Synopsys(SNPS) - 2025 Q2 - Quarterly Results

Financial Performance - Revenue for Q2 FY 2025 was $1.604 billion, a 10.2% increase from $1.455 billion in Q2 FY 2024[2] - GAAP net income for Q2 FY 2025 was $349.2 million, or $2.24 per diluted share, compared to $299.1 million, or $1.92 per diluted share in Q2 FY 2024[6] - Non-GAAP net income for Q2 FY 2025 was $572.7 million, or $3.67 per diluted share, up from $466.9 million, or $3.00 per diluted share in Q2 FY 2024[7] - The company reported a net income of $345,110,000 for the three months ended April 30, 2025, compared to $289,089,000 for the same period in 2024, marking a year-over-year increase of 19.4%[35] - Net income for the six months ended April 30, 2025, was $642.5 million, a decrease of 12.6% compared to $735.3 million for the same period in 2024[40] Revenue Guidance - The company reaffirmed its full-year 2025 revenue guidance, projecting revenue between $6.745 billion and $6.805 billion[12] - For Q3 FY 2025, revenue is expected to range from $1.755 billion to $1.785 billion[12] Operating Performance - Non-GAAP operating margin guidance for FY 2025 remains unchanged, reflecting confidence in business demand[5] - Operating income for the six months ended April 30, 2025, was $628,265,000, a decrease from $684,698,000 in the same period of 2024[35] - Revenue from the Design Automation segment for the six months ended April 30, 2025, was $2.14 billion, representing a 5.0% increase from $2.04 billion in the same period of 2024[46] - Adjusted operating income for the Design IP segment was $277.1 million for the six months ended April 30, 2025, down 25.2% from $370.5 million in the prior year[46] - The adjusted operating margin for the Design Automation segment improved to 40.3% from 38.1% year-over-year[46] Cash and Assets - Cash and cash equivalents increased significantly to $14,119,095,000 as of April 30, 2025, compared to $3,896,532,000 on October 31, 2024[38] - Total current assets rose to $16,879,029,000 as of April 30, 2025, up from $6,469,666,000 on October 31, 2024[38] - Cash, cash equivalents, and restricted cash at the end of the period totaled $14.12 billion, significantly up from $1.51 billion at the end of the previous year[42] Expenses and Liabilities - Research and development expenses for the three months ended April 30, 2025, were $553,979,000, compared to $493,136,000 in the same period of 2024, reflecting an increase of 12.3%[35] - Total liabilities as of April 30, 2025, were $13,840,912,000, significantly higher than $4,050,355,000 on October 31, 2024[38] - Cash flows from operating activities provided $207.9 million, down 46.5% from $388.8 million in the prior year[42] Strategic Focus - The company continues to focus on AI and software-defined systems as key growth drivers in a complex design environment[3] - The company anticipates the completion of the acquisition of ANSYS, Inc., which is expected to impact future financial results positively[31] - Synopsys delivers comprehensive silicon to systems design solutions, partnering with semiconductor and systems customers to enhance R&D capabilities[63] Tax and Non-GAAP Measures - The effective tax rate for Q2 FY 2025 was 11.9% on a GAAP basis, while the non-GAAP effective tax rate was 16.0%[24] - The company adopts a non-GAAP tax rate of 16% for fiscal year 2025 to provide consistency across reporting periods and align with expected geographic earnings mix[61] - The company continues to focus on non-GAAP financial measures to provide a clearer view of its core business operations and future performance expectations[50] Acquisitions and Divestitures - The company completed the sale of its Software Integrity business on September 30, 2024, which is now classified as a discontinued operation[5] - The company incurs significant expenses related to acquisitions and divestitures, including compensation expenses and professional fees, which are excluded from core operations for consistent comparison across periods[57] - Restructuring charges include severance and termination benefits, aimed at aligning costs with business strategies, and are not considered part of core operations[59] - Gains and losses from the sale of strategic investments in privately held companies are excluded as they do not reflect core business results[60] Financing Activities - Proceeds from debt issuance amounted to $10.03 billion, indicating significant financing activity during the period[42]