Cadence CEO argues company is undervalued amid AI boom

Everyone knows Nvidia. Everyone knows TSMC. But the company that makes the software those chip giants use to actually design their processors? That one’s been trading at a discount, according to its own CEO. Cadence Design Systems CEO Anirudh Devgan has made the case that his company got unfairly left behind in the AI-driven rally that lifted much of the semiconductor industry. For a business that provides the essential design tools for virtually every advanced chip hitting the market, that’s a bold but defensible argument. The picks-and-shovels play hiding in plain sight Cadence occupies a peculiar niche in the semiconductor food chain. The company doesn’t make chips. It makes the electronic design automation (EDA) software that chip designers use to architect increasingly complex processors, from AI accelerators to systems-on-chip. Major tech firms including Google and Amazon rely on Cadence’s platform to design their custom silicon. As these hyperscalers pour billions into proprietary AI chips, the demand for sophisticated design tools scales right alongside. The company’s Q2 2026 revenue came in at $1.584 billion, edging past Wall Street expectations of $1.58 billion. Earlier i...