By Russ Henke on 3/28/2009 5:14 AM

 

SaaS, or Software as a Service, has been a topic in COFES blog circles in the past. See for example the Brian Seitz blog of 02/10/008 entitled, “Is SaaS the Killer App for the CAD Industry?” That blog entry excited some 14 comments that stretched out through November of 2008. If you’re interested, go to the BLOGS tab on this site, and scroll down the right hand margin until you get to the Brian Seitz URL.

Another article on SaaS that might be of interest appeared recently on EDAcafe.com by Sharon Tan of Gary Smith EDA, entitled, “SOFTWARE-AS-A-SERVICE IN EDA – TIME AGAIN?” If you have an interest, copy and paste the following URL into your browser:

http://www10.edacafe.com/goto.php?http://e2ma.net/go/1848739412/1691895/63020433/goto:http://www.garysmitheda.com/note_TimeAgain.html

A pdf version is available there as well. Enjoy!

 

By Russ Henke on 3/13/2009 4:56 AM

Headed for COFES2009 in Scottsdale, AZ in April? Bone up on the latest financial results of the leading Mechanical CAD and CAE (MCAD) Vendors, as well as the leading Electronics Design Automation and Intellectual Property (EDA and IP) Vendors, by reading the following three recent Commentaries: Commentary: Electronics IP Industry - A February 2009 Update http://www10.edacafe.com/nbc/articles/view_article.php?articleid=656383# Commentary: MCAD Industry View – A March 2009 Update http://www.mcadcafe.com/PDFs/MCAD_Commentary_4Q08.pdf Commentary: EDA Industry Update March 2009 -- What did the Last Quarter Bring? http://www10.edacafe.com/nbc/articles/view_article.php?articleid=665171 The basic format for each of these Commentaries is as follows: News Highlights are followed by the revenue & earnings performances of the selected group players for Q4 2008, and then vendor by vendor details. This is followed by the revenue and earnings performances for the calendar year and then for five years. Vendor...

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By Russ Henke on 3/6/2009 6:48 AM

We all found out on February 27, 2009 that the US economy at the end of last year actually contracted at a far faster rate than initially estimated, according to a US Bureau of Economic Analysis report. The decline in the country's gross domestic product in Q4 2008 was the worst since the 1982 recession. Output fell 6.2% at an annualized rate in the fourth quarter of 2008, revised downward from a previous estimate of a 3.8% decline. Today, more bad news was released by the US Labor Department. The nation's unemployment rate rose to 8.1% in February 2009, the highest since 1983, as employers chopped another 651,000 jobs. Both figures were (as usual) worse than analysts expected. And as predicted in this blog space on February 6, 2009, revised figures released today show even deeper payroll reductions in the prior two months: the economy lost 681,000 jobs in December 2008 and another 655,000 in January 2009. Since the recession began in December 2007, the economy has lost an incredible 4.4 million jobs....

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By Russ Henke on 2/28/2009 10:09 AM

In recent blog entries in this space, the impacts of the general US and worldwide economic collapse on Electronics IP Providers were discussed. For example, on January 22 and 30, 2009, recent financials were presented for a small EDA IP supplier (Virage Logic) located in Silicon Valley. Then on February 20, 2009, Internet access was published here to the latest overall financial reports & commentary on seven key Electronics IP Providers, just posted that day in EDAcafe.com: http://www10.edacafe.com/nbc/articles/view_article.php?articleid=656383 Electronics IP Providers form a subset of the overall Electronics Design Automation (EDA) software & services industry, the “CAD” of modern electronics devices and chips. The detailed saga of one of the BIG 3 EDA vendors (Cadence Design Systems) over the last six months was also updated here in a blog entry on February 22, 2009. But the worlds of MCAD and MCAE are also...

