|
%
|
|
(3.3
|
)%
|
•
|
tax benefit of
$33.7 million
related to the release of an uncertain tax position from a previous business combination and the release of related interest and penalties; and
|
•
|
tax benefit of $12.8 million for the retroactively enacted fiscal 2012 federal research tax credit and for the fiscal 2013 research tax credit;
|
•
|
federal, state and foreign tax expense on our fiscal 2013 income, and tax expense related to integrating our fiscal 2013 acquisitions.
|
|
As of
|
|
Change
|
||||||||||||||||
|
January 2,
2016 |
|
January 3,
2015 |
|
December 28, 2013
|
|
2015 vs. 2014
|
|
2014 vs. 2013
|
||||||||||
|
(In millions)
|
||||||||||||||||||
Cash, cash equivalents and short-term investments
|
$
|
711.2
|
|
|
$
|
1,022.6
|
|
|
$
|
633.0
|
|
|
$
|
(311.4
|
)
|
|
$
|
389.6
|
|
Net working capital
|
$
|
428.5
|
|
|
$
|
458.6
|
|
|
$
|
72.9
|
|
|
$
|
(30.1
|
)
|
|
$
|
385.7
|
|
|
|
|
Change
|
||||||||||||||||
|
2015
|
|
2014
|
|
2013
|
|
2015 vs. 2014
|
|
2014 vs. 2013
|
||||||||||
|
(In millions)
|
||||||||||||||||||
Cash provided by operating activities
|
$
|
378.2
|
|
|
$
|
316.7
|
|
|
$
|
367.6
|
|
|
$
|
61.5
|
|
|
$
|
(50.9
|
)
|
|
|
|
Change
|
||||||||||||||||
|
2015
|
|
2014
|
|
2013
|
|
2015 vs. 2014
|
|
2014 vs. 2013
|
||||||||||
|
(In millions)
|
||||||||||||||||||
Cash used for investing activities
|
$
|
(44.5
|
)
|
|
$
|
(198.0
|
)
|
|
$
|
(426.9
|
)
|
|
$
|
153.5
|
|
|
$
|
228.9
|
|
|
|
|
Change
|
||||||||||||||||
|
2015
|
|
2014
|
|
2013
|
|
2015 vs. 2014
|
|
2014 vs. 2013
|
||||||||||
|
(In millions)
|
||||||||||||||||||
Cash provided by (used for) financing activities
|
$
|
(626.3
|
)
|
|
$
|
289.0
|
|
|
$
|
(116.3
|
)
|
|
$
|
(915.3
|
)
|
|
$
|
405.3
|
|
|
Payments Due by Period
|
||||||||||||||||||
|
Total
|
|
Less
Than 1 Year
|
|
1-3 Years
|
|
3-5 Years
|
|
More
Than 5 Years
|
||||||||||
|
(In millions)
|
||||||||||||||||||
Operating lease obligations
|
$
|
54.3
|
|
|
$
|
21.0
|
|
|
$
|
21.9
|
|
|
$
|
8.8
|
|
|
$
|
2.6
|
|
Purchase obligations
(1)
|
48.2
|
|
|
34.4
|
|
|
11.8
|
|
|
2.0
|
|
|
—
|
|
|||||
Long-term debt
|
350.0
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
350.0
|
|
|||||
Contractual interest payments
|
139.7
|
|
|
15.8
|
|
|
31.6
|
|
|
31.0
|
|
|
61.3
|
|
|||||
Current income tax payable
|
11.0
|
|
|
11.0
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Other long-term contractual obligations
(2)
|
24.8
|
|
|
—
|
|
|
3.2
|
|
|
12.3
|
|
|
9.3
|
|
|||||
Total
|
$
|
628.0
|
|
|
$
|
82.2
|
|
|
$
|
68.5
|
|
|
$
|
54.1
|
|
|
$
|
423.2
|
|
(1)
|
With respect to purchase obligations that are cancelable by us, this table includes the amount that would have been payable if we had canceled the obligation as of
January 2, 2016
or the earliest cancellation date.
|
(2)
|
Included in other long-term contractual obligations are long-term income tax liabilities related to unrecognized tax benefits of
$11.1 million
that we estimate will be paid or settled within 3 to 5 years. The remaining portion of other long-term contractual obligations is primarily liabilities associated with defined benefit retirement plans and acquisitions.
|
•
|
we have persuasive evidence of an arrangement with a customer;
|
•
|
delivery has occurred;
|
•
|
the fee for the arrangement is considered to be fixed or determinable at the outset of the arrangement; and
|
•
|
collectibility of the fee is probable.
|
•
|
Vendor-specific objective evidence of fair value, or VSOE;
|
•
|
Third-party evidence of selling price, or TPE; and
|
•
|
Best estimate of the selling price, or BESP.
|
|
Notional
Principal
|
|
Weighted
Average
Contract
Rate
|
|||
|
(In millions)
|
|
|
|||
Forward Contracts:
|
|
|
|
|||
European Union euro
|
$
|
52.2
|
|
|
0.91
|
|
Japanese yen
|
33.9
|
|
|
121.74
|
|
|
Israeli shekel
|
21.7
|
|
|
3.86
|
|
|
Canadian dollar
|
12.4
|
|
|
1.37
|
|
|
Chinese renminbi
|
8.1
|
|
|
6.56
|
|
|
British pound
|
6.0
|
|
|
0.66
|
|
|
Taiwan dollar
|
5.7
|
|
|
32.8
|
|
|
Other
|
16.5
|
|
|
N/A
|
|
|
Total
|
$
|
156.5
|
|
|
|
|
Estimated fair value
|
$
|
(0.4
|
)
|
|
|
|
|
2015
|
|
2014
|
||||||||||||||||||||||||||||
|
|
4
th
|
|
3
rd
|
|
2
nd
|
|
1
st
|
|
4
th
|
|
3
rd
|
|
2
nd
|
|
1
st
|
||||||||||||||||
|
|
(In thousands, except per share amounts)
|
||||||||||||||||||||||||||||||
Revenue
(1)
|
|
$
|
441,079
|
|
|
$
|
433,763
|
|
|
$
|
415,883
|
|
|
$
|
411,366
|
|
|
$
|
423,098
|
|
|
$
|
400,496
|
|
|
$
|
378,788
|
|
|
$
|
378,550
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Cost of revenue
|
|
60,902
|
|
|
65,211
|
|
|
51,755
|
|
|
60,585
|
|
|
58,115
|
|
|
54,079
|
|
|
54,413
|
|
|
57,099
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net income
(1) (2) (3) (4)
|
|
80,374
|
|
|
77,624
|
|
|
58,160
|
|
|
36,259
|
|
|
65,030
|
|
|
37,535
|
|
|
23,263
|
|
|
33,070
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net income per share - basic
(1) (2) (3) (4)
|
|
0.27
|
|
|
0.27
|
|
|
0.20
|
|
|
0.13
|
|
|
0.23
|
|
|
0.13
|
|
|
0.08
|
|
|
0.12
|
|
||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Net income per share - diluted
(1) (2)
|
|
0.26
|
|
|
0.25
|
|
|
0.19
|
|
|
0.12
|
|
|
0.21
|
|
|
0.12
|
|
|
0.08
|
|
|
0.11
|
|
(1)
|
Fiscal 2014 included 53 weeks, with the 53rd week falling in the fourth fiscal quarter. For certain of our sales arrangements, where revenue is recognized over time, the 53rd week in fiscal 2014 resulted in incremental fourth quarter revenue of approximately $15 million, which is net of certain other immaterial adjustments to fourth quarter revenue.
|
(2)
|
During the fourth quarter of fiscal 2014, we recorded a benefit for income taxes of
$8.1 million
resulting from the enactment of the United States federal research tax credit in December 2014.
|
(3)
|
During the third quarter of fiscal 2015, we recorded a benefit for income taxes of $13.8 million resulting from the effective settlement of a tax examination of a foreign subsidiary.
|
(4)
|
During the fourth quarter of fiscal 2015, we recorded a benefit for income taxes of $10.1 million resulting from the enactment of the United States federal research tax credit in December 2015.
|
|
Page
|
|
(a) 1. Financial Statements
|
|
|
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
|
||
|
|
|
(a) 2. Financial Statement Schedules
|
|
|
|
|
|
|
All financial statement schedules are omitted because they are not applicable, not required or the required information is shown in the consolidated financial statements or notes thereto.
