By Elias Schisgall
Synopsys expects a strong fiscal 2026 after reporting higher revenue in the fourth quarter as its acquisition of Ansys boosted sales.
The company, which makes software to design and test computer chips, on Thursday posted a profit of $448.7 million, or $2.39 a share, compared with $279 million, or $1.79 a share, a year earlier.
The company had previously guided for a loss, and analysts polled by FactSet were anticipating a loss of 24 cents a share.
Stripping out certain one-time items, adjusted earnings were $2.90 a share. Analysts were expecting $2.78 a share.
Revenue rose to $2.25 billion, compared with $1.64 billion a year earlier. Analysts were expecting $2.25 billion in revenue.
Much of the revenue bump was attributed to the company's acquisition of Ansys, which closed in July. Ansys contributed $667.7 million in revenue for the quarter, Synopsys said.
For the current first quarter, Synopsys said it expects revenue between $2.37 billion and $2.42 billion and adjusted earnings between $3.52 a share and $3.58 a share.
Synopsys forecasts fiscal 2026 revenue between $9.56 billion and $9.66 billion and adjusted earnings between $14.32 a share and $14.40 a share. Analysts are expecting $9.64 billion in revenue and adjusted earnings of $13.96 a share.
Write to Elias Schisgall at elias.schisgall@wsj.com
(END) Dow Jones Newswires
By Elias Schisgall
Synopsys is targeting double-digit growth driven by its Ansys acquisition as the semiconductor design company gears up to launch its first integrated product across both platforms in 2026.
Ansys, which specializes in engineering simulations for computer chips, added $667.7 million in revenue to Synopsys' operations during the fourth quarter, but Chief Financial Officer Shelagh Glaser said the real upside will be unlocked once the company releases a joint solution product next year.
She said that Synopsys engineers are set to deliver the company's first unified solution product with Ansys in the first half of the current fiscal year.
"Then we're going to have a drumbeat of products after that, that really bring these two design worlds together for our customers," Glaser said in an interview Wednesday.
Glaser said Ansys will be a major factor in the company's goals of double-digit growth and margins in the mid 40% range.
She said Synopsys' transition from traditional CPUs to GPU-accelerated systems through its partnership with Nvidia will speed up the company's operations. Nvidia's decision to take a $2 billion stake in Synopsys spoke to the significance of the Ansys integration, she said.
Glaser also said that Synopsys had begun its first round of layoffs after the company said in November that it would cut 10% of its workforce through late 2027.
She declined to share how many employees had left so far, but that the cuts in the last month were "fairly significant," adding that the majority of layoffs would be complete by the end of 2026.
The company's outlook was driven by the rapid scaling of artificial-intelligence infrastructure, Glaser said, but tempered by consumer-facing businesses that are still figuring out how to implement AI into their products.
"The hyperscalers, the AI index folks, are going at breakneck speed, and then the other side of the market, we've not seen full recovery on that yet," she said. "So that's headwinds, tailwinds."
Synopsys is still experiencing headwinds in China even after the Trump administration lifted some restrictions on exports as businesses remain nervous about the regulatory landscape.
"That created a lot of uncertainty in the customer base," she said. "We saw deals become smaller, we saw deals shipped out, and I think it's really just customers navigating that uncertain environment."
For the fiscal first quarter, Synopsys said after the close it expects revenue of $2.37 billion to $2.42 billion and adjusted earnings between $3.52 a share and $3.58 a share.
Synopsys is forecasting fiscal 2026 revenue of $9.56 billion to $9.66 billion, and adjusted earnings per share of $14.32 to $14.40. Analysts are expecting $9.64 billion in revenue and adjusted earnings of $13.96 a share, according to FactSet.
For the fiscal fourth quarter the company posted a profit of $448.7 million, or $2.39 a share, compared with $279 million, or $1.79 a share, a year earlier. The company had previously guided for a loss, and analysts polled by FactSet were anticipating a loss of 24 cents a share.
Stripping out certain one-time items, adjusted earnings were $2.90 a share. Analysts were expecting $2.78 a share.
Revenue rose to $2.25 billion, compared with $1.64 billion a year earlier. That was in line with the $2.25 billion in revenue analysts surveyed by FactSet expected. Much of the revenue bump was attributed to the acquisition of Ansys, which closed in July.
The stock rose 2.4% to $487.30 in after-hours trading.
Write to Elias Schisgall at elias.schisgall@wsj.com
(END) Dow Jones Newswires
December 10, 2025 18:15 ET (23:15 GMT)
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