Synopsys Inc【SNPS】株式ニュース

Synopsys Posts Financial Results for Second Quarter Fiscal Year 2026May 27, 2026 4:05 PM
PR Newswire (US) Announces Plan for September 2026 Investor DayResults SummaryQuarterly revenue of $2.276 billion, above prior guidance; quarterly GAAP earnings per diluted share (EPS) of $0.09, and non-GAAP EPS of $3.35Raising expectations for full-year total revenue to $9.665 billion at the midpoint, driven by strong performance across the business and an EPS-neutral Ansys channel-related accounting impact, partly offset by the impending close of the Processor IP Solutions businessRaising full-year non-GAAP EPS guidance to $14.76 at the midpoint on expanded operating margin driven by strong cost discipline and accelerating synergiesSUNNYVALE, Calif., May 27, 2026 /PRNewswire/ -- Synopsys, Inc. (Nasdaq: SNPS) today reported results for its second quarter of fiscal year 2026. Revenue for the second quarter of fiscal year 2026 was $2.276 billion, compared to $1.604 billion for the second quarter of fiscal year 2025. "Synopsys delivered a strong second quarter with solid execution and strength across the business," said Sassine Ghazi, Synopsys president and CEO. "AI is scaling semiconductor demand, architectural diversity and complexity of chips and the systems they power - driving demand across our portfolio. Our momentum, leadership roadmap, and deep customer engagements are a strong foundation for sustained growth and margin expansion as we solve our customers' toughest engineering challenges.""Second quarter revenue and non-GAAP EPS exceeded guidance. Our continued focus on execution and financial discipline sets us up for a strong second half," said Shelagh Glaser, CFO of Synopsys. "We are raising our targets for revenue, operating margin, EPS, and free cash flow for the year, as we drive greater efficiency across the business."The company plans to host an Investor Day on Sept. 30, during which management will provide additional detail regarding the company's long-term financial targets and strategy to capitalize on its sizable opportunity as the leader in engineering solutions from silicon to systems.GAAP Results
On a U.S. generally accepted accounting principles (GAAP) basis, net income for the second quarter of fiscal year 2026 was $17.1 million, or $0.09 per diluted share, compared to $349.2 million, or $2.24 per diluted share, for the second quarter of fiscal year 2025.Non-GAAP Results
On a non-GAAP basis, net income for the second quarter of fiscal year 2026 was $643.7 million, or $3.35 per diluted share, compared to non-GAAP net income of $572.7 million, or $3.67 per diluted share, for the second quarter of fiscal year 2025.For a reconciliation of net income, earnings per diluted share and other measures on a GAAP and non-GAAP basis, see "GAAP to Non-GAAP Reconciliation" in the accompanying tables below.Business Segments
Synopsys reports revenue and operating income in two segments: (1) Design Automation, which includes our advanced silicon design, verification products and services, Ansys products, system integration products and services, digital, custom and field programmable gate array IC design software, verification software and hardware products, manufacturing software products and other; and (2) Design IP, which includes our logic libraries, embedded memories, wired interface IP, memory interface IP, security IP, and embedded processors.Financial Targets
Synopsys also provided its consolidated financial targets for the third quarter and full fiscal year 2026. These targets assume no further changes to export control restrictions or the current U.S. government "Entity List" restrictions. These targets constitute forward-looking statements and are based on current expectations. For a discussion of factors that could cause actual results to differ materially from these targets, see "Forward-Looking Statements" below.Third Quarter and Full Fiscal Year 2026 Financial Targets(in millions, except per share amounts)

Range for Three Months
Ending
Range for Fiscal Year
Ending
July 31, 2026
October 31, 2026
LowHigh
LowHighRevenue (1)$         2,410$         2,460
$         9,625$         9,705GAAP Expenses$         2,075$         2,125
$         8,469$         8,599Non-GAAP Expenses$         1,440$         1,470
$         5,675$         5,725Non-GAAP Interest and Other Income (Expense), net$ (121)$ (117)
$ (495)$ (485)Non-GAAP Tax Rate18 %18 %
18 %18 %Outstanding Shares (fully diluted)192194
192194GAAP EPS$ 0.84$ 0.98
$ 2.49$ 2.91Non-GAAP EPS$ 3.63$ 3.69
$         14.72$         14.80Operating Cash Flow

~$2,300Free Cash Flow (2)

~$2,000Capital Expenditures

~$300

(1) Fiscal year 2026 revenue includes $2.96 billion of expected Ansys revenue (including $60 million related to an
accounting impact for Ansys channel partners), and reflects the impact of approximately $110 million of the
divested Optical Solutions Group and PowerArtist RTL businesses, and $40 million related to the expected divestiture of the Processor IP Solutions business. (2) Free cash flow is calculated as cash provided from operating activities less capital expenditures.

Fiscal Year 2026 Revenue Target Raise Breakdown(in millions)