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By Russ Henke on 2/22/2009 8:25 AM

The ups and downs (mostly downs) of one of the Big 3 Electronics Design Automation (EDA) vendors Cadence Design Systems have been frequent topics in this blog space since the autumn of 2008. The last update occurred here on January 9, 2009, when it was announced that Cadence had given up its search for an outside CEO and had appointed Lip-Bu Tan as president and CEO the day before. Tan had been the interim vice chairman of the Board of Directors and member of the Interim Office of the Chief Executive. For the record, Cadence stock closed regular trading on January 08 at $4.12, up $0.09 or 2.23%. In after hours trading, the stock lost 2.36%, trading at $4.02, implying a Market Cap just north of $1 billion. In early February 2009, Cadence reported actual Q4 2008 revenue of $227 million, less than 50% of the revenue of $458 million reported for Q4 2007. On a GAAP basis, Cadence suffered a net loss of $1.64 billion, or minus $6.57 per share in Q4 2008, compared to net income of $120 million in Q4 2007, or plus $0.41 per share. After the Q4 2008 results were announced on February 4, Cadence shares closed at $3.65, although the shares rebounded the next day to close at $4.20 each. ...

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By Russ Henke on 2/20/2009 1:18 PM

On January 22 and January 30, 2009, related blog entries appeared in this space that discussed the impact of the general US economic collapse on a small EDA IP supplier (Virage Logic) located in Silicon Valley.

If those two January blog entries were of any interest to you, you may like to read the latest overall financial report & commentary on seven key Electronics IP Providers, posted in EDAcafe.com on February 20, 2009.

http://www10.edacafe.com/nbc/articles/view_article.php?articleid=656383

By Russ Henke on 2/11/2009 6:35 AM

As a welcome antidote to chronically depressing economic news, two recently-published articles caught the eye of this mechanical computer aided design (MCAD) veteran (1). Appearing within 10 days of each other, the two articles discussed progress in the often-esoteric world of 3D MCAD solid modeling. First, on January 26, 2009 in MCADcafe Weekly, Contributing Editor and CAD veteran Jeff Rowe published an extensive article entitled, “NX 6 – Synchronous Modeling Promotes Design Freedom.” In the article, Jeff reviewed user design and modeling experiences with Siemens PLM’s NX 6 software product. Then on February 4, 2009, Autodesk (San Rafael, CA) unveiled its plans for “Autodesk Inventor Fusion Technology” that promises to unite parametric, history-based modeling with direct, history-free modeling. More on this announcement below. Based in Plano, Texas, Siemens PLM had announced the pending release of its NX 6 digital product development software on May 20, 2008 in conjunction with its annual industry...

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By Russ Henke on 2/6/2009 6:57 AM

On February 3, 2009, The CAD Society announced that it had appointed an Interim President and interim Vice President to take the CAD Society forward into the new year. Rachael Dalton-Taggart, 20 year industry veteran and Director of Marketing with Lattice Technology, will be Interim President until later this year. Ken Feitz, 18 year industry veteran, and Marketing Manager at TransMagic Inc. will take on the roles of Vice President and Treasurer for the same term. The CAD Society was formed in 1990, as part of the NCGA (National Computer Graphics Association), and it split out on its own when the NCGA ended. Since then, the CAD Society has been best known for its annual awards recognizing the achievements of CAD industry leaders. Those awards have been presented at the annual COFES since 2000. Retiring President Mike McGrath commented on the change, "Rachael and Ken have both been actively assisting the CAD Society for some time now, and they have been responsible for several changes to the CAD Society...

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By Russ Henke on 2/6/2009 5:59 AM

The legacy lingers if not the man. Already 14 months old and counting, Bush 43’s second recession in 8 years dealt another body blow to the staggering US economy in January 2009.

The US labor department reported just this morning that US employers eliminated 598,000 more jobs in January, the most since 1974, and drove the US unemployment rate to 7.6%, further proof that the nation's job climate continues to deteriorate at an alarming pace with no end in sight.

The latest net total of actual job losses for January 2009 was far worse than the eye-popping figure of 524,000 that economists had been predicting. Job reductions in November and December also were deeper than previously reported, and no doubt January’s numbers will increase as well.

Think we need a Stimulus Bill passed quickly? Think tax cuts alone will do the trick?

