Q1 2025 Synopsys Inc Earnings Call Transcript
Key Points
- Synopsys Inc (SNPS) exceeded the midpoint of its Q1 revenue guidance and delivered non-GAAP EPS above the guidance range.
- The company reported a 4% year-over-year increase in Design Automation revenue, despite having one less work week compared to the previous year.
- Synopsys Inc (SNPS) is making strong progress with its pending acquisition of Ansys, which is expected to enhance AI-powered design solutions.
- The company is seeing strong design activity at advanced nodes, with significant customer adoption of its Fusion Compiler platform for 2-nanometer projects.
- Synopsys Inc (SNPS) continues to expand its AI offerings, with significant productivity improvements reported by customers using its AI-driven tools.
- Q1 revenue was down 4% year over year, and non-GAAP EPS was down 10%, partly due to one less work week in Q1 2025 compared to Q1 2024.
- The industrial, automotive, and consumer electronics markets remain challenged, impacting overall business performance.
- Revenue from the Design IP segment was down 17% year over year, attributed to timing and a tough prior year comparison.
- The company is facing headwinds in China, with expectations of continued deceleration in growth below the corporate average.
- Free cash flow was a $108.2 million outflow for the quarter, indicating cash management challenges.
Ladies and gentlemen, welcome to the Synopsys earnings conference call for the first-quarter, fiscal year 2025.
(Operator Instructions)As a reminder, today's call is being recorded.
At this time, I would like to turn the conference over to Trey Campbell, Senior Vice President - Investor Relations. Please go ahead.
Good afternoon, everyone. With us, today, are Sassine Ghazi, President and CEO of Synopsys; and Shelagh Glaser, CFO.
Before we begin, I'd like to remind everyone that during the course of this conference call, Synopsys will discuss forecasts, targets, and other forward-looking statements regarding the company and its financial results. While these statements represent our best current judgment about future results and performance, as of today, our actual results are subject to many risks and uncertainties that could cause actual results to differ, materially, from what we expect.
In addition to any risks that we highlight during this call,
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