For Fiscal Year EndingOctober 31, 2026
Prior Guidance
Mid-PointBusiness
PerformanceAnsys Channel Accounting
ImpactProcessor IP
Solutions
DivestitureNew Guidance Mid-PointRevenue$9,610+ $35+ $60($40)$9,665For a reconciliation of Synopsys' third quarter and fiscal year 2026 targets, including expenses, earnings per diluted share and other measures on a GAAP and non-GAAP basis, a discussion of the financial targets that we are not able to reconcile without unreasonable efforts and a discussion of why management believes such measurements provide useful information to investors, see "GAAP to Non-GAAP Reconciliation" in the accompanying tables below.Earnings Call Open to Investors
Synopsys will hold a conference call for financial analysts and investors today at 2:00 p.m. Pacific Time. A live webcast of the call will be available in the investor relations portion of Synopsys' corporate website at www.synopsys.com. Synopsys uses its website as a tool to disclose important information about Synopsys and comply with its disclosure obligations under Regulation Fair Disclosure. A webcast replay will also be available on the corporate website from approximately 5:30 p.m. Pacific Time today through the time Synopsys announces its results for the third quarter of fiscal year 2026.Availability of Final Financial Statements
Synopsys will include final financial statements for the second quarter of fiscal year 2026 in its quarterly report on Form 10-Q to be filed with the Securities and Exchange Commission (SEC) and available at www.sec.gov on or before June 9, 2026.Continuing Operations
On Sept. 30, 2024, Synopsys completed the sale of its Software Integrity business. Unless otherwise noted, Synopsys' Software Integrity business has been presented as a discontinued operation in the Synopsys' consolidated financial statements for all periods presented herein and all financial results and targets are presented herein on a continuing operations basis.Reconciliation of Second Quarter Fiscal Year 2026 Results
The following tables reconcile the specific items excluded from GAAP in the calculation of non-GAAP net income, earnings per diluted share, and tax rate for the periods indicated below.GAAP to Non-GAAP Reconciliation of Second Quarter Fiscal Year 2026 Results(unaudited and in thousands, except per share amounts)

Three Months Ended
Six Months Ended
April 30,
April 30,
2026
2025
2026
2025GAAP net income from continuing operations attributed to
Synopsys$           17,105
$    349,232
$      82,063
$    644,915Adjustments:

Amortization of acquired intangible assets403,631
11,656
807,866
24,252Stock-based compensation222,303
201,723
481,027
388,002Restructuring charges115,894
—
234,176
—Acquisition/divestiture related items23,649
69,514
39,241
144,343Loss on sale of strategic investments—
2,435
—
2,435Tax adjustments(138,848)
(61,862)
(282,170)
(158,076)Non-GAAP net income from continuing operations attributed to
Synopsys$         643,734
$    572,698
$  1,362,203
$  1,045,871

Three Months Ended
Six Months Ended
April 30,
April 30,
2026
2025
2026
2025GAAP net income from continuing operations per diluted share
attributed to Synopsys$              0.09
$        2.24
$        0.43
$        4.13Adjustments:

Amortization of acquired intangible assets2.10
0.07
4.22
0.16Stock-based compensation1.16
1.29
2.51
2.48Restructuring charges0.60
—
1.22
—Acquisition/divestiture related items0.12
0.45
0.20
0.92Loss on sale of strategic investments—
0.02
—
0.02Tax adjustments(0.72)
(0.40)
(1.47)
(1.02)Non-GAAP net income from continuing operations per diluted
share attributed to Synopsys$              3.35
$        3.67
$        7.11
$        6.69

Shares used in computing net income per diluted share amounts: 192,144
156,088
191,580
156,218

GAAP to Non-GAAP Tax Rate Reconciliation(unaudited)

Three Months EndedSix Months Ended
April 30, 2026April 30, 2026GAAP effective tax rate12.5 %17.0 %Stock-based compensation9.7 %4.7 %Restructuring charges(2.1) %(2.1) %Income tax adjustments (1)(2.1) %(1.6) %Non-GAAP effective tax rate18.0 %18.0 %

(1) The tax adjustments are primarily due to differences in the tax rate effect of certain deductions, such as the
deduction for foreign-derived intangible income and credits.Reconciliation of 2026 Targets
The following tables reconcile the specific items excluded from GAAP in the calculation of non-GAAP targets for the periods indicated below.GAAP to Non-GAAP Reconciliation of Third Quarter Fiscal Year 2026 Targets(in thousands, except per share amounts)

Range for Three Months Ending

July 31, 2026

Low
HighTarget GAAP expenses
$      2,075,000
$      2,125,000Adjustments:

      Amortization of acquired intangible assets
(400,000)
(405,000)      Stock-based compensation
(230,000)
(240,000)      Restructuring charges
(5,000)
(10,000)Target non-GAAP expenses
$      1,440,000
$      1,470,000

Range for Three Months Ending

July 31, 2026

Low
HighTarget GAAP earnings per diluted share attributed to Synopsys
$             0.84
$             0.98Adjustments:

      Amortization of acquired intangible assets
2.10
2.07      Stock-based compensation
1.24
1.19      Restructuring charges
0.05
0.03      Tax adjustments
(0.60)
(0.58)Target non-GAAP earnings per diluted share attributed to Synopsys
$             3.63
$             3.69

Shares used in non-GAAP calculation (midpoint of target range)
193,000
193,000

GAAP to Non-GAAP Reconciliation of Full Fiscal Year 2026 Targets(in thousands, except per share amounts)

Range for Fiscal Year Ending

October 31, 2026

Low
HighTarget GAAP expenses
$      8,469,241
$      8,599,241Adjustments:

      Amortization of acquired intangible assets
(1,610,000)
(1,620,000)      Stock-based compensation
(945,000)
(965,000)      Restructuring charges
(200,000)
(250,000)      Acquisition/divestiture related items (1)
(39,241)
(39,241)Target non-GAAP expenses
$      5,675,000
$      5,725,000

Range for Fiscal Year Ending

October 31, 2026

Low
HighTarget GAAP earnings per diluted share attributed to Synopsys
$             2.49
$             2.91Adjustments:

      Amortization of acquired intangible assets
8.39
8.34      Stock-based compensation
5.00
4.90      Restructuring charges
1.30
1.04      Acquisition/divestiture related items (1)
0.20
0.20      Tax adjustments
(2.66)
(2.59)Target non-GAAP earnings per diluted share attributed to Synopsys
$           14.72
$           14.80

