Overview

• Synopsys missed fiscal third-quarter expectations with revenue of about $1.74 billion and adjusted EPS of $3.39, both below consensus.
• Executives said Design IP sales fell as expected deals collapsed following U.S. export curbs that disrupted China design starts and a pullback by a major foundry customer; IP revenue dropped 8% to $427.6 million, falling to 24.6% of total.
• The company cut its full-year adjusted EPS outlook to $12.76 to $12.80 from $15.11 to $15.19 and guided fourth-quarter adjusted EPS to $2.76 to $2.80, below analyst forecasts.
• Synopsys forecast current-quarter revenue of $2.23 billion to $2.26 billion, above estimates, and indicated a higher full-year sales range of roughly $7.03 billion to $7.06 billion.
• Shares sank by roughly a third, erasing year-to-date gains, and peer Cadence Design Systems also fell; the results come after Synopsys closed its $35 billion Ansys acquisition in July following conditional approval in China.