Key TakeawaysSynopsys shares surged to an all-time high Thursday, after the software firm posted better-than-expected first-quarter results and guidance on the back of the AI boom. The Sunnyvale, Calif.-based company projected adjusted earnings per share for the current quarter ranging between $3.09 and $3.14.CEO Sassine Ghazi credited customers' spending on AI for the bullish numbers.Synopsys Inc. (SNPS) shares surged to an all-time high Thursday, after the software firm posted better-than-expected first-q ...

Synopsys (SNPS) shares gained 4.7% during Wednesday’s extended trading session after the company reported better-than-expected first-quarter fiscal 2024 results. The company’s first-quarter non-GAAP earnings per share (EPS) of $3.56 beat the Zacks Consensus Estimate of $3.43. The bottom line improved 35.9% year over year, primarily driven by higher revenues and better cost management.Revenues jumped 21% year over year to $1.65 billion, driven by growth across its business segments. The top line was in line ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-Q (MARK ONE) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE QUARTERLY PERIOD ENDED JANUARY 31, 2024 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE TRANSITION PERIOD FROM TO COMMISSION FILE NUMBER: 000-19807 SYNOPSYS, INC. (Exact name of registrant as specified in its charter) Delaware 56-1546236 (State or other jurisdiction ...

Financial Data and Key Metrics - Revenue for Q1 2024 was $1.65 billion, up 21% year-over-year, at the upper end of the guidance range [3] - Non-GAAP operating margin was 38.7%, up approximately 3.5 points year-over-year [3] - Non-GAAP EPS was $3.56, up 36% year-over-year, surpassing the upper end of the guidance range [3][23] - Operating cash outflow was $88 million for the quarter, with cash and short-term investments ending at $1.27 billion [14] - Full-year 2024 revenue guidance is $6.57 billion to $6.63 billion, with non-GAAP EPS expected to grow 20% to 21% [15][56] Segment Performance Design Automation - Revenue was $985.3 million, up 11% year-over-year, with an adjusted operating margin of 37% [14] - Strong design win activity, including industry-first tape-outs for GAA-based mobile cores and server SoCs at advanced nodes [6] - VSO.ai saw strong demand, with a large North American HPC semiconductor company deploying it across four projects [7] - TSO.ai demonstrated a 20% reduction in total pattern count, and Silicon.da analytics saw significant engagement growth [8] Design IP - Revenue was $525.7 million, up 53% year-over-year, driven by broad-based strength, with an adjusted operating margin of 47.5% [14] - Closed multiyear, multinode, and multi-foundry agreements for next-generation automotive and IoT platforms [10] - PCIe 6.0 IP led the industry with over 50 lifetime wins, and PCIe 7.0 technology was showcased at DesignCon 2024 [10] - Launched the new ARC 5 RISC-V-based portfolio, attracting strong customer interest [11] Software Integrity - Revenue was $138.2 million, up 8% year-over-year, with an adjusted operating margin of 17.3% [14] - The company continues to evaluate strategic alternatives for this business [144] Market Trends and Strategic Direction - The semiconductor industry is scaling towards $1 trillion in revenue by the end of the decade, driven by AI, silicon proliferation, and software-defined systems [4] - Synopsys is positioned to capitalize on the shift towards a silicon-to-systems approach, with customers increasingly adopting system-level design methodologies [5] - The company announced its intent to acquire Ansys, which will expand its TAM by 1.5 times to $28 billion and enhance its silicon-to-systems strategy [25] - Multi-die packaging is a significant growth driver, with Synopsys securing four die-to-die IP engagements in the quarter [30] Management Commentary on Operating Environment and Future Outlook - The company is confident in its leadership position, robust customer design activity, and the resilience of its time-based business model [15] - Synopsys is entering an era of pervasive intelligence, with AI and smart technologies driving demand for more sophisticated silicon and system-level solutions [24] - The Ansys acquisition is expected to close in the first half of 2024, with customer feedback being overwhelmingly positive [25][92] Other Important Information - The company launched Synopsys.ai, focusing on optimization, XSO.ai analytics, and generative AI, including a copilot for chip design [26] - Synopsys.ai copilot, developed in collaboration with Microsoft, aims to accelerate chip design through generative AI capabilities [28] - The company demonstrated the industry's first silicon success for UCIeS IP in TSMC's N5 process, highlighting its leadership in multi-die packaging [30] Q&A Session Summary China Market and Revenue Trends - Q1 sales in China were modestly accretive to overall growth, but the company expects headwinds to continue for the remainder of the year [36][37] - The backlog stood at $8.2 billion, down from a record $8.6 billion in Q4, reflecting normal lumpiness in timing of big orders [38] IP Business Performance - The IP business saw 50% growth in Q1, driven by new standards, multi-die packaging, and increased demand for interface IP [42][65][66] - The company expects IP demand to remain strong due to the secular trend of silicon proliferation and more sophisticated chip designs [66] Ansys Acquisition and Customer Feedback - Customer feedback on the Ansys acquisition has been overwhelmingly positive, with customers looking forward to deeper integration and system-level solutions [92][119] - The acquisition is expected to bring cross-sell opportunities and synergies, with a projected run rate of $400 million in synergies by year four [100] Hardware Business and Inventory - Inventory grew by 17% quarter-on-quarter to support record hardware demand, with hardware becoming a critical part of customer design processes [86][113] - The company anticipates another record year for hardware, driven by the increasing complexity of chip designs [86] AI and Edge Computing Trends - AI is expanding beyond data centers into edge and endpoint devices, creating opportunities for Synopsys in automotive, smartphones, and IoT [90][91] - The company is engaged with customers developing AI capabilities for a wide range of applications, reinforcing its position in the era of pervasive intelligence [91]

