Synopsys Posts Financial Results for Third Quarter Fiscal Year 2026

Outcomes Abstract

• Quarterly income of $2.477 billion; displays broad-based power with outperformance in Design Automation
• Quarterly GAAP earnings per diluted share (EPS) of $2.84, and non-GAAP EPS of $3.91, exceeding high-end of prior steerage
• Elevating expectations for full-year whole income to $9.715 billion on the midpoint and full-year non-GAAP EPS steerage to $15.07 on the midpoint on continued AI-driven demand power

SUNNYVALE, Calif., Aug. 26, 2026 /PRNewswire/ — Synopsys, Inc. (Nasdaq: SNPS) in the present day reported outcomes for its third quarter of fiscal yr 2026. Income for the third quarter of fiscal yr 2026 was $2.477 billion, in comparison with $1.740 billion for the third quarter of fiscal yr 2025.

“AI is driving unprecedented complexity and rising demand for the silicon IP and engineering options essential to ship next-generation AI compute, infrastructure and bodily AI programs,” mentioned Sassine Ghazi, president and CEO of Synopsys. “One yr after the transformational acquisition of Ansys, we’re executing with focus, extending our management and gaining momentum.”

“Synopsys delivered an impressive third quarter, with income and earnings per share exceeding the excessive finish of our steerage vary. Outcomes had been pushed by broad-based power throughout the enterprise, led by EDA, a robust quarter from Ansys, and our design IP enterprise returned to year-over-year development,” mentioned Shelagh Glaser, CFO of Synopsys. “Given our sturdy efficiency and expectations for double-digit development in EDA, we’re elevating our full yr income, non-GAAP working margin, EPS and money circulate steerage.”

GAAP Outcomes
On a U.S. typically accepted accounting rules (GAAP) foundation, web revenue for the third quarter of fiscal yr 2026 was $545.8 million, or $2.84 per diluted share, in comparison with $242.5 million, or $1.50 per diluted share, for the third quarter of fiscal yr 2025.

Non-GAAP Outcomes
On a non-GAAP foundation, web revenue for the third quarter of fiscal yr 2026 was $752.5 million, or $3.91 per diluted share, in comparison with non-GAAP web revenue of $548.9 million, or $3.39 per diluted share, for the third quarter of fiscal yr 2025.

For a reconciliation of web revenue, earnings per diluted share and different measures on a GAAP and non-GAAP foundation, see “GAAP to Non-GAAP Reconciliation” within the accompanying tables beneath.

Enterprise Segments 
Synopsys studies income and working revenue in two segments: (1) Design Automation, which incorporates our superior silicon design, verification services, Ansys merchandise, system integration services, digital, customized and discipline programmable gate array built-in circuit design software program, verification software program and {hardware} merchandise, manufacturing software program merchandise and different; and (2) Design IP, which incorporates our logic libraries, embedded recollections, wired interface IP, reminiscence interface IP and safety IP.

Monetary Targets
Synopsys additionally offered its consolidated monetary targets for the fourth quarter and full fiscal yr 2026. These targets assume no additional adjustments to export management restrictions or the present U.S. authorities “Entity Listing” restrictions. These targets represent forward-looking statements and are primarily based on present expectations. For a dialogue of things that might trigger precise outcomes to vary materially from these targets, see “Ahead-Trying Statements” beneath.

For a reconciliation of Synopsys’ fourth quarter and monetary yr 2026 targets, together with bills, earnings per diluted share and different measures on a GAAP and non-GAAP foundation, a dialogue of the monetary targets that we aren’t in a position to reconcile with out unreasonable efforts and a dialogue of why administration believes such measurements present helpful info to traders, see “GAAP to Non-GAAP Reconciliation” within the accompanying tables beneath.

Earnings Name Open to Buyers
Synopsys will maintain a convention name for monetary analysts and traders in the present day at 2:00 p.m. Pacific Time. A stay webcast of the decision can be accessible within the investor relations portion of Synopsys’ company web site at www.synopsys.com. Synopsys makes use of its web site and social media channels as instruments to reveal essential details about Synopsys and to adjust to its disclosure obligations below Regulation Honest Disclosure. A webcast replay can even be accessible on the company web site from roughly 5:30 p.m. Pacific Time in the present day by way of the time Synopsys broadcasts its outcomes for the fourth quarter and monetary yr 2026.

Availability of Remaining Monetary Statements
Synopsys will embrace last monetary statements for the third quarter of fiscal yr 2026 in its quarterly report on Kind 10-Q to be filed with the Securities and Change Fee (SEC) and accessible at www.sec.gov on or earlier than September 9, 2026.

