Synopsys Experiences Surge in Revenue Following Ansys Acquisition.

Synopsys Inc. (SNPS) has reported Q3 2025 revenue of $1.74 billion, a significant increase. Analysts project an average one-year price target of $649.53, indicating a potential upside of 7.47%. GF Value estimates suggest a 16.03% increase, highlighting Synopsys' growth potential. The company's acquisition of Ansys has strengthened its foothold in engineering solutions, and its revised full-year 2025 guidance projects revenue between $7.03 billion and $7.06 billion.

Synopsys Inc. (SNPS) reported its financial results for the third quarter of 2025, revealing a significant increase in revenue. The company reported Q3 revenue of $1.74 billion, a 14% year-over-year increase. Despite missing analyst expectations, the stock saw a slight decline during regular trading hours but recovered in aftermarket trading.

Synopsys' earnings per share (EPS) of $3.39 fell short of the expected $3.80, with revenue also below the forecast of $1.77 billion. The stock experienced a decline of 0.77% during regular trading hours, closing at $609.08, but recovered to $612.01 in aftermarket trading.

Analysts project an average one-year price target of $649.53, indicating a potential upside of 7.47%. GF Value estimates suggest a 16.03% increase, highlighting Synopsys' growth potential. The company's acquisition of Ansys has strengthened its foothold in engineering solutions, and its revised full-year 2025 guidance projects revenue between $7.03 billion and $7.06 billion.

Synopsys continues to expand its engineering solutions portfolio with strategic acquisitions and innovations. The company is undergoing a strategic review, including a 10% global headcount reduction by the end of fiscal 2026. Despite the earnings miss, Synopsys maintains strong financial health with a 7.02x current ratio, indicating robust liquidity.

The company's Design Automation segment grew by 23%, while Design IP revenue declined by 8%. The acquisition of Ansys has diversified Synopsys' portfolio and customer base, enabling it to maximize the capabilities of engineering teams across various industries.

Looking ahead, Synopsys provided revenue guidance for Q4 2025, projecting between $2.23 billion and $2.26 billion. The company is focusing on higher-value IP solutions and subsystem delivery, aiming to capitalize on the evolving semiconductor IP landscape.

Executive Commentary: CEO Sassine Ghazi emphasized the company's leadership in engineering solutions, stating, "We are now the leader in engineering solutions from silicon to systems." He also highlighted the transformative potential of physical AI, saying, "The rise of physical AI underscores the importance of our combined expertise."

Risks and Challenges: Supply chain disruptions, export restrictions to China, subdued semiconductor demand, integration challenges from the Ansys acquisition, and global economic uncertainties could influence Synopsys' performance.

Overall, Synopsys Inc. reported a strong Q3 2025, with analysts seeing significant growth potential. The company's strategic acquisitions and innovations position it well for future growth, despite the current challenges.