Shares used in non-GAAP calculation (midpoint of target range)
193,000
193,000

(1) Adjustments reflect actual expenses incurred by Synopsys as of April 30, 2026, and do not fully reflect all
potential adjustments for future periods for the reasons set forth in "GAAP to Non-GAAP Reconciliation"
below.Forward-Looking Statements
This press release and the investor conference call contain forward-looking statements, including, but not limited to, statements concerning our short-term and long-term financial targets, expectations and objectives; our businesses, business segments, strategies, partnerships, initiatives and opportunities, including, among other things, the reallocation of resources in our Design IP segment to higher growth opportunities and planned restructuring activities; industry growth and technological trends, such as artificial intelligence, including our development and planned commercialization thereof; business and market outlook; the potential impact of the uncertain macroeconomic environment and global economic conditions on our financial results; the impact of current and future U.S. and foreign trade regulations, government actions and regulatory changes, such as export control restrictions and tariffs; the ANSYS, Inc. (Ansys) integration and its expected impact, including expected synergies and the timing thereof, our ability to create joint solutions as a combined company, and related accounting changes; planned acquisitions or divestitures, including the expected completion of the sale of the Processor IP Solutions business, and their anticipated timing and impact; our key customers, customer concentration, customer engagement, customer demand and market expansion; results and strategies related to our products, technology and services, including product development and our planned product releases and capabilities; the expected realization of our contracted but unsatisfied or partially unsatisfied performance obligations (backlog); planned stock repurchases; our expected tax rate; and the status, expected outcome or expected impact of litigation and/or regulatory investigations. These statements involve risks, uncertainties and other factors that could cause our actual results, time frames or achievements to differ materially from those expressed or implied in such forward-looking statements. Such risks, uncertainties and factors include, but are not limited to: macroeconomic conditions and geopolitical uncertainty in the global economy; uncertainty in the growth of the semiconductor and electronics industries; the highly competitive industry we operate in; actions by the U.S. or foreign governments, such as the imposition of additional export restrictions or tariffs; consolidation among our customers and our dependence on a relatively small number of large customers; risks and compliance obligations relating to the global nature of our operations; failure to realize the benefits expected from the transactions we complete, including the acquisition of Ansys (the Ansys Merger) or unexpected difficulties or expenditures arising therefrom; risks related to inaccuracies in, or failures to achieve, our operational and business metrics or forecasts of growth; and more. Additional information on potential risks, uncertainties and other factors that could affect Synopsys' results is included in filings we make with the SEC from time to time, including in the sections entitled "Risk Factors" in our latest Annual Report on Form 10-K and in our latest Quarterly Report on Form 10-Q. The financial information contained in this press release should be read in conjunction with the consolidated financial statements and notes thereto included in Synopsys' most recent reports on Forms 10-K and 10-Q, each as may be amended from time to time. Synopsys' financial results for its second quarter of fiscal year 2026 are not necessarily indicative of Synopsys' operating results for any future periods.Effectiveness of Information
The targets included in this press release, the statements made during the earnings conference call, the information contained in the financial supplement and the corporate overview presentation, each of which are available in the investor relations portion of Synopsys' corporate website at www.synopsys.com (collectively, the Earnings Materials), represent Synopsys' expectations and beliefs as of May 27, 2026. Although these Earnings Materials are expected to remain available on Synopsys' website through the time Synopsys announces its results for the third quarter of fiscal year 2026, their continued availability through such time does not mean that Synopsys is reaffirming or confirming their continued validity. Synopsys undertakes no duty, and does not intend, to update any forward-looking statement, including any targets, provided in the Earnings Materials, whether as a result of new information, future events or otherwise, unless required by law.SYNOPSYS, INC.Unaudited Condensed Consolidated Statements of Income(in thousands, except per share amounts)

Three Months Ended
Six Months Ended
April 30,
April 30,
2026
2025
2026
2025Revenue:

Time-based products$          945,624
$          828,326
$        1,897,165
$        1,656,564 Upfront products546,252
510,676
1,287,782
878,800    Total products revenue1,491,876
1,339,002
3,184,947
2,535,364 Maintenance and service784,109
265,264
1,499,836
524,217      Total revenue2,275,985
1,604,266
4,684,783
3,059,581Cost of revenue:

Products232,897
216,216
475,299
385,058 Maintenance and service148,597
94,471
295,335
187,008 Amortization of acquired intangible assets248,356
7,660
496,598
16,256      Total cost of revenue629,850
318,347
1,267,232
588,322Gross margin1,646,135
1,285,919
3,417,551
2,471,259Operating expenses:

Research and development700,124
553,979
1,415,112
1,107,195 Sales and marketing381,998
215,021
778,373
424,220 General and administrative172,418
136,497
355,150
303,583 Amortization of acquired intangible assets 155,275
3,996
311,268
7,996 Restructuring charges115,894
—
234,176
—      Total operating expenses1,525,709
909,493
3,094,079
1,842,994Operating income120,426
376,426
323,472
628,265Interest expense(133,364)
(94,336)
(296,079)
(105,475)Other income (expense), net32,214
114,101
70,936
164,518Income before income taxes19,276
396,191
98,329
687,308Provision for income taxes2,408
47,181
16,745
40,887Net income from continuing operations16,868
349,010
81,584
646,421Loss from discontinued operations, net of income
taxes—
(3,900)
—
(3,900)Net income16,868
345,110
81,584
642,521Less: Net income (loss) attributed to non-controlling
interest and redeemable non-controlling interest(237)
(222)
(479)
1,506Net income attributed to Synopsys$           17,105
$          345,332
$           82,063
$          641,015

Net income (loss) attributed to Synopsys

Continuing operations$           17,105
$          349,232
$           82,063
$          644,915 Discontinued operations—
(3,900)
—
(3,900) Net income$           17,105
$          345,332
$           82,063
$          641,015

