Earnings results often indicate what direction a company will take in the months ahead. With Q2 behind us, let’s have a look at Cadence Design Systems (NASDAQ: CDNS) and its peers.
The demand for rich, interactive 2D, 3D, VR and AR experiences is growing, and while the ubiquitous metaverse might still be more of a buzzword than a real thing, what is real is the demand for the tools to create these experiences, whether they are games, 3D tours or interactive movies.
The 6 design software stocks we track reported a strong Q2. As a group, revenues beat analysts’ consensus estimates by 1.4% while next quarter’s revenue guidance was 2.9% above.
Luckily, design software stocks have performed well with share prices up 17.9% on average since the latest earnings results.
Cadence Design Systems (NASDAQ: CDNS)
Powering the chips behind everything from smartphones to AI accelerators for over 35 years, Cadence Design Systems (NASDAQ: CDNS) provides essential computational software, hardware, and intellectual property used by engineers to design and verify advanced electronic systems and semiconductors.
Cadence Design Systems reported revenues of $1.58 billion, up 24.2% year on year. This print exceeded analysts’ expectations by 0.5%. Overall, it was a very strong quarter for the company with a solid beat of analysts’ billings estimates and EPS guidance for next quarter exceeding analysts’ expectations.
“Cadence delivered an outstanding Q2 driven by broad-based strength and the accelerating demand for our AI-driven solutions across both Design for AI and AI for Design fronts,” said Anirudh Devgan, president and chief executive officer.
Cadence Design Systems achieved the fastest revenue growth among its peers. Investor expectations, however, were likely higher than Wall Street’s published projections, leaving some wishing for even better results (analysts’ consensus estimates are those published by big banks and advisory firms, not the investors who make buy and sell decisions). The stock is down 3.7% since reporting and currently trades at $325.99.
Best Q2: Unity (NYSE: U)
Powering over half of the world's mobile games and expanding into industries from automotive to architecture, Unity (NYSE: U) provides software tools and services that allow developers to create, run, and monetize interactive 2D and 3D content across multiple platforms.
Unity reported revenues of $546.5 million, up 23.9% year on year, outperforming analysts’ expectations by 6.1%. The business had a stunning quarter with a solid beat of analysts’ billings estimates and EBITDA guidance for next quarter exceeding analysts’ expectations.
Unity scored the biggest analyst estimate beat in the group. The market seems happy with the results as the stock is up 28.4% since reporting. It currently trades at $45.55.
Is now the time to buy Unity? Access our full analysis of the earnings results here, it’s free.
Slowest Q2: PTC (NASDAQ: PTC)
Originally known as Parametric Technology Corporation until its 2013 rebranding, PTC (NASDAQ: PTC) provides software that helps manufacturers design, develop, and service physical products through digital solutions for CAD, PLM, ALM, and SLM.
PTC reported revenues of $600 million, down 6.8% year on year, falling short of analysts’ expectations by 1.3%. It was a slower quarter as it posted a significant miss of analysts’ billings estimates and a miss of analysts’ annual recurring revenue estimates.
PTC delivered the slowest revenue growth and weakest full-year guidance update among its peers. Interestingly, the stock is up 15.9% since the results and currently trades at $153.50.
Read our full analysis of PTC’s results here.
Procore Technologies (NYSE: PCOR)
With a mission to build software for the people that build the world, Procore Technologies (NYSE: PCOR) provides cloud-based software that enables owners, contractors, and other stakeholders to collaborate and manage construction projects from any device.
Procore Technologies reported revenues of $375.2 million, up 15.8% year on year. This result surpassed analysts’ expectations by 2.6%. Overall, it was a very strong quarter as it also logged a solid beat of analysts’ billings estimates and an impressive beat of analysts’ adjusted operating income estimates.
Procore Technologies had the weakest guidance update of the whole group. The stock is up 23.4% since reporting and currently trades at $61.88.
Read our full, actionable report on Procore Technologies here, it’s free.
Dolby Laboratories (NYSE: DLB)
Known for its iconic "D" logo that appears before countless movies and TV shows, Dolby Laboratories (NYSE: DLB) designs and licenses audio and video technologies that enhance entertainment experiences in movies, TV shows, music, and other media.
Dolby Laboratories reported revenues of $305 million, down 3.3% year on year. This print lagged analysts’ expectations by 2%. Taking a step back, it was a mixed quarter as it also produced revenue guidance for next quarter exceeding analysts’ expectations but EPS guidance for next quarter meeting analysts’ expectations.
Dolby Laboratories delivered the highest guidance raise but had the weakest performance against analyst estimates in the group. The stock is up 20.4% since reporting and currently trades at $62.34.
Read our full, actionable report on Dolby Laboratories here, it’s free.
Market Update
Over the past year, investors have been forced to repeatedly answer the same question: what is the market’s biggest risk? The answer has changed several times, and each shift has reshaped market leadership.
Late in 2025 and early 2026, artificial intelligence became the market’s primary uncertainty. Investors questioned whether AI would erode software pricing power and weaken competitive moats as AI made it easier to replicate once-differentiated products.
By the spring, technology took a back seat to geopolitics. The U.S. conflict with Iran briefly became the market’s dominant narrative, raising concerns about oil prices, inflation, and global growth. But as energy markets remained orderly and fears of a prolonged supply disruption faded, investors quickly turned their focus back to fundamentals.
Want to invest in winners with rock-solid fundamentals? Check out our Hidden Gem Stocks and add them to your watchlist. These companies are poised for growth regardless of the political or macroeconomic climate.
