Jim Cramer on AMD and Other Stocks

3. Cadence Design Systems, Inc. (NASDAQ:CDNS)

Number of Hedge Fund Holders: 64

Cramer likes Cadence Design Systems, Inc. (NASDAQ:CDNS) and commented that it reported surprising numbers in its recent earnings report.

“We got this unbelievable set of numbers last night from some outfit you haven’t heard of, but I studied pretty closely for the last 30 years, called Cadence Design Systems. An incredibly good semiconductor design software company goes arm in arm with Nvidia, it sent the whole group flying.”

Cadence Design (NASDAQ:CDNS) is a significant player in the global semiconductor industry, providing a comprehensive range of software, hardware, services, and reusable integrated circuit (IC) design blocks. On October 28, it announced its third-quarter results, showing accelerating growth and a positive outlook for the upcoming quarter.

During the third quarter, the company experienced a revenue increase of 19%, reaching $1.215 billion. It slightly exceeded market expectations, while non-GAAP earnings per share rose by 30.2% to $1.64, significantly surpassing analysts’ consensus forecasts. The growth marked a substantial improvement compared to the prior quarter, which had seen a 9% revenue increase.

A strong area of growth was observed in the system design and analysis segment, which reported a remarkable 47% increase. This surge shows heightened demand for AI-driven optimization and advanced modeling tools. Cadence Design’s (NASDAQ:CDNS) intellectual property (IP) business saw revenue growth of 59%, further highlighting the company’s strong position in this area. Another noteworthy aspect of the quarter was the performance of the Cadence.AI portfolio, which nearly tripled in revenue.