|
|
|
|
|
|
|
|
|
As of
|
||||||
|
January 2,
2016 |
|
January 3,
2015 |
||||
ASSETS
|
|||||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
616,686
|
|
|
$
|
932,161
|
|
Short-term investments
|
94,498
|
|
|
90,445
|
|
||
Receivables, net
|
164,848
|
|
|
122,492
|
|
||
Inventories
|
56,762
|
|
|
56,394
|
|
||
2015 notes hedges
|
—
|
|
|
523,930
|
|
||
Prepaid expenses and other
|
31,967
|
|
|
126,313
|
|
||
Total current assets
|
964,761
|
|
|
1,851,735
|
|
||
Property, plant and equipment, net
|
228,599
|
|
|
230,112
|
|
||
Goodwill
|
551,772
|
|
|
553,767
|
|
||
Acquired intangibles, net
|
296,482
|
|
|
360,932
|
|
||
Long-term receivables
|
4,498
|
|
|
3,644
|
|
||
Other assets
|
304,903
|
|
|
209,366
|
|
||
Total assets
|
$
|
2,351,015
|
|
|
$
|
3,209,556
|
|
LIABILITIES AND STOCKHOLDERS’ EQUITY
|
|||||||
Current liabilities:
|
|
|
|
||||
Convertible notes
|
$
|
—
|
|
|
$
|
342,499
|
|
2015 notes embedded conversion derivative
|
—
|
|
|
523,930
|
|
||
Accounts payable and accrued liabilities
|
238,022
|
|
|
225,375
|
|
||
Current portion of deferred revenue
|
298,285
|
|
|
301,287
|
|
||
Total current liabilities
|
536,307
|
|
|
1,393,091
|
|
||
Long-term liabilities:
|
|
|
|
||||
Long-term portion of deferred revenue
|
30,209
|
|
|
54,726
|
|
||
Long-term debt
|
348,788
|
|
|
348,676
|
|
||
Other long-term liabilities
|
59,596
|
|
|
79,489
|
|
||
Total long-term liabilities
|
438,593
|
|
|
482,891
|
|
||
Commitments and contingencies (Notes 6 and 7)
|
|
|
|
||||
Stockholders’ equity:
|
|
|
|
||||
Preferred stock - $0.01 par value; authorized 400 shares, none issued or outstanding
|
—
|
|
|
—
|
|
||
Common stock - $0.01 par value; authorized 600,000 shares; issued and outstanding shares: 309,392 and 291,584, respectively
|
1,863,086
|
|
|
1,851,427
|
|
||
Treasury stock, at cost; 19,768 shares and 14,453 shares, respectively
|
(400,555
|
)
|
|
(203,792
|
)
|
||
Accumulated deficit
|
(73,991
|
)
|
|
(326,408
|
)
|
||
Accumulated other comprehensive income (loss)
|
(12,425
|
)
|
|
12,347
|
|
||
Total stockholders’ equity
|
1,376,115
|
|
|
1,333,574
|
|
||
Total liabilities and stockholders’ equity
|
$
|
2,351,015
|
|
|
$
|
3,209,556
|
|
|
2015
|
|
2014
|
|
2013
|
||||||
Revenue:
|
|
|
|
|
|
||||||
Product and maintenance
|
$
|
1,578,944
|
|
|
$
|
1,479,151
|
|
|
$
|
1,357,934
|
|
Services
|
123,147
|
|
|
101,781
|
|
|
102,182
|
|
|||
Total revenue
|
1,702,091
|
|
|
1,580,932
|
|
|
1,460,116
|
|
|||
Costs and expenses:
|
|
|
|
|
|
||||||
Cost of product and maintenance
|
155,659
|
|
|
156,333
|
|
|
132,245
|
|
|||
Cost of service
|
82,794
|
|
|
67,373
|
|
|
67,956
|
|
|||
Marketing and sales
|
402,432
|
|
|
399,688
|
|
|
378,157
|
|
|||
Research and development
|
637,567
|
|
|
603,006
|
|
|
534,022
|
|
|||
General and administrative
|
109,982
|
|
|
113,619
|
|
|
121,314
|
|
|||
Amortization of acquired intangibles
|
23,716
|
|
|
24,017
|
|
|
19,416
|
|
|||
Restructuring and other charges
|
4,511
|
|
|
10,252
|
|
|
17,999
|
|
|||
Total costs and expenses
|
1,416,661
|
|
|
1,374,288
|
|
|
1,271,109
|
|
|||
Income from operations
|
285,430
|
|
|
206,644
|
|
|
189,007
|
|
|||
Interest expense
|
(28,311
|
)
|
|
(34,121
|
)
|
|
(37,581
|
)
|
|||
Other income, net
|
10,477
|
|
|
8,479
|
|
|
7,570
|
|
|||
Income before provision (benefit) for income taxes
|
267,596
|
|
|
181,002
|
|
|
158,996
|
|
|||
Provision (benefit) for income taxes
|
15,179
|
|
|
22,104
|
|
|
(5,247
|
)
|
|||
Net income
|
$
|
252,417
|
|
|
$
|
158,898
|
|
|
$
|
164,243
|
|
Net income per share – basic
|
$
|
0.88
|
|
|
$
|
0.56
|
|
|
$
|
0.59
|
|
Net income per share – diluted
|
$
|
0.81
|
|
|
$
|
0.52
|
|
|
$
|
0.56
|
|
Weighted average common shares outstanding – basic
|
288,018
|
|
|
283,349
|
|
|
277,796
|
|
|||
Weighted average common shares outstanding – diluted
|
312,302
|
|
|
306,775
|
|
|
294,564
|
|
|
2015
|
|
2014
|
|
2013
|
||||||
Net income
|
$
|
252,417
|
|
|
$
|
158,898
|
|
|
$
|
164,243
|
|
Other comprehensive loss, net of tax effects:
|
|
|
|
|
|
||||||
Foreign currency translation adjustments
|
(25,276
|
)
|
|
(11,476
|
)
|
|
(21,470
|
)
|
|||
Changes in unrealized holding gains or losses on available-for-sale securities, net of reclassification adjustments for realized gains and losses
|
169
|
|
|
(305
|
)
|
|
(180
|
)
|
|||
Changes in defined benefit plan liabilities
|
335
|
|
|
(183
|
)
|
|
2,011
|
|
|||
Total other comprehensive loss, net of tax effects
|
(24,772
|
)
|
|
(11,964
|
)
|
|
(19,639
|
)
|
|||
Comprehensive income
|
$
|
227,645
|
|
|
$
|
146,934
|
|
|
$
|
144,604
|
|
|
Common Stock
|
|
|
|
|
|
|
|
|
|||||||||||||
|
|
|
Par Value
|
|
|
|
|
|
Accumulated
|
|
|
|||||||||||
|
|
|
and Capital
|
|
|
|
|
|
Other
|
|
|
|||||||||||
|
|
|
in Excess
|
|
Treasury
|
|
Accumulated
|
|
Comprehensive
|
|
|
|||||||||||
|
Shares
|
|
of Par
|
|
Stock
|
|
Deficit
|
|
Income (Loss)
|
|
Total
|
|||||||||||
Balance, December 29, 2012
|
280,644
|
|
|
$
|
1,721,556
|
|
|
$
|
(200,786
|
)
|
|
$
|
(649,549
|
)
|
|
$
|
43,950
|
|
|
$
|
915,171
|
|
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
164,243
|
|
|
—
|
|
|
$
|
164,243
|
|
||||
Other comprehensive loss, net of taxes
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(19,639
|
)
|
|
$
|
(19,639
|
)
|
||||
Issuance of common stock and reissuance of treasury stock under equity incentive plans, net of forfeitures
|
8,726
|
|
|
(35,541
|
)
|
|
78,198
|
|
|
—
|
|
|
—
|
|
|
$
|
42,657
|
|
||||
Stock received for payment of employee taxes on vesting of restricted stock
|
(1,237
|
)
|
|
(2,586
|
)
|
|
(17,554
|
)
|
|
—
|
|
|
—
|
|
|
$
|
(20,140
|
)
|
||||
Tax benefit from stock-based compensation
|
—
|
|
|
6,999
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
$
|
6,999
|
|
||||
Stock options assumed in acquisitions
|
—
|
|
|
529
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
$
|
529
|
|
||||
Stock-based compensation expense
|
—
|
|
|
66,285
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
$
|
66,285
|
|
||||
Balance, December 28, 2013
|
288,133
|
|
|
$
|
1,757,242
|
|
|
$
|
(140,142
|
)
|
|
$
|
(485,306
|
)
|
|
$
|
24,311
|
|
|
$
|
1,156,105
|
|
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
158,898
|
|
|
—
|
|
|
$
|
158,898
|
|
||||
Other comprehensive loss, net of taxes
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(11,964
|
)
|
|
$
|
(11,964
|
)
|
||||
Purchase of treasury stock
|
(5,856
|
)
|
|
—
|
|
|
(100,117
|
)
|
|
—
|
|
|
—
|
|
|
$
|
(100,117
|
)
|
||||
Issuance of common stock and reissuance of treasury stock under equity incentive plans, net of forfeitures
|
10,631
|
|
|
8,630
|
|
|
57,518
|
|
|
—
|
|
|
—
|
|
|
$
|
66,148
|
|
||||
Stock received for payment of employee taxes on vesting of restricted stock
|
(1,324
|
)
|
|
(3,676
|
)
|
|
(21,051
|
)
|
|
—
|
|
|
—
|
|
|
$
|
(24,727
|
)
|
||||
Tax benefit from stock-based compensation
|
—
|
|
|
5,439
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
$
|
5,439
|
|
||||
Stock-based compensation expense
|
—
|
|
|
83,792
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
$
|
83,792
|
|
||||
Balance, January 3, 2015
|
291,584
|
|
|
$
|
1,851,427
|
|
|
$
|
(203,792
|
)
|
|
$
|
(326,408
|
)
|
|
$
|
12,347
|
|
|
$
|
1,333,574
|
|
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
252,417
|
|
|
—
|
|
|
$
|
252,417
|
|
||||
Other comprehensive loss, net of taxes
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(24,772
|
)
|
|
$
|
(24,772
|
)
|
||||
Purchase of treasury stock
|
(16,255
|
)
|
|
—
|
|
|
(333,189
|
)
|
|
—
|
|
|
—
|
|
|
$
|
(333,189
|
)
|
||||
Issuance of common stock and reissuance of treasury stock under equity incentive plans, net of forfeitures
|
12,399
|
|
|
(90,542
|
)
|
|
165,253
|
|
|
—
|
|
|
—
|
|
|
$
|
74,711
|
|
||||
Issuance of common stock for settlement of 2015 Warrants
|
23,122
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
$
|
—
|
|
||||
Stock received for payment of employee taxes on vesting of restricted stock
|
(1,458
|
)
|
|
(4,824
|
)
|
|
(28,827
|
)
|
|
—
|
|
|
—
|
|
|
$
|
(33,651
|
)
|
||||
Tax benefit from stock-based compensation
|
—
|
|
|
14,684
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
$
|
14,684
|
|
||||
Stock-based compensation expense
|
—
|
|
|
92,341
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
$
|
92,341
|
|
||||
Balance, January 2, 2016
|
309,392
|
|
|
$
|
1,863,086
|
|
|
$
|
(400,555
|
)
|
|
$
|
(73,991
|
)
|
|
$
|
(12,425
|
)
|
|
$
|
1,376,115
|
|
|
2015
|
|
2014
|
|
2013
|
||||||
Cash and cash equivalents at beginning of year
|
$
|
932,161
|
|
|
$
|
536,260
|
|
|
$
|
726,357
|
|
Cash flows from operating activities:
|
|
|
|
|
|
||||||
Net income
|
252,417
|
|
|
158,898
|
|
|
164,243
|
|
|||
Adjustments to reconcile net income to net cash provided by operating activities:
|
|
|
|
|
|
||||||
Depreciation and amortization
|
118,165
|
|
|
115,634
|
|
|
98,308
|
|
|||
Amortization of debt discount and fees
|
9,402
|
|
|
20,529
|
|
|
25,384
|
|
|||
Stock-based compensation
|
92,341
|
|
|
83,792
|
|
|
66,285
|
|
|||
Gain on investments, net
|
(2,124
|
)
|
|
(4,707
|
)
|
|
(5,311
|
)
|
|||
Deferred income taxes
|
(13,148
|
)
|
|
12,478
|
|
|
(2,366
|
)
|
|||
Other non-cash items
|
646
|
|
|
6,854
|
|
|
3,932
|
|
|||
Changes in operating assets and liabilities, net of effect of acquired businesses:
|
|
|
|
|
|
||||||
Receivables
|
(44,732
|
)
|
|
(17,925
|
)
|
|
(3,609
|
)
|
|||
Inventories
|
(1,120
|
)
|
|
(11,708
|
)
|
|
(14,594
|
)
|
|||
Prepaid expenses and other
|
(1,380
|
)
|
|
(2,501
|
)
|
|
30,368
|
|
|||
Other assets
|
(1,558
|
)
|
|
(42,181
|
)
|
|
(2,530
|
)
|
|||
Accounts payable and accrued liabilities
|
15,321
|
|
|
3,856
|
|
|
41,727
|
|
|||
Deferred revenue
|
(27,019
|
)
|
|
(11,860
|
)
|
|
2,506
|
|
|||
Other long-term liabilities
|
(19,011
|
)
|
|
5,563
|
|
|
(36,738
|
)
|
|||
Net cash provided by operating activities
|
378,200
|
|
|
316,722
|
|
|
367,605
|
|
|||
Cash flows from investing activities:
|
|
|
|
|
|
||||||
Purchases of available-for-sale securities
|
(96,531
|
)
|
|
(124,165
|
)
|
|
(111,702
|
)
|
|||
Proceeds from the sale of available-for-sale securities
|
60,949
|
|
|
85,384
|
|
|
77,621
|
|
|||
Proceeds from the maturity of available-for-sale securities
|
31,316
|
|
|
46,612
|
|
|
38,706
|
|
|||
Proceeds from the sale of long-term investments
|
4,570
|
|
|
1,085
|
|
|
6,234
|
|
|||
Purchases of property, plant and equipment
|
(44,808
|
)
|
|
(39,810
|
)
|
|
(44,929
|
)
|
|||
Cash paid in business combinations and asset acquisitions, net of cash acquired
|
—
|
|
|
(167,121
|
)
|
|
(392,825
|
)
|
|||
Net cash used for investing activities
|
(44,504
|
)
|
|
(198,015
|
)
|
|
(426,895
|
)
|
|||
Cash flows from financing activities:
|
|
|
|
|
|
||||||
Proceeds from issuance of debt
|
—
|
|
|
348,649
|
|
|
—
|
|
|||
Proceeds from revolving credit facility
|
—
|
|
|
100,000
|
|
|
100,000
|
|
|||
Payment on revolving credit facility
|
—
|
|
|
(100,000
|
)
|
|
(100,000
|
)
|
|||
Payment of convertible notes
|
(349,999
|
)
|
|
(1
|
)
|
|
(144,639
|
)
|
|||
Payment of convertible notes embedded conversion derivative liability
|
(530,643
|
)
|
|
(1
|
)
|
|
—
|
|
|||
Proceeds from convertible notes hedges
|
530,643
|
|
|
1
|
|
|
—
|
|
|||
Principal payments on receivable financing
|
—
|
|
|
—
|
|
|
(2,526
|
)
|
|||
Payment of debt issuance costs
|
—
|
|
|
(6,500
|
)
|
|
—
|
|
|||
Payment of acquisition-related contingent consideration
|
—
|
|
|
(1,835
|
)
|
|
(677
|
)
|
|||
Excess tax benefits from stock-based compensation
|
15,591
|
|
|
7,583
|
|
|
9,034
|
|
|||
Proceeds from issuance of common stock
|
74,938
|
|
|
65,913
|
|
|
42,657
|
|
|||
Stock received for payment of employee taxes on vesting of restricted stock
|
(33,651
|
)
|
|
(24,727
|
)
|
|
(20,140
|
)
|
|||
Payments for repurchases of common stock
|
(333,189
|
)
|
|
(100,117
|
)
|
|
—
|
|
|||
Net cash provided by (used for) financing activities
|
(626,310
|
)
|
|
288,965
|
|
|
(116,291
|
)
|
|||
Effect of exchange rate changes on cash and cash equivalents
|
(22,861
|
)
|
|
(11,771
|
)
|
|
(14,516
|
)
|
|||
Increase (decrease) in cash and cash equivalents
|
(315,475
|
)
|
|
395,901
|
|
|
(190,097
|
)
|
|||
Cash and cash equivalents at end of year
|
$
|
616,686
|
|
|
$
|
932,161
|
|
|
$
|
536,260
|
|
|
|
|
|
|
|
||||||
Supplemental cash flow information:
|
|
|
|
|
|
||||||
Cash paid for interest
|
$
|
19,918
|
|
|
$
|
9,963
|
|
|
$
|
12,429
|
|
Cash paid (received) for income taxes, net
|
29,494
|
|
|
26,453
|
|
|
(3,084
|
)
|
|||
Non-cash investing and financing activities:
|
|
|
|
|
|
||||||
Stock options assumed in acquisitions
|
—
|
|
|
—
|
|
|
529
|
|
|||
Available-for-sale securities received from customer
|
—
|
|
|
1,695
|
|
|
240
|
|
•
|
Term licenses;
|
•
|
Subscription licenses; and
|
•
|
Perpetual licenses.
