EDA Software

Hey friend, pull up a chair. Looking at our run-rate, here's how I see the next two quarters shaping up. Revenue keeps grinding higher — call it mid-single-digit sequential growth as our Palladium and hardware-assisted verification platforms stay sold-out into the AI compute build-out, and software renewals layer on top of that install base quarter after quarter. Two assumptions I'm signing my name to: first, IP and system design stay healthy because chiplet adoption means more verification surface per design, not less — every die needs its own signoff story. Second, gross margin holds in the mid-85s even as we carry heavier hardware mix, because software dollars keep compounding against that fixed cost base. Net income trends up because operating leverage finally catches up to the revenue ramp — we're past the heaviest R&D investment cycle and the P&L starts converting. Top risk? A pullback in custom-IC tape-outs. If AI capex digests and our chip customers throttle design starts, verification signoffs slow right alongside them. That's the cost of truth in this business — when chips pause, so do we.