Good afternoon. My name is Rachel, and I will be your conference operator today. At this time, I would like to welcome everyone to the Cadence Design Systems Fourth Quarter 2011 Earnings Conference Call. [Operator Instructions] I will now turn the call over to Alan Lindstrom, Director of Investor Relations for Cadence Design Systems. Please go ahead.

Thank you, Rachel, and welcome to our earnings conference call for the fourth quarter of fiscal 2011. The webcast of this call can be accessed through our website, www.cadence.com, and will be archived for 2 weeks. With us today are Lip-Bu Tan, President and CEO of Cadence; and Geoff Ribar, Senior Vice President and CFO. Please note that today's discussion will contain forward-looking statements, and that our actual results may differ materially from those expectations. For information on the factors that could cause a difference in our results, please refer to our filings with the Securities and Exchange Commission. These include Cadence's most recent reports on Form 10-K and Form 10-Q, including the company's future filings and the cautionary statements regarding forward-looking statements in the earnings press release issued today. In addition to financial results prepared in accordance with generally accepted accounting principles, or GAAP, we will also present certain non-GAAP financial measures today. Cadence management believes that in addition to using GAAP results in evaluating our business, they can also be useful to measure results using certain non-GAAP financial measures. Investors and potential investors are encouraged to review the reconciliation of non-GAAP financial measures with their most direct, comparable GAAP financial results, which can be found in the Quarterly Earnings section of the Investor Relations portion of our website. A copy of today's press release dated February 1, 2012, for the quarter ended December 31, 2011, and related financial tables can also be found in the Investor Relations portion of our website. Now I'll turn the call over to Lip-Bu.

Good afternoon, everyone, and thank you for joining us. I'm pleased to report that Cadence finished a successful 2011 with a very strong Q4. For Q4, revenue totaled $308 million, non-GAAP operating margin was 21%, and we generated $62 million of operating cash flow. For the year 2011, revenue grew 23% to $1.15 billion, non-GAAP operating margin doubled to 18%, and operating cash flow totaled $240 million. For 2012 we are forecasting revenue growth of approximately 8% to 11%. Geoff will present our full outlook in a few minutes. Now I will recap our successes in 2011 and then provide some of our Q4 highlights. In 2011, Cadence demonstrated the readiness of our digital, custom, analog and signoff solutions for 22 -- 20-nanometer design. We completed 7 20-nanometer test chips with companies including ARM, Samsung, TSMC and other foundries and customers. Many more are in progress for 2012. We established our product capabilities for designing SoC using advanced multi-core processors, including the first ARM Cortex-A15 test chip designed for the 20-nanometer TSMC silicon. 2011 was a stellar year for the Palladium XP Verification Computing Platform. An increasing numbers of customers, both semiconductor and system companies, now use Palladium to develop complex SoC and for hardware-software co-design. Growing adoptions of our Encounter digital solution was highlighted in 2011 by key displacements at 2 major semiconductor companies and significant business wins at many other customers. In 2011, our Virtuoso 6.1 strengthened its position as a platform of choice for doing custom and analog design. Virtuoso, based on the industry-standard open-access database, is enabling a paradigm shift from traditional connectivity-driven to a more automated constraint-driven methodology that is delivering a 2x productivity improvement. To address the challenge of integrating hardware and software for complex systems, in 2011, we launched the System Development Suite.…

Thanks, Lip-Bu, and good afternoon, everyone. If you saw in our press release and heard in Lip-Bu's remarks, Cadence finished 2011 with a very strong Q4. I'll review the Q4 and 2011 results in more detail, then present our outlook for Q1 in 2012. Bookings for 2011 totaled $1.158 billion compared to $956 million for 2010, up 21%. The high quality of these bookings is obvious when you consider the weighted average contract life for 2011 was about 2.5 years, down from 2.9 years for 2010. So adjusting for the average contract life, annualized bookings were up over 30%. The book-to-bill was greater than 1, resulting in a year-end backlog of $1.7 billion. Our total backlog did not significantly increase from 2010, the quality of the backlog improved to shorter contract lives. Total revenue for the fourth quarter was $308 million compared to $249 million for Q4 of 2010. Revenue exceeded our guidance range due to strong demand across our product lines. Revenue for the year was $1.15 billion compared to $936 million for 2010, an increase of 23%. For Q4, product revenue was $177 million, maintenance revenue was $101 million and services revenue was $30 million. The revenue mix for the geographies in Q4 was 44% for the Americas, 20% for EMEA, 19% for Asia and 17% for Japan. Total cost and expenses on a non-GAAP basis for Q4 were $244 million compared to $240 million for Q3 of 2011. Higher variable compensation contributed to the sequential increase. Quarter-end headcount was approximately 4,700, unchanged from Q3. Non-GAAP operating margin for Q4 was 21% compared to 11% for Q4 2010. For the year 2011, non-GAAP operating margin was 18% compared to 9% for 2010. For Q4, we recorded GAAP net income per share of $0.04 compared to net loss of…

