REVENUE (Tables)

6 Months Ended

Jun. 30, 2024

Revenue from Contract with Customer [Abstract]

Revenue from external customers by product category

The following table shows the percentage of revenue contributed by each of Cadence’s five product categories for the three and six months ended June 30, 2024 and June 30, 2023:


	Three Months Ended				Six Months Ended
	June 30, 2024		June 30, 2023		June 30, 2024		June 30, 2023
Custom Integrated Circuit (“IC”) Design and Simulation	21	%	22	%	21	%	21	%
Digital IC Design and Signoff	27	%	27	%	28	%	26	%
Functional Verification, including Emulation and Prototyping Hardware*	25	%	27	%	25	%	30	%
Intellectual Property (“IP”)	13	%	11	%	13	%	11	%
System Design and Analysis	14	%	13	%	13	%	12	%
Total	100	%	100	%	100	%	100	%

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* Includes immaterial amount of revenue accounted for under leasing arrangements.

Disaggregation of revenue

The following table shows the percentage of Cadence’s revenue that is classified as recurring or up-front for the three and six months ended June 30, 2024 and June 30, 2023:


	Three Months Ended				Six Months Ended
	June 30, 2024		June 30, 2023		June 30, 2024		June 30, 2023
Revenue recognized over time	85	%	82	%	86	%	79	%
Revenue from arrangements with non-cancelable commitments	3	%	3	%	3	%	3	%
Recurring revenue	88	%	85	%	89	%	82	%
Up-front revenue	12	%	15	%	11	%	18	%
Total	100	%	100	%	100	%	100	%

Contract balances

Cadence’s contract balances as of June 30, 2024 and December 31, 2023 were as follows:


	As of
	June 30, 2024		December 31, 2023

	(In thousands)

Contract assets	$	25,400	$	17,554
Deferred revenue	767,421		763,955