Dec. 10, 2025 –
Shares of the chip design automation software company Synopsys Inc. were trending higher in late trading today after it beat expectations on earnings and revenue and offered strong profit guidance for the current quarter and year.
The company reported fiscal 2025 fourth-quarter earnings before certain costs such as stock compensation of $2.90 per share, ahead of Wall Street’s forecast of $2.78 per share. Revenue for the period rose by an impressive 37%, to $2.26 billion, just ahead of the analyst consensus estimate of $2.25 billion. Synopsys ended the quarter with net income of $448.4 million, down from the $1.095 billion profit it recorded in the same period one year ago.
For the full year, Synopsys posted record revenue of $7.1 billion, up about 15% from the previous year.
Synopsys President and Chief Executive Sassine Ghazi (pictured) said the company delivered on a solid year that underscored its status as the industry’s leader in engineering solutions for silicon systems. “We enter fiscal 2026 with an intense focus on driving sustainable growth and margin expansion through continued innovation and disciplined execution,” he added.
The fortunes of Synopsys are tied to those of the semiconductor industry, for the company is one of the major suppliers of the electronic design automation software that’s used by chipmakers such as Nvidia Corp., Intel Corp., Samsung Electronics Co. Ltd. and Qualcomm Inc. Those companies rely on Synopsys’ software to automate large parts of the chip design process, including steps such as the actual design, verification, signoff, physical verification and more.
Synopsys’ main competitor is Cadence Design Systems Inc., and the two dominate the chipmaking software market. Virtually every computer chip in the world was designed using either Synopsys or Cadence software.
Not surprisingly, Synopsys has grown immensely over the last three years or so thanks to the rise of artificial intelligence, which is fueling intense demand for ever-more powerful computer chips that can satisfy the enormous processing requirements of large language models.
Synopsys Chief Financial Officer Shelagh Glaser told analysts on a conference call that the company now has an order backlog of more than $11.4 billion, all waiting to be converted into revenue. “We expect to set another revenue record in 2026 while fully integrating Ansys,” she added, referring to the company’s $35 billion acquisition of the engineering design software maker Ansys Corp., which closed earlier this year.