[Operator Instructions] Your first question comes from Raj Seth with Cowen and Company.

Geoff, can you talk a little bit more perhaps about how to think of the model as it rolls through 2012, which I think you detailed into 2013. I guess one of the questions is should we expect to see bookings growth in 2013? Do bookings come down? Do we have any echo from the trough that you saw some years before? And is there -- you talked about sort of your ambition for operating margins and reaching those in 2013. How should we think about sort of normalized business levels, either revenue or sort of cash flow as I assume we normalized in 2013. Anything you can discuss there would be helpful.

Yes, so obviously, Raj, we're very excited to actually tell you that the mid-20s are happening in 2013, I think. We're very proud of the progress we made in 2011 that we'll continue to make in 2012. I think that's kind of where we want to stick though, Raj, on we're actually guiding to beyond 2012. I think it's important to recognize that we expect to grow faster than some of our -- some of the others in the industry have talked about in our core business, and that we're going to get to 2013, get to the mid-20s in 2013.

Okay, I guess that's fair. Lip-Bu, can you talk a little bit -- you talked about leadership at 20, progress in digital and involvement in multi-core designs. I'm wondering if on the digital side, especially as it relates to multi-core, if you can expand a little bit on that and perhaps comment on the consolidation that we've just seen in the industry and your view of potential sort of industry implications of that?

So first of all, Cadence decided to commit to the leadership on the 20-nanometer. And clearly, we have our success in the digital Encounter side because of our leadership. And we mentioned about a couple big displacements that we'll win and we won. And then secondly, I think, clearly, the multi-core, that is a commitment. We want to be the leaders in that. And our announcement with ARM, that is very significant and opened up tremendous opportunity for us. As you know, ARM is very strong in the smartphone, tablet and even in cloud. And then the other part, clearly, I mentioned also in my script, on the mixed-signal side, because of our Virtuoso success and couple of big displacement coming up and that we won and on this mixed-signal and the digital content become more and more critical, that able to provide an end-to-end flow on the design and also drive a lot of efficiency in the power.

And so could you talk a little bit about industry consolidation? I mean, there's consolidation sort of happening on both sides. Synopsys obviously buys Magma who was, I think, perceived as one of the leaders in digital, and is certainly behind some of the multi-core designs we see in the app processors of the market today. What's the implication of that deal? It's clear from the filings that you guys didn't have a lot of interest there. But what do you think the implication is on the industry? And just the flip side of that is the semiconductor industry itself is consolidating, how do you think of that as impacting the overall market opportunity for the industry? Atheros, Qualcomm and all the kind of deals we're starting to see, which I expect will continue.

Yes, I think it's a very profound question. And clearly, I'll try to answer some of your questions. And so first of all, I think the industry consolidation, you mentioned about TI, National, Qualcomm, Atheros, that will be the trend that will continue. And so I think, clearly, winning in the -- I call it the winning platform become critical for the EDA player. That's why we have a laser focus to winning some of this big displacements, the platform we want to win. And so we're going to continue to win that. And in terms of our own industry consolidation, Raj, you know me, I'm a basketball player, I always like to see the game come to me rather than forcing it. We like our strategy. We like our growth map. We stick to our focus in terms of driving our product portfolio, take the leadership in that. And then meanwhile we actively pursue acquisition to add technology that we can really provide the best solution for our customer. Clearly, our EDA360, Silicon Realization, the end-to-end flow and the mixed-signal and the SoC and our IP, and then clearly in our system side, I think will be tremendous. Just related to, I think you mentioned about the Synopsys and Magma merger. First of all, clearly, it didn't change any of our technology momentum. And no change to our market positions. And clearly, we are committed to our roadmap. And then in fact, it created a lot of opportunity for us because our end of life and overlapping digital flow between the 2 company. And then by the way, Magma is only the less than 10% of Synopsys. So clearly, they provide a lot of opportunity for us. While heavily engaging with the customer, they are looking for this solution that we provide, excited about what we have.

