Synopsys Reports Q3 2025 Earnings, CEO Discusses Acquisition Impact

Synopsys, Inc. reported Q3 2025 earnings with CEO Sassine Ghazi and CFO Shelagh Glaser discussing the results. The company's performance includes roughly 2 weeks of Ansys financials, which were acquired on July 17. Key points of the earnings call include the company's financial results, including revenue and earnings per share, as well as its outlook for the future. The call also included a question-and-answer session with analysts.

Synopsys, Inc. (NASDAQ: SNPS) reported its Q3 2025 earnings today, with CEO Sassine Ghazi and CFO Shelagh Glaser providing insights into the company's performance. The earnings included approximately two weeks of Ansys financials, which were acquired on July 17. The company reported third-quarter revenue of $1.74 billion and non-GAAP EPS of $3.39.

Key Points from the Earnings Call

1. Revenue Growth and Acquisition Impact: Synopsys's revenue increased by 23% year-over-year, driven by strong performance in the Design Automation segment, which includes Ansys products. The acquisition of Ansys expanded Synopsys's customer base and long-term growth opportunities.

2. IP Business Underperformance: The IP business saw an 8% year-over-year decline due to factors such as new export restrictions in China, challenges at a major foundry customer, and road map and resource decisions that did not yield expected results. The company is actively pivoting its IP resources and road map towards higher growth opportunities.

3. AI and Simulation Solutions: Synopsys's AI and simulation solutions performed in line with expectations. The company released Ansys 2025 R2, providing customers with advanced AI-driven simulation capabilities, GPU acceleration, system-level modeling, and cloud computing.

4. Multi-die and AI Integration: Synopsys achieved multiple successful multi-die tape-outs and is working on integrating its semiconductor timing and power sign-off capabilities with Ansys's gold standard of thermal sign-off. The company expects to deliver its first fully integrated solution in the first half of next year.

5. Outlook and Strategic Initiatives: Despite external headwinds, Synopsys remains optimistic about its future. The company is taking a more cautious view of Q4 but expects to deliver a record revenue year. Synopsys is also conducting a strategic portfolio review and taking actions to focus on the highest growth opportunities.

Analyst Questions and Answers

During the question-and-answer session, analysts asked about the impact of the Ansys acquisition, the company's pivot in the IP business, and its plans for integrating AI capabilities. Sassine Ghazi and Shelagh Glaser provided detailed responses, emphasizing the company's commitment to leveraging AI and simulation solutions to drive growth and innovation.

Conclusion

Synopsys, Inc.'s Q3 2025 earnings reflect the company's strong performance in the Design Automation and Simulation & Analysis segments, driven by the Ansys acquisition. While the IP business faced headwinds, the company is actively pivoting its resources to capitalize on higher growth opportunities. Synopsys remains optimistic about its future, with a focus on AI integration and strategic initiatives to drive long-term growth.

References

Synopsys, Inc. (SNPS) Q3 2025 Earnings Call Transcript^[1] https://seekingalpha.com/article/4821266-synopsys-inc-snps-q3-2025-earnings-call-transcript