Persevering with Operations 
On Sept. 30, 2024, Synopsys accomplished the sale of its Software program Integrity enterprise. Until in any other case famous, Synopsys’ Software program Integrity enterprise has been introduced as a discontinued operation in Synopsys’ consolidated monetary statements for all intervals introduced herein and all monetary outcomes and targets are introduced herein on a seamless operations foundation.

Reconciliation of Third Quarter Fiscal 12 months 2026 Outcomes
The next tables reconcile the particular gadgets excluded from GAAP within the calculation of non-GAAP web revenue, earnings per diluted share, and tax charge for the intervals indicated beneath.

Reconciliation of 2026 Targets
The next tables reconcile the particular gadgets excluded from GAAP within the calculation of non-GAAP targets for the intervals indicated beneath.

Ahead-Trying Statements
This press launch and the investor convention name include forward-looking statements, together with, however not restricted to, statements regarding our short-term and long-term monetary targets, expectations and targets; our companies, enterprise segments, methods, partnerships, initiatives and alternatives, together with, amongst different issues, the reallocation of sources in our Design IP section to greater development alternatives and deliberate restructuring actions; {industry} development and technological developments, reminiscent of synthetic intelligence, together with our improvement and deliberate commercialization thereof; enterprise and market outlook; the potential influence of the unsure macroeconomic setting and international financial circumstances on our monetary outcomes; the influence of present and future U.S. and overseas commerce rules, authorities actions and regulatory adjustments, reminiscent of export management restrictions and tariffs; the ANSYS, Inc. (Ansys) integration and its anticipated influence, together with anticipated synergies and the timing thereof, our skill to create joint options as a mixed firm, and associated accounting adjustments; deliberate and not too long ago accomplished acquisitions or divestitures, and their anticipated timing and influence; our key clients, buyer focus, buyer engagement, buyer demand and market enlargement; outcomes and methods associated to our merchandise, expertise and companies, together with product improvement and our deliberate product releases and capabilities; the anticipated realization of our contracted however unhappy or partially unhappy efficiency obligations (backlog); deliberate inventory repurchases; our anticipated tax charge; and the standing, anticipated final result or anticipated influence of litigation and/or regulatory investigations. These statements contain dangers, uncertainties and different components that might trigger our precise outcomes, time frames or achievements to vary materially from these expressed or implied in such forward-looking statements. Such dangers, uncertainties and components embrace, however usually are not restricted to: macroeconomic circumstances and geopolitical uncertainty within the international economic system; uncertainty within the development of the semiconductor and electronics industries; the extremely aggressive {industry} we function in; actions by the U.S. or overseas governments, such because the imposition of further export restrictions or tariffs; consolidation amongst our clients and our dependence on a comparatively small variety of giant clients; dangers and compliance obligations referring to the worldwide nature of our operations; failure to appreciate the advantages anticipated from the transactions we full, together with the acquisition of Ansys (the Ansys Merger) or sudden difficulties or expenditures arising therefrom; dangers associated to inaccuracies in, or failures to realize, our operational and enterprise metrics or forecasts of development; and extra. Extra info on potential dangers, uncertainties and different components that might have an effect on Synopsys’ outcomes is included in filings we make with the SEC infrequently, together with within the sections entitled “Threat Elements” in our newest Annual Report on Kind 10-Ok and in our newest Quarterly Report on Kind 10-Q. The monetary info contained on this press launch needs to be learn along side the consolidated monetary statements and notes thereto included in Synopsys’ most up-to-date studies on Varieties 10-Ok and 10-Q, every as could also be amended infrequently. Synopsys’ monetary outcomes for its third quarter of fiscal yr 2026 usually are not essentially indicative of Synopsys’ working outcomes for any future intervals.

Effectiveness of Data
The targets included on this press launch, the statements made through the earnings convention name, the knowledge contained within the monetary complement and the company overview presentation, every of which can be found within the investor relations portion of Synopsys’ company web site at www.synopsys.com (collectively, the Earnings Supplies), symbolize Synopsys’ expectations and beliefs as of August 26, 2026. Though these Earnings Supplies are anticipated to stay accessible on Synopsys’ web site by way of the time Synopsys broadcasts its outcomes for the fourth quarter and monetary yr 2026, their continued availability by way of such time doesn’t imply that Synopsys is reaffirming or confirming their continued validity. Synopsys undertakes no responsibility, and doesn’t intend, to replace any forward-looking assertion, together with any targets, offered within the Earnings Supplies, whether or not on account of new info, future occasions or in any other case, until required by regulation.