Net income (loss) per share attributed to Synopsys -
basic:

Continuing operations$             0.09
$             2.25
$             0.43
$             4.17 Discontinued operations—
(0.02)
—
(0.03) Basic net income per share$             0.09
$             2.23
$             0.43
$             4.14

Net income (loss) per share attributed to Synopsys -
diluted:

Continuing operations$             0.09
$             2.24
$             0.43
$             4.13 Discontinued operations—
(0.03)
—
(0.03) Diluted net income per share$             0.09
$             2.21
$             0.43
$             4.10

Shares used in computing per share amounts:

Basic191,464
154,927
190,513
154,666 Diluted192,144
156,088
191,580
156,218

SYNOPSYS, INC.Unaudited Condensed Consolidated Balance Sheets(in thousands, except par value amounts)

April 30, 2026
October 31, 2025ASSETS:

Current assets:

Cash and cash equivalents
$        2,412,472
$        2,888,030 Short-term investments
71,966
72,929          Total cash, cash equivalents and short-term investments
2,484,438
2,960,959 Accounts receivable, net
1,267,305
1,505,427 Inventories
441,836
365,190 Prepaid and other current assets
1,195,391
1,180,526 Current assets held for sale
48,248
—          Total current assets
5,437,218
6,012,102Property and equipment, net
714,744
696,693Operating lease right-of-use assets, net
697,112
702,008Goodwill
26,853,807
26,899,215Intangible assets, net
11,875,418
12,679,591Deferred income taxes
113,642
112,159Other long-term assets
1,197,086
1,122,693           Total assets
$      46,889,027
$      48,224,461

LIABILITIES AND STOCKHOLDERS' EQUITY:

Current liabilities:

Accounts payable and accrued liabilities
$        1,185,204
$        1,326,211 Operating lease liabilities
135,523
128,205 Deferred revenue
2,419,876
2,245,961 Short-term debt
22,117
22,117 Current liabilities held for sale
27,912
—           Total current liabilities
3,790,632
3,722,494Long-term operating lease liabilities
670,475
680,698Long-term deferred revenue
389,419
382,557Long-term debt
10,013,845
13,462,398Other long-term liabilities
1,547,591
1,649,299           Total liabilities
16,411,962
19,897,446Stockholders' equity:

Preferred stock, $0.01 par value: 2,000 shares authorized; none outstanding
—
— Common stock, $0.01 par value: 400,000 shares authorized; 191,444 and 185,994
shares outstanding, respectively
1,928
1,860 Capital in excess of par value
20,565,562
18,640,947 Retained earnings
10,397,550
10,315,487 Treasury stock, at cost: 593 and 1,222 shares, respectively
(242,827)
(398,278) Accumulated other comprehensive loss
(244,082)
(232,414)           Total Synopsys stockholders' equity
30,478,131
28,327,602Non-controlling interest
(1,066)
(587)           Total stockholders' equity
30,477,065
28,327,015           Total liabilities and stockholders' equity
$      46,889,027
$      48,224,461

SYNOPSYS, INC.Unaudited Condensed Consolidated Statements of Cash Flows(in thousands)

Six Months Ended April 30,
2026
2025CASH FLOWS FROM OPERATING ACTIVITIES:

Net income $           81,584
$          642,521Adjustments to reconcile net income to net cash provided by operating
activities:

Amortization and depreciation907,177
96,838Reduction of operating lease right-of-use assets72,852
51,728Amortization of capitalized costs to obtain revenue contracts 41,158
25,405Stock-based compensation481,027
388,186Allowance for credit losses14,842
15,940Loss on sale of strategic investments—
2,435Gain on sale of building—
(51,385)Loss on divestitures, net of transaction costs—
8,299Amortization of bridge financing costs—
40,411Amortization of debt issuance costs16,903
2,348Deferred income taxes(121,045)
(237,170)Other (153)
(181)Net changes in operating assets and liabilities, net of effects from
acquisitions and dispositions:

Accounts receivable234,512
(74,098)Inventories(85,832)
(39,766)Prepaid and other current assets44,649
(140,472)Other long-term assets(87,060)
(36,058)Accounts payable and accrued liabilities(114,629)
(242,529)Operating lease liabilities(74,166)
(48,617)Income taxes(122,420)
(36,870)Deferred revenue196,367
(37,412)Unrealized loss on settlement of interest rate treasury lock—
(121,643)Net cash provided by operating activities1,485,766
207,910

CASH FLOWS FROM INVESTING ACTIVITIES:

Proceeds from maturities of short-term investments11,180
35,461Proceeds from sales of short-term investments3,656
22,015Purchases of short-term investments(13,903)
(47,558)Purchases of strategic investments(781)
(3,368)Purchases of property and equipment, net(89,518)
(96,303)Proceeds from sale of building—
74,279Proceeds from business divestiture, net of cash divested—
70,082Other—
(611)Net cash provided by (used in) investing activities(89,366)
53,997

CASH FLOWS FROM FINANCING ACTIVITIES:

Proceeds from debt, net of issuance costs—
10,034,464Repayment of debt (3,462,369)
(1,289)Issuances of common stock116,136
118,308Payments for taxes related to net share settlement of equity awards(217,884)
(166,872)Common stock issuance for private placement2,000,000
—Purchase of equity forward contract(37,500)
—Purchases of treasury stock(262,500)
—Redemption of redeemable non-controlling interest—
(30,000)Net cash provided by (used in) financing activities(1,864,117)
9,954,611Effect of exchange rate changes on cash, cash equivalents and restricted cash(9,247)
8,186Net change in cash, cash equivalents and restricted cash(476,964)
10,224,704Cash, cash equivalents and restricted cash, beginning of year2,893,721
3,898,729Cash, cash equivalents and restricted cash, end of period$        2,416,757
$      14,123,433

