Synopsys Inc. has recently released its 10-Q report, providing a comprehensive overview of its financial performance and operations for the third quarter of fiscal 2025. The company, headquartered in Sunnyvale, California, specializes in electronic design automation software products utilized in the design and testing of integrated circuits. It operates in two segments, Design Automation and Design IP, offering a wide range of digital and custom IC design solutions, verification solutions, FPGA design products, and intellectual property (IP) solutions for various applications.
In the third quarter of fiscal 2025, Synopsys reported revenues of $1.7 billion, marking a 14% increase from the same period in fiscal 2024. However, the company experienced weakness in its Design IP segment due to various headwinds, including China export control restrictions, weaker than expected demand from a major foundry customer, and certain roadmap and resource decisions that did not yield the intended results.
For the nine months ended July 31, 2025, Synopsys reported revenues of $4.8 billion, representing a 7% increase from the same period in fiscal 2024. The total cost of revenue and operating expenses for this period amounted to $4.0 billion, reflecting a 16% increase primarily due to higher employee-related costs, legal and consulting fees, and amortization expenses related to intangible assets acquired from the Ansys Merger.
The company highlighted its consistent revenue growth since 2005, attributing it to solid execution, leading technologies, and strong customer relationships. Synopsys also emphasized its strategy to expand its total addressable market by maximizing the capabilities of R&D teams across industries, focusing on semiconductor, high-tech, industrial, aerospace, and more.
Of particular note was Synopsys' acquisition of ANSYS, Inc. (Ansys) on July 17, 2025, which is expected to have a significant impact on the company's future operations and financial performance. The report also discussed the impact of the current macroeconomic and geopolitical environment on Synopsys' business, citing increased volatility in global markets and the challenges posed by the uncertain macroeconomic environment, including changes in U.S. and global trade policy, sustained global inflationary pressures, and geopolitical pressures.
As a result of these announcements, the company's shares have moved -0.77% on the market, and are now trading at a price of $604.37. For more information, read the company's full 10-Q submission here.
