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Synopsys reported a successful fiscal year 2025 with record revenue of $7.05 billion, a 15% increase driven by strategic integrations such as ANSYS. The company's Q4 revenue was $2.25 billion, aligning with guidance, while EPS of $2.90 exceeded expectations. The firm is poised for further growth in 2026, targeting revenue between $9.56 and $9.66 billion and an EPS of $14.32 to $14.40. Despite geopolitical challenges in China, the overall sentiment was optimistic with a strategic focus on AI-driven initiatives and collaborations, notably with NVIDIA. The conference call emphasized Synopsys's redefined role from an EDA leader to a broader engineering solutions provider, a transformation bolstered by the ANSYS acquisition. The strategic partnership with NVIDIA is seen as a key driver for future growth, integrating accelerated computing into design workflows. Management described 2026 as a transitional year for the IP business, with efforts focused on streamlining operations and capturing new market opportunities. Analyst questions focused on organic growth rates, operational synergies, market headwinds in the IP segment, and the impact of continued restrictions on China sales. Management confirmed confidence in maintaining long-term double-digit growth, encouraged by emerging opportunities in AI and synergy from strategic collaborations. The call concluded on a positive note, with a reiteration of financial discipline and commitment to innovation as pivotal to future prosperity.
Synopsys achieved a record annual revenue of $7.05 billion in 2025.
AI is driving chips to the atomic level, prompting new engineering workflows.
Our strategic partnership with NVIDIA will revolutionize design using AI.
Design IP segment faced a challenging year, down 8% in 2025.
2026 targets include revenue of $9.56 to $9.66 billion, EPS $14.32 to $14.40.
Non-GAAP operating margin set to improve by 320 basis points in 2026.
Cash flow from operations expected to grow $700 million in 2026.
Integration of ANSYS with Synopsys is progressing with unified R&D teams.
Hyperscalers use multiple chip strategies, driving demand for Synopsys solutions.
ANSYS performed well in China, while Synopsys faced restrictions in advanced solutions sales.
Annual Revenue
$7.05 billion
up 15%
Q4 Revenue
$2.25 billion
high end of guidance
Q4 EPS
$2.90
ahead of guidance
Operating Margin
37.3%
Free Cash Flow
$1.35 billion
ahead of expectations