Synopsys provides segment information, namely revenue, adjusted segment operating income and adjusted segment operating margin, in accordance with Financial Accounting Standards Board Accounting Standards Codification Topic 280, Segment Reporting. Synopsys' chief operating decision maker (CODM) is our Chief Executive Officer. In evaluating our business segments, the CODM considers the income and expenses that the CODM believes are directly related to those segments. The CODM does not allocate certain operating expenses managed at a consolidated level to our business segments and, as a result, the reported operating income and operating margin do not include these unallocated expenses as shown in the table below. These unallocated expenses are presented in the table below to provide a reconciliation of the total adjusted operating income from segments to our consolidated operating income:SYNOPSYS, INC.Business Segment Reporting (1)(in millions)

Three Months Ended
April 30, 2026
Three Months Ended
April 30, 2025
Six Months Ended April 30, 2026
Six Months Ended
April 30, 2025

Revenue by segment

- Design Automation$            1,821.8
$             1,122.3
$             3,823.6
$             2,142.5% of Total80.0 %
70.0 %
81.6 %
70.0 %- Design IP$ 454.2
$ 482.0
$ 861.2
$ 917.1% of Total20.0 %
30.0 %
18.4 %
30.0 %

Adjusted operating income by segment

- Design Automation$ 789.1
$ 458.8
$             1,736.6
$ 863.4- Design IP$ 110.6
$ 150.5
$ 176.8
$ 277.1

Adjusted operating margin by segment

- Design Automation43.3 %
40.9 %
45.4 %
40.3 %- Design IP24.4 %
31.2 %
20.5 %
30.2 %

Total Adjusted Segment Operating Income Reconciliation (1)(in millions)

Three Months Ended
April 30, 2026
Three Months Ended
April 30, 2025
Six Months Ended April 30, 2026
Six Months Ended
April 30, 2025

GAAP total operating income – as reported$                120.4
$                376.4
$                323.5
$                628.3Other expenses managed at consolidated level

Amortization of acquired intangible assets403.6
11.7
807.9
24.3Stock-based compensation (2)222.3
201.7
481.0
388.2Restructuring charges115.9
—
234.2
—Acquisition/divestiture related items (3)23.6
39.6
39.2
100.3Non-qualified deferred compensation plan13.8
(20.1)
27.6
(0.5)Total adjusted segment operating income$                899.7
$                609.3
$               1,913.4
$               1,140.5

