Synopsys Reports Record Revenue and Raises Outlook Amid Strong Demand for Chip Design Software

Synopsys Expects Upbeat Q4 on Firm Demand for Chip Design Software

(Reuters) - Synopsys forecast its fourth-quarter revenue and profit above Wall Street estimates on Wednesday, a sign of steady demand for its software to design complex and AI-compatible chips as businesses race to adopt the lucrative technology. Growing computing requirements for artificial intelligence systems have triggered demand for custom design of more powerful and complex chips, helping companies such as Synopsys, as they provide software and hardware used to design cutting-edge processors. For the past five decades there has been an inflection point for the industry and "right now that inflection point is AI", CEO Sassine Ghazi told Reuters in an interview. "It's not hype, it's real and it's driving silicon complexity and building out of infrastructure and data center and training at a pace the industry has not seen before," Ghazi said, adding that Synopsys launched its first AI product in 2020. Shares of the Sunnyvale, California-based company, which partners with chip firms including Nvidia, Qualcomm and Intel, were up 1.2% in extended trading. Revenue from the company's design automation unit -- its largest segment, which includes digital and custom integrated circuit design software -- rose about 6% to $1.06 billion in the third quarter. Synopsys competes with companies such as Cadence Design Systems and Siemens AG's Siemens EDA in electronic design automation software, which is used by engineers for designing semiconductors. Semiconductor firms also turn to Synopsys' AI-powered electronic design automation suite, Synopsys.ai, in a bid to improve complex chip designs. Synopsys expects fourth-quarter revenue to be between $1.61 billion and $1.64 billion, the midpoint of which is above LSEG estimates of $1.61 billion. It forecast adjusted earnings per share between $3.27 and $3.32 for the quarter ending Oct. 31, versus the estimate of $3.23. Third-quarter revenue rose about 13% to $1.53 billion. Excluding items, it earned $3.43 per share, beating estimates of $3.28. (Reporting by Jaspreet Singh in Bengaluru and Max A. Cherney in San Francisco; Editing by Shilpi Majumdar)

Synopsys delivers record quarterly revenue (NASDAQ:SNPS)

U.S. silicon chip designer Synopsys (NASDAQ:SNPS) on Wednesday narrowed its annual revenue guidance range while providing current quarter forecasts that largely exceeded estimates. Shares of the company rose as much as 2.3% after hours, and were last up 1.3% to $571.88. Sunnyvale, Calif.-based Synopsys (SNPS) primarily offers design, verification and manufacturing of silicon chips that are used to power software in everything from smartphones to self-driving cars. The firm also makes silicon intellectual property (IP) core, which in the semiconductor industry means a reusable unit of chip layout design. SNPS said it earned $3.43 per share on an adjusted basis for FQ3 2024 on revenue of $1.53B. Analysts had expected the firm to earn $3.29 per share on revenue of $1.52B. The revenue figure was a quarterly record for Synopsys (SNPS), as demand for chips continues to grow amid companies racing to ramp up their artificial intelligence (AI) processes. "The complexity and pace of technology innovation is accelerating as silicon and systems companies race to capitalize on AI in this era of pervasive intelligence," SNPS top boss Sassine Ghazi said in a statement. Turning to Synopsys' (SNPS) guidance, the company now expects revenue for fiscal year ending October 31 of $6.105B to $6.135B, compared to a previous range of $6.09B to $6.15B. The consensus revenue estimate is $6.13B. The firm lifted its fiscal year adjusted profit per share outlook to $13.07-$13.12 from $12.90-$12.98. The consensus estimate is $12.96. For FQ4 2024, Synopsys (SNPS) sees adjusted profit per share of $3.27 to $3.32 on revenue of $1.614B to $1.644B. The consensus is for earnings of $3.24 on revenue of $1.61B. "For the full year, we expect to achieve revenue growth of approximately 15% and non-GAAP EPS growth of approximately 24% while expanding non-GAAP operating margin by two points," SNPS finance chief Shelagh Glaser said. Synopsys (SNPS) has been busy in the merger & acquisition space in 2024. In January, it announced a $35B cash-and-stock deal to buy engineering software firm Ansys (ANSS). Then in May, it sold its software security business to private equity firms Clearlake Capital and Francisco Partners for up to $2.1B.

Synopsys beats Q3 estimates, shares rise on raised outlook By Investing.com

MOUNTAIN VIEW, California - Synopsys Inc . (NASDAQ:SNPS) reported better-than-expected third-quarter results and provided an upbeat full-year forecast, sending its shares up 2% in after-hours trading. The electronic design automation software maker posted adjusted earnings per share of $3.43 for the quarter ended July 31, surpassing the analyst estimate of $3.28. Revenue climbed 13% YoY to a record $1.53 billion, slightly above the consensus expectation of $1.52 billion. Synopsys now anticipates full-year revenue growth of approximately 15%, driven by "continued, strong execution and business momentum." The company also expects non-GAAP EPS growth of about 24% while expanding non-GAAP operating margin by two percentage points. "The complexity and pace of technology innovation is accelerating as silicon and systems companies race to capitalize on AI in this era of pervasive intelligence," said Sassine Ghazi, president and CEO of Synopsys. "Synopsys is mission-critical to technology innovation and our customer set is expanding as more companies in more industries define and optimize system performance at the silicon level." CFO Shelagh Glaser attributed the strong performance to "leadership products and relentless execution." The company's Design Automation segment, which includes advanced silicon design and verification products, and its Design IP segment both contributed to the quarterly results.

