Cadence Design Swings to a Loss

SAN FRANCISCO -- As expected, Cadence Design Systems(CDNS Quote) reported a big first-quarter drop to both the top and bottom lines Wednesday.

The semiconductor-design software company had projected at the end of January that revenue would fall short of last year's performance.

The San Jose, Calif. company said Wednesday that revenue declined 21% to $287.2 million from $365.2 million a year ago. Analysts were expecting $284.3 million, according to Thomson Financial.

The company lost $18.7 million, or 7 cents a share, vs. posting earnings of $44.4 million, or 15 cents a share, in the year-ago period.

Excluding items, EPS was 4 cents. Analysts were expecting 5 cents.

Shares were down 29 cents, or 2.6%, to $10.95 in after-hours trading.

For the second quarter, the company projected revenue of $310 million to $320 million and EPS, less items, of 13 cents to 15 cents. Analysts were expecting $312.6 million and 15 cents a share, less items.

The company also named Kevin S. Palatnik as chief financial officer to succeed and report to William Porter, who was appointed to the newly created role of chief administrative officer.

As the chip industry forecasts slower growth, demand for design software and services has contracted at some suppliers. But Cadence competitors Synopsys(SNPS Quote) and Mentor Graphics(MENT Quote) both beat expectations when they reported earnings in February.

Stock in smaller rival Magma Design Automation(LAVA Quote) has fallen 22% in the past three months. It reports earnings May 1.