Synopsys, Inc.

Synopsys, Inc.

SNPS

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Market Cap$91.07B
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Compare to Similar Companies

P/E RatioDividendsReturn on EquityPrice-to-SalesDebt-to-Equity
Synopsys, Inc.Synopsys, Inc.117.3-3%11.10.4

Earnings Call Q2 2026

May 27, 2026 - AI Summary

Q2 performance beat (strong execution + AI-driven demand) - Revenue: $2.276B; Non-GAAP op margin 39.5%; Non-GAAP EPS $3.35 — all exceeded guidance. - Drivers cited: continued AI supply-chain demand, including increased design/simulation/system validation complexity. - Segment momentum: - EDA/design automation: revenue ~+8% YoY; Hardware-assisted verification a key growth driver (notably hyperscalers; system wins across ZS5, Xebu, HAPS-200). - ANSYS: strong demand across industries (semis, aerospace/defense, automotive) and simulation use cases (e.g., physics-based synthetic data, safety-critical workflows).
Major accounting item & integration changes: ANSYS channel revenue is the “surprising” noise - Q2 revenue included an ANSYS channel accounting impact of +$12.5M revenue and +$12.5M expense (gross-basis recognition due to deeper pricing visibility/oversight of channel partners). - Management said it’s neutral to EPS and cash flow, but investors should adjust their understanding of “organic” growth quarter-to-quarter. - Full-year guidance will reflect this accounting impact (see next bullet).
Raised FY26 guidance across revenue, margins, EPS, and free cash flow - Updated FY26 revenue range: $9.625B to $9.705B (midpoint raised +$35M vs prior, due to strong first-half performance), plus two structural/accounting items: - ANSYS channel accounting: + $60M revenue with equivalent expense impact. - Processor IP Solutions business divestiture: expected to close soon, reducing revenue by ~$40M for the remainder of FY26. - Operating margin / EPS: - Non-GAAP op margin ~41% at midpoint (up 50 bps). - Non-GAAP EPS guidance: $14.72–$14.80 (midpoint +$0.34 increase). - GAAP EPS: $2.49–$2.91. - Cash flow: - Cash flow from operations raised to ~ $2.3B. - CapEx ~ $300M unchanged → Free cash flow ~ $2.0B (up +$100M vs prior). - Q3 targets (directional expectation): total revenue $2.41B–$2.46B; Non-GAAP EPS $3.63–$3.69.

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$544.50

Target Price by Analysts

9.3% upsideSynopsys Target Price DetailsTarget Price
$301.06

Current Fair Value

39.5% downside

Overvalued by 39.5% based on the discounted cash flow analysis.

Share Statistics

Market cap$91.07 Billion
Enterprise Value$101.92 Billion
Dividend Yield$- (-)
Earnings per Share$8.13
Beta1.25
Outstanding Shares190,513,000

Return

Return on Equity2.54%ROE
Return on Assets1.65%
Return on Invested Capital3.35%

Valuation & Multiples

P/E Ratio117.25P/E Ratio
PEG-123.37PEG
Price to Sales11.07Price to Sales
Price to Book Ratio3.13Price to Book Ratio
Enterprise Value to Revenue11.74
Enterprise Value to EBIT70.64
Enterprise Value to Net Income131
Total Debt to Enterprise0.13
Debt to Equity0.44Debt to Equity

Revenue Sources

No data

Insider Trades

Last Earnings Call

Report Date
May 27, 2026
EPS Estimate
$3.15
Average shareholder expectation
Revenue Estimate
$2.25 B
Average shareholder expectation

Next Earnings Call

Expected Date
September 8, 2026
EPS Estimate
$3.64
Average shareholder expectation
Revenue Estimate
$2.44 B
Average shareholder expectation

Institutional Put/Call Ratio

Market sentiment based on institutional option activity.

Put/Call Ratio1.1150 13.31%
Total Calls2,403,073 12.13%
Total Puts2,679,367 21.50%

Institutional Ownership

Holdings and activity of institutional investors.

Ownership %104.47% 1.42%
Total Invested$66.33B 16.78%
Investors Holding1,459 18.00%

ESG Score

No data

About Synopsys, Inc.

13,000 employees

Synopsys, is the Silicon to Software™ partner for innovative companies developing the electronic products and software applications we rely on every day. As an S&P 500 company, Synopsys has a long history of being a global leader in elec...

Relevant Senate Committees

Joint Committee on Taxation

As the non-partisan body providing official revenue estimates and technical analysis for tax legislation, its work directly shapes tax policy, including corporate tax structures and R&D credits, which are highly material to a technology company like Synopsys.

Finance

This committee's control over taxation (e.g., corporate tax rates, R&D credits) and trade policy (e.g., tariffs on tech goods, export controls) directly impacts Synopsys's profitability, investment decisions, global operations, and the overall economic environment for the tech sector.

Appropriations

This committee directly allocates discretionary federal spending, determining precise funding for defense programs, scientific research (e.g., CHIPS Act implementation), and other tech-intensive projects, directly affecting the demand and order books for Synopsys's products.

Judiciary

This committee's oversight of intellectual property law is directly critical to Synopsys's 'semiconductor IP' business model. Furthermore, antitrust enforcement in the tech sector significantly impacts the competitive landscape for Synopsys and its M&A activities.

Armed Services

Semiconductor design tools (EDA), intellectual property (IP), and secure software are foundational to modern defense systems. This committee's authorization and funding decisions (via NDAA) for microelectronics, advanced computing, and cybersecurity directly impact the market for Synopsys's products and services.

Select Committee on Intelligence

Given Synopsys's role in application security and the critical national security importance of semiconductors, members of this committee could possess highly material non-public information related to cyber threats, critical infrastructure, or defense technology priorities.

Commerce, Science, and Transportation

This committee has broad jurisdiction over interstate commerce, technology policy (e.g., data privacy, FTC oversight affecting software), and crucial 'Science' policy and funding that is highly relevant to the semiconductor and software industries.