Your next question comes from Rich Valera with Needham.

Wondering -- you're talking about the digital and your progress there, and I think you've announced the notable kind of first last quarter where you had the first test chip, the 20-nanometers with TSMC and ARM for the new Cortex core. Can you give out what any follow-through you may have received from that or any broader implications of being kind of first to market with a 20-nanometer flow with TSMC and ARM?

Sure. So let me answer that, Rich. Clearly we have a lot of success in the digital side in the prepared script. And clearly, the leadership in the 20-nanometer and with the foundry partners, I think, clearly, is a very strong position for us. And then we also mentioned about and announced the ARM A15 co-development, and we have a lot of success engaging with the ARM's customers that are using ARM license. And we won a few, and we also have quite a heavy engagement with the others in the 2012. We are excited about the opportunity in front of us. Clearly, we want to take the leadership there.

Great. And then on emulation, you guys obviously had a very strong year in emulation in 2011 as did really the whole industry. Just wondering how you're thinking about that business heading into 2012. There will be some tough comparisons, I guess, but it sounds like -- but it seems that you have some sort of secular growth there as you move to sort of sub 40-nanometer geometries. Just wondering how you're thinking about emulation for 2012.

Sure. Rich, I will start first and then Geoff can chip in. And so first of all, I think this -- hardware emulation, as I mentioned, you become a very critical phase of a design because more complex chip and the whole verification, the earlier you find the box is a very good important for your time-to-market. So any complex SoC or any 40-nanometer chip design is almost like a must-have, and then we have the best-of-class. And so we're going to continue seeing significant growth in this area. And the customers that we talked to, they continue to love our products and are buying from us. And so we're going to continue doing that. And in fact, we're going to expand that into our Virtual System Platform and also the Rapid Prototyping Platform. And a couple of customers already engage and extend to that whole suite of products that we are offering, and the time-to-market is so critical for them. And so we have a very good 2011, and we're going to continue to see growth in 2012.

Yes, Rich, this is Geoff. So I think a couple additional points. Our customer base has expanded here from our traditional chip companies, but also to system companies. We're seeing that in the Palladium XP, but also in the other businesses that were becoming more important to the group of system companies. We did have extremely strong growth in Palladium XP in 2011. We do think it's a secular trend that there's going to be continued use. We do expect that growth rate, though not to be the same in the Palladium XP from '11 to '12 as it was from '10 to '11.

Great, that's helpful. And then just following up on the mid-20s up margin in 2013. Geoff, in the past you've talked about kind of achieving that at some point, somewhat independent of revenue level, i.e., you would cut expenses if you needed to, to get there. Just wondering if you can give us any other color in terms of how you intend to sort of glide into that mid-20s up margin. Sounds like you're expecting revenue growth somewhere north of, I guess, the mid- to low single digits. But can you give us any more calibration there on how you look to get to that?

Sure. We kind of guided this year's growth at approximately 10%, 2012 from 2011. Obviously, we're not expecting to cut expenses to get there. We are expecting growth to continue. So we expect to see growth continue. As I think we said, we expect to grow faster than some of our competitors have committed to. And we think that will get us there. We obviously have to continue to execute to get there. It's not a slam dunk, but I think you've seen our execution be materially good in the past year and we need to continue that and continue to improve on that.

Your next question comes from Sterling Auty with JPMorgan.

Couple of questions. First on the term length of the 2.3 years in the fourth quarter, definitely very low end, even for what you've seen in the last couple of years. Can you give maybe a little bit more color as to what the discussions were going on in those contract terms? How much of it may have been some of the uncertainty in the semiconductor market during the quarter?

I think, Sterling, let me start first and then Geoff will chip in. So this is very significant for us because -- since I came on board 3 years ago, I was driving the team to really focus on the term, the quality of the terms and the way we engage with our customer. After 3 years, I think our relationship with our customers tremendously improved. And then secondly, I think the team is -- I'm very proud of my team that are very disciplined in terms of providing the right terms and then the right products, technology to the customer to enable them to successful on that. And that is something very significant. That's why you noticed that even though in our revenue and our bookings guidance per year, but if you look at the duration and the quality is tremendously improved.

