Cadence Design Systems, Inc. reported unaudited consolidated earnings results for the fourth quarter and year ended December 30, 2017. For the quarter, the company reported total revenue of $501,722,000 compared to $468,980,000 a year ago. Income from operations was $81,278,000 compared to $53,117,000 a year ago. Income before provision for income taxes was $76,951,000 compared to $52,234,000 a year ago. Net loss was $14,442,000 or $0.05 per diluted share compared to income of $38,477,000 or $0.14 per diluted share a year ago. For the fourth quarter of 2017, non-GAAP net income was $111 million, or $0.39 per share on a diluted basis, as compared to net income of $95 million, or $0.34 per share on a diluted basis, for the same period in 2016. Operating cash flow was $127 million.

For the full year, the company reported total revenue of $1,943,032,000 compared to $1,816,083,000 a year ago. Income from operations was $323,955,000 compared to $244,901,000 a year ago. Income before provision for income taxes was $315,046,000 compared to $237,153,000 a year ago. Net income was $204,101,000 or $0.73 per diluted share compared to $203,086,000 or $0.70 per diluted share a year ago. Net cash provided by operating activities was $470,740,000 compared to $444,879,000 a year ago. Purchases of property, plant and equipment was $57,901,000 compared to $53,712,000 a year ago. Using the non-GAAP measure, net income for 2017 was $393 million or $1.40 per share on a diluted basis, as compared to non-GAAP net income of $351 million or $1.21 per share on a diluted basis for 2016.

For the first quarter of 2018, the company expects total revenue in the range of $500 million to $510 million. First quarter GAAP net income per diluted share is expected to be in the range of $0.20 to $0.22. Net income per diluted share using the non-GAAP measure is expected to be in the range of $0.36 to $0.38. It expects net income on a GAAP basis of $58 to $64 million and net income on a non-GAAP basis of $103 to $109 million for the first quarter ending March 31, 2018. The company expects non-GAAP operating margins of approximately 26%.

For 2018, the company expects total revenue in the range of $2.015 billion to $2.055 billion. On a GAAP basis, net income per diluted share for 2018 is expected to be in the range of $0.80 to $0.90. Using the non-GAAP measure, net income per diluted share for 2018 is expected to be in the range of $1.50 to $1.60. For 2018, the company is forecasting a non-GAAP income tax rate of 16%, down from 23% used in fiscal 2017, primarily resulting from the tax rate reduction. For comparison purposes, the company expects the outlook for 2018 on the prior ASC Topic 605 basis to be as follows: revenue in the range of $2.055 billion to $2.095 billion, GAAP net income per dilute share in the range of $0.93 to $1.03 and non-GAAP net income per diluted share in the range of $1.62 to $1.72. It expects net income on a GAAP basis of $226 to $254 million and net income on a non-GAAP basis of $426 to $454 million for the year ending December 29, 2018. The company will continue to improve operating profitability in 2018 expects operating margin of 28.4% for 2018 under the old rules, which is up from 27.5% achieved in 2017. The company expects non-GAAP operating margin of approximately 27% under the new rules. Adjusting for the difference in revenue, this implies a non-GAAP operating margin of 28.4% under the old rules. Further the company expects operating cash flow to be in the range of $480 million to $530 million.