Synopsys (SNPS) reported $1.65 billion in revenue for the quarter ended January 2024, representing a year-over-year increase of 21.2%. EPS of $3.56 for the same period compares to $2.62 a year ago.The reported revenue represents a surprise of +0.23% over the Zacks Consensus Estimate of $1.65 billion. With the consensus EPS estimate being $3.43, the EPS surprise was +3.79%.While investors scrutinize revenue and earnings changes year-over-year and how they compare with Wall Street expectations to determine th ...

Synopsys (SNPS) came out with quarterly earnings of $3.56 per share, beating the Zacks Consensus Estimate of $3.43 per share. This compares to earnings of $2.62 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of 3.79%. A quarter ago, it was expected that this maker of software used to test and develop chips would post earnings of $3.04 per share when it actually produced earnings of $3.17, delivering a surprise of 4.28%.Over the ...

Close Collaboration with EDA Flows and Broad IP Portfolio Enables Chipmakers to Boost Performance and Speed Time to Market Highlights: Synopsys digital and analog EDA flows are certified and optimized to meet power, performance, and area targets on the Intel 18A process Broad portfolio of high-quality Synopsys IP reduces integration risk and accelerates time to market, providing a competitive edge to designers adopting the Intel 18A process Synopsys 3DIC Compiler, a unified exploration-to-signoff platform, ...