Yes. And I think, again, we're trying on -- the sales quality has been the focus since Lip-Bu took over, right? And I think we've made a lot of success there. We don't want to trade sales quality off for deal term. I think the other thing is the shorter term provides some benefits to us. To get back to Raj's earlier question, it means much less likely that we're going to be concerned about any hold in bookings or revenue going forward because the shorter deal term means those deals are coming up for renewal more often. It gives us more chance to sell, more chances to be successful. And also, it doesn't leave for a giant hole out there. So I think that's very important also.

Absolutely. And we're bouncing around between calls, so I apologize if you said this, mentioned, this already. But when you look at the outlook for the first quarter, it seems extremely strong. I'm trying to put into context, maybe with the new Palladium release, is there some Palladium orders that maybe you got in the fourth quarter, shipped in the first, like we did last year. Or how should we think about the context of the first quarter outlook?

So we're -- our business, I think, has changed with the ratable business model over time. I think you're not going to see the traditional quarterly pattern that you've seen. You'll see more sequential growth as you go forward. And I think that's how you should look at our business going forward.

And also, I think, Sterling, across the board, our auto product line has been very strong in Q4, and then you will carry all forward.

Okay. And then last question. Lip-Bu, kind of back to what I touched on in the first one -- first question, which is if we look at throughout 2011, there was an awful lot of semiconductor uncertainty whether we are still inventory correction or what is happening in the demand environment. It felt like things got better here in the fourth quarter but it was still mixed. Do you feel comfortable enough with the conversations you're hearing from customers that they've got enough insight into their business that they feel good about R&D budgets where they won't have to make any cuts or put their spending at risk as we move into 2012?

Yes, I think, Sterling, it's a good question. And that we watch that very carefully, and we are heavily engaging with our customer. And so clearly, some customers, the top-leading customer, they are increasing their R&D and they are hiring people. Of course there's a few that are laying off people or cut back their R&D. But so far, from my visibility, the R&D engagement in the design have been increasing and are very steady. We are very optimistic and cautiously optimistic in the use of our tool. We like our product portfolio, our leading position. And we don't see any slowdown in term of the design engagement with us.

Your next question comes from Jay Vleeschhouwer with Griffin Securities.

Lip-Bu and Geoff, I'd like to ask first about your customer base or customer concentration. That is, if you look at the top 10 or so customers in 2011, was it appreciable difference in terms of the names in that list or the concentration of revenues from that list in 2011 versus, let's say, 2009 or 2010? And looking forward, would you expect there to be any appreciable changes in your customer concentration or top list of names for 2012, 2013?

Yes, I think you note, Jay, a good question. Clearly, we have a very broad and diversified customer base. We don't have any single customer more than 10% of our revenue. And we are very engaging with our top 10 customers. Is there much changes? Not much. I think it's a winning company that we are engaged more and increasing. And we like that, and we're going to continue that.

Okay. And following up on some of the earlier questions about emulation or the hardware-based business. Doing some rough math, it looks like the hardware business accounted for something like 40% of the total increase in your product revenue in 2011 versus 2010. As you pointed out, it was a strong business. In dollar terms, how do you think 2012 might look versus 2011 in terms of the possible increase in emulation? Or put it another way, are there any other product lines that could account for considerably large increases in product revenue in 2012 versus 2011 besides the emulation business?

So Jay, this is Geoff. So emulation business was a very strong business for us last year as you [indiscernible]. We don't comment on the exact numbers, but it was a very strong business for us. I think we grew at well over 20% in revenue from year-over-year. And again, a small portion of that was emulation, but a portion of that was also core business. That core business growth we anticipate going forward. We expect the emulation growth to slow down.

Okay. Maybe 1 or 2 last ones. I'd like to tie in your comments about IP and your strength there to geography. That is to say you had good growth in the second half of the year and for the year as a whole in Japan and Asia Pac. And what makes Asia Pac interesting is that it's quite a large market for IP, the second-largest market overall. For further consumption of IP, it's bigger than Japan. And China and Taiwan look like 1/4 of the spending over there, for example, is just on IP versus tools. And for the long question here is, how are you positioned for that very large market in IP? And what kind of growth rate do you expect to see in that part of the world for that part of your business?