|
•
|
Access and use all products delivered at the outset of an arrangement throughout the entire term of the arrangement, generally
two
to
three
years, with no rights to return; and
|
•
|
Remix among the products delivered at the outset of the arrangement, so long as the cumulative contractual value of all products in use does not exceed the total license fee determined at the outset of the arrangement.
|
•
|
Use unspecified additional products that become commercially available during the term of the arrangement; and
|
•
|
Remix into other unspecified additional products that may become available during the term of the arrangement, so long as the cumulative contractual value of all products in use does not exceed the total license fee determined at the outset of the arrangement.
|
•
|
Vendor specific objective evidence of fair value, or VSOE;
|
•
|
Third-party evidence of selling price, or TPE; and
|
•
|
Best estimate of the selling price, or BESP.
|
•
|
The nature and history of current or cumulative financial reporting income or losses;
|
•
|
Sources of future taxable income;
|
•
|
The anticipated reversal or expiration dates of the deferred tax assets; and
|
•
|
Tax planning strategies.
|
|
January 2, 2016
|
|
January 3, 2015
|
||||||||||||||||||||
|
(In thousands)
|
||||||||||||||||||||||
|
Principal
|
|
Unamortized Discount
|
|
Carrying Value
|
|
Principal
|
|
Unamortized Discount
|
|
Carrying Value
|
||||||||||||
2015 Notes
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
349,999
|
|
|
$
|
(7,500
|
)
|
|
$
|
342,499
|
|
2024 Notes
|
350,000
|
|
|
(1,212
|
)
|
|
348,788
|
|
|
350,000
|
|
|
(1,324
|
)
|
|
348,676
|
|
||||||
Revolving credit facility
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Total outstanding debt
|
$
|
350,000
|
|
|
$
|
(1,212
|
)
|
|
$
|
348,788
|
|
|
$
|
699,999
|
|
|
$
|
(8,824
|
)
|
|
$
|
691,175
|
|
|
As of
|
||||||
|
January 2, 2016
|
|
January 3, 2015
|
||||
|
(In thousands)
|
||||||
Cash and cash equivalents
|
$
|
616,686
|
|
|
$
|
932,161
|
|
Short-term investments
|
94,498
|
|
|
90,445
|
|
||
Cash, cash equivalents and short-term investments
|
$
|
711,184
|
|
|
$
|
1,022,606
|
|
|
As of
|
||||||
|
January 2,
2016 |
|
January 3,
2015 |
||||
|
(In thousands)
|
||||||
Cash and interest bearing deposits
|
$
|
255,995
|
|
|
$
|
203,665
|
|
Money market funds
|
360,691
|
|
|
728,496
|
|
||
Total cash and cash equivalents
|
$
|
616,686
|
|
|
$
|
932,161
|
|
|
As of January 2, 2016
|
||||||||||||||
|
Amortized
Cost
|
|
Gross
Unrealized
Gains
|
|
Gross
Unrealized
Losses
|
|
Fair
Value
|
||||||||
|
(In thousands)
|
||||||||||||||
Corporate debt securities
|
$
|
34,905
|
|
|
$
|
1
|
|
|
$
|
(77
|
)
|
|
$
|
34,829
|
|
Bank certificates of deposit
|
15,049
|
|
|
1
|
|
|
(4
|
)
|
|
15,046
|
|
||||
United States Treasury securities
|
36,372
|
|
|
2
|
|
|
(88
|
)
|
|
36,286
|
|
||||
United States government agency securities
|
4,151
|
|
|
1
|
|
|
—
|
|
|
4,152
|
|
||||
Commercial paper
|
1,993
|
|
|
—
|
|
|
—
|
|
|
1,993
|
|
||||
Marketable debt securities
|
92,470
|
|
|
5
|
|
|
(169
|
)
|
|
92,306
|
|
||||
Marketable equity securities
|
1,817
|
|
|
375
|
|
|
—
|
|
|
2,192
|
|
||||
Total short-term investments
|
$
|
94,287
|
|
|
$
|
380
|
|
|
$
|
(169
|
)
|
|
$
|
94,498
|
|
|
As of January 3, 2015
|
||||||||||||||
|
Cost
|
|
Gross
Unrealized
Gains
|
|
Gross
Unrealized
Losses
|
|
Fair
Value
|
||||||||
|
(In thousands)
|
||||||||||||||
Corporate debt securities
|
$
|
34,919
|
|
|
$
|
6
|
|
|
$
|
(31
|
)
|
|
$
|
34,894
|
|
Bank certificates of deposit
|
21,900
|
|
|
10
|
|
|
—
|
|
|
21,910
|
|
||||
United States Treasury securities
|
19,375
|
|
|
12
|
|
|
(13
|
)
|
|
19,374
|
|
||||
United States government agency securities
|
9,209
|
|
|
3
|
|
|
(4
|
)
|
|
9,208
|
|
||||
Commercial paper
|
3,184
|
|
|
4
|
|
|
(2
|
)
|
|
3,186
|
|
||||
Marketable debt securities
|
88,587
|
|
|
35
|
|
|
(50
|
)
|
|
88,572
|
|
||||
Marketable equity securities
|
1,817
|
|
|
56
|
|
|
—
|
|
|
1,873
|
|
||||
Total short-term investments
|
$
|
90,404
|
|
|
$
|
91
|
|
|
$
|
(50
|
)
|
|
$
|
90,445
|
|
|
Amortized
Cost
|
|
Fair
Value
|
||||
|
(In thousands)
|
||||||
Due in less than one year
|
$
|
50,777
|
|
|
$
|
50,751
|
|
Due in one to three years
|
41,693
|
|
|
41,555
|
|
||
Total marketable debt securities included in short-term investments
|
$
|
92,470
|
|
|
$
|
92,306
|
|
|
As of
|
||||||
|
January 2,
2016 |
|
January 3,
2015 |
||||
|
(In thousands)
|
||||||
Cost method
|
$
|
1,081
|
|
|
$
|
1,081
|
|
Equity method
|
2,836
|
|
|
5,058
|
|
||
Total non-marketable investments
|
$
|
3,917
|
|
|
$
|
6,139
|
|
|
As of
|
||||||
|
January 2,
2016 |
|
January 3,
2015 |
||||
|
(In thousands)
|
||||||
Accounts receivable
|
$
|
107,041
|
|
|
$
|
79,410
|
|
Unbilled accounts receivable
|
57,807
|
|
|
43,082
|
|
||
Long-term receivables
|
4,498
|
|
|
3,644
|
|
||
Total receivables
|
$
|
169,346
|
|
|
$
|
126,136
|
|
Less allowance for doubtful accounts
|
—
|
|
|
—
|
|
||
Total receivables, net
|
$
|
169,346
|
|
|
$
|
126,136
|
|
|
2015
|
|
2014
|
|
2013
|
||||||
|
(In thousands)
|
||||||||||
United States
|
$
|
47,867
|
|
|
$
|
12,680
|
|
|
$
|
20,092
|
|
Foreign subsidiaries
|
219,729
|
|
|
168,322
|
|
|
138,904
|
|
|||
Total income before provision (benefit) for income taxes
|
$
|
267,596
|
|
|
$
|
181,002
|
|
|
$
|
158,996
|
|
|
2015
|
|
2014
|
|
2013
|
||||||
|
(In thousands)
|
||||||||||
Current:
|
|
|
|
|
|
||||||
Federal
|
$
|
(10,265
|
)
|
|
$
|
(13,754
|
)
|
|
$
|
(40,494
|
)
|
State and local
|
(713
|
)
|
|
(1,159
|
)
|
|
2,574
|
|
|||
Foreign
|
24,622
|
|
|
19,100
|
|
|
28,040
|
|
|||
Total current
|
13,644
|
|
|
4,187
|
|
|
(9,880
|
)
|
|||
|
|
|
|
|
|
||||||
Deferred:
|
|
|
|
|
|
||||||
Federal
|
(13,165
|
)
|
|
2,075
|
|
|
4,888
|
|
|||
State and local
|
1,751
|
|
|
1,633
|
|
|
3,037
|
|
|||
Foreign
|
(1,734
|
)
|
|
8,770
|
|
|
(10,291
|
)
|
|||
Total deferred
|
(13,148
|
)
|
|
12,478
|
|
|
(2,366
|
)
|
|||
|
|
|
|
|
|
||||||
Tax expense allocated to shareholders’ equity
|
14,683
|
|
|
5,439
|
|
|
6,999
|
|
|||
|
|
|
|
|
|
||||||
Total provision (benefit) for income taxes
|
$
|
15,179
|
|
|
$
|
22,104
|
|
|
$
|
(5,247
|
)
|
|
2015
|
|
2014
|
|
2013
|
||||||
|
(In thousands)
|
||||||||||
Provision computed at federal statutory income tax rate
|
$
|
93,659
|
|
|
$
|
63,350
|
|
|
$
|
55,648
|
|
State and local income tax, net of federal tax effect
|
3,621
|
|
|
1,168
|
|
|
4,085
|
|
|||
Foreign income tax rate differential
|
(56,873
|
)
|
|
(39,012
|
)
|
|
(39,144
|
)
|
|||
Non-deductible share-based compensation costs
|
2,687
|
|
|
5,726
|
|
|
2,053
|
|
|||
Change in deferred tax asset valuation allowance
|
(11,066
|
)
|
|
10,065
|
|
|
18,354
|
|
|||
Tax credits
|
(19,243
|
)
|
|
(17,331
|
)
|
|
(18,372
|
)
|
|||
Repatriation of foreign earnings
|
50
|
|
|
(2,910
|
)
|
|
(2,116
|
)
|
|||
Non-deductible research and development expense
|
336
|
|
|
2,195
|
|
|
3,043
|
|
|||
Tax effects of intra-entity transfer of assets
|
(7,928
|
)
|
|
(5,397
|
)
|
|
270
|
|
|||
Domestic production activity deduction
|
—
|
|
|
(1,281
|
)
|
|
(1,088
|
)
|
|||
Withholding taxes
|
5,119
|
|
|
4,064
|
|
|
3,333
|
|
|||
Interest and penalties not included in tax settlements
|
331
|
|
|
(382
|
)
|
|
1,701
|
|
|||
Increase (decrease) in unrecognized tax benefits not included in tax settlements
|
3,530
|
|
|
157
|
|
|
(33,730
|
)
|
|||
Other
|
956
|
|
|
1,692
|
|
|
716
|
|
|||
Provision (benefit) for income taxes
|
$
|
15,179
|
|
|
$
|
22,104
|
|
|
$
|
(5,247
|
)
|
Effective tax rate
|
6
|
%
|
|
12
|
%
|
|
(3
|
)%
|
|
As of
|
||||||
|
January 2,
2016 |
|
January 3,
2015 |
||||
|
(In thousands)
|
||||||
Deferred tax assets:
|
|
|
|
||||
Tax credit carryforwards
|
$
|
189,672
|
|
|
$
|
180,127
|
|
Reserves and accruals
|
54,774
|
|
|
65,935
|
|
||
Intangible assets
|
29,256
|
|
|
38,938
|
|
||
Capitalized research and development expense for income tax purposes
|
26,332
|
|
|
33,552
|
|
||
Operating loss carryforwards
|
25,208
|
|
|
25,285
|
|
||
Deferred income
|
16,407
|
|
|
19,534
|
|
||
Capital loss carryforwards
|
20,552
|
|
|
21,494
|
|
||
Stock-based compensation costs
|
17,612
|
|
|
20,009
|
|
||
Depreciation and amortization
|
22,442
|
|
|
10,904
|
|
||
Investments
|
7,113
|
|
|
6,825
|
|
||
Other
|
—
|
|
|
1,332
|
|
||
Total deferred tax assets
|
409,368
|
|
|
423,935
|
|
||
Valuation allowance
|
(91,677
|
)
|
|
(102,742
|
)
|
||
Net deferred tax assets
|
317,691
|
|
|
321,193
|
|
||
|
|
|
|
||||
Deferred tax liabilities:
|
|
|
|
||||
Intangible assets
|
(45,697
|
)
|
|
(57,040
|
)
|
||
Undistributed foreign earnings
|
(25,156
|
)
|
|
(28,026
|
)
|
||
Other
|
(1,390
|
)
|
|
(1,607
|
)
|
||
Total deferred tax liabilities
|
(72,243
|
)
|
|
(86,673
|
)
|
||
Total net deferred tax assets
|
$
|
245,448
|
|
|
$
|
234,520
|
|
•
|
The magnitude and duration of Cadence’s profitability in the United States;
|
•
|
Cadence’s multi-year history of approximately
90%
of the aggregate value of its bookings being of a type that revenue is recurring in nature;
|
•
|
Cadence’s existing revenue backlog as of
January 2, 2016
that provides Cadence with an objective source of future revenues to be recognized in fiscal 2016 and subsequent periods; and
|
•
|
Cadence’s expectation of having sufficient sources of income in the future to prevent the expiration of deferred tax assets.