(1) Synopsys manages the business on a long-term, annual basis, and considers quarterly fluctuations of revenue and profitability as normal elements of our
business. Amounts may not foot due to rounding.(2) The adjustment includes non-GAAP expenses attributable to non-controlling interest and redeemable non-controlling interest.(3) The adjustment excludes the amortization of bridge financing costs entered into in connection with the Ansys Merger that was recorded in interest
expense, and certain divestiture related items that were recorded in other income (expense), net in our unaudited condensed consolidated statements of
income. GAAP to Non-GAAP Reconciliation
Synopsys continues to provide all information required in accordance with GAAP but acknowledges evaluating its ongoing operating results may not be as useful if an investor is limited to reviewing only GAAP financial measures. Accordingly, Synopsys presents non-GAAP financial measures in reporting its financial results to provide investors with an additional tool to evaluate Synopsys' operating results in a manner that focuses on what Synopsys believes to be its core business operations and what Synopsys uses to evaluate its business operations and for internal budgeting and resource allocation purposes. This press release includes non-GAAP earnings per diluted share, non-GAAP net income and non-GAAP tax rate for the periods presented. It also includes future estimates for non-GAAP expenses, non-GAAP interest and other income (expense), net, non-GAAP tax rate, non-GAAP earnings per diluted share and free cash flow. These non-GAAP financial measures may be different from non-GAAP financial measures used by other companies.When possible, Synopsys provides a reconciliation of non-GAAP financial measures to their most closely applicable GAAP financial measures. Synopsys is unable to provide a full reconciliation of certain third quarter and full fiscal year 2026 non-GAAP financial targets to the corresponding GAAP financial measures on a forward-looking basis because Synopsys believes that it would not be possible for it to have the required information necessary to quantitatively reconcile such measures with sufficient precision without unreasonable efforts due to, among other things, the potential variability and limited predictability of the excluded adjustment items necessary for a full reconciliation such as certain acquisition/divestiture related items, tax deduction variability, changes in the fair value of non-qualified deferred compensation plan, and gains (losses) on the sale of strategic investments. For the same reasons, Synopsys is unable to address the probable significance of the unavailable information. Synopsys' management does not itself, nor does it suggest that investors should, consider such non-GAAP financial measures in isolation from, as superior to, or as a substitute for, financial information prepared in accordance with GAAP. These non-GAAP financial measures are meant to supplement, and be viewed in conjunction with, the corresponding GAAP financial measures. Synopsys' management believes the presentation of non-GAAP financial measures, when shown in conjunction with the corresponding GAAP financial measures, provides useful information to investors allowing them to view financial and business trends relating to our financial condition and results of operations through the eyes of management. Synopsys' management evaluates and makes decisions about our business operations using both GAAP financial measures and non-GAAP financial measures to help facilitate internal comparisons to Synopsys' historical operating results and forecasted targets, planning and forecasting in subsequent periods and comparisons to competitors' operating results.The following are descriptions of the adjustments made to reconcile non-GAAP financial measures (other than free cash flow, which is defined in the footnote to the Financial Targets table above) to the most directly comparable GAAP financial measures:(i) Amortization of acquired intangible assets. We incur expenses from the amortization of acquired intangible assets, which may include impairment charges from write-downs of acquired intangible assets. Acquired intangible assets include, among other things, core/developed technology, customer relationships, contract rights, trademarks and trade names, and other intangibles related to acquisitions. We amortize the intangible assets over their estimated useful lives. We do not enter into acquisitions on a predictable cycle. The amount of an acquisition's purchase price allocated to intangible assets and their estimated useful lives can vary significantly and are unique to each acquisition. From time to time, we incur impairment charges due to write-downs of acquired intangible assets. We believe that the presentation of non-GAAP financial measures that adjust for the amortization of intangible assets, including impairment charges, provides investors and others with a consistent basis for comparison across accounting periods. We also exclude this item because such expenses are non-cash in nature and we believe the non-GAAP financial measures excluding this item provide meaningful supplemental information regarding our core operational performance and liquidity, and ability to invest in research and development and fund future acquisitions and capital expenditures.(ii) Stock-based compensation. Stock-based compensation expenses consist primarily of expenses related to restricted stock units, stock options, employee stock purchase rights and other stock awards, including such expenses associated with acquisitions. We exclude stock-based compensation expense from our non-GAAP financial measures primarily because it is not an expense that typically requires or will require cash settlement by us. Further, the expense for the fair value of the stock-based instruments we utilize may bear little resemblance to the actual value realized upon the vesting or future exercise of the related stock-based awards and, therefore, is not used by management to assess the core profitability of our business operations.(iii) Acquisition/divestiture related items. In connection with certain of our business combinations and/or divestitures, we incur significant expenses that we would not have otherwise incurred as part of our business operations. These expenses include, among other things, compensation expenses, professional fees and other direct expenses, concurrent restructuring activities and divestiture activities, including employee severance and other exit costs, bridge financing costs, costs related to integration activities, debt forgiveness, changes to the fair value of contingent consideration related to the acquired company, and amortization of the fair value difference of below-market value assets arising from arrangements entered into or acquired in conjunction with an acquisition. We also recognize the gains and losses from the mark-up of equity or cost method investments to fair value upon obtaining control through acquisition. We exclude these items because they are related to acquisitions and divestitures and have no direct correlation to the core operation of our business. Further, because we do not acquire or divest businesses on a predictable cycle and the terms of each transaction can vary significantly and are unique to each transaction, we believe it is useful to exclude such expenses when looking for a consistent basis for comparison across accounting periods.(iv) Restructuring charges. We initiate restructuring activities to align our costs to our operating plans and business strategies based on then-current economic conditions, and such activities have a specific and defined term. Restructuring costs generally include severance and other termination benefits related to voluntary retirement programs, involuntary headcount reductions and facilities closures. Such restructuring costs include elimination of operational redundancy, permanent reductions in workforce and facilities closures and, therefore, are not considered by us to be a part of the core operation of our business and are not used by management when assessing the core profitability and performance of our business operations.(v) Gains (losses) on the sale of strategic investments. We exclude gains and losses on the sale of equity investments in privately held companies because we do not believe they are reflective of our core business and operating results.(vi) Deferred compensation. We exclude changes in the fair value of our non-qualified deferred compensation plan because we do not use these to assess the core profitability of our business operations.(vii) Income tax effect of non-GAAP pre-tax adjustments. Excluding the income tax effect of non-GAAP pre-tax adjustments from the provision for income taxes assists investors in understanding the tax provision associated with those adjustments and the effect on net income. Beginning in fiscal year 2026, we transitioned from an annual non-GAAP tax rate to a three-year normalized non-GAAP tax rate of 18.0%. We believe this will provide better consistency across reporting periods by eliminating the effects of non-recurring and period-specific items, which can vary in size and frequency and do not necessarily reflect our normal operations. This rate is based on our projected annual rate through fiscal year 2028, primarily due to the completion of the acquisition of Ansys in the third quarter of fiscal year 2025 and the enactment of the One Big Beautiful Bill Act (the OBBB), which affects taxable income starting in fiscal year 2026 over the next several years. In projecting this rate, we evaluated our historical and projected mix of U.S. and international profit before tax, excluding the impact of stock-based compensation, the amortization of purchased intangibles and other GAAP only adjustments described above. We also considered other factors, including our current tax structure, U.S. tax law changes, such as the OBBB which impacts Synopsys' expensing of U.S. research expenditures commencing in fiscal year 2026, and changes to foreign derived intangible income commencing in fiscal year 2027.About Synopsys
Synopsys, Inc. (Nasdaq: SNPS) is the leader in engineering solutions from silicon to systems, enabling customers to rapidly innovate AI-powered products. We deliver industry-leading silicon design, IP, simulation and analysis solutions, and design services. We partner closely with our customers across a wide range of industries to maximize their R&D capability and productivity, powering innovation today that ignites the ingenuity of tomorrow. Learn more at?www.synopsys.com.?© 2026 Synopsys, Inc. All rights reserved. Synopsys, Ansys, the Synopsys and Ansys logos, and other Synopsys trademarks are available at https://www.synopsys.com/company/legal/trademarks-brands.html. Other company or product names may be trademarks of their respective owners.INVESTOR CONTACT:
Tushar Jain
Synopsys, Inc.
650-584-4289
Synopsys-ir@synopsys.comEDITORIAL CONTACT:
Cara Walker
Synopsys, Inc.
650-584-5000
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Synopsys Launches Ansys 2026 R1 to Re-Engineer Engineering with Joint Solutions and AI-Powered ProductsMarch 11, 2026 12:00 PM
PR Newswire (US)