Yes, so, Jay, let me try to answer that. First of all, clearly, our growth engine, I mentioned earlier, in our IP, SoC and also in the systems side, we continue to make good progress on that. On the IP side, if you recall, we bought the Denali that gives us tremendous leadership in the memory IP. We're going to continue doing that. And we're -- now we are moving into the storage and also in the high-speed connectivity side. So very differentiating value IP that's provided to our customer. You correctly point out there's a lot of important customer in Asia Pacific that like to have IP growth, while heavily engaging and while winning, a couple of them. And we continue to win, continue to engage many of our customer in Asia. Asia Pacific growth, as we all know, is a fast growing area. Cadence is very well-positioned in that region. And we are very active. We have the right team, driving success and engaged with our customer. And so we're going to continue to win that.

So I'd also like to point out, one of our strong growth areas was Verification IP. In the past year, we grew over 40% year-over-year. So we think it's a very strong business for us with very strong growth characteristics.

All right. And then lastly, there was an earlier question referring back to the events a few years ago in terms of your business model and the transition. Just to follow up to that, is there remaining any lumpiness in your business, Geoff? You and I have spoken about the lumpiness, reflecting what happened a few years ago in terms of the run off of bookings and contracts. Do you think that everything is now pretty much smoothed out? And Any nonlinearities, so-called, are pretty much done?

Yes. And then in history, we had some customers that we only recognize revenue when they paid. Japan was a part of that. It's still a little bit there. But because of the ratable nature of business right now, we don't expect to see much lumpiness. We expect to see much more sequential growth period-over-period. We're still completing the model change. That won't be totally done until Q4 of this year, so 2013 will be the first year. We're essentially 100% converted. But again, I think you'll expect to see sequential growth out of us going forward, that's our goal and our expectation.

Your next question comes from Krish Sankar with Bank of America Merrill Lynch.

Lip-Bu, what's your view on the semi R&D spending and EDA growth for 2012?

Sure. So I think, Krish, a couple of points. So clearly, the semiconductor in our industry, the earlier question in terms of some bigger companies' success continue to hiring and there are some laying off. But overall, the trend is moving upward. And even the system companies are starting to engage a lot in the semiconductor design. So we are continuing to see that low single-digit growth in the semi industry. In terms of the R&D, and as I mentioned earlier, the engagement with the R&D development, we see steady increase and still very active, especially in some of the mixed signal and then the leading edge process with the leading company. We don't see any slowdown at all.

And, Krishna, this is Geoff. Again, we're seeing that 10% growth in our business, right? That's obviously driven by our views of our customers. As Lip-Bu said, our customer base, in some ways, is expanding because we're having more and more systems business as some of our customers consolidate in the semi side.

Right. And I think Geoff mentioned earlier, some of our friend in the EDA, in the industry that I mentioned about, have single low digit growth. And we basically indicating that 8% to 11% growth for us, so we will be growing faster.

Yes, that's very helpful. So just to follow up on that. The delta, like from the single -- low single-digits to your midpoint 10% growth, how much of that is actually coming from incremental checkings? How much is coming from maybe the tailwind of your revenue model transition?

So the tailwind of our model transition is actually probably the smallest portion that's out there. We are seeing our sales quality continue to improve. As I think we mentioned, our run rate is actually improving on old deals versus new deals. So that's good. The sales quality is improving. And we have seen market share gains. I think we've talked in Q2, where we have a couple of top 10 providers to move to digital flow. We talked about verification IP -- or verification win in this past quarter. And you're seeing that in other places, too, but those are some of the notable ones.

And if I can just extrapolate that, due to the fact that you expect next year 2013 up margins in the mid-20s, what kind of top line function, what ranges that are you baking into that expectation?

Yes, we're not baking any expectation to it. It's a core imperative of the company, and we're going to get there. And obviously we expect some revenue growth to get there, but we'll get there either way.

And then the final question from my end. Can you tell us a little bit about how the renewal calendar for this year is shaping up? When do customers come back to renew and how would you contrast this versus what you saw in 2011?

Yes, I think it's obvious from our bookings growth. I mean, just look at our bookings growth and the numbers we're talking about in our bookings growth. They're growing faster than revenue is. Our contract life continues to be extremely good. So I think you can see we expect a pretty good calendar and pretty good booking year.

[Operator Instructions] Your next question comes from Mahesh Sanganeria with RBC Capital Markets.

