Cadence Strengthens Analysis Portfolio With Hexagon D&E Unit Buyout

Cadence Design Systems, Inc. CDNS has signed a definitive agreement to acquire the Design & Engineering (D&E) division of Hexagon AB, including its renowned MSC Software business, an industry pioneer in engineering simulation and analysis. The €2.7 billion deal, structured with 70% cash and 30% Cadence common stock, marks a significant step in advancing Cadence’s Intelligent System Design strategy. Pending regulatory approvals and customary closing conditions, the transaction is expected to be finalized in the first quarter of 2026.

By integrating Hexagon’s proven technology and expertise, Cadence will strengthen its System Design & Analysis portfolio and extend its presence in the multi-billion-dollar structural analysis market, building on its earlier acquisition of Beta CAE in 2024. Hexagon’s D&E division generated approximately $280 million in 2024 revenues and employs more than 1,100 experts worldwide in R&D, sales and support, with strong ecosystem partnerships.

What Does This Deal Offer?

The acquisition positions Cadence to deliver a unified end-to-end platform covering electromagnetics, electrothermal, CFD and now advanced structural analysis, an increasingly critical need as industries demand multiphysics simulations earlier in the design cycle. Hexagon’s D&E portfolio, led by flagship solutions MSC Nastran and Adams, is recognized globally as the gold standard for structural and multibody dynamics simulation. These tools are crucial for aerospace and automotive leaders where precision, performance and reliability are critical, and they are increasingly vital in emerging fields like robotics and physical AI, where accurate motion simulation is essential. Additional technologies in system dynamics, multiphysics analysis, metal forming and autonomous driving simulation will further enhance Cadence’s capabilities.

This acquisition will expand Cadence’s reach to top-tier aerospace and automotive clients, including Boeing, Lockheed Martin, BAE, Volkswagen, BMW and Toyota, who rely on Hexagon D&E’s solutions for mission-critical workflows that ensure structural integrity, vehicle dynamics and system reliability. This comes at a critical time as industries pivot toward electric vehicles, autonomous technologies and advanced materials.

Cadence Design Systems, Inc. Price and Consensus

Cadence Design Systems, Inc. price-consensus-chart | Cadence Design Systems, Inc. Quote

Cadence highlighted the significance of the deal, stating that incorporating Hexagon’s advanced simulation software will expand Cadence’s Intelligent System Design vision to encompass the full spectrum of physical behavior, from electromagnetics and fluids to structures and motion.

Its acquisition strategy has played a pivotal part in developing Cadence’s business in the last few years. To strengthen its IP business, Cadence signed a definitive agreement with Arm Holdings in April 2025, to acquire its Artisan foundation IP business. The acquisition includes a suite of standard cell libraries, memory compilers and general-purpose I/Os, all finely tuned for advanced process nodes at leading global foundries. In Januarry 2025, the company announced the buyout of Secure-IC, which will expand its IP portfolio, including interface, memory, AI and DSP solutions.

In June 2024, Cadence completed the acquisition of Switzerland-based BETA CAE Systems International AG, a leading provider of engineering simulation solutions. The deal will likely enhance Cadence's Intelligent System Design strategy by broadening its range of multiphysics system analysis offerings and helping Cadence enter the structural analysis sector. Other notable acquisitions include Invecas (January 2024), Intrinsix (2023), Pointwise (2021) and NUMECA (2021).

CDNS’ Zacks Rank & Stock Price Performance

CDNS currently has a Zacks Rank #3 (Hold). Shares of the company have soared 41.2% in the past year compared with the Zacks Computer-Software industry’s growth of 23.6%.

Stocks to Consider From the Computer Software Space

Some better-ranked stocks from the computer software space are Manhattan Associates, Inc. MANH, PTC Inc. PTC and Microsoft Corporation MSFT. MANH and PTC carry a Zacks Rank #1 (Strong Buy), while MSFT has a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Manhattan’s earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, with the average surprise being 17.84%. In the last reported quarter, MANH delive in the past year.PTC’s earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, with the average surprise being 23.18%. In the last reported quarter, PTC delivered an earningred an earnings surprise of 16.96%. Its shares have decreased 16.3% in the past year.

PTC’s earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, with the average surprise being 23.18%. In the last reported quarter, PTC delivered an earnings surprise of 34.43%. PTC shares have increased 29.4% over the past year.

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