By Russ Henke on 1/30/2009 5:39 AM

On January 22, 2009, a blog entry in this space discussed the impact of the general US economic collapse on a small EDA IP supplier (Virage Logic) located in Silicon Valley. We promised the following: “Virage Logic's management will announce first-quarter fiscal year 2009 results on Wednesday, January 28, 2009. We’ll keep an eye on them for ya.”Well, Virage Logic followed through and on January 28, 2009 did report its financial results for the first fiscal quarter ended December 31, 2008. Total revenue for the first quarter of fiscal 2009 was reported as $11.3 million, compared with $14.1 million for the first quarter of fiscal 2008 and $15.5 million for the fourth quarter of fiscal 2008. The $11.3 million was right in the middle of the revised revenue range estimated on December 30, 2008.As reported under US generally accepted accounting principles (GAAP), Virage Logic’s official net loss for the first quarter of fiscal 2009 was reported January 28 at $2.6 million, or ($0.11) per share, compared with net income...

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By Russ Henke on 1/26/2009 6:08 AM

For those who may not make it a regular practice to read Frank Rich’s New York Times op-ed piece every Sunday, please allow me to recommend it to your attention.

Yesterday’s Frank Rich column (“No Time for Poetry”) was especially important, as it contained a concise explanation of the challenge to all Americans (of all political stripes) that was inherent in President Obama’s Inaugural Address of January 20, 2009. It helps set the stage for the cooperation that will be required for us to pull ourselves out of the deep and dangerous economic quagmire of 2008 – 2009.

Copy and Paste this URL into your browser:

http://www.nytimes.com/2009/01/25/opinion/25rich.html?_r=1&th=&emc=th&pagewanted=print

By Russ Henke on 1/22/2009 7:13 AM

In past months, blog entries in this space have described the impact of the collapsing US and worldwide economy on relatively large Mechanical CAD (MCAD) and Electronic Design Automation (EDA) vendors, such as Autodesk, Cadence, Mentor Graphics, Synopsys, and the like. But of course, smaller providers in similar market niches are also affected, sometimes with very harsh results. Take Virage Logic, for example. Virage Logic is a provider of semiconductor intellectual property (IP) for the design of complex integrated circuits. The company’s product portfolio includes embedded SRAMs, embedded NVMs, embedded test and repair, logic libraries, memory development software, and DDR memory controller subsystems.Virage Logic is one of six public Electronic IP suppliers located in Silicon Valley; Virage’s annual revenues rank it approximately in the middle of this competitive six-pack. But the dominant market lead belongs to ARM Holdings based in the UK; ARM’s revenues are 5X its nearest IP rival, and ARM is the only one...

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By Russ Henke on 1/21/2009 6:56 AM

Yesterday, January 20, 2009, was a banner day for hundreds of millions of people across the USA and around the world, as Barack Obama was inaugurated the 44th US President.There were even elements of good business news that broke through. For example, the Wall Street Journal reported, "Bucking the trend of high-tech competitors, International Business Machines Corp. (IBM) posted a 12% gain in fourth-quarter profit and gave an upbeat outlook for 2009." IBM said that in spite of facing "an extremely difficult economic environment," it predicts it will "continue to benefit from the increasing profitability of its software and services businesses." IBM asserted that "customers are continuing to sign up for outsourcing and other services contracts." The WS Journal also reported that "Fiat, Chrysler and Cerberus Capital Management...announced that they have signed a non-binding term sheet to establish a global strategic alliance." As a "consideration for Fiat Group's contribution to the alliance of strategic assets,...

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By Russ Henke on 1/20/2009 7:00 AM

Note: This blog entry was first posted on January 16, 2009.Further to the impact of the US economic collapse previously discussed in this blog space, on January 15, 2009 Autodesk, Inc. announced a restructuring plan to reduce its annual operating expenses. The company anticipates the restructuring will result in annual pre-tax cost savings of approximately $130 million annually starting in its fiscal year 2010. As part of its restructuring plan, Autodesk plans to reduce its staff by approximately 750 employees, representing approximately 10% of the company's global workforce. The company also plans to consolidate certain facilities. The actions are in addition to the ongoing cost reduction initiatives previously announced, which included a hiring freeze, business travel restrictions, and other reductions in its operating expenses. As a result of this restructuring, the company anticipates taking a pre-tax charge in the range of $65 million to $75 million. For more info, copy and paste the following URL into your...

