Mentor Graphics Corp (MENT) has seen consistent growth since the 2008 downturn, with bookings up 70% last quarter compared to the previous year, as the company leads the market in special purpose computers and physical verification software, says Walden C. Rhines, Chairman and Chief Executive Officer of Mentor Graphics Corporation.
“We have had quite a run here. Over the last five years, our compound average growth rate of earnings, our non-GAAP earnings, have been about 50% per year, GAAP earnings about 35% per year, so it’s been fairly consistently growing ever since the 2008 downturn. The particular strength we saw in the last quarter is a continuation and acceleration of what we’ve seen over the last few years, and it came from two areas,” Rhines said.
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The two areas of growth have been from hardware acceleration, which is the use of special computers and software to verify designs, and the move to the next generation of integrated technology, in particular use of physical verification software, Rhines says. MENT is the market leader in both areas and has seen a significant increase in bookings.
“Mentor has the leading special-purpose computer or emulator in the market today, and the bookings for that particular portion of our product line increased over 160% this past quarter compared to last year, and last year the revenue doubled,” Rhines said. “The other big contributor was the move by our industry to the next generation of integrated circuit technology called 14-nanometer…The move to that generation of technology is causing a retooling among the customer base for the design software, and particularly the physical verification software that allows you to take the actual layout of a design and alter it to make it manufacturable and verify that it, in fact, does what it’s supposed to do. Mentor is the leader in that area and has quite a large market share in the 70% range, and so the strength in that field has been a big impetus for growth for Mentor.”
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