Synopsys offers section info, specifically income, adjusted section working revenue and adjusted section working margin, in accordance with Monetary Accounting Requirements Board Accounting Requirements Codification Subject 280, Phase Reporting. Synopsys’ chief working determination maker (CODM) is our Chief Government Officer. In evaluating our enterprise segments, the CODM considers the revenue and bills that the CODM believes are instantly associated to these segments. The CODM doesn’t allocate sure working bills managed at a consolidated degree to our enterprise segments and, in consequence, the reported working revenue and working margin don’t embrace these unallocated bills as proven within the desk beneath. These unallocated bills are introduced within the desk beneath to offer a reconciliation of the whole adjusted working revenue from segments to our consolidated working revenue:

GAAP to Non-GAAP Reconciliation
Synopsys continues to offer all info required in accordance with GAAP however acknowledges evaluating its ongoing working outcomes will not be as helpful if an investor is restricted to reviewing solely GAAP monetary measures. Accordingly, Synopsys presents non-GAAP monetary measures in reporting its monetary outcomes to offer traders with a further instrument to judge Synopsys’ working ends in a way that focuses on what Synopsys believes to be its core enterprise operations and what Synopsys makes use of to judge its enterprise operations and for inside budgeting and useful resource allocation functions. This press launch consists of non-GAAP earnings per diluted share, non-GAAP web revenue, non-GAAP working margin and non-GAAP tax charge for the intervals introduced. It additionally consists of future estimates for non-GAAP bills, non-GAAP curiosity and different revenue (expense), web, non-GAAP tax charge, non-GAAP working margin, non-GAAP earnings per diluted share and free money circulate. These non-GAAP monetary measures could also be completely different from non-GAAP monetary measures utilized by different corporations.

When potential, Synopsys offers a reconciliation of non-GAAP monetary measures to their most carefully relevant GAAP monetary measures. Synopsys is unable to offer a full reconciliation of sure fourth quarter and full fiscal yr 2026 non-GAAP monetary targets to the corresponding GAAP monetary measures on a forward-looking foundation as a result of Synopsys believes that it could not be potential for it to have the knowledge essential to quantitatively reconcile such measures with ample precision with out unreasonable efforts because of, amongst different issues, the potential variability and restricted predictability of the excluded adjustment gadgets essential for a full reconciliation reminiscent of sure acquisition/divestiture associated gadgets, tax deduction variability, adjustments within the honest worth of non-qualified deferred compensation plan, and good points (losses) on the sale of strategic investments. For a similar causes, Synopsys is unable to handle the possible significance of the unavailable info. 

Synopsys’ administration doesn’t itself, nor does it counsel that traders ought to, contemplate such non-GAAP monetary measures in isolation from, as superior to, or as an alternative choice to, monetary info ready in accordance with GAAP. These non-GAAP monetary measures are supposed to complement, and be seen along side, the corresponding GAAP monetary measures. Synopsys’ administration believes the presentation of non-GAAP monetary measures, when proven along side the corresponding GAAP monetary measures, offers helpful info to traders permitting them to view monetary and enterprise developments referring to our monetary situation and outcomes of operations by way of the eyes of administration. Synopsys’ administration evaluates and makes selections about our enterprise operations utilizing each GAAP monetary measures and non-GAAP monetary measures to assist facilitate inside comparisons to Synopsys’ historic working outcomes and forecasted targets, planning and forecasting in subsequent intervals and comparisons to opponents’ working outcomes.

The next are descriptions of the changes made to reconcile non-GAAP monetary measures (apart from free money circulate, which is outlined within the footnote to the Monetary Targets desk above) to essentially the most instantly comparable GAAP monetary measures:

(i) Amortization of acquired intangible property. We incur bills from the amortization of acquired intangible property, which can embrace impairment expenses from write-downs of acquired intangible property. Acquired intangible property embrace, amongst different issues, core/developed expertise, buyer relationships, contract rights, logos and commerce names, and different intangibles associated to acquisitions. We amortize the intangible property over their estimated helpful lives. We don’t enter into acquisitions on a predictable cycle. The quantity of an acquisition’s buy value allotted to intangible property and their estimated helpful lives can fluctuate considerably and are distinctive to every acquisition. Occasionally, we incur impairment expenses because of write-downs of acquired intangible property. We imagine that the presentation of non-GAAP monetary measures that alter for the amortization of intangible property, together with impairment expenses, offers traders and others with a constant foundation for comparability throughout accounting intervals. We additionally exclude this merchandise as a result of such bills are non-cash in nature and we imagine the non-GAAP monetary measures excluding this merchandise present significant supplemental info concerning our core operational efficiency and liquidity, and talent to spend money on analysis and improvement and fund future acquisitions and capital expenditures.

(ii) Inventory-based compensation. Inventory-based compensation bills consist primarily of bills associated to restricted inventory items, inventory choices, worker inventory buy rights and different inventory awards, together with such bills related to acquisitions. We exclude stock-based compensation expense from our non-GAAP monetary measures primarily as a result of it isn’t an expense that sometimes requires or would require money settlement by us. Additional, the expense for the honest worth of the stock-based devices we make the most of could bear little resemblance to the precise worth realized upon the vesting or future train of the associated stock-based awards and, due to this fact, will not be utilized by administration to evaluate the core profitability of our enterprise operations.

