10-KPeriod: FY2024

SYNOPSYS INC Annual Report, Year Ended Oct 31, 2024

Filed December 19, 2024For Securities:SNPS

Summary

Synopsys, Inc. (SNPS) delivered a strong fiscal year 2024, reporting a 15% increase in revenue to $6.1 billion, driven by broad-based growth across its product lines and geographies. The company's core businesses, Design Automation and Design IP, continue to benefit from the increasing complexity and demand in the semiconductor and electronics industries, fueled by trends like AI and advanced computing. A significant development for Synopsys is the pending acquisition of Ansys, a major player in engineering simulation and analysis software, valued at approximately $35.0 billion. This transformative deal, expected to close in the first half of calendar year 2025, aims to create a comprehensive "silicon to systems" design solution provider. While the company is investing in R&D and operations to support growth, it has also divested its Software Integrity business, recognizing a significant gain on the sale. Despite macroeconomic uncertainties and geopolitical pressures, Synopsys demonstrates resilience, maintaining strong customer relationships and a clear strategy for future innovation and market leadership.

Financial Statements
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Key Highlights

  • 1Synopsys reported a 15% year-over-year revenue growth in fiscal 2024, reaching $6.1 billion, indicating strong performance across its Design Automation and Design IP segments.
  • 2The company is progressing with its significant $35 billion acquisition of Ansys, a move intended to expand its comprehensive silicon to systems design solutions.
  • 3Synopsys successfully divested its Software Integrity business, realizing a substantial gain which contributed to its financial results.
  • 4The company continues to invest heavily in Research and Development (R&D), with R&D expenses increasing by 13% year-over-year, highlighting a commitment to innovation and product enhancement.
  • 5Despite ongoing macroeconomic uncertainties and geopolitical challenges, Synopsys has maintained strong customer relationships and a resilient business model.
  • 6The company's strong employee retention rate of 6.4% voluntary turnover, coupled with positive employee engagement scores (80 from SHAPE survey), suggests a stable and motivated workforce.
  • 7Synopsys highlights the increasing importance of AI in its EDA solutions, with its Synopsys.ai suite aimed at enhancing design productivity and efficiency.

Frequently Asked Questions

Synopsys demonstrated strong financial performance in fiscal year 2024, with revenue growing by 15% to $6.1 billion. This growth was primarily driven by increases across all product categories and geographic regions, reflecting robust demand for its electronic design automation (EDA) and silicon intellectual property (IP) solutions.

Synopsys is in the process of acquiring Ansys in a cash-and-stock transaction valued at approximately $35 billion, with an expected closing in the first half of calendar year 2025. This strategic acquisition is anticipated to create a comprehensive "silicon to systems" design platform, combining Synopsys' EDA and IP capabilities with Ansys' engineering simulation and analysis software, aiming to enhance customer value and expand market reach.

Synopsys recently completed the divestiture of its Software Integrity business, which has been classified as discontinued operations. This strategic move has resulted in the company now operating with two primary segments: Design Automation and Design IP. The divestiture resulted in a significant gain recognized in the financial results.

The key growth drivers for Synopsys include the increasing complexity of chip designs, the rise of AI, and demand from sectors like automotive and cloud computing. The company continues to invest heavily in research and development (R&D) to enhance its AI-driven EDA solutions and expand its IP portfolio. Investments in its workforce and talent development are also highlighted as crucial for maintaining its competitive edge and innovation.