Synopsys, Inc. is a prominent player in the semiconductor and software industry, providing solutions in electronic design automation (EDA), silicon IP, and system verification. For its second quarter of fiscal year 2025, Synopsys reported a revenue of $1.604 billion, marking a 10% increase from $1.455 billion in the same quarter of the previous year. The company’s non-GAAP earnings per diluted share for the quarter were $3.67, compared to $3.00 in the prior year, reflecting strong performance in its product offerings.

The company is exhibiting stable growth despite challenges in specific markets, notably a decline in revenue from China, which was expected to affect overall performance. Overall, the revenue guidance for the full fiscal year 2025 remains unchanged at $6.745 billion to $6.805 billion. Non-GAAP operating margin was reported at 38%, with adjusted operating margins for key segments, including Design Automation at 40.9% and Design IP at 31.2%.

Total GAAP costs and expenses for the quarter were $1.23 billion, and non-GAAP costs and expenses were $995 million. The company’s backlog increased by $400 million, reaching $8.1 billion compared to the previous quarter. The business segments are performing as follows: Design Automation generated $1.12 billion in revenue, translating to a 6% year-over-year increase, while Design IP generated $482 million, up 21% from the previous year.

Full-year guidance has been reaffirmed, with the company projecting non-GAAP earnings per share of between $15.11 to $15.19. Operating cash flow is anticipated to be approximately $1.5 billion, with free cash flow of around $1.3 billion. The company also noted that the impact of recent bond issuance has been integrated into its updated EPS guidance.

For the third quarter of fiscal year 2025, Synopsys provided a revenue forecast of between $1.755 billion and $1.785 billion, alongside GAAP earnings per share estimates ranging from $2.63 to $2.74. Non-GAAP earnings per share for the third quarter are estimated to fall between $3.82 and $3.87, inclusive of bond-related costs.

With a strong cash position of $14.3 billion and a debt load of $10.1 billion, Synopsys is positioned to navigate current market conditions while capitalizing on growth opportunities in AI and semiconductor design. The company continues to emphasize its leadership in EDA and related technologies as fundamental to driving customer innovation and addressing market demands.