Release combines AI, multiphysics simulation, and real-world digital twin technology to transform how teams explore designs, validate earlier, and engineer smarter, more resilient systemsKey Highlights Delivers unified Synopsys-Ansys workflows that bring together previously separate engineering processes to create more cohesive and efficient product developmentAdvances generative AI and first agentic engineering capabilities that speed design exploration, automate preprocessing, and enable faster, system-level insightEnhances system-level engineering with expanded digital twin capabilities and connected modeling workflows that deliver deeper real-world insight across complex systemsSUNNYVALE, Calif., March 11, 2026 /PRNewswire/ -- Synopsys, Inc. (NASDAQ: SNPS) today launched Ansys 2026 R1, delivering the first wave of integrated Synopsys-Ansys capabilities built on nearly a century of combined engineering expertise. The release also expands the Ansys simulation AI portfolio with a new, AI-enhanced training offering designed to make learning more effective and efficient, along with advanced AI features that help engineering teams gain earlier system-level insight, reduce reliance on physical testing, and optimize performance across increasingly complex, software-defined products.

"The transition to intelligent, interconnected systems is driving the need for faster, physics-first, system-level design," said Ravi Subramanian, Chief Product Management Officer at Synopsys. "By bringing Synopsys and Ansys technologies together, we're moving beyond point-to-point connections to create a unified fabric that links materials, physics, electronics, and software into a seamlessly orchestrated design environment. Synopsys enables organizations to move from concept to reality with extreme speed, empowering engineering teams and customers to innovate with confidence."Joint Solutions Accelerating the Future of Systems-Aware EngineeringAnsys 2026 R1 marks the beginning of a new era for engineering shaped by rising system complexity, AI-driven product demands, and the industry's shift to early validation. To meet these pressures, Synopsys introduces targeted, system-aware integrations between select Synopsys and Ansys technologies, delivering high-impact workflows that accelerate early exploration, improve cross-domain collaboration, and provide deeper insight across key industries.New Synopsys-Ansys joint solutions delivered in the Ansys 2026 R1 release include:Synopsys VC Functional Safety Manager (VC FSM) and Ansys medini® analyze™ software are now connected by an end-to-end safety workflow that links system-level and silicon-level safety analysis. The integration streamlines collaboration among system safety and chip safety verification engineers by automating traceability from systems to chip. The workflow also eliminates manual data sharing processes between tools, saving time for critical applications in automotive and aerospace safety.Synopsys QuantumATK® and the Ansys Granta MI® platform are integrated for an atomic-scale-to-enterprise materials workflow that supports material discovery, novel material development, and manufacturing process improvement. The integration streamlines collaboration among materials scientists and design engineers by enabling direct export of simulation-ready, validated material properties into Granta MI. This repeatable workflow creates curated, consistent materials records that help teams predict performance earlier and make more data-driven decisions.Synopsys OptoCompiler™ and Ansys Lumerical FDTD™ software are integrated to create a design workflow connecting device-level photonic design with advanced system-level optical simulation. The integration improves collaboration between device designers and system-level photonic engineers by automating Verilog-A model generation and ensuring consistent optical behavior across tools. The workflow also eliminates manual data translation between design and simulation environments, saving time and improving reliability for advanced photonic applications.In addition to the Ansys SCADE® model-based software development solution, Synopsys offers TPT, a robust test automation solution for control software. Together, these synergistic technologies help customers strengthen their development workflows, streamline verification, and accelerate the delivery of high-quality, reliable embedded systems. SCADE delivers a rigorous, safety-critical software development environment, and TPT enables automated test generation, execution, and analysis — empowering teams to accelerate iteration, strengthen early validation, and improve the quality of complex control software. Both solutions combined can reduce manual verification effort and increase automation for customers building mission-critical control systems across domains, including advanced driver assistance, electrified powertrains, flight control, engine control, and avionics systems."Modern automotive microcontrollers and processors integrate increasing levels of functionality, safety mechanisms, and configurability," said Tina Lamers, VP Global Safety at NXP Semiconductors. "Their contribution to system safety can only be fully understood when device-level safety analysis is seamlessly integrated into ECU and vehicle-level safety concepts. This makes functional safety a shared responsibility across silicon vendors, tier 1 suppliers, and original equipment manufacturers (OEMs)."Drive Earlier, Smarter Design Iteration with AI-Powered Digital EngineeringAnsys 2026 R1 introduces generative AI and the portfolio's first agentic capabilities, bolstering an AI-enhanced portfolio that accelerates validation, speeds design exploration, and automates complex workflows — empowering engineering teams with smarter, faster insight at every stage of development.Ansys GeomAI platform for geometry introduces a generative AI-driven approach to conceptual design exploration, enabling engineering teams to rapidly generate, evaluate, and refine geometry concepts with greater creativity and efficiency. By learning directly from reference designs, GeomAI helps engineers accelerate early-stage innovation while preserving engineering intent to ensure AI-generated concepts remain predictable, reliable, and ready for downstream validation.In addition, Mesh Agent, a new feature in Ansys Mechanical™ software available for exploratory use, helps engineers debug and resolve meshing failures during model pre-processing. The agentic feature guides engineers with proven, validated remediation steps to increase confidence in automated pre-processing.Now advancing through early customer evaluations, the Discovery Validation Agent in Ansys Discovery™ software applies agentic AI grounded in decades of engineering expertise to proactively identify setup issues using contextual intelligence and industry best practices, empowering engineers to confidently move faster, avoid costly mistakes, and achieve higher-performing