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By Russ Henke on 1/14/2009 7:21 AM

Despite widespread public skepticism that she is the right choice, on January 13, 2009 Yahoo named former Autodesk chief executive Carol Bartz as its new CEO in an effort to revive the struggling Internet company. Bartz replaces Yahoo co-founder Jerry Yang.Yahoo has been suffering from slowing growth and tough competition from Google. Many Yahoo investors are still upset over the failed $47.5 billion takeover bid by Microsoft in 2008 ($33 per share), which given the subsequent collapse of the US economy, might have been the right move for Yahoo. On January 13, 2009 Yahoo stock fell 1% to $12.10.Now 60 years old, Carol Bartz led Autodesk for 14 years. Its annual revenue grew five-fold by the time she stepped down in 2006, while its share price increased 10-fold during her tenure. Bartz remains as chairwoman of Autodesk. She's also on the board of Cisco Systems, alongside Yang, in addition to serving on the boards of Intel and NetApp.Despite Carol’s spectacular success at Autodesk, skeptics worry whether she’s the...

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By Russ Henke on 1/13/2009 7:00 AM

Further to previous blog entries in this space concerning the debate over the US government helping the Big 3 US auto companies weather the current recession, comes the following news from the Society of Manufacturing Engineers:DEARBORN, Mich., Jan 11 /PRNewswire/ -- If the Detroit Three gradually disappeared, Toyota, Honda, Nissan, the Koreans, and the Chinese would eventually fill the gap. In "Factory Man," a new autobiography being published in February 2009 by the Society of Manufacturing Engineers (SME; http://www.sme.org), author James E. Harbour says there is an even greater long-term risk. Profits from the American auto industry would largely be sent overseas, and millions of shareholders would go broke. Worse, the foreign companies would keep their major engineering operations at home.In his book "Factory Man," Harbour says what America needs right now is a good jolt of the power of the factory. During recent Washington hearings, he viewed elected officials playing a game of liquidation roulette with...

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By Russ Henke on 1/9/2009 6:51 AM

EDA vendor Cadence has been a frequent topic in this blog space since last Fall.Yesterday, January 8, 2009 Cadence announced that it has given up its search for an outside CEO and has unanimously appointed Lip-Bu Tan as president and chief executive officer, effective immediately. Tan had been the interim vice chairman of the Board of Directors and member of the Interim Office of the Chief Executive. Consequent to the appointment of Tan, the Interim Office of the Chief Executive has been dissolved. John Shoven will continue to serve as chairman of the Board of Directors. Charlie Huang will serve as senior vice president and chief strategy officer; and Kevin Palatnik will continue to serve as senior vice president and chief financial officer. Lip-Bu Tan has been a member of Cadence's Board of Directors since 2004, and serves as a member of the Finance and Technology Committees of the Board. Tan continues to serve as chairman of Walden International, a venture capital firm he founded in 1987. He has also been associated...

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By Russ Henke on 1/9/2009 6:05 AM

The Labor Department today revealed W’s last lame-duck 2008 “gift” to the US economy…another 524,000 jobs lost in December.

Also, new revisions for both October and November turn out to be even deeper than previously estimated. Revised figures show that US employers slashed 584,000 positions in November as well as 423,000 in October.

For all of 2008, the US economy lost a net total of 2.6 million jobs. That’s the most in one year since 1945, folks!

By Russ Henke on 1/5/2009 7:15 AM

If you are interested in what caused the 2008 US Financial Mess, and in suggestions for repairing the damage, you would be well-advised to read two back-to-back articles that appeared in the Sunday January 4, 2009 New York Times by Michael Lewis and David Einhorn, entitled,

“The End of the Financial World as We Know It”

http://www.nytimes.com/2009/01/04/opinion/04lewiseinhorn.html?_r=1&th&emc=th


“How to Repair a Broken Financial World”

http://www.nytimes.com/2009/01/04/opinion/04lewiseinhornb.html?th&emc=th

By Russ Henke on 1/1/2009 7:10 AM

Happy New Year !!

Let’s all work to make 2009 far more healthful and prosperous for everyone than 2008!

