What Cadence Design Systems, Inc. told the SEC could break it.

On July 27, 2025, Cadence settled with BIS and the DOJ over export-control violations that occurred 2015-2021, primarily involving a Cadence subsidiary's sales of products/services valued at $45.3 million to a China customer and subsequent transfer of the involved technology — illustrating material export-compliance exposure.

“on July 27, 2025, we reached a settlement with each of BIS and the U.S. Department of Justice ("DOJ") that resolved matters relating to export control violations that occurred between 2015 and 2021 primarily involving sales initiated by a Cadence subsidiary of products and services valued at $45.3 million in total over that period to a customer in China”

On May 23, 2025, BIS required a license for export/re-export/in-country transfer of Cadence's EDA software and technology (ECCNs 3D991/3E991) when a party is in China or a Chinese military end user (rescinded July 2, 2025); BIS later extended Entity/MEU-List restrictions to 50%-owned affiliates (Sept 29, 2025, with a one-year suspension), and China's 2030 semiconductor-leadership policy raises competitive and access risk.

“on May 23, 2025, BIS informed us that a license was required for the export, re-export or in-country transfer of EDA software and technology classified under Export Control Classification Numbers (ECCNs) 3D991 and 3E991 on the Commerce Control List (“EDA Software and Technology”) when a party to the transaction is located in China or is a Chinese "military end user"”

Cadence depends on a single supplier or a limited number of suppliers for certain hardware components and on contract manufacturers to produce its hardware (emulation) products, making it vulnerable to supply disruption and price fluctuation.

“We depend on a single supplier or a limited number of suppliers for certain hardware components and contract manufacturers for production of our hardware products, making us vulnerable to supply disruption and price fluctuation.”

Cadence outsources substantially all of its infrastructure and relies on third-party data-center providers; disruption in their operations, limitations on capacity, or interference with Cadence's use could adversely affect its cloud/IP services and business.

“We rely on third-party data center providers and any disruption in the operations of these third-party providers, limitations on capacity or interference with our use could adversely affect our business, financial condition and results of operations. We outsource substantially all of the infrastructure”