Cadence Design Systems Acquires Arm's Artisan IP Business, Analysts Project 6.53% Upside

Cadence Design Systems has acquired Arm Holdings' Artisan foundation IP business, enhancing its capabilities in standard cell libraries, memory compilers, and GPIOs. Analysts project a potential upside of 6.53% for Cadence's stock in the next year and rate it "Outperform". The acquisition is expected to have a limited impact on this year's revenue and earnings.

Cadence Design Systems, Inc. (CDNS) has finalized its acquisition of Arm's Artisan foundation IP business, which includes standard cell libraries, memory compilers, and GPIOs optimized for advanced process nodes at top foundries [1]. This strategic move aims to bolster Cadence's design IP portfolio, complementing its existing protocol, interface, memory interface, and SerDes IP offerings. The acquisition aligns with Cadence's strategy to accelerate customers' time to market while optimizing cost, power, and performance in SoC designs using advanced foundry processes [1].

Analysts project a potential upside of 6.53% for Cadence's stock in the next year and rate it "Outperform" [2]. Despite the acquisition, the company expects it to have an immaterial impact on this year's revenue and earnings [1]. The acquisition is part of Cadence's broader strategy to establish itself as a key force in the AI and semiconductor design ecosystem, leveraging innovations such as the Cerebrus AI Studio, Millennium M2000 AI supercomputer, and strategic partnerships with other industry titans [2].

Cadence Design Systems, valued at a market cap of $94.1 billion, has outperformed the broader market, with shares gaining 22.8% over the past year, compared to the S&P 500 Index's 14.3% rise [2]. The company's Q2 2025 results were stellar, with revenue surging 20% year-over-year to $1.3 billion and non-GAAP EPS reaching $1.65, exceeding forecasts [2]. For the current fiscal year, analysts expect CDNS' EPS to grow 21.6% year over year to $5.47 [2].

Kayne Anderson Rudnick Investment Management LLC, one of the institutional investors, reduced its stake in Cadence Design Systems by 3.5% in the first quarter of 2025 [3]. Despite this reduction, institutional investors own 84.85% of the company's stock [3]. Cadence Design Systems' stock has been trading at $344.98, with a 0.28% increase on the NasdaqGS [1].

References:
[1] https://www.nasdaq.com/articles/cadence-completes-acquisition-arm-artisan-foundation-ip-business
[2] https://finance.yahoo.com/news/cadence-design-stock-analyst-estimates-123636398.html
[3] https://www.marketbeat.com/instant-alerts/filing-kayne-anderson-rudnick-investment-management-llc-cuts-stock-position-in-cadence-design-systems-inc-cdns-2025-08-25/