Synopsys Details Growth Strategy and Long-term Financial Model at 2026 Investor Day

October 1, 2026 -

Leading portfolio of engineering solutions positions Synopsys to capitalize on the continued expansion of digital and physical AI and the AI-driven transformation of engineering.
Updates long-term growth targets to reflect accelerating revenue and expanding non-GAAP operating margins. Company expects fiscal year 2027 revenue growth of approximately 15% year over year to $11.15 billion at the midpoint of guidance range.
After investing in the business, Synopsys expects to return up to 50% of free cash flow to shareholders via share repurchases; with intent to repurchase approximately $1 billion in shares over the coming months, subject to market conditions.

SUNNYVALE, Calif. -- Synopsys, Inc. (NASDAQ: SNPS) today detailed its long-term growth strategy and sustainable long-term financial model at its 2026 Investor Day in New York. Management outlined how AI is driving demand, transforming engineering, unlocking new business models and accelerating growth across the portfolio. A replay of the presentation will be available on Synopsys' investor relations website.

Synopsys President and CEO, Sassine Ghazi, said: "AI is creating multiple, reinforcing growth engines for Synopsys. The acceleration of frontier intelligence is fueling an unprecedented demand for compute power while increasing system complexity. Simultaneously, purpose-built silicon is reshaping the IP market, while Physical AI and agentic workflows are driving deeper integration of our trusted tools. Together, these forces are expanding our addressable market, increasing consumption of our technology, and creating new, recurring revenue streams."

Highlights from executive presentations include:

Silicon IP Business Expands to Serve Growing Demand for Special-purpose Silicon

Synopsys is expanding beyond traditional standards-based IP into application-optimized IP (AOIP), helping customers develop differentiated silicon tailored to specific workloads and system architectures. As AI drives demand for custom silicon across hyperscalers and system companies, Synopsys is leveraging its interface IP leadership, system expertise, and engineering scale to deliver optimized IP subsystems and platforms that accelerate time-to-market while improving performance and efficiency.

This 'Factory 2' IP model expands Synopsys' value capture per design win and increases its participation in the long-term growth of custom silicon and AI infrastructure. Demonstrating early momentum for the new IP business model, the company has secured multiple AOIP customers spanning compute, ASIC, and AI connectivity architectures. This includes an IP agreement with Amazon, which was announced today.

Powering the Next Frontier of AI-Driven Design

Ghazi today also explained the company's strategy to create and capture value in the delivery of AI-powered engineering solutions and announced a groundbreaking partnership with OpenAI to collaborate as preferred partners to develop and deliver GPT-Synopsys, a specialized model for chip design that brings together OpenAI's frontier AI with Synopsys' trusted EDA tools and chip design expertise.

Synopsys is advancing the next frontier of AI-driven design and simulation with a strategy that enables customers to adopt its agentic AI portfolio in the way that best fits their engineering environment. Customers can deploy the full Synopsys Autopilot platform, integrate Synopsys agents into their own AI platforms, or leverage frontier AI models optimized for specialized engineering workflows. Across all approaches, Synopsys provides the trusted engineering context, domain-specific agents, and ground-truth execution engines that power the development of the world's most advanced products. This flexible model expands Synopsys' opportunity to participate across the emerging AI engineering ecosystem while creating multiple avenues to monetize AI-driven engineering through a combination of subscription and consumption-based models across tools, agents and platform.

Synopsys Fiscal 2027 and Long-term Financial Outlook

Synopsys provided financial guidance for fiscal year 2027 and a comprehensive multi-year financial framework through fiscal year 2030. The company also announced its intent to repurchase approximately $1 billion of Synopsys shares over the coming months, subject to market conditions, underscoring confidence in its long-term cash generation.

Shelagh Glaser, Synopsys CFO, said, "Our updated financial framework reflects confidence in both our growth trajectory and our ability to scale efficiently while helping customers re-engineer their engineering to accelerate AI-powered products. We remain focused on disciplined execution, converting growth into expanding margins and strong free cash flow, while continuing to invest in innovation and deliver sustainable long-term value for our shareholders."