|
•
|
Tax credits in certain states that are accumulating at a rate greater than Cadence’s capacity to utilize the credits and tax credits in certain states where it is likely the credits will expire unused;
|
•
|
Federal, state and foreign deferred tax assets related to investments and capital losses that can only be utilized against gains that are capital in nature; and
|
•
|
Foreign tax credits that can only be fully utilized if Cadence has sufficient income of a specific character in the future.
|
|
Amount
|
|
Expiration Periods
|
||
|
(In thousands)
|
|
|
||
Federal*
|
$
|
25,976
|
|
|
from 2021 through 2035
|
California*
|
240,885
|
|
|
from 2016 through 2035
|
|
Other states (tax effected, net of federal benefit)*
|
3,177
|
|
|
from 2016 through 2035
|
|
Foreign (tax effected)
|
7,193
|
|
|
from 2032 through indefinite
|
|
Amount
|
|
Expiration Periods
|
||
|
(In thousands)
|
|
|
||
Federal*
|
$
|
139,820
|
|
|
from 2016 through 2035
|
California
|
30,455
|
|
|
indefinite
|
|
Other states
|
6,150
|
|
|
from 2016 through 2030
|
|
Foreign
|
13,246
|
|
|
from 2017 through 2035
|
Jurisdiction
|
|
Earliest Tax Year Open to Examination
|
|
|
|
United States - Federal
|
|
2012
|
United States - California
|
|
2011
|
Hungary
|
|
2007
|
|
2015
|
|
2014
|
|
2013
|
||||||
|
(In thousands)
|
||||||||||
Unrecognized tax benefits at the beginning of the fiscal year
|
$
|
97,224
|
|
|
$
|
78,279
|
|
|
$
|
92,378
|
|
Gross amount of the increases (decreases) in unrecognized tax benefits of tax positions taken during a prior year*
|
(7,331
|
)
|
|
8,301
|
|
|
6,196
|
|
|||
Gross amount of the increases in unrecognized tax benefits as a result of tax positions taken during the current year
|
7,513
|
|
|
12,381
|
|
|
5,119
|
|
|||
Amount of decreases in unrecognized tax benefits relating to settlements with taxing authorities, including the utilization of tax attributes
|
(9,571
|
)
|
|
—
|
|
|
(15,171
|
)
|
|||
Reductions to unrecognized tax benefits resulting from the lapse of the applicable statute of limitations
|
(119
|
)
|
|
(86
|
)
|
|
(11,850
|
)
|
|||
Effect of foreign currency translation
|
104
|
|
|
(1,651
|
)
|
|
1,607
|
|
|||
Unrecognized tax benefits at the end of the fiscal year
|
$
|
87,820
|
|
|
$
|
97,224
|
|
|
$
|
78,279
|
|
|
|
|
|
|
|
||||||
Total amounts of unrecognized tax benefits that, if upon resolution of the uncertain tax positions would reduce Cadence’s effective tax rate
|
$
|
48,335
|
|
|
$
|
57,127
|
|
|
$
|
49,458
|
|
|
2015
|
|
2014
|
|
2013
|
||||||
|
(In thousands)
|
||||||||||
Interest
|
$
|
110
|
|
|
$
|
255
|
|
|
$
|
(12,470
|
)
|
Penalties
|
(127
|
)
|
|
(748
|
)
|
|
(7,698
|
)
|
|
2015
|
|
2014
|
|
2013
|
||||||
|
(In thousands)
|
||||||||||
Rent expense
|
$
|
27,406
|
|
|
$
|
26,666
|
|
|
$
|
25,450
|
|
|
|
|
Committed
|
|
|
||||||
|
Operating
|
|
Sub-lease
|
|
Net Operating
|
||||||
|
Leases
|
|
Income
|
|
Leases
|
||||||
For the fiscal years:
|
(In thousands)
|
||||||||||
2016
|
$
|
21,669
|
|
|
$
|
(671
|
)
|
|
$
|
20,998
|
|
2017
|
13,009
|
|
|
(80
|
)
|
|
12,929
|
|
|||
2018
|
8,996
|
|
|
—
|
|
|
8,996
|
|
|||
2019
|
6,199
|
|
|
—
|
|
|
6,199
|
|
|||
2020
|
2,600
|
|
|
—
|
|
|
2,600
|
|
|||
Thereafter
|
2,608
|
|
|
—
|
|
|
2,608
|
|
|||
Total lease payments
|
$
|
55,081
|
|
|
$
|
(751
|
)
|
|
$
|
54,330
|
|
Authorization Date
|
|
Amount
|
|
Remaining Authorization
|
||||
|
|
(In thousands)
|
||||||
February 2008
|
|
$
|
500,000
|
|
|
$
|
—
|
|
August 2008
|
|
500,000
|
|
|
381,083
|
|
||
July 2015
|
|
578,804
|
|
|
578,804
|
|
||
Total remaining authorization
|
|
|
|
$
|
959,887
|
|
|
2015
|
|
2014
|
|
2013
|
||||||
|
(In thousands)
|
||||||||||
Shares repurchased
|
16,255
|
|
|
5,856
|
|
|
—
|
|
|||
Total cost of repurchased shares
|
$
|
333,189
|
|
|
$
|
100,117
|
|
|
$
|
—
|
|
|
2015
|
|
2014
|
|
2013
|
||||||
|
(In thousands)
|
||||||||||
Stock options
|
$
|
7,903
|
|
|
$
|
11,870
|
|
|
$
|
13,100
|
|
Restricted stock
|
78,615
|
|
|
65,894
|
|
|
49,019
|
|
|||
ESPP
|
5,823
|
|
|
6,028
|
|
|
4,166
|
|
|||
Total stock-based compensation expense
|
$
|
92,341
|
|
|
$
|
83,792
|
|
|
$
|
66,285
|
|
|
|
|
|
|
|
||||||
Income tax benefit
|
$
|
24,294
|
|
|
$
|
20,544
|
|
|
$
|
16,236
|
|
|
2015
|
|
2014
|
|
2013
|
||||||
|
(In thousands)
|
||||||||||
Cost of product and maintenance
|
$
|
2,436
|
|
|
$
|
2,244
|
|
|
$
|
1,596
|
|
Cost of services
|
3,561
|
|
|
3,280
|
|
|
2,321
|
|
|||
Marketing and sales
|
21,654
|
|
|
20,580
|
|
|
15,642
|
|
|||
Research and development
|
49,755
|
|
|
43,173
|
|
|
32,999
|
|
|||
General and administrative
|
14,935
|
|
|
14,515
|
|
|
13,727
|
|
|||
Total stock-based compensation expense
|
$
|
92,341
|
|
|
$
|
83,792
|
|
|
$
|
66,285
|
|
|
2015
|
|
2014
|
|
2013
|
||||||
Dividend yield
|
None
|
|
|
None
|
|
|
None
|
|
|||
Expected volatility
|
26.8
|
%
|
|
29.2
|
%
|
|
40.0
|
%
|
|||
Risk-free interest rate
|
1.61
|
%
|
|
1.59
|
%
|
|
0.86
|
%
|
|||
Expected term (in years)
|
5.0
|
|
|
4.8
|
|
|
4.7
|
|
|||
Weighted-average fair value of options granted
|
$
|
4.60
|
|
|
$
|
3.89
|
|
|
$
|
4.93
|
|
|
|
|
Weighted-
Average
|
|
Weighted-
Average
Remaining
Contractual
Terms
|
|
Aggregate
Intrinsic
|
|||||
|
Shares
|
|
Exercise Price
|
|
(Years)
|
|
Value
|
|||||
|
(In thousands)
|
|
|
|
|
|
(In thousands)
|
|||||
Options outstanding as of January 3, 2015
|
13,876
|
|
|
$
|
9.71
|
|
|
|
|
|
||
Granted
|
1,305
|
|
|
17.25
|
|
|
|
|
|
|||
Exercised
|
(5,948
|
)
|
|
8.79
|
|
|
|
|
|
|||
Canceled and forfeited
|
(256
|
)
|
|
12.26
|
|
|
|
|
|
|||
Options outstanding as of January 2, 2016
|
8,977
|
|
|
$
|
11.35
|
|
|
3.5
|
|
$
|
84,954
|
|
Options vested as of January 2, 2016
|
7,098
|
|
|
$
|
10.35
|
|
|
3.1
|
|
$
|
74,264
|
|
Options vested as of, and expected to vest after, January 2, 2016
|
8,976
|
|
|
$
|
11.35
|
|
|
3.5
|
|
$
|
84,947
|
|
|
2015
|
|
2014
|
|
2013
|
||||||
|
(In thousands)
|
||||||||||
Intrinsic value of options exercised
|
$
|
67,363
|
|
|
$
|
24,032
|
|
|
$
|
15,114
|
|
Cash received from options exercised
|
52,261
|
|
|
46,123
|
|
|
27,569
|
|
|
2015
|
|
2014
|
|
2013
|
||||||
|
(In thousands)
|
||||||||||
Stock-based compensation expense related to performance-based grants
|
$
|
5,544
|
|
|
$
|
5,227
|
|
|
$
|
4,340
|
|
|
|
|
Weighted-
Average Grant Date
|
|
Weighted-
Average
Remaining
Vesting
Terms
|
|
Aggregate
Intrinsic
|
|||||
|
Shares
|
|
Fair Value
|
|
(Years)
|
|
Value
|
|||||
|
(In thousands)
|
|
|
|
|
|
(In thousands)
|
|||||
Unvested shares as of January 3, 2015
|
10,451
|
|
|
$
|
15.51
|
|
|
|
|
|
||
Granted
|
5,849
|
|
|
19.62
|
|
|
|
|
|
|||
Vested
|
(5,019
|
)
|
|
14.68
|
|
|
|
|
|
|||
Forfeited
|
(704
|
)
|
|
16.34
|
|
|
|
|
|
|||
Unvested shares as of January 2, 2016
|
10,577
|
|
|
$
|
18.13
|
|
|
1.1
|
|
$
|
220,103
|
|
Unvested shares expected to vest after January 2, 2016
|
10,000
|
|
|
$
|
18.08
|
|
|
1.1
|
|
$
|
208,091
|
|
|
2015
|
|
2014
|
|
2013
|
||||||
|
(In thousands)
|
||||||||||
Fair value of restricted stock realized upon vesting
|
$
|
99,564
|
|
|
$
|
75,283
|
|
|
$
|
58,091
|
|
|
2015
|
|
2014
|
|
2013
|
||||||
Dividend yield
|
None
|
|
|
None
|
|
|
None
|
|
|||
Expected volatility
|
22.9
|
%
|
|
24.2
|
%
|
|
25.7
|
%
|
|||
Risk-free interest rate
|
0.13
|
%
|
|
0.06
|
%
|
|
0.09
|
%
|
|||
Expected term (in years)
|
0.5
|
|
|
0.5
|
|
|
0.5
|
|
|||
Weighted-average fair value of options granted
|
$
|
4.23
|
|
|
$
|
3.39
|
|
|
$
|
3.21
|
|
|
2015
|
|
2014
|
|
2013
|
||||||
|
(In thousands, except per share amounts)
|
||||||||||
Cadence shares purchased under the ESPP
|
1,519
|
|
|
1,689
|
|
|
1,382
|
|