By Russ Henke on 12/30/2008 8:55 AM

As previously discussed in this blog space, the Bush administration was slow and grudging in helping out the critical US auto industry, exacting many concessions and rules before it recently parted with a few billion dollars. Here is an update:The New York Times reported today that "The Treasury Department has agreed to take a stake of $5 billion in GMAC, the auto lending company, and agreed to lend $1 billion to General Motors to help GMAC reorganize itself as a bank holding company." The Treasury Department said "it would buy $5 billion in senior preferred equity with an 8 percent dividend from GMAC. It also said it is lending up to $1 billion to GM to help GMAC reorganize itself as a bank holding company. The agency said it was using funds from the $700 billion Emergency Economic Stabilization Act's Troubled Asset Relief Program to buy the GMAC equity make the loan to G.M." The Wall Street Journal also reported, "The move represents the second tranche of government aid that redounds to the benefit of...

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By Russ Henke on 12/19/2008 6:01 AM

As part of its continuing program of acquisitions to build analysis and simulation capability, Autodesk announced this week that it had signed a definitive agreement to acquire ALGOR, Inc. for approximately $34 million.

Headquartered in Pittsburgh, PA, ALGOR's computer aided engineering (CAE) software is used for product design and development in the automotive, aerospace, medical, consumer products, defense, energy and utilities industries.

The acquisition will strengthen the Autodesk solution for digital prototyping with advanced simulation functionality, including multiphysics, mechanical event simulation and fluid flow.

By Russ Henke on 12/14/2008 5:44 PM

Electronic Design Automation (EDA) vendor Cadence Design Systems has been a frequent subject for blog entries in this space for months, especially since its CEO and four other executives suddenly resigned back in October 2008. Simultaneously, the company also delayed reporting its Q3 2008 financial results to launch an investigation of its financial methods and practices for all of 2008.Well, on December 10, 2008, Cadence finally reported the results of said investigation, and the news was not pretty.Cadence said it actually lost $169 million, or 67 cents per share, for Q3 2008, which certainly compares unfavorably with profit of $72.7 million, or 24 cents per share, in Q3 2007. The Q3 2008 revenue of course also declined dramatically, falling 42% to $232 million from $401 million in Q3 2007. The much-reduced Q3 2008 revenue figure still missed analysts' most-recent pre-December 10 estimates for Q3 2008 of $239 million.The company paid a dear price as it finally announced its Q3 2008 results. Trading near $4.00...

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By Russ Henke on 12/5/2008 7:11 AM

In previous blog entries in this space, we’ve talked multiple times about the building evidence of Bush 43’s second recession. For example, the 240,000 jobs lost in the US in October, the tenth consecutive month of job losses, brought the total job losses for 2008 to 1.2 million.

But the news released today is ridiculous and unforgivable! The Labor Department just announced that US employers slashed 533,000 jobs in November alone! This is the worst monthly number in 34 years!

The unemployment rate would be even higher if not for the exodus in November of 422,000 more frustrated people from the work force.

Job losses in November were widespread, hitting factories, construction companies, financial firms, retailers, leisure and hospitality, and others industries. The few places where gains were logged --- you guessed it -- the government and health services.

As if we needed confirmation, the “news” emerged on December 1, 2008 from the National Bureau of Economic Research, (despite repeated...

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By Russ Henke on 11/30/2008 8:13 AM

Cadence Design Systems, one of the Big 3 Electronic Design Automation (EDA) Vendors, has been the subject of frequent blog entries in this space, even before the top five execs resigned from Cadence in mid-October 2008 (see the related blog entry posted on October 19, 2008, entitled, “EDA Executives Pay the Price – and probably, so will many other employees”). Many updates in this blog space have followed.

The large reduction in Stock Market Capitalization suffered by Cadence since January 2008 is behind most of the company’s woes.

Since October, Cadence has been the public target of both real news as well as rumors, much of it negative.

The update today contains the difficulty Cadence endures just keeping up with those pesky SEC filings associated with Cadence’s Q3 decision to review its financial statements for 2008. For example, Cadence received a letter from The NASDAQ Stock Market on November 18, 2008 indicating that the company is not in compliance with the filing requirements under NASDAQ Marketplace Rule 4310(c)(14) because Cadence did not file in a timely fashion its Quarterly Report on Form 10-Q for the quarter ended September 27, 2008. Cadence must submit a plan to regain compliance no later than January 19, 2009, or risk being delisted from The NASDAQ Global Select Market.

