Synopsys Exceeds Q1 Revenue Guidance and Delivers Strong Non-GAAP EPS as AI and HPC Remain Robust
On February 26, 2025, Synopsys, a leading provider of electronic design automation (EDA) software and services, announced its financial results for the first quarter of fiscal year 2025. The company exceeded the midpoint of its Q1 revenue guidance and delivered non-GAAP earnings per share (EPS) above its guidance range.
According to Sassine Ghazi, President and CEO of Synopsys, the company had a solid start to 2025, with AI and HPC remaining robust in the first quarter. However, industrial, automotive, and consumer electronics remained challenged due to various market headwinds.
Ghazi noted that despite these challenges, Synopsys' opportunity is tied to research and development (R&D) and underpinned by the mega trends of AI and silicon proliferation and software-defined systems. These trends are increasing design complexity and cost while driving greater compute and energy demands.
"New design paradigms are essential to address these challenges, and Synopsys is racing to deliver," Ghazi said. "We had the privilege to meet with semi and automotive customers in January, who all expressed their strong belief in the strategy we are driving."
The company's pending acquisition of ANSYS will pave the way for new AI-powered design solutions that use electronics and physics giving R&D teams the tools they need to ignite their future innovation. In January, the European Commission approved Synopsys' pending procompetitive acquisition of ANSYS, and the U.K. CMA provisionally accepted its remedies toward Phase 1 approval.
In Q1, Design Automation revenue was up 4% year-over-year with one less week of revenue versus the prior Q1, while design activity remained strong. Synopsys strengthened its position in hardware-assisted verification (HAV) solutions by expanding its industry-leading HAV portfolio to include new HAPS 200 prototyping systems and new ZeBu 200 emulation systems.
The company also saw strong design activity at advanced nodes with 2-nanometer projects accelerating rapidly. Fusion Compiler, Synopsys' industry-leading platform for advanced node digital design implementation, was used exclusively by a U.S. hyperscaler to tape out a 2-nanometer test chip.
"Our pending acquisition of ANSYS will pave the way for new AI-powered design solutions that use electronics and physics giving R&D teams the tools they need to ignite their future innovation," Ghazi said.