|||
Cash received for the purchase of shares under the ESPP
|
$
|
22,449
|
|
|
$
|
20,017
|
|
|
$
|
15,088
|
|
Weighted-average purchase price per share
|
$
|
14.78
|
|
|
$
|
11.85
|
|
|
$
|
10.91
|
|
|
Shares
|
|
|
(In thousands)
|
|
Employee equity incentive plans*
|
21,523
|
|
Employee stock purchase plans
|
6,660
|
|
Directors stock option plans*
|
1,845
|
|
Total
|
30,028
|
|
|
Gross Carrying
Amount
|
||
|
(In thousands)
|
||
Balance as of December 28, 2013
|
$
|
456,905
|
|
Goodwill resulting from acquisitions
|
102,025
|
|
|
Measurement period adjustments
|
(3,476
|
)
|
|
Effect of foreign currency translation
|
(1,687
|
)
|
|
Balance as of January 3, 2015
|
553,767
|
|
|
Effect of foreign currency translation
|
(1,995
|
)
|
|
Balance as of January 2, 2016
|
$
|
551,772
|
|
|
Gross Carrying
Amount
|
|
Accumulated
Amortization
|
|
Acquired
Intangibles, Net
|
||||||
|
(In thousands)
|
||||||||||
Existing technology
|
$
|
329,627
|
|
|
$
|
(124,097
|
)
|
|
$
|
205,530
|
|
Agreements and relationships
|
173,325
|
|
|
(86,808
|
)
|
|
86,517
|
|
|||
Tradenames, trademarks and patents
|
10,119
|
|
|
(5,684
|
)
|
|
4,435
|
|
|||
Total acquired intangibles
|
513,071
|
|
|
(216,589
|
)
|
|
296,482
|
|
|
Gross Carrying
Amount
|
|
Accumulated
Amortization
|
|
Acquired
Intangibles, Net
|
||||||
|
(In thousands)
|
||||||||||
Existing technology
|
$
|
328,325
|
|
|
$
|
(84,822
|
)
|
|
$
|
243,503
|
|
Agreements and relationships
|
175,202
|
|
|
(65,512
|
)
|
|
109,690
|
|
|||
Tradenames, trademarks and patents
|
10,619
|
|
|
(4,480
|
)
|
|
6,139
|
|
|||
Total acquired intangibles with definite lives
|
514,146
|
|
|
(154,814
|
)
|
|
359,332
|
|
|||
In-process technology
|
1,600
|
|
|
—
|
|
|
1,600
|
|
|||
Total acquired intangibles
|
$
|
515,746
|
|
|
$
|
(154,814
|
)
|
|
$
|
360,932
|
|
|
2015
|
|
2014
|
|
2013
|
||||||
|
(In thousands)
|
||||||||||
Cost of product and maintenance
|
$
|
40,532
|
|
|
$
|
36,907
|
|
|
$
|
24,023
|
|
Amortization of acquired intangibles
|
23,716
|
|
|
24,017
|
|
|
19,416
|
|
|||
Total amortization of acquired intangibles
|
$
|
64,248
|
|
|
$
|
60,924
|
|
|
$
|
43,439
|
|
|
Severance
and
Benefits
|
|
Excess
Facilities
|
|
Other
|
|
Total
|
||||||||
|
(In thousands)
|
||||||||||||||
Balance, December 29, 2012
|
$
|
—
|
|
|
$
|
4,343
|
|
|
$
|
—
|
|
|
$
|
4,343
|
|
Restructuring and other charges, net
|
17,589
|
|
|
101
|
|
|
309
|
|
|
17,999
|
|
||||
Non-cash charges
|
—
|
|
|
—
|
|
|
(309
|
)
|
|
(309
|
)
|
||||
Cash payments
|
(6,944
|
)
|
|
(951
|
)
|
|
—
|
|
|
(7,895
|
)
|
||||
Effect of foreign currency translation
|
27
|
|
|
59
|
|
|
—
|
|
|
86
|
|
||||
Balance, December 28, 2013
|
$
|
10,672
|
|
|
$
|
3,552
|
|
|
$
|
—
|
|
|
$
|
14,224
|
|
Restructuring and other charges (credits), net
|
8,004
|
|
|
(945
|
)
|
|
3,193
|
|
|
10,252
|
|
||||
Non-cash charges
|
—
|
|
|
—
|
|
|
(2,450
|
)
|
|
(2,450
|
)
|
||||
Cash payments
|
(13,967
|
)
|
|
(1,056
|
)
|
|
(262
|
)
|
|
(15,285
|
)
|
||||
Effect of foreign currency translation
|
(247
|
)
|
|
(284
|
)
|
|
—
|
|
|
(531
|
)
|
||||
Balance, January 3, 2015
|
$
|
4,462
|
|
|
$
|
1,267
|
|
|
$
|
481
|
|
|
$
|
6,210
|
|
Restructuring and other charges (credits), net
|
3,636
|
|
|
1,095
|
|
|
(220
|
)
|
|
4,511
|
|
||||
Non-cash charges
|
—
|
|
|
(116
|
)
|
|
—
|
|
|
(116
|
)
|
||||
Cash payments
|
(7,322
|
)
|
|
(1,798
|
)
|
|
(261
|
)
|
|
(9,381
|
)
|
||||
Effect of foreign currency translation
|
(25
|
)
|
|
(62
|
)
|
|
—
|
|
|
(87
|
)
|
||||
Balance, January 2, 2016
|
$
|
751
|
|
|
$
|
386
|
|
|
$
|
—
|
|
|
$
|
1,137
|
|
|
As of
|
||
|
January 2, 2016
|
||
|
(In thousands)
|
||
Accounts payable and accrued liabilities
|
$
|
990
|
|
Other long-term liabilities
|
147
|
|
|
Total liabilities
|
$
|
1,137
|
|
|
2015
|
|
2014
|
|
2013
|
||||||
|
(In thousands)
|
||||||||||
Interest income
|
$
|
2,667
|
|
|
$
|
1,827
|
|
|
$
|
1,706
|
|
Gains on sale of marketable debt and equity securities, net
|
21
|
|
|
722
|
|
|
1,364
|
|
|||
Gains on non-marketable investments
|
2,348
|
|
|
2,524
|
|
|
1,098
|
|
|||
Gains (losses) on securities in NQDC trust
|
(369
|
)
|
|
3,415
|
|
|
3,293
|
|
|||
Gains on foreign exchange
|
5,606
|
|
|
1,742
|
|
|
285
|
|
|||
Write-down of non-marketable investments
|
—
|
|
|
(1,956
|
)
|
|
(464
|
)
|
|||
Other income, net
|
204
|
|
|
205
|
|
|
288
|
|
|||
Total other income, net
|
$
|
10,477
|
|
|
$
|
8,479
|
|
|
$
|
7,570
|
|
|
2015
|
|
2014
|
|
2013
|
||||||
|
(In thousands, except per share amounts)
|
||||||||||
Net income
|
$
|
252,417
|
|
|
$
|
158,898
|
|
|
$
|
164,243
|
|
Weighted-average common shares used to calculate basic net income per share
|
288,018
|
|
|
283,349
|
|
|
277,796
|
|
|||
Convertible notes
|
—
|
|
|
—
|
|
|
8
|
|
|||
2015 Warrants
|
16,434
|
|
|
15,930
|
|
|
10,549
|
|
|||
Stock-based awards
|
7,850
|
|
|
7,496
|
|
|
6,211
|
|
|||
Weighted-average common shares used to calculate diluted net income per share
|
312,302
|
|
|
306,775
|
|
|
294,564
|
|
|||
Net income per share - basic
|
$
|
0.88
|
|
|
$
|
0.56
|
|
|
$
|
0.59
|
|
Net income per share - diluted
|
$
|
0.81
|
|
|
$
|
0.52
|
|
|
$
|
0.56
|
|
|
2015
|
|
2014
|
|
2013
|
|||
|
(In thousands)
|
|||||||
2013 Warrants*
|
—
|
|
|
—
|
|
|
6,830
|
|
Options to purchase shares of common stock
|
1,029
|
|
|
2,773
|
|
|
5,973
|
|
Non-vested shares of restricted stock
|
60
|
|
|
18
|
|
|
846
|
|
Total potential common shares excluded
|
1,089
|
|
|
2,791
|
|
|
13,649
|
|
|
As of
|
||||||
|
January 2,
2016 |
|
January 3,
2015 |
||||
|
(In thousands)
|
||||||
Inventories:
|
|
|
|
||||
Raw materials
|
$
|
40,499
|
|
|
$
|
42,428
|
|
Finished goods
|
16,263
|
|
|
13,966
|
|
||
Inventories
|
$
|
56,762
|
|
|
$
|
56,394
|
|
|
|
|
|
||||
Prepaid expenses and other:
|
|
|
|
||||
Prepaid expenses and other current assets
|
$
|
31,967
|
|
|
$
|
31,856
|
|
Deferred income taxes
|
—
|
|
|
94,457
|
|
||
Prepaid expenses and other
|
$
|
31,967
|
|
|
$
|
126,313
|
|
|
|
|
|
||||
Property, plant and equipment:
|
|
|
|
||||
Computer equipment and related software
|
$
|
471,842
|
|
|
$
|
445,536
|
|
Buildings
|
126,156
|
|
|
126,382
|
|
||
Land
|
55,898
|
|
|
55,926
|
|
||
Leasehold, building and land improvements
|
90,400
|
|
|
91,128
|
|
||
Furniture and fixtures
|
21,847
|
|
|
22,424
|
|
||
Equipment
|
42,274
|
|
|
40,637
|
|
||
In-process capital assets
|
1,527
|
|
|
630
|
|
||
Total cost
|
809,944
|
|
|
782,663
|
|
||
Less: Accumulated depreciation and amortization
|
(581,345
|
)
|
|
(552,551
|
)
|
||
Property, plant and equipment, net
|
$
|
228,599
|
|
|
$
|
230,112
|
|
|
|
|
|
||||
Other assets:
|
|
|
|
||||
Deferred income taxes
|
$
|
245,651
|
|
|
$
|
140,969
|
|
Other long-term assets
|
59,252
|
|
|
68,397
|
|
||
Other assets
|
$
|
304,903
|
|
|
$
|
209,366
|
|
|
|
|
|
||||
Accounts payable and accrued liabilities:
|
|
|
|
||||
Payroll and payroll-related accruals
|
$
|
155,592
|
|
|
$
|
151,526
|
|
Accounts payable
|
25,152
|
|
|
12,102
|
|
||
Income taxes payable - current
|
11,024
|
|
|
9,118
|
|
||
Accrued operating liabilities
|
46,254
|
|
|
52,629
|
|
||
Accounts payable and accrued liabilities
|
$
|
238,022
|
|
|
$
|
225,375
|
|
|
|
|
|
•
|
Level 1
– Quoted prices for identical instruments in active markets;
|
•
|
Level 2
– Quoted prices for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-derived valuations in which all significant inputs and significant value drivers are observable in active markets; and
|
•
|
Level 3
– Valuations derived from valuation techniques in which one or more significant inputs or significant value drivers are unobservable.