(iii) Acquisition/divestiture associated gadgets. In reference to sure of our enterprise mixtures and/or divestitures, we incur vital bills that we might not have in any other case incurred as a part of our enterprise operations. These bills embrace, amongst different issues, compensation bills, skilled charges and different direct bills, concurrent restructuring actions and divestiture actions, together with worker severance and different exit prices, bridge financing prices, prices associated to integration actions, debt forgiveness, adjustments to the honest worth of contingent consideration associated to the acquired firm, and amortization of the honest worth distinction of below-market worth property arising from preparations entered into or acquired along side an acquisition. We additionally acknowledge the good points and losses from the divestitures of enterprise, in addition to the mark-up of fairness or price methodology investments to honest worth upon acquiring management by way of acquisition. We exclude these things as a result of they’re associated to acquisitions and divestitures and haven’t any direct correlation to the core operation of our enterprise. Additional, as a result of we don’t purchase or divest companies on a predictable cycle and the phrases of every transaction can fluctuate considerably and are distinctive to every transaction, we imagine it’s helpful to exclude such bills when on the lookout for a constant foundation for comparability throughout accounting intervals.

(iv) Restructuring expenses. We provoke restructuring actions to align our prices to our working plans and enterprise methods primarily based on then-current financial circumstances, and such actions have a selected and outlined time period. Restructuring prices typically embrace severance and different termination advantages associated to voluntary retirement packages, involuntary headcount reductions and amenities closures. Such restructuring prices embrace elimination of operational redundancy, everlasting reductions in workforce and amenities closures and, due to this fact, usually are not thought of by us to be part of the core operation of our enterprise and usually are not utilized by administration when assessing the core profitability and efficiency of our enterprise operations.

(v) Beneficial properties (losses) on the sale of strategic investments. We exclude good points and losses on the sale of fairness investments in privately held corporations as a result of we don’t imagine they’re reflective of our core enterprise and working outcomes.

(vi) Deferred compensation. We exclude adjustments within the honest worth of our non-qualified deferred compensation plan as a result of we don’t use these to evaluate the core profitability of our enterprise operations.

(vii) Revenue tax impact of non-GAAP pre-tax changes. Excluding the revenue tax impact of non-GAAP pre-tax changes from the availability for revenue taxes assists traders in understanding the tax provision related to these changes and the impact on web revenue.  Starting in fiscal yr 2026, we transitioned from an annual non-GAAP tax charge to a three-year normalized non-GAAP tax charge of 18.0%. We imagine this may present higher consistency throughout reporting intervals by eliminating the results of non-recurring and period-specific gadgets, which might fluctuate in dimension and frequency and don’t essentially replicate our regular operations. This charge is predicated on our projected annual charge by way of fiscal yr 2028, primarily because of the completion of the acquisition of Ansys within the third quarter of fiscal yr 2025 and the enactment of the One Huge Stunning Invoice Act (the OBBB), which impacts taxable revenue beginning in fiscal yr 2026 over the subsequent a number of years. In projecting this charge, we evaluated our historic and projected mixture of U.S. and worldwide revenue earlier than tax, excluding the influence of stock-based compensation, the amortization of bought intangibles and different GAAP solely changes described above. We additionally thought of different components, together with our present tax construction, U.S. tax regulation adjustments, such because the OBBB which impacts Synopsys’ expensing of U.S. analysis expenditures commencing in fiscal yr 2026, and adjustments to overseas derived intangible revenue commencing in fiscal yr 2027.

About Synopsys
Synopsys, Inc. (Nasdaq: SNPS) is the chief in engineering options from silicon to programs, enabling clients to quickly innovate AI-powered merchandise. We ship industry-leading silicon design, IP, simulation and evaluation options, and design companies. We companion carefully with our clients throughout a variety of industries to maximise their R&D functionality and productiveness, powering innovation in the present day that ignites the ingenuity of tomorrow. Be taught extra at www.synopsys.com. 

©  2026 Synopsys, Inc. All rights reserved. Synopsys, Ansys, the Synopsys and Ansys logos, and different Synopsys logos can be found at https://www.synopsys.com/company/legal/trademarks-brands.html. Different firm or product names could also be logos of their respective house owners.

INVESTOR CONTACT:
Tushar Jain
Synopsys, Inc.
650-584-4289
Synopsys-ir@synopsys.com

EDITORIAL CONTACT:
Cara Walker
Synopsys, Inc.
650-584-5000
corp-pr@synopsys.com

SOURCE Synopsys, Inc.