10-KPeriod: FY2023

SYNOPSYS INC Annual Report, Year Ended Oct 31, 2023

Filed December 12, 2023For Securities:SNPS

Summary

Synopsys, Inc. (SNPS) reported solid financial performance for the fiscal year ended October 31, 2023, with revenue increasing by 15% to $5.84 billion. This growth was driven by strong performance across all product segments and geographies, particularly in Design Automation and Design IP. The company continues to invest in research and development, maintaining its leadership in Electronic Design Automation (EDA) while expanding its Design IP and Software Integrity offerings. Despite macroeconomic uncertainties and geopolitical pressures impacting global economic conditions, Synopsys demonstrated resilience. The company also announced its decision to explore strategic alternatives for its Software Integrity segment. Leadership transition is underway with Sassine Ghazi set to become CEO effective January 1, 2024, succeeding founder Aart J. de Geus.

Financial Highlights

57 data points
Beta

Revenue

$5.32B

80.6% Gross Margin

Net Income

$1.23B

23.1% Net Margin

EPS (Diluted)

$7.92

Total Assets

$10.33B

Cash & Equivalents

$1.44B

Free Cash Flow

$1.51B

Financial Statements
Beta
Revenue$5.32B
Cost of Revenue$1.03B
Gross Profit$4.29B
R&D Expenses$1.85B
Operating Expenses$3.01B
Operating Income$1.27B
Interest Expense$1.18M
Net Income$1.23B
EPS (Basic)$8.08
EPS (Diluted)$7.92
Shares Outstanding (Basic)152.15M
Shares Outstanding (Diluted)155.19M

Key Highlights

  • 1Revenue grew 15% year-over-year to $5.84 billion, driven by strong demand across all business segments.
  • 2Design Automation and Design IP segments showed robust growth, contributing significantly to overall revenue.
  • 3Operating income increased by 9% to $1.27 billion, reflecting effective management of expenses.
  • 4The company is exploring strategic alternatives for its Software Integrity segment, indicating a potential future shift in business focus.
  • 5Synopsys continues to invest heavily in R&D, representing 33% of total revenue, to maintain technological leadership.
  • 6The company repurchased approximately $1.2 billion of its common stock in fiscal year 2023, underscoring its commitment to returning capital to shareholders.
  • 7A planned leadership transition is underway with Sassine Ghazi set to assume the CEO role in early 2024.

Frequently Asked Questions

Synopsys reported a 15% increase in revenue for fiscal year 2023, reaching $5.84 billion, up from $5.08 billion in the prior year. This growth was attributed to strong performance across its Design Automation, Design IP, and Software Integrity segments.

Synopsys announced it is exploring strategic alternatives for its Software Integrity segment. This means the company is considering a range of strategic opportunities, including a potential sale or spin-off, to optimize its portfolio and focus on core areas.

Synopsys continues to prioritize research and development, which accounted for 33% of its total revenue in fiscal year 2023. This significant investment is aimed at maintaining its leadership in EDA and enhancing its AI-driven solutions, IP offerings, and software security tools.

While Synopsys has demonstrated resilience and growth, it acknowledges the uncertainty in the macroeconomic environment, including inflation and geopolitical pressures. The company expects a challenging near-term growth environment in China but anticipates overall growth across its geographies. The time-based revenue model provides a degree of stability.