|
|
Fair Value Measurements as of January 2, 2016:
|
||||||||||||||
|
Total
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
||||||||
|
(In thousands)
|
||||||||||||||
Assets
|
|
||||||||||||||
Cash equivalents:
|
|
|
|
|
|
|
|
||||||||
Money market funds
|
$
|
360,691
|
|
|
$
|
360,691
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Short-term investments:
|
|
|
|
|
|
|
|
||||||||
Corporate debt securities
|
34,829
|
|
|
—
|
|
|
34,829
|
|
|
—
|
|
||||
Bank certificates of deposit
|
15,046
|
|
|
—
|
|
|
15,046
|
|
|
—
|
|
||||
United States Treasury securities
|
36,286
|
|
|
36,286
|
|
|
—
|
|
|
—
|
|
||||
United States government agency securities
|
4,152
|
|
|
4,152
|
|
|
—
|
|
|
—
|
|
||||
Commercial paper
|
1,993
|
|
|
—
|
|
|
1,993
|
|
|
—
|
|
||||
Marketable equity securities
|
2,192
|
|
|
2,192
|
|
|
—
|
|
|
—
|
|
||||
Trading securities held NQDC trust
|
24,905
|
|
|
24,905
|
|
|
—
|
|
|
—
|
|
||||
Total Assets
|
$
|
480,094
|
|
|
$
|
428,226
|
|
|
$
|
51,868
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
||||||||
|
Total
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
||||||||
|
(In thousands)
|
||||||||||||||
Liabilities
|
|
||||||||||||||
Foreign currency exchange contracts
|
362
|
|
|
—
|
|
|
362
|
|
|
—
|
|
||||
Total Liabilities
|
$
|
362
|
|
|
$
|
—
|
|
|
$
|
362
|
|
|
$
|
—
|
|
|
|
|
|
|
|
|
|
||||||||
|
|
|
|
|
|
|
|
||||||||
|
|
|
|
|
|
|
|
||||||||
|
|
|
|
|
|
|
|
||||||||
|
|
|
|
|
|
|
|
|
2015
|
|
2014
|
|
2013
|
||||||
|
(In thousands)
|
||||||||||
Contributions to defined contribution plans
|
$
|
22,337
|
|
|
$
|
21,121
|
|
|
$
|
20,055
|
|
|
2015
|
|
2014
|
|
2013
|
||||||
|
(In thousands)
|
||||||||||
Trading securities
|
$
|
(369
|
)
|
|
$
|
3,415
|
|
|
$
|
3,293
|
|
|
January 2,
2016 |
|
January 3,
2015 |
|
December 28,
2013 |
||||||
|
(In thousands)
|
||||||||||
Unfunded projected benefit obligation - defined benefit retirement plans
|
$
|
6,131
|
|
|
$
|
6,794
|
|
|
$
|
7,160
|
|
|
2015
|
|
2014
|
|
2013
|
||||||
|
(In thousands)
|
||||||||||
Expense related to defined benefit retirement plans
|
$
|
1,359
|
|
|
$
|
1,799
|
|
|
$
|
1,817
|
|
|
As of
|
||||||
|
January 2,
2016 |
|
January 3,
2015 |
||||
|
(In thousands)
|
||||||
Foreign currency translation gain (loss)
|
$
|
(9,569
|
)
|
|
$
|
15,707
|
|
Changes in defined benefit plan liabilities
|
(3,066
|
)
|
|
(3,401
|
)
|
||
Unrealized holding gains on available-for-sale securities
|
210
|
|
|
41
|
|
||
Total accumulated other comprehensive income (loss)
|
$
|
(12,425
|
)
|
|
$
|
12,347
|
|
|
2015
|
|
2014
|
|
2013
|
||||||
|
(In thousands)
|
||||||||||
Unrealized holding gains or losses
|
$
|
202
|
|
|
$
|
(156
|
)
|
|
$
|
(127
|
)
|
Reclassification of unrealized holding gains or losses to other income, net
|
(33
|
)
|
|
(149
|
)
|
|
(53
|
)
|
|||
Changes in unrealized holding gains or losses
|
$
|
169
|
|
|
$
|
(305
|
)
|
|
$
|
(180
|
)
|
|
2015
|
|
2014
|
|
2013
|
||||||
|
(In thousands)
|
||||||||||
Americas:
|
|
|
|
|
|
||||||
United States
|
$
|
782,419
|
|
|
$
|
696,608
|
|
|
$
|
648,714
|
|
Other Americas
|
25,960
|
|
|
23,357
|
|
|
22,940
|
|
|||
Total Americas
|
808,379
|
|
|
719,965
|
|
|
671,654
|
|
|||
Asia
|
413,588
|
|
|
360,280
|
|
|
289,065
|
|
|||
Europe, Middle East and Africa
|
316,684
|
|
|
328,724
|
|
|
303,593
|
|
|||
Japan
|
163,440
|
|
|
171,963
|
|
|
195,804
|
|
|||
Total
|
$
|
1,702,091
|
|
|
$
|
1,580,932
|
|
|
$
|
1,460,116
|
|
|
As of
|
||||||||||
|
January 2,
2016 |
|
January 3,
2015 |
|
December 28,
2013 |
||||||
|
(In thousands)
|
||||||||||
Americas:
|
|
|
|
|
|
||||||
United States
|
$
|
189,665
|
|
|
$
|
200,760
|
|
|
$
|
207,694
|
|
Other Americas
|
387
|
|
|
578
|
|
|
294
|
|
|||
Total Americas
|
190,052
|
|
|
201,338
|
|
|
207,988
|
|
|||
Asia
|
24,767
|
|
|
22,145
|
|
|
23,508
|
|
|||
Europe, Middle East and Africa
|
12,832
|
|
|
5,951
|
|
|
6,326
|
|
|||
Japan
|
948
|
|
|
678
|
|
|
893
|
|
|||
Total
|
$
|
228,599
|
|
|
$
|
230,112
|
|
|
$
|
238,715
|
|
CADENCE DESIGN SYSTEMS, INC.
|
|
|
|
/s/ Lip-Bu Tan
|
|
Lip-Bu Tan
|
|
President, Chief Executive Officer and Director
|
|
Dated:
|
February 18, 2016
|
|
|
|
|
|
|
/s/ Lip-Bu Tan
|
DATE:
|
February 18, 2016
|
Lip-Bu Tan
|
|
|
President, Chief Executive Officer and Director
|
|
|
|
|
|
|
|
|
/s/ Geoffrey G. Ribar
|
DATE:
|
February 18, 2016
|
Geoffrey G. Ribar
|
|
|
Senior Vice President and Chief Financial Officer
|
|
|
|
|
|
|
|
/s/
|
Dr. John B. Shoven
|
|
February 18, 2016
|
|
Dr. John B. Shoven, Chairman of the Board of Directors
|
|
|
|
|
|
|
|
|
|
/s/
|
Mark W. Adams
|
|
February 18, 2016
|
|
Mark W. Adams, Director
|
|
|
|
|
|
|
|
|
|
/s/
|
Susan L. Bostrom
|
|
February 18, 2016
|
|
Susan L. Bostrom, Director
|
|
|
|
|
|
|
|
|
|
/s/
|
Dr. James D. Plummer
|
|
February 18, 2016
|
|
Dr. James D. Plummer, Director
|
|
|
|
|
|
|
|
|
|
/s/
|
Dr. Alberto Sangiovanni-Vincentelli
|
|
February 18, 2016
|
|
Dr. Alberto Sangiovanni-Vincentelli, Director
|
|
|
|
|
|
|
|
|
|
/s/
|
George M. Scalise
|
|
February 18, 2016
|
|
George M. Scalise, Director
|
|
|
|
|
|
|
|
|
|
/s/
|
Roger S. Siboni
|
|
February 18, 2016
|
|
Roger S. Siboni, Director
|
|
|
|
|
|
|
|
|
|
/s/
|
Young K. Sohn
|
|
February 18, 2016
|
|
Young K. Sohn, Director
|
|
|
|
|
|
|
|
|
|
Incorporated by Reference
|
|
|
||||
Exhibit
|
|
|
|
|
|
|
|
Exhibit
|
|
Filing
|
|
Provided
|
Number
|
|
Exhibit Title
|
|
Form
|
|
File No.
|
|
No.
|
|
Date
|
|
Herewith
|
2.02
|
|
Agreement and Plan of Merger, dated as of March 11, 2013, by and among the Registrant, Tundra Holdings, Inc., Tundra Subsidiary Corporation, Tensilica, Inc. and Shareholder Representative Services LLC, as Stockholder Agent.
|
|
10-Q
|
|
000-15867
|
|
2.01
|
|
4/25/2013
|
|
|
3.01
|
|
Restated Certificate of Incorporation, as filed with the Secretary of State of the State of Delaware on May 13, 1998.
|
|
10-Q
|
|
001-10606
|
|
3.01(j)
|
|
8/18/1998
|
|
|
3.02
|
|
Certificate of Designation for the Series A Junior Participating Preferred Stock, as amended on February 1, 2000.
|
|
10-K
|
|
001-10606
|
|
4.02
|
|
3/27/2000
|
|
|
3.03
|
|
The Registrant's Amended and Restated Bylaws, effective as of May 5, 2014.
|
|
8-K
|
|
000-15867
|
|
3.01
|
|
5/7/2014
|
|
|
4.01
|
|
Specimen Certificate of the Registrant’s Common Stock.
|
|
S-4
|
|
033-43400
|
|
4.01
|
|
10/17/1991
|
|
|
4.02
|
|
Base Indenture, dated October 9, 2014, between the Registrant and Wells Fargo Bank, N.A., as trustee.
|
|
8-K
|
|
000-15867
|
|
4.01
|
|
10/9/2014
|
|
|
4.03
|
|
First Supplemental Indenture, dated October 9, 2014, between the Registrant and Wells Fargo Bank, N.A., as trustee (including the Form of 4.375% Senior Notes due 2024).
