Revenue during the quarter grew 6.33 percent to $468.98 million from $441.08 million in the previous year period. Gross margin for the quarter contracted 241 basis points over the previous year period to 83.78 percent. Total expenses were 88.67 percent of quarterly revenues, up from 81.45 percent for the same period last year. That has resulted in a contraction of 723 basis points in operating margin to 11.33 percent.

Operating income for the quarter was $53.12 million, compared with $81.84 million in the previous year period.

"Through focus on innovation and execution, Cadence again delivered strong results for both the fourth quarter and fiscal 2016. Core EDA is foundational to our System Design Enablement (SDE) strategy, and digital and signoff revenue grew 9 percent for the year on strong customer adoption, while in System Integration, Palladium® Z1 had a phenomenal year with hardware revenue surging to a record high," said Lip-Bu Tan, president and chief executive officer. "SDE is expanding our reach with systems companies and into segments like automotive, aerospace and defense, where we had key wins with important customers in 2016."

For financial year 2017, Cadence Design Systems, Inc. projects revenue to be in the range of $470 million to $480 million. The company expects net income to be in the range of $53 million to $59 million. It forecasts adjusted net income to be in the range of $83 million to $89 million. The company forecasts diluted earnings per share to be in the range of $0.19 to $0.21. The company forecasts diluted earnings per share to be in the range of $0.30 to $0.32 on adjusted basis.

For the first-quarter 2017, Cadence Design Systems, Inc. projects revenue to be in the range of $1,900 million to $1,950 million. The company expects net income to be in the range of $248 million to $276 million. It forecasts adjusted net income to be in the range of $368 million to $396 million. The company forecasts diluted earnings per share to be in the range of $0.89 to $0.99. On an adjusted basis, the company forecasts diluted earnings per share to be in the range of $1.32 to $1.42.

Cash flow from investing activities was $1.36 million from investing activities during the year as against cash outgo of $44.50 million in the last year.

The company has spent $592.70 million cash to carry out financing activities during the year as against cash outgo of $626.31 million in the last year period.

Cash and cash equivalents stood at $465.23 million as on Dec. 31, 2016, down 24.56 percent or $151.45 million from $616.69 million on Jan. 02, 2016.

Debt increases substantially
Cadence Design Systems, Inc. has witnessed an increase in total debt over the last one year. It stood at $693.49 million as on Dec. 31, 2016, up 102.01 percent or $350.21 million from $343.29 million on Jan. 02, 2016. Short-term debt stood at $50 million as on Dec. 31, 2016. Total debt was 33.07 percent of total assets as on Dec. 31, 2016, compared with 14.60 percent on Jan. 02, 2016. Debt to equity ratio was at 0.93 as on Dec. 31, 2016, up from 0.25 as on Jan. 02, 2016. Interest coverage ratio deteriorated to 8.35 for the quarter from 19.49 for the same period last year.