Geoff, just wanted to follow-up on the last comment you made on the increase in run rate. Can you just provide more color what is driving -- how are you able to get the run rate increase? Is that the -- that newer technology you're able to get a better pricing or broader product portfolio?

Yes. So clearly, technologies, they're probably the most important part to it, right? We worked hard to improve our technology, to expand our technology offerings, to be an end-to-end provider. And so that provides for the same engineer, on the other side provides an opportunity to sell more tools to them. So that's part of it. The second part is our sales quality. Again, we worked really hard to improve our discounts, improve our run rates, improve our timeliness of our business. And I think that contributes also. And I think the third part is market share gains.

Okay. And just a quick question on the expenses. Of course, it's going up a little bit more than normal this time because of the catch up. But is there a specific model we should be using in terms of OpEx year-over-year -- OpEx growth is low single-digit, is OpEx growth a good number to model going forward beyond this year?

So I think what I said in my prepared remarks is that we expect at least 50% of our revenue increases to drop to the bottom line. I think if you go back over the past couple of years, you'll see that we've actually exceeded that occasionally. So that will vary a little bit. But we expect that general view going forward. I think that's how you should model your OpEx.

And one more clarification on your -- the non-GAAP operating margin for 2013, is that something you plan to achieve at the beginning of the year? Or are you planning that for the full year or your -- towards the end of the year?

Mid-20s in 2013.

Your final question comes from Tom Diffely with D.A. Davidson.

Lip-Bu, I was hoping to talk a little bit more about the China -- Chinese market. Obviously, you guys are very strong there. So I was wondering if you could just quantify how big that market is today for the overall EDA market? And then what kind of growth are you seeing there and how big it could become in the next several years?

It's a good question, Tom. So clearly, if you look at China, they consume about 1/3 of the semiconductor. That includes some of the networks complex churning [ph] manufacturing and also some of the internal consumption, and it's growing. And it's the fastest growing area. We're very well-positioned there. And then clearly, you're going to see quite a few world-class company coming up like Spreadtrum, HiSilicon, a few others in that long list of name. They are coming up really strong, very well-positioned. And Cadence are heavily engaging with that. That would be one of the very fast growing areas. We pay a lot of attention on that. And I think the -- some of these companies become a wold-class company, and there's starting to really pay attention to the IP, the legitimate EDA tool. And that really play into our strength, and we are very well-positioned to capture that.

So do you think that your exposure there could give you a couple of percentage points of leverage above the rest of your business on an annual basis for a while?

Yes, Tom, we'd love to comment, but we can't. I'm sorry.

So Geoff, maybe just a couple of more questions on the income statement. The R&D level seems to jump around a bit, and I'm wondering what causes -- it didn't seem to be revenue-driven usually. And so kind of what goes into that, what factors?

So the vast majority of our R&D spend is people, right? The most important attribute, the most important part of the company is the people. So we do have some swings based on incentive plans and those types of things, right, as we perform well. And I think that's probably we're you're seeing the swing a little bit. But I think, pretty steadily on percentage, we've managed that -- have managed quite well.

Okay. And also, it looks like the other income line was positive for several quarters in a row. It's gotten negative and it looks like you're projecting negative for next -- or for this year as well. What changed on that line? What factors inside of that line?

Foreign exchange. So we're going to be conservative guiding foreign exchange going forward. Right now, we had some benefits from foreign exchange in the past year.

Okay. And then the biggest exposures there?

Well, most of -- or almost all of our revenue is in dollars except for Japan. But we have large organizations around the world in a bunch of different geographies from Europe to India to China to Japan. And so how those play out will swing those numbers around.

Okay. So you're just conservatively viewing the dollar getting a little weaker at some point?

Yes, I wish I could predict FX.

Thank you. I'll now turn the call back over to Lip-Bu Tan for any closing remarks.

Thank you. In closing, I'm very proud of the accomplishment of the Cadence team in 2011. In addition to outstanding financial results, our accomplishments included introduction of new products for hardware and software co-design and co-verification, leadership for 22-nanometer and advanced multi-core processor design and deep collaboration with industry leaders. We have momentum on many fronts, and I'm very excited about our prospect for 2012. Thank you, everyone, for joining us this afternoon. We look forward to speaking with you soon. Thank you.

Thank you for participating in today's Cadence Design Systems Fourth Quarter 2011 Earnings Conference Call. You may now disconnect.