China top 100 developers July contract sales 211.2 billion yuan: CRIC

China top 100 developers July contract sales 211.2 billion yuan: CRIC

San Jose, California-based Cadence Design Systems (CDNS.O) is expected to pay over $100 million to the U.S. government as part of a deal to resolve an investigation into its sales of chip design products to a Chinese military university, according to two sources familiar with the matter [1]. The settlement discussions between Cadence and the U.S. began in December and are nearing resolution as the U.S. and China engage in new trade talks.

Cadence is accused of illegally selling its chip design technology to front companies representing China's National University of Defense Technology (NUDT). NUDT's supercomputers are believed to support nuclear explosive simulation and military simulation activities. The U.S. Commerce Department has restricted shipments to NUDT since 2015, citing national security concerns.

The potential deal comes as the U.S. and China meet for new trade talks, demonstrating the U.S.'s commitment to enforcing export controls on China, despite ongoing negotiations. Cadence's sales to NUDT through the CSCC or Central South CAD Center alias occurred about 50 times between 2015 and 2020. The deal is not yet finalized.

Cadence, known for its electronic computer-aided design software, has been under investigation for over four years. The company received subpoenas from the U.S. Commerce Department and the Justice Department in 2021 and 2023, respectively, over its business activity in China. Several employees at a Chinese subsidiary of Cadence were terminated over the sales.

Entities placed on the restricted trade list, known as the entity list, are prohibited from receiving goods and technology from U.S. companies without licenses from the Commerce Department, which are generally denied. Cadence will report its second-quarter financial results on Monday, July 2, 2025, at 2 p.m. Pacific Time.

References:
[1] https://www.reuters.com/world/china/cadence-nears-deal-pay-over-100-million-us-china-sales-sources-say-2025-07-28/