CDNSNEUTRAL

Gross Margin

85.4%

Higher than 90% of Technology sector peers

Updated 200h ago

Sector Performance

90th percentile

CDNS

85.4%

Sector Median

65.2%

Sector Avg

60.4%

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Deep Analysis

CDNS’s gross margin of 85.4% means that for every dollar of revenue, the company keeps 85.4 cents after subtracting the direct costs of producing its software and services — a measure of core profitability.

This is far above the sector median of 65.2%, placing CDNS in the 90th percentile among its technology peers, indicating it is one of the most efficient in converting revenue into gross profit. However, the year-over-year change, quarter-over-quarter change, and trend over the last eight quarters are all listed as N/A, so there is no recent historical data to confirm whether this high margin is stable, improving, or declining. The combination of an exceptionally high gross margin with no available trend data limits the ability to assess momentum or risk; the strong level alone is favorable but offers no forward-looking signal. This mixed picture aligns with the overall NEUTRAL verdict — the margin is superior but the absence of trend information prevents it from being either a bullish or bearish factor on its own.

Frequently Asked Questions

What does the Gross Margin tell investors about CDNS?

Gross margin reveals pricing power and cost structure. Software companies often sustain 70–80%; manufacturers typically 30–50%. Expansion is a bullish signal.

How is the Gross Margin calculated?

Gross Margin is calculated as: Gross Profit / Revenue.

How does CDNS's Gross Margin compare to its sector?

CDNS's Gross Margin of 85.4% compares to a Technology sector median of 65.2%, placing it in the 90th percentile.

Who are CDNS's closest peers by Gross Margin?

The closest Technology peers by Gross Margin include: ORCL (65.2%), MDB (72.2%), SAP (73.0%), LIF (77.3%), OKTA (77.8%).

The Formula

Gross Profit / Revenue

Why It Matters

Gross margin reveals pricing power and cost structure. Software companies often sustain 70–80%; manufacturers typically 30–50%. Expansion is a bullish signal.