On May 22, 2024, Synopsys Inc (SNPS, Financial) released its 8-K filing detailing the financial results for the second quarter of fiscal year 2024. Synopsys, a leading provider of electronic design automation software, intellectual property, and software integrity products, reported revenue of $1.455 billion for the quarter, falling short of the analyst estimate of $1.510 billion. However, the company exceeded earnings per share (EPS) expectations, reporting $3.00 on a non-GAAP basis, compared to the estimated $2.02.
Company Overview
Synopsys Inc (SNPS, Financial) is renowned for its electronic design automation (EDA) software, which automates the chip design process, enhancing design accuracy, productivity, and complexity in a full-flow end-to-end solution. The firm's growing software integrity (SI) business allows customers to continuously manage and test the code base for security and quality. Synopsys' comprehensive portfolio benefits from the convergence of semiconductor companies moving up-stack toward systems-like companies and systems companies moving down-stack toward in-house chip design.
Performance and Challenges
Synopsys Inc (SNPS, Financial) reported a revenue increase to $1.455 billion for Q2 FY2024, up from $1.263 billion in the same quarter last year. Despite this growth, the revenue fell short of the analyst estimate of $1.510 billion. The company's net income on a GAAP basis was $299.1 million, or $1.92 per diluted share, compared to $275.6 million, or $1.78 per diluted share, in Q2 FY2023. On a non-GAAP basis, net income was $466.9 million, or $3.00 per diluted share, surpassing the analyst estimate of $2.02.
Financial Achievements
Synopsys Inc (SNPS, Financial) demonstrated strong operational execution and business momentum, as highlighted by CEO Sassine Ghazi:
“We continued our strong operational execution and business momentum in Q2. Customers continue investing in Synopsys solutions to maximize their R&D and power their future innovations for this era of pervasive intelligence.”
Additionally, CFO Shelagh Glaser noted:
“Synopsys’ strong Q2 results were driven by our team’s relentless focus on execution, our leading technology that is mission-critical to customers, and our resilient business model.”
Key Financial Metrics
Synopsys Inc (SNPS, Financial) provided the following key financial metrics for Q2 FY2024:
| Metric | Q2 FY2024 | Q2 FY2023 |
|---|---|---|
| Revenue | $1.455 billion | $1.263 billion |
| GAAP Net Income | $299.1 million | $275.6 million |
| GAAP EPS | $1.92 | $1.78 |
| Non-GAAP Net Income | $466.9 million | $368.3 million |
| Non-GAAP EPS | $3.00 | $2.38 |
Analysis and Future Outlook
Synopsys Inc (SNPS, Financial) has shown resilience and strong performance in Q2 FY2024, particularly in its non-GAAP earnings, which significantly exceeded analyst expectations. The company's strategic focus on enhancing its EDA and SI solutions continues to drive customer investment and innovation. However, the revenue miss indicates potential challenges in market conditions or competitive pressures that may need to be addressed.
Looking ahead, Synopsys has raised its full-year targets for revenue and non-GAAP EPS, reflecting confidence in its business model and operational execution. The planned acquisition of Ansys is expected to further strengthen Synopsys' position in the market, providing additional growth opportunities.
For more detailed financial information and analysis, visit the full 8-K filing.
Explore the complete 8-K earnings release (here) from Synopsys Inc for further details.