Synopsys expects upbeat Q4 on firm demand for chip design software

For the past five decades there has been an inflection point for the industry and "right now that inflection point is AI", CEO Sassine Ghazi told Reuters in an interview. "It's not hype, it's real and it's driving silicon complexity and building out of infrastructure and data center and training at a pace the industry has not seen before," Ghazi said, adding that Synopsys launched its first AI product in 2020. Shares of the Sunnyvale, California-based company, which partners with chip firms including Nvidia, Qualcomm and Intel, were up 1.2% in extended trading. Revenue from the company's design automation unit -- its largest segment, which includes digital and custom integrated circuit design software -- rose about 6% to $1.06 billion in the third quarter. Synopsys competes with companies such as Cadence Design Systems and Siemens AG's Siemens EDA in electronic design automation software, which is used by engineers for designing semiconductors. Semiconductor firms also turn to Synopsys' AI-powered electronic design automation suite, Synopsys.ai, in a bid to improve complex chip designs. Synopsys expects fourth-quarter revenue to be between $1.61 billion and $1.64 billion, the midpoint of which is above LSEG estimates of $1.61 billion. It forecast adjusted earnings per share between $3.27 and $3.32 for the quarter ending Oct. 31, versus the estimate of $3.23. Third-quarter revenue rose about 13% to $1.53 billion. Excluding items, it earned $3.43 per share, beating estimates of $3.28. (Reporting by Jaspreet Singh in Bengaluru and Max A. Cherney in San Francisco; Editing by Shilpi Majumdar)

Chip design software firm Synopsys delivers record revenue as AI accelerates demand - SiliconANGLE

Chip design software firm Synopsys delivers record revenue as AI accelerates demand Silicon chip design software maker Synopsys Inc. delivered third-quarter earnings and revenue above expectations and then issued strong guidance, sending its stock higher in after-hours trading. The company, one of the leaders in the electronic design automation software industry, reported earnings before certain costs such as stock compensation of $3.43 per share, well ahead of the analysts' consensus estimate of $3.28. Revenue for the period rose 13% from a year earlier to $1.53 billion, also beating the Street's target of $1.52 billion. The rising revenue provided a nice boost to Synopsys' bottom line, with the company reporting net income for the quarter of $408.1 million, up from just $336.3 million in the year-ago period. Synopsys, based in Sunnyvale, California, sells software design tools used by computer chipmakers such as Intel Corp. and Qualcomm Inc. Its software helps to automate the semiconductor design process. Chip design involves many stages, including design, verification, signoff, physical verification and more, and Synopsys' software can aid in each of these steps. Virtually every computer chip in the world has been designed using software from Synopsys or its rival Cadence Design Systems Inc. The growing compute requirements for artificial intelligence systems have led to companies clamoring for more powerful and complex chips, and Synopsys provides the tools chipmakers need to design that silicon. That demand likely explains why Synopsys' revenue figure was a quarterly record for the company. Synopsys President and Chief Executive Sassine Ghazi (pictured), who assumed the role one year earlier, said the company's expectations of a record year in terms of annual revenue demonstrate the strong resilience of its business. "The complexity and pace of technology innovation is accelerating as silicon and systems companies race to capitalize on AI in this era of pervasive intelligence," Ghazi said. "Synopsys is mission-critical to technology innovation and our customer set is expanding as more companies in more industries define and optimize system performance at the silicon level." That's apparent from the results of its biggest business unit, the design automation group, which includes digital and custom integrated circuit design software. It delivered $1.06 billion in sales, up 6% from a year earlier. In terms of guidance, Synopsys said it's looking for fourth-quarter sales of between $1.61 billion and $1.64 billion, with earnings pegged at a range of $3.27 to $3.32 per share. Those numbers are better than expected, with analysts looking for revenue of $1.62 billion and earnings of $3.25 per share. For the full year, Synopsys is guiding for revenue of $6.11 billion to $6.14 billion, with earnings of $13.07 to $13.12. Wall Street is looking for total annual sales of $6.12 billion and $12.96 in earnings. Shares of Synopsys rose by just over a percentage point in extended trading, following a similar gain during regular market hours. The company has been looking to refine its business of late. In January, it announced plans to acquire the engineering software firm Ansys Inc. for $35 billion, in an acquisition that is now being examined by the U.K.'s Competition and Markets Authority. If that deal goes ahead, it will see Synopsys' EDA solutions combined with Ansys' simulation and analyst capabilities to deliver a seamlessly integrated silicon-to-systems approach to innovation. Then in May, it said it has sold its software security business to the private equity firms Clearlake Capital Group LP and Francisco Partners Management LP for $2.1 billion.