Financial Performance - Record quarterly revenue of $1.649 billion, up approximately 21% year over year compared to $1.361 billion in Q1 FY 2023[2] - GAAP net income for Q1 FY 2024 was $449.1 million, or $2.89 per diluted share, compared to $271.5 million, or $1.75 per diluted share in Q1 FY 2023[5] - Non-GAAP net income for Q1 FY 2024 was $553.7 million, or $3.56 per diluted share, compared to $406.7 million, or $2.62 per diluted share in Q1 FY 2023[6] - Total revenue for the first quarter of fiscal year 2024 was $1,649.2 million, a 21.2% increase from $1,361.3 million in the same period of fiscal year 2023[36] - Net income attributed to Synopsys for the first quarter was $449.1 million, a 65.5% increase compared to $271.5 million in the prior year[36] Revenue Segmentation - Design Automation segment revenue was $985.3 million, representing 59.7% of total revenue, while Design IP segment revenue rose to $525.7 million, accounting for 31.9% of total revenue[46] - Time-based products revenue increased to $904.4 million, up 15.6% from $782.3 million year-over-year[36] Guidance and Targets - The company reaffirmed its full-year 2024 targets for revenue and non-GAAP operating margin, while raising non-GAAP EPS guidance[3] - Financial targets for Q2 FY 2024 include revenue range of $1.560 billion to $1.590 billion and non-GAAP EPS range of $3.09 to $3.14[12] - For the full fiscal year 2024, revenue targets are set between $6.570 billion and $6.630 billion, with non-GAAP EPS targets between $13.47 and $13.55[12] Operational Highlights - The company highlighted strong execution driven by AI investments from customers in silicon and systems[3] - Synopsys operates in three segments: Design Automation, Design IP, and Software Integrity, contributing to robust design activity among semiconductor and systems customers[7] Financial Metrics - The effective non-GAAP tax rate for Q1 FY 2024 was 15.0%[24] - Cash and cash equivalents decreased to $1,118.9 million from $1,438.9 million at the end of the previous quarter[39] - Total assets increased to $10,558.3 million, up from $10,333.1 million at the end of the previous quarter[39] - The company reported a gross margin of $1,320.1 million, reflecting a strong operational performance compared to $1,077.0 million in the same quarter last year[36] - GAAP total operating income for the three months ended January 31, 2024, was $359.6 million, up from $255.9 million in the same period of 2023, representing an increase of 40.5%[48] - Total adjusted segment operating income increased to $638.4 million in Q1 2024 from $479.2 million in Q1 2023, reflecting a growth of 33.3%[48] Expenses and Adjustments - Stock-based compensation expenses rose to $180.7 million in Q1 2024 from $134.2 million in Q1 2023, an increase of 34.5%[48] - Amortization of acquired intangible assets increased to $27.1 million in Q1 2024 compared to $25.4 million in Q1 2023, a rise of 6.7%[48] - Non-qualified deferred compensation plan expenses increased significantly to $40.1 million in Q1 2024 from $20.2 million in Q1 2023, marking a 98.0% increase[48] - Acquisition/divestiture related items accounted for $30.9 million in Q1 2024, up from $2.6 million in Q1 2023, indicating a substantial increase[48] Strategic Initiatives - The company plans to explore strategic alternatives for its Software Integrity segment amid ongoing macroeconomic uncertainties[33] - Synopsys is in the process of acquiring ANSYS, Inc., with expectations regarding financing and regulatory approvals still pending[33] Non-GAAP Measures - The company has adopted a non-GAAP tax rate of 15% for fiscal year 2024 to provide better consistency across interim reporting periods[61] - Synopsys has begun excluding gains (losses) on the sale of strategic investments from non-GAAP financial measures in Q1 2024[54] - Synopsys emphasizes that non-GAAP financial measures are intended to supplement GAAP measures and provide a clearer view of core business operations[53] Additional Notes - The first quarter included a favorable impact of one additional week compared to FY 2023[2] - The first quarter of fiscal year 2024 included one extra week compared to the first quarter of fiscal year 2023[51]

In its upcoming report, Synopsys (SNPS) is predicted by Wall Street analysts to post quarterly earnings of $3.43 per share, reflecting an increase of 30.9% compared to the same period last year. Revenues are forecasted to be $1.61 billion, representing a year-over-year increase of 18.6%.The consensus EPS estimate for the quarter has undergone a downward revision of 1.4% in the past 30 days, bringing it to its present level. This represents how the covering analysts, as a whole, have reassessed their initial ...

Synopsys (SNPS) is expected to deliver a year-over-year increase in earnings on higher revenues when it reports results for the quarter ended January 2024. This widely-known consensus outlook gives a good sense of the company's earnings picture, but how the actual results compare to these estimates is a powerful factor that could impact its near-term stock price.The stock might move higher if these key numbers top expectations in the upcoming earnings report, which is expected to be released on February 21. ...