The company's updated long-term targets and fiscal year 2027 outlook are provided below:

Our long-term, FY26E - FY30E objectives ⁽¹⁾

Revenue	Operating Margin	Free Cash Flow ⁽²⁾
Company⁽²⁾	Long-term non-GAAP	Free Cash Flow Growth
Mid-Teens growth ~15%	FY30E operating margin ~50%	in the Mid 20%'s

Design Automation ⁽²⁾	Earnings⁽²⁾	Capital Return⁽³⁾
EDA: Mid-Teens: 13%+	Non-GAAP EPS growth	Up to 50%
S&A: Double-Digit: 10%+	in the Mid 20%s	of Free Cash Flow
Design IP⁽²⁾		via share repurchases
High-Teens: 17%+

(1) These multi-year objectives are provided as of September 30, 2026. See below for additional information regarding these forward-looking non-GAAP measures, including reconciliations to the most comparable GAAP measures to the extent available without unreasonable efforts

(2) FY26E - FY30E Growth CAGR
(3) Capital allocation objectives are based on current business outlook and may vary based on market conditions, strategic opportunities, and balance sheet priorities

Full Fiscal Year 2027 Financial Targets
(in millions, except per share amounts)

	Range for Fiscal Year Ending
	October 31, 2027
	Low	High
Revenue	$11,100	$11,200
GAAP Expenses	$8,765	$8,905
Non-GAAP Expenses	$6,215	$6,275
Non-GAAP Interest and Other Income (Expense), net	($465)	($455)
Non-GAAP Tax Rate	18 %	18 %
Outstanding Shares (fully diluted)	190	192
GAAP Operating Margin	Midpt: ~20.7%
Non-GAAP Operating Margin	Midpt: ~44.0%
GAAP EPS	$8.16	$8.61
Non-GAAP EPS	$19.04	$19.12
Operating Cash Flow	~$3,600
Free Cash Flow ⁽¹⁾	~$3,100
Capital Expenditures	~$500

(1) Free cash flow is calculated as cash provided from operating activities less capital expenditures

GAAP to Non-GAAP Reconciliation of Full Fiscal Year 2027 Targets
(in thousands, except per share data)

	Range for Fiscal Year
	Ending October 31, 2027
	Low	High
Target GAAP expenses	$ 8,765,000	$ 8,905,000
Adjustments:
Amortization of acquired intangible assets	(1,540,000)	(1,550,000)
Stock-based compensation	(960,000)	(980,000)
Restructuring charges	(50,000)	(100,000)
Target non-GAAP expenses	$ 6,215,000	$ 6,275,000

	Range for Fiscal Year
	Ending October 31, 2027
	Low	High
Target GAAP earnings per diluted share attributed to Synopsys	$ 8.16	$ 8.61
Adjustments:
Amortization of acquired intangible assets	$ 8.12	$ 8.06
Stock-based compensation	$ 5.13	$ 5.03
Restructuring charges	$ 0.52	$ 0.26
Tax adjustments and settlement	$ (2.89)	$ (2.84)
Target non-GAAP earnings per diluted share attributed to Synopsys	$ 19.04	$ 19.12

Shares used in non-GAAP calculation (midpoint of target range)	191,000	191,000

GAAP to Non-GAAP Reconciliation of Operating Margin at Midpoint of Full Fiscal Year 2027 Targets

	Twelve Months Ending October 31, 2027
At midpoint of revenue and expense guidance ranges
GAAP operating margin	20.7 %
Amortization of acquired intangible assets	13.9 %
Stock-based compensation	8.7 %
Restructuring charges	0.7 %
Target non-GAAP operating margin	44.0 %

Presentations and the webcast replay from today's Synopsys 2026 Investor Day are available at: https://investor.synopsys.com/.

About Synopsys

Synopsys, Inc. (Nasdaq: SNPS) is the leader in engineering solutions from silicon to systems, enabling customers to rapidly innovate AI-powered products. We deliver industry-leading silicon design, IP, simulation and analysis solutions, and design services. We partner closely with our customers across a wide range of industries to maximize their R&D capability and productivity, powering innovation today that ignites the ingenuity of tomorrow. Learn more at www.synopsys.com.