Cadence's Troubles Impact Sector

SAN FRANCISCO - Semiconductor software developers paid the price across the board Thursday for Cadence Design System's(CDNS Quote) bearish revenue outlook, delivered Wednesday.

Mentor Graphics(MENT Quote) was recently off $1.08, or 11.8%, to $8.11, while Synopsys(SNPS Quote) was down $1.75, or 7.3%, to $22.29.

But it was Cadence that felt the most pain from the news, knocking the stock down $4.99, or 32.9%, to $10.17 Thursday. Cadence disclosed that revenue would come in about 27% below the Street's estimates.

Each company's outlook is somewhat affected by its mix of revenue. For instance, Cadence disclosed Thursday that 40% of its revenue will come from "turns," or revenue that is recognized up front in license renewal deals. Such deals are harder to close in a weak economy. ...