Cadence Design Systems, Inc. (CDNS) partners with Lightmatter to develop co-packaged optics solutions for AI and HPC systems. This collaboration integrates Cadence’s high-speed SerDes IP and UCIe technology with Lightmatter’s optical engine to meet the demands of modern AI infrastructure. The shift to CPO signifies a significant change in data center architecture, enhancing bandwidth and power efficiency.
The partnership combines Cadence’s connectivity IP and chiplet disaggregation capabilities with Lightmatter’s silicon photonics and integrated lasers expertise. This collaboration aims to support hyperscalers in building custom AI and HPC chips with superior performance and scalability. As AI workloads grow, integrating high-speed SerDes and UCIe IP into CPO platforms is crucial for scalable, power-efficient systems.
Cadence’s acquisition strategy, including Secure-IC and Hexagon AB’s D&E division, has strengthened its IP portfolio in interface, memory, AI, and DSP solutions. The company is well-positioned to benefit from the increasing demand for AI solutions and new product launches like Cerebrus AI Studio. Cadence’s focus on optical interconnect solutions optimizes data movement, reduces energy consumption, and enhances bandwidth density in AI clusters.
For Q4 2025, Cadence anticipates revenues between $1.405-$1.435 billion and non-GAAP EPS in the range of $1.88-$1.94. The company is set to report its Q4 and fiscal 2025 results on February 17, 2026. CDNS currently holds a Zacks Rank #3 (Hold) and has outperformed the Computer-Software industry with a 7.6% increase in its share price over the past year.
Other notable stocks in the technology space include SAP, Synopsys, Inc., and Microsoft Corporation, all carrying a Zacks Rank #2 (Buy). SAP, SNPS, and MSFT have shown strong earnings performances and stock price movements in the past year. Investors can explore these top technology stocks for potential growth opportunities in 2026.
Read more at Nasdaq: Cadence & Lightmatter Team Up to Scale Optical Connectivity for AI