designs from the start.More AI updates in Ansys 2026 R1 include:The Ansys SimAI™ platform for simulation now features two offerings: the original product, Ansys SimAI Premium SaaS, and Ansys SimAI Pro, built for desktop access for projects that require local data storage.Ansys SimAI connectors in Ansys optiSLang® software allow an end-to-end workflow, from training data generation, AI training, and AI use for optimization and design studies.Ansys Engineering Copilot™ is now available in Ansys medini analyze, Ansys ModelCenter®, and Ansys Rocky™ software, delivering intelligent, AI-guided assistance directly within the user interface.A new integration between optiSLang and Discovery creates a streamlined, AI-ready workflow for rapid sensitivity analysis and one-click optimization, helping engineers explore design alternatives early before validating concepts in Mechanical, Fluent, or Ansys Icepak® software."Ansys simulation metamodeling is transforming the way we approach power-grid design," said Venu Kondapalli, Vice President, Silicon Design Engineering at Altera. "Altera is always pathfinding on latest AI models. By combining machine-learning insights on optiSLang with fast, guided optimization, we can quickly pinpoint the right balance of metal resources while maintaining power-grid integrity and reliability. This lets us converge place-and-route faster, reduce costly design iterations, and move to closure with far greater confidence."Connect Systems and Optimize Performance with Real World Digital TwinsR1's expanded digital twin innovations give organizations deeper real-world insight before physical prototyping. Ansys TwinAI™ software introduces new fusion modeling methods that better align simulation data with sensor and test information, along with a temporal fusion transformer that strengthens large-scale time-series modeling and training efficiency. A new TwinAI reduced-order model (ROM) wizard guides teams through the creation and deployment of high-fidelity ROMs, accelerating the delivery of real-time digital twins. In addition, enhancements to Ansys AVxcelerate Sensors™ software, including a new GPU-accelerated multispectral light-propagation engine and expanded NVIDIA Omniverse integration, create a unified, 3D digital twin pipeline, more physically accurate camera behavior, surface reflections, and edge-case realism across scenarios."Ansys reduced-order modeling techniques — including linear time-invariant (LTI) and linear parameter-varying (LPV) methods — are essential to building our digital twin," said Dr. Bogdan C. Ionescu, Senior Principal Key Expert in the Power Electronics Group at Innomotics. "This digital twin runs extremely fast and gives us critical insight into quantities we cannot measure directly, such as the internal temperatures of insulated gate bipolar transistors inside power cells. By delivering these results in real time, the digital twin can provide the drive controller with the information needed to operate safely and efficiently."Additional digital twin, model-based systems engineering (MBSE), and digital engineering updates include:Ansys CoSim, a new distributed co-simulation product, connects multiple system-level tools in a coordinated workflow that lets each subsystem run in its native environment while exchanging data seamlessly. Its synchronization algorithms enable independent timesteps for fast, accurate multiphysics validation, improving interoperability and accelerating system-level analysis across system simulation, MBSE, and autonomous development.Ansys HFSS-PI introduces a new broadband 3D power integrity simulation capability with the performance required to overcome today's IC, package, and board power-delivery challenges. Purpose-built for next-generation chip-package integration, higher-density layouts, and advanced 3D packaging, HFSS-PI enables large-scale 3D power integrity analysis with deep insight into complex coupling mechanisms and return-path behavior.An enhanced connection between Ansys System Architecture Modeler (SAM)™, a SysML v2 web platform, and Ansys ModelCenter automates execution of SysML v2 model expressions alongside external analysis tools — eliminating the need to manually translate hundreds of expressions into scripts and allowing teams to accelerate requirement verification and design-space exploration.Embedded software development teams can now import Ansys SCADE Display® design tool models directly into Ansys Systems Tool Kit® (STK®) software, enabling display behavior to relate to mission-level elements for high-fidelity, system-in-the-loop assessment.Updates to Ansys HFSS-IC™ platform include a Synopsys user interface that replaces legacy workflows and delivers the speed and capacity needed to import die-scale and interposer-level designs. The modern UI also enables direct OpenAccess-based design import for single- and multi-die simulations, streamlining interoperability and boosting IC-designer productivity.Ansys FreeFlow™ software expands its capabilities with a powerful meshless computational fluid dynamics approach that delivers fast, robust performance without the need for traditional meshing for complex free-surface flows, spray behavior, and dynamic liquid interactions.Antenna Wizard, a new feature in STK available for early adoption, streamlines antenna modeling with fast, automated setup. It can quickly generate high-fidelity antenna representations to guide early mission analysis and provide antenna engineers with a strong starting point for detailed Ansys HFSS™ software design.Follow Synopsys Converge 2026 News and Updates
Synopsys Converge is taking place March 11-12, 2026, at the Santa Clara Convention Center. Follow news and updates as well as keynote details and replays via the Synopsys Converge Newsroom, on LinkedIn, and on X.About SynopsysSynopsys, Inc. (Nasdaq: SNPS) is the leader in engineering solutions from silicon to systems, enabling customers to rapidly innovate AI-powered products. We deliver industry-leading silicon design, IP, simulation and analysis solutions, and design services. We partner closely with our customers across a wide range of industries to maximize their R&D capability and productivity, powering innovation today that ignites the ingenuity of tomorrow. Learn more at www.synopsys.com. © 2026 Synopsys, Inc. All rights reserved. Synopsys, Ansys, the Synopsys and Ansys logos, and other Synopsys trademarks are available at https://www.synopsys.com/company/legal/trademarks-brands.html. Other company or product names may be trademarks of their respective owners.Contacts
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View original content to download multimedia:https://www.prnewswire.com/news-releases/synopsys-launches-ansys-2026-r1-to-re-engineer-engineering-with-joint-solutions-and-ai-powered-products-302711215.htmlSOURCE Synopsys, Inc.

Original: Synopsys Launches Ansys 2026 R1 to Re-Engineer Engineering with Joint Solutions and AI-Powered Products