|
|
8-K
|
|
000-15867
|
|
4.02
|
|
10/9/2014
|
|
|
10.01*
|
|
The Registrant’s Amended and Restated 1987 Stock Incentive Plan.
|
|
S-8
|
|
333-174201
|
|
99.1
|
|
5/13/2011
|
|
|
10.02*
|
|
Form of Stock Option Agreement and Form of Stock Option Exercise Request under the Registrant’s 1987 Stock Incentive Plan, as amended and restated.
|
|
10-Q
|
|
001-10606
|
|
10.02
|
|
8/10/2004
|
|
|
10.03*
|
|
Form of Nonstatutory Incentive Stock Award Agreement under the Registrant’s 1987 Stock Incentive Plan, as amended and restated.
|
|
10-K
|
|
001-10606
|
|
10.03
|
|
3/16/2005
|
|
|
10.04*
|
|
Form of Incentive Stock Award Agreement for performance-based Incentive Stock Awards granted prior to July 29, 2008, as amended and restated, under the Registrant’s 1987 Stock Incentive Plan, as amended and restated.
|
|
10-Q
|
|
001-10606
|
|
10.02
|
|
12/11/2008
|
|
|
10.05*
|
|
Form of Incentive Stock Award Agreement for performance-based Incentive Stock Awards to be granted subsequent to July 29, 2008 under the Registrant’s 1987 Stock Incentive Plan, as amended and restated.
|
|
10-Q
|
|
001-10606
|
|
10.03
|
|
12/11/2008
|
|
|
10.06*
|
|
Form of Stock Option Agreement under the Registrant’s 1987 Stock Incentive Plan, as amended and restated.
|
|
10-Q
|
|
001-10606
|
|
10.01
|
|
5/1/2009
|
|
|
10.07*
|
|
Form of Incentive Stock Award Agreement for performance-based Incentive Stock Awards under the Registrant’s 1987 Stock Incentive Plan, as amended and restated.
|
|
10-Q
|
|
001-10606
|
|
10.02
|
|
5/1/2009
|
|
|
10.08*
|
|
The Registrant’s 1995 Directors Stock Incentive Plan.
|
|
10-Q
|
|
001-15867
|
|
10.01
|
|
7/26/2012
|
|
|
10.09*
|
|
Form of Stock Option Agreement, as currently in effect under the Registrant’s 1995 Directors Stock Incentive Plan.
|
|
10-K
|
|
000-15867
|
|
10.76
|
|
2/21/2013
|
|
|
10.10*
|
|
Form of Incentive Stock Award Agreement, as currently in effect under the Registrant’s 1995 Directors Stock Incentive Plan.
|
|
10-K
|
|
000-15867
|
|
10.77
|
|
2/21/2013
|
|
|
10.11*
|
|
The Registrant’s Amended and Restated 2000 Equity Incentive Plan.
|
|
S-8
|
|
333-174200
|
|
99.1
|
|
5/13/2011
|
|
|
10.12*
|
|
Form of Incentive Stock Award Agreement under the Registrant’s Amended and Restated 2000 Equity Incentive Plan.
|
|
10-Q
|
|
001-10606
|
|
10.02
|
|
10/28/2011
|
|
|
10.13*
|
|
Form of Restricted Stock Unit Award Agreement under the Registrant’s Amended and Restated 2000 Equity Incentive Plan.
|
|
10-Q
|
|
001-10606
|
|
10.03
|
|
10/28/2011
|
|
|
10.14*
|
|
Form of Stock Option Agreement under the Registrant’s Amended and Restated 2000 Equity Incentive Plan.
|
|
10-Q
|
|
001-10606
|
|
10.04
|
|
10/28/2011
|
|
|
10.15*
|
|
The Registrant's Omnibus Equity Incentive Plan, as amended and restated.
|
|
S-8
|
|
333-204278
|
|
99.01
|
|
5/18/2015
|
|
|
10.16*
|
|
Form of Incentive Stock Award Agreement for Non-Executive Employees and Consultants, as currently in effect under the Registrant’s Omnibus Equity Incentive Plan.
|
|
S-8
|
|
333-195771
|
|
99.02
|
|
5/7/2014
|
|
|
10.17*
|
|
Form of Restricted Stock Unit Agreement for Non-Executive Employees and Consultants, as currently in effect under the Registrant’s Omnibus Equity Incentive Plan.
|
|
S-8
|
|
333-195771
|
|
99.03
|
|
5/7/2014
|
|
|
10.18*
|
|
Form of Stock Option Agreement for Non-Executive Employees and Consultants, as currently in effect under the Registrant’s Omnibus Equity Incentive Plan.
|
|
S-8
|
|
333-195771
|
|
99.04
|
|
5/7/2014
|
|
|
10.19*
|
|
Form of Incentive Stock Award Agreement for Executives, as currently in effect under the Registrant’s Omnibus Equity Incentive Plan.
|
|
S-8
|
|
333-195771
|
|
99.05
|
|
5/7/2014
|
|
|
10.20*
|
|
Form of Restricted Stock Unit Agreement for Executives, as currently in effect under the Registrant’s Omnibus Equity Incentive Plan.
|
|
S-8
|
|
333-195771
|
|
99.06
|
|
5/7/2014
|
|
|
10.21*
|
|
Form of Stock Option Agreement for Executives, as currently in effect under the Registrant’s Omnibus Equity Incentive Plan.
|
|
S-8
|
|
333-195771
|
|
99.07
|
|
5/7/2014
|
|
|
10.22*
|
|
The Registrant’s Amended and Restated Employee Stock Purchase Plan.
|
|
S-8
|
|
333-188449
|
|
99.01
|
|
5/8/2013
|
|
|
10.23*
|
|
The Registrant’s 1996 Deferred Compensation Venture Investment Plan, as amended and restated effective January 1, 2001.
|
|
10-K
|
|
001-10606
|
|
10.09
|
|
3/12/2002
|
|
|
10.24*
|
|
The Registrant’s 2002 Deferred Compensation Venture Investment Plan, as amended.
|
|
10-Q
|
|
001-10606
|
|
10.32
|
|
8/10/2004
|
|
|
10.25*
|
|
The Registrant’s 1994 Deferred Compensation Plan, as amended and restated effective November 20, 2003 (409A Grandfathered Plan).
|
|
10-K
|
|
001-10606
|
|
10.1
|
|
2/26/2008
|
|
|
10.26*
|
|
The Registrant’s 2009 Deferred Compensation Plan.
|
|
10-K
|
|
001-10606
|
|
10.13
|
|
2/26/2008
|
|
|
10.27*
|
|
Amendments Number One, Two and Three of the Registrant’s 2009 Deferred Compensation Plan.
|
|
|
|
|
|
|
|
|
|
X
|
10.28*
|
|
The Senior Executive Bonus Plan.
|
|
|
|
|
|
|
|
|
|
X
|
10.29*
|
|
Director Medical and Prescription Benefits Coverage Reimbursement Plan.
|
|
10-Q
|
|
001-10606
|
|
10.02
|
|
4/29/2011
|
|
|
10.30
|
|
Chip Estimate Corporation 2003 Stock Option Plan.
|
|
S-8
|
|
333-149877
|
|
99.1
|
|
3/24/2008
|
|
|
10.31
|
|
Altos Design Automation, Inc. 2006 Stock Plan, as amended December 23, 2009.
|
|
S-8
|
|
333-174202
|
|
99.1
|
|
5/13/2011
|
|
|
10.32
|
|
Tensilica, Inc. 2007 Stock Incentive Plan.
|
|
S-8
|
|
333-188452
|
|
99.01
|
|
5/8/2013
|
|
|
10.33
|
|
C2 Design Automation (d/b/a/ Forte Design Systems) 2010 Stock Option Plan.
|
|
S-8
|
|
333-194102
|
|
99.01
|
|
2/24/2014
|
|
|
10.34
|
|
Jasper Design Automation, Inc. 2011 Stock Incentive Plan.
|
|
S-8
|
|
333-197579
|
|
99.01
|
|
7/23/2014
|
|
|
10.35
|
|
Form of Incentive Stock Award Agreement under the Jasper Design Automation, Inc. 2011 Stock Incentive Plan.
|
|
S-8
|
|
333-197579
|
|
99.02
|
|
7/23/2014
|
|
|
10.36
|
|
Form of Stock Option Agreement under the Jasper Design Automation, Inc. 2011 Stock Incentive Plan.
|
|
S-8
|
|
333-197579
|
|
99.03
|
|
7/23/2014
|
|
|
10.37*
|
|
Form of Indemnity Agreement between the Registrant and its directors and executive officers, as amended and restated.
|
|
10-Q
|
|
001-10606
|
|
10.01
|
|
12/11/2008
|
|
|
10.38*
|
|
Employment Agreement, effective as of July 29, 2008, between the Registrant and James J. Cowie.
|
|
10-K
|
|
001-10606
|
|
10.92
|
|
3/2/2009
|
|
|
10.39*
|
|
Employment Agreement, effective as of January 8, 2009, between the Registrant and Lip-Bu Tan.
|
|
10-K
|
|
001-10606
|
|
10.93
|
|
3/2/2009
|
|
|
10.40*
|
|
Employment Agreement, effective as of February 23, 2009, between the Registrant and Chi-Ping Hsu.
|
|
10-K
|
|
001-10606
|
|
10.95
|
|
3/2/2009
|
|
|
10.41*
|
|
Employment Agreement, effective as of February 23, 2009, between the Registrant and Nimish H. Modi.
|
|
10-K
|
|
001-10606
|
|
10.96
|
|
3/2/2009
|
|
|
10.42*
|
|
Form of First Amendment to Employment Agreement between the Registrant and the Registrant’s named executive officers.
|
|
10-Q
|
|
001-10606
|
|
10.02
|
|
7/31/2009
|
|
|
10.43*
|
|
Form of Second Amendment to Employment Agreement between the Registrant and the Registrant’s named executive officers.
|
|
10-K
|
|
001-10606
|
|
10.94
|
|
2/26/2010
|
|
|
10.44*
|
|
Second Amendment to Employment Agreement, effective as of March 1, 2010, between the Registrant and Lip-Bu Tan.
|
|
10-K
|
|
001-10606
|
|
10.95
|
|
2/26/2010
|
|
|
10.45*
|
|
Employment Agreement, effective as of October 21, 2011, between the Registrant and Geoffrey G. Ribar.
|
|
10-K
|
|
001-10606
|
|
10.77
|
|
2/24/2012
|
|
|
10.46*
|
|
Employment Agreement, effective as of September 20, 2012, between the Registrant and Thomas P. Beckley.
|
|
10-K
|
|
000-15867
|
|
10.44
|
|
2/20/2014
|
|
|
10.47*
|
|
Employment Agreement, effective as of March 16, 2015, between the Registrant and Anirudh Devgan.
|
|
10-Q
|
|
000-15867
|
|
10.01
|
|
4/27/2015
|
|
|
10.48*
|
|
Executive Transition and Release Agreement, dated October 28, 2015, between the Registrant and Charlie Huang.
|
|
8-K
|
|
000-15867
|
|
10.01
|
|
10/29/2015
|
|
|
10.49*
|
|
Letter, dated September 1, 2015, between the Registrant and Neil Zaman.
|
|
|
|
|
|
|
|
|
|
X
|
10.50
|
|
Credit Agreement, dated as of December 12, 2012, by and among the Registrant, certain subsidiaries of the Registrant, Bank of America, N.A. and other lenders party thereto.
|
|
8-K
|
|
000-15867
|
|
10.01
|
|
12/13/2012
|
|
|
10.51
|
|
First Amendment to Credit Agreement, dated as of September 19, 2014, by and among the Registrant, Bank of America, N.A. and other lenders party thereto.