...

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By Russ Henke on 11/22/2008 7:02 AM

The turbulence at EDA vendor Cadence Design Systems has been the topic of frequent blog entries in this space since mid-summer 2008. While the company’s Q1-Q3 2008 financials have still not been re-stated, and a new CEO has still not be named to replace Mike Fister, who resigned in mid-July, Cadence did make some executive promotions this week aimed at stabilizing the employee base. On November 21, 2008, Cadence announced the promotion of three senior managers to executive positions in R&D and Worldwide Sales and Field Operations. All three come from inside Cadence ranks and all report to the “Interim Office of the Chief Executive.” Dr. Chi-Ping Hsu, 53, was named senior vice president of research and development for the Implementation Products Group. Dr. Hsu joined Cadence in 2003 from Get2Chip, Inc. Mr. Nimish Modi, 46, was named senior vice president of research and development for the Front End Group. He came to Cadence in 2006 from Intel. Finally, Mr. Tom Cooley, 46, was named senior vice president of Worldwide...

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By Russ Henke on 11/20/2008 9:42 AM

Despite the economic and security importance of the US Auto Industry and the strong arguments to the contrary from many sectors (see for example the November 19, 2008 blog entry in this space containing excerpts from Pat Buchanan), prospects for an immediate US auto industry bailout look bleaker today (November 20):The AP reported, "Congress, unwilling or unable to approve a $25 billion bailout for Detroit's Big Three, appears ready to punt the automakers' fate to a lame-duck Republican president. Caught in the middle of a who-blinks-first standoff are legions of manufacturing firms and auto dealers -- and millions of Americans' jobs -- after Senate Democrats canceled a showdown vote that had been expected Thursday (today)." The Politico added that the "year-end drive to win new aid for the ailing auto industry was near collapse." The Wall Street Journal added that Senate Majority Leader Harry Reid "backed away from efforts to force a vote this week" on the Democratic bailout bill. He said he "might move...

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By Russ Henke on 11/19/2008 11:45 AM

Further to previous blog entries in this space, we call your attention to key excerpts from the November 18, 2008 blog of Patrick J. Buchanan, entitled, “As GM Goes, So Goes the GOP”:In the original bailout, “Hank Paulson demanded $700 billion to haul away the trash in the dumpsters of JPMorgan Chase and Goldman Sachs — assuring us that he could hold a garage sale of the junk. Now (mid-November) we hear from Paulson that the $700 billion Congress voted will not, after all, be used to buy up rotten paper on the books of the big banks. Some banks are using the cash to buy other banks.So Republicans are right to be enraged. But they are now about to do something terminally stupid. With GM, Ford and Chrysler teetering on the brink, they are turning a cold stone face to Detroit and are about to follow the counsel of that quintessential Bushite Dick Darman, who said of our computer chip industry, “If our guys can’t hack it, let ‘em go.” America responded — by letting George H.W. Bush and Darman go.Are Republicans aware...

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By Russ Henke on 11/18/2008 8:14 AM

Further to recent blog entries in this space, these figures about the deteriorating market caps of the Big 3 Electronic Design Automation (EDA) Vendors are sobering:

• Synopsys has lost 36% of its value since January 1, 2008. Market Cap is approximately $2.32 billion at this writing.

• Mentor Graphics has lost 49% of its value since January 1, 2008. Market Cap is approximately $557 million at this writing.

• Cadence has lost 77% of its value since January 1, 2008. Market Cap is approximately $975 million at this writing.

By Russ Henke on 11/15/2008 9:20 AM

Further to the blog entry in this space yesterday (November 14, 2008), you may be interested in the article below that appeared in the New York Times today (November 15, 2008):

Tech Industry, Long Insulated, Feels a Slump (ASHLEE VANCE)

Paste this URL into your browser:

http://www.nytimes.com/2008/11/15/technology/15tech.html?_r=1&th=&adxnnl=
1&oref=slogin&emc=th&adxnnlx=1226769111-PR7FqvP6jAozYEOGWeHAxg