A lack of labor supply for electronic demand automation (EDA) chip designers presents an opportunity for two stocks in particular, according to research from Goldman Sachs. Cadence Design Systems and Synopsys are two of the largest manufacturers of chip design software that maps billions of tiny transistors onto just a few millimeters of surface area. Goldman analysts said in a note Monday that the two companies represent “defensive, stable producers at best and victims of AI disruption at worst.” However, given the structural shortage of labor supply across the semiconductor industry, these companies may be uniquely positioned to grow EDA revenues. “Our analysis suggests that the shift to custom AI silicon is exacerbating the structural shortage of chip design engineers, and EDA companies are uniquely positioned to monetize agenttic AI, an opportunity we estimate at up to $3.7 billion annually by 2030,” the analysts wrote. “This is not reflected in street estimates and could start to become evident as early as late 2026.” As a result, Goldman raised its price target on CDNS stock from $410 to $470, a 26% upside. CDNS stock closed Friday at $384.17. Goldman’s 12-month price target for SNPS is $600, but analysts highlighted potential downside risks such as export restrictions, loss of market share and decline in custom chip designs. Memory sector under scrutiny Memory chips are critical components of consumer electronics such as smartphones and laptops. It has also become a critical component of artificial intelligence data centers and the servers installed in these facilities. In particular, demand for high-bandwidth memory is high, leading to soaring prices. However, questions are beginning to emerge about the sustainability of AI demand, and the sector has experienced significant fluctuations in recent weeks. In interviews with CNBC’s Arjun Karpal last week, several AI executives poured cold water on the idea that demand is slowing, while acknowledging that companies are becoming more cautious about the cost of using AI. “We think the demand for AI is almost limitless,” Pat Gelsinger, former Intel CEO and current general partner at Playground Global, told CNBC on Wednesday, adding that energy availability is “the only real limiting factor.” “Because how much economic value can be gained from increased intelligence? It’s almost infinite, across every conceivable industry,” Gelsinger added. Elsewhere in the industry, Taiwan Semiconductor Manufacturing Co., Ltd. reported on Monday that June sales rose 67.9% from the same period last year, ahead of its second-quarter earnings release later this week. TSMC’s total revenue for the first half of 2026 reached NT$2.4 trillion ($74.99 billion), an increase of 35.6% compared to the same period in 2025. TSMC reported June revenue of NT$442.68 billion, an increase of 6.2% month-on-month. Shares of the Taiwanese semiconductor giant rose 1% on Monday. —CNBC’s Arjun Kharpal, Michael Bloom and Jenny Lee also contributed to this report.