|
|
8-K
|
|
000-15867
|
|
10.01
|
|
9/22/2014
|
|
|
10.52
|
|
Term Loan Agreement, dated as of January 28, 2016, by and among the Registrant, J.P. Morgan Securities LLC, Merrill Lynch, Pierce, Fenner & Smith Incorporated, JPMorgan Chase Bank, N.A., and other lenders party thereto.
|
|
8-K
|
|
000-15867
|
|
10.01
|
|
2/3/2016
|
|
|
21.01
|
|
Subsidiaries of the Registrant.
|
|
|
|
|
|
|
|
|
|
X
|
23.01
|
|
Independent Registered Public Accounting Firm’s Consent.
|
|
|
|
|
|
|
|
|
|
X
|
31.01
|
|
Certification of the Registrant’s Chief Executive Officer, Lip-Bu Tan, pursuant to Rule 13a-14 of the Securities Exchange Act of 1934.
|
|
|
|
|
|
|
|
|
|
X
|
31.02
|
|
Certification of the Registrant’s Chief Financial Officer, Geoffrey G. Ribar, pursuant to Rule 13a-14 of the Securities Exchange Act of 1934.
|
|
|
|
|
|
|
|
|
|
X
|
32.01
|
|
Certification of the Registrant’s Chief Executive Officer, Lip-Bu Tan, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
|
|
|
|
|
|
|
|
|
X
|
32.02
|
|
Certification of the Registrant’s Chief Financial Officer, Geoffrey G. Ribar, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
|
|
|
|
|
|
|
|
|
X
|
101.INS
|
|
XBRL Instance Document.
|
|
|
|
|
|
|
|
|
|
X
|
101.SCH
|
|
XBRL Taxonomy Extension Schema Document.
|
|
|
|
|
|
|
|
|
|
X
|
101.CAL
|
|
XBRL Taxonomy Extension Calculation Linkbase Document.
|
|
|
|
|
|
|
|
|
|
X
|
101.DEF
|
|
XBRL Taxonomy Extension Definition Linkbase Document.
|
|
|
|
|
|
|
|
|
|
X
|
101.LAB
|
|
XBRL Taxonomy Extension Label Linkbase Document.
|
|
|
|
|
|
|
|
|
|
X
|
101.PRE
|
|
XBRL Taxonomy Extension Presentation Linkbase Document.
|
|
|
|
|
|
|
|
|
|
X
|
|
1.
|
Section 1.1 shall be revised by adding the following to the end thereof:
|
1.
|
Section 3.4 of the Plan shall be revised by adding the following to the end of the first paragraph thereof:
|
1.
|
Purpose.
|
2.
|
Eligibility.
|
3.
|
Administration of the Plan.
|
4.
|
Performance Bonus Amounts.
|
(i)
|
The relevant performance criteria shall include, either individually or in combination, applied to the Company as a whole or to individual units thereof, and measured either absolutely or relative to a designated group of companies or relative to a pre-established target or a previous year’s results (and in each case as specified during the Applicable Period, on a GAAP or non-GAAP basis, if applicable): (a) cash flow (including measures of operating or free cash flow), (b) earnings per share (diluted or basic), (c) earnings per share from continuing operations, (d) earnings (including but not limited to earnings before interest, taxes, depreciation and amortization), (e) return on equity, (f) total stockholder return, (g) return on capital, (h) return on assets or net assets, (i) revenue or revenue growth, (j) income or net income, (k) operating income or net operating income, (l) operating profit or net operating profit, (m) operating margin, (n) return on operating revenue, (o) market share, (p) customer loyalty or satisfaction as measured by a customer loyalty or satisfaction index determined by an independent consultant or expert in measuring such matters, (q) return on investment, (r) stock price, (s) market capitalization, (t) cash from operations, (u) product innovation or release schedule, (v) capital expenditure , (w) working capital, (x) cost of capital, (y) cost reductions, (z) bookings and segments of bookings such as net product bookings, (aa) market penetration, and (bb) technology development or proliferation. With respect to Executives who are not “covered employees” within the meaning of Section 162(m) of the Code and who, in the Compensation Committee’s judgment, are not likely to be covered employees at any time during the applicable performance period or during any period in which an award may be paid following a performance period, the performance criterion established for the performance period may consist of any objective or subjective Company-wide, unit or individual measures, whether or not listed herein.
|
(ii)
|
To the extent consistent with Section 162(m) of the Code, the Compensation Committee (A) may appropriately adjust any evaluation of performance under a performance criteria to eliminate the effects of charges for restructurings, discontinued operations, extraordinary items and all items of gain, loss or expense determined to be extraordinary or unusual in nature or related to the disposal of a segment of a business or related to a change in accounting principle all as determined in accordance with the applicable accounting provisions, as well as the cumulative effect of accounting changes, in each case as determined in accordance with generally accepted accounting principles or identified in the Company’s financial statements or notes to the financial statements, and (B) may appropriately adjust any evaluation of performance under a performance criteria to exclude any of the following events that occurs during a performance period: (i) asset write-downs, (ii) litigation, claims, judgments or settlements, (iii) the effect of changes in tax law or other such laws or provisions affecting reported results, (iv) accruals for reorganization and restructuring programs and (v) accruals of any amounts for payment under this Plan or any other compensation arrangement maintained by the Company.
|
(iii)
|
As determined by the Compensation Committee, any given performance criterion may be measured over all or part of the fiscal year. During the Applicable Period, the Compensation Committee must identify in writing the target bonus, and the selected performance criteria and targets. If for any fiscal year the Compensation Committee determines to measure the performance criterion set forth in Section 4(i) over less than the entire fiscal year, then the performance bonus for the fiscal year shall be the bonus calculated for such short performance period or, if more than one performance period per fiscal year is involved, then the sum of the bonuses calculated separately for each short performance period ending with or within the fiscal year.
|
(iv)
|
The Compensation Committee may in its discretion direct that any performance bonus be reduced below the amount as calculated above or to decide that no payment shall be made. Further, the Compensation Committee may in its discretion increase the amount of compensation otherwise payable to any Executive upon satisfaction of the designated targets if such Executive is not covered by Section 162(m) of the Code.
|
5.
|
The Payment of Bonuses.
|
6.
|
Amendment and Termination.
|
7.
|
Cadence Design Systems, Inc. Clawback Policy.
|
8.
|
Section 409A of the Code.
|
9.
|
No Right to Employment, Reelection or Continued Service.
|
10.
|
Unfunded Plan.
|
11.
|
Governing Law.
|
Azuro, Inc.
|
|
Delaware, U.S.A.
|
Beijing Cadence Electronics Technology Company Limited
|
|
People’s Republic of China
|
Beijing Cadence Information Technology Co., Ltd.
|
|
People's Republic of China
|
C2 Design Automation (d/b/a Forte Design Systems)
|
|
California, U.S.A.
|
Cadence AMS Design India Private Limited
|
|
India
|
Cadence Design (Israel) II Ltd.
|
|
Israel
|
Cadence Design Enablement
|
|
Ireland
|
Cadence Design Systems (Canada) Ltd.
|
|
Canada
|
Cadence Design Systems (Cyprus) Ltd.
|
|
Cyprus
|
Cadence Design Systems (India) Private Limited
|
|
India
|
Cadence Design Systems (Ireland) Limited
|
|
Ireland
|
Cadence Design Systems (Israel) Ltd.
|
|
Israel
|
Cadence Design Systems (Japan) B.V.
|
|
The Netherlands
|
Cadence Design Systems (S) Pte Ltd.
|
|
Singapore
|
Cadence Design Systems (Taiwan) B.V.
|
|
The Netherlands
|
Cadence Design Systems A.B.
|
|
Sweden
|
Cadence Design Systems Asia Ltd.
|
|
Hong Kong
|
Cadence Design Systems B.V.
|
|
The Netherlands
|
Cadence Design Systems do Brasil Microeletronica Ltda.
|
|
Brazil
|
Cadence Design Systems GmbH
|
|
Germany
|
Cadence Design Systems I B.V.
|
|
The Netherlands
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Cadence Design Systems Kft.
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Hungary
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Cadence Design Systems Leasing, Inc.
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Delaware, U.S.A.
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Cadence Design Systems Limited
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United Kingdom
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Cadence Design Systems LLC
|
|
Russia
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Cadence Design Systems Management (Shanghai) Ltd.
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People’s Republic of China
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Cadence Design Systems S.A.S.
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France
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Cadence Design Systems S.r.l.
|
|
Italy
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Cadence Group
|
|
Ireland
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Cadence International (Cyprus) Ltd.
|
|
Cyprus
|
Cadence International Ltd.
|
|
Ireland
|
Cadence Korea Ltd.
|
|
Korea
|
Cadence Netherlands B.V.
|
|
The Netherlands
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Cadence Taiwan, Inc.
|
|
Taiwan
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Cadence Technology Ltd.
|
|
Ireland
|
Cadence U.S., Inc.
|
|
Delaware, U.S.A.
|
Castlewilder
|
|
Ireland
|
Castlewilder Global
|
|
Ireland
|
Chip Estimate Corporation
|
|
Delaware, U.S.A.
|
Daffodil Acquisition II, Inc.
|
|
Delaware, U.S.A.
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Denali Design Systems Private Ltd.
|
|
India
|
Denali Software Kabushiki Kaisha
|
|
Japan
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Denali Software, LLC
|
|
California, U.S.A.
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Forte Design Systems, K.K.
|
|
Japan
|
Gardenia MJM II
|
|
Mauritius
|
Jasper Design Automation, A.B.
|
|
Sweden
|
Jasper Design Automation, LLC
|
|
California, U.S.A.
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Jasper Holdings Ltd.
|
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Cayman Islands
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Quickturn Design Systems, Inc.
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Delaware, U.S.A.
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Shanghai Cadence Electronics Technology Co., Ltd.
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People’s Republic of China
|
Sigrity, Inc.
|
|
California, U.S.A.
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Tality Canada Corporation
|
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Canada
|
Taray, Inc.
|
|
California, U.S.A.
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Telos Venture Partners III, L.P.
|
|
Delaware, U.S.A.
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Tensilica Technologies India Private Limited
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India
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Tensilica, LLC
|
|
Delaware, U.S.A.
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Tundra Holdings, Inc.
|
|
Delaware, U.S.A.
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TVP I LLC
|
|
Delaware, U.S.A.
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TVP II LLC
|
|
Delaware, U.S.A.
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TVP III LLC
|
|
Delaware, U.S.A.
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1.
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I have reviewed this Annual Report on Form 10-K of Cadence Design Systems, Inc.;
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2.
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Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
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3.
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Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
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4.
|
The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
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(d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
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5.
|
The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
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By:
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|
/s/ Lip-Bu Tan
|
|
|
|
Lip-Bu Tan
|
|
|
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President and Chief Executive Officer
|
|
|
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(Principal Executive Officer)
|
|
1.
|
I have reviewed this Annual Report on Form 10-K of Cadence Design Systems, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
(a)
|
Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
(b)
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
(c)
|
Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
|
(d)
|
Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
|
5.
|
The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
(a)
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
|
(b)
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.
|
By:
|
|
/s/ Geoffrey G. Ribar
|
|
|
|
Geoffrey G. Ribar
|
|
|
|
Senior Vice President and Chief Financial Officer
|
|
|
|
(Principal Accounting and Financial Officer)
|
|
1.
|
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
2.
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
|
|
/s/ Lip-Bu Tan
|
|
|
|
Lip-Bu Tan
|
|
|
|
President and Chief Executive Officer
|
|
|
|
(Principal Executive Officer)
|
|
|
|
Date:
|
February 18, 2016
|
1.
|
The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
2.
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
|
|
/s/ Geoffrey G. Ribar
|
|
|
|
Geoffrey G. Ribar
|
|
|
|
Senior Vice President and Chief Financial Officer
|
|
|
|
(Principal Accounting and Financial Officer)
|
|
|
|
Date:
|
February 18, 2016
|