Semiconductor design software provider Cadence Design Systems (NASDAQ:CDNS) will be reporting results tomorrow after market close. Here’s what to expect.

Cadence beat analysts’ revenue expectations by 2.5% last quarter, reporting revenues of $1.22 billion, up 18.8% year on year. It was a very strong quarter for the company, with an impressive beat of analysts’ billings estimates and a solid beat of analysts’ EBITDA estimates.

Is Cadence a buy or sell going into earnings? Read our full analysis here, it’s free.

This quarter, analysts are expecting Cadence’s revenue to grow 26.3% year on year to $1.35 billion, improving from the 18.8% increase it recorded in the same quarter last year. Adjusted earnings are expected to come in at $1.82 per share.

Analysts covering the company have generally reconfirmed their estimates over the last 30 days, suggesting they anticipate the business to stay the course heading into earnings. Cadence has missed Wall Street’s revenue estimates four times over the last two years.

Looking at Cadence’s peers in the vertical software segment, some have already reported their Q4 results, giving us a hint as to what we can expect. Procore delivered year-on-year revenue growth of 16.2%, beating analysts’ expectations by 1.4%, and PTC reported revenues up 2.7%, topping estimates by 1.9%. Procore traded up 16.5% following the results while PTC was down 9.6%.

Read our full analysis of Procore’s results here and PTC’s results here.

There has been positive sentiment among investors in the vertical software segment, with share prices up 4.4% on average over the last month. Cadence is down 5% during the same time and is heading into earnings with an average analyst price target of $323.93 (compared to the current share price of $295.32).

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