Core Insights - Synopsys reported disappointing fiscal Q3 results, missing Wall Street expectations for both earnings and sales, leading to an 18% drop in stock price during after-hours trading [1][6]. - The company earned an adjusted $3.39 per share on sales of $1.74 billion, while analysts had anticipated earnings of $3.80 per share on sales of $1.77 billion [2]. - For the upcoming fiscal Q4, Synopsys forecasts adjusted earnings of $2.78 per share on sales of $2.25 billion, significantly below Wall Street's expectations of $4.50 per share on sales of $2.01 billion [3]. Financial Performance - In the year-ago quarter, Synopsys earned an adjusted $3.43 per share on sales of $1.53 billion, indicating a slight decline in earnings year-over-year [2]. - The fiscal Q3 report was the first following the $35 billion acquisition of Ansys, which is expected to enhance Synopsys's portfolio and market position [4]. - The company's intellectual property business underperformed during the quarter, as noted by the CEO [5]. Market Reaction - Following the earnings report, Synopsys stock fell 18% to $495 in after-hours trading, after a regular session close of $604.37, which was a 0.8% decline [6]. - Synopsys is currently in a flat base with a buy point of $651.73, according to IBD MarketSurge charts, and is listed among IBD Tech Leaders [6].

Core Viewpoint - Synopsys' shares rose by 5.5% following the U.S. Federal Trade Commission's conditional approval of its $35 billion acquisition of Ansys, with the deal expected to enhance Synopsys' capabilities in semiconductor design and analysis [1][2][3]. Group 1: Acquisition Details - The acquisition of Ansys has received approval from the European Commission and is now pending approval from China, with a potential closing date in the second half of 2026 [2]. - The deal is significant as it positions Synopsys to lead in the evolving semiconductor market, where the complexity of products is increasing [3][5]. Group 2: Strategic Importance - The integration of Ansys' simulation and analysis software with Synopsys' electronic design automation tools will enable companies to design and analyze semiconductor products more effectively [3][5]. - This acquisition aligns with broader industry trends, as seen with Siemens' recent acquisition of Altair, indicating a shift towards more comprehensive simulation and analysis capabilities in the sector [6]. Group 3: Investor Sentiment - The conditional approval from the FTC is likely to boost investor confidence in Synopsys, as it represents a step closer to realizing long-term growth opportunities from the acquisition [6][7]. - Investors are optimistic about the completion of the Ansys deal, viewing it as a critical component of Synopsys' investment case [6][7].