Synopsys Inc. (NASDAQ:SNPS) shares are trading higher Thursday after the company issued fiscal-year 2027 financial guidance above estimates.
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FY27 Financial Guidance
Synopsys issued financial guidance for fiscal year 2027 and a comprehensive multi-year financial framework through fiscal year 2030.
Synopsys expects fiscal-year 2027 GAAP earnings in the range of $8.16 to $8.61 per share, and adjusted earnings per share of $19.04 to $19.12, above the consensus estimate of $17.32. The company also sees fiscal-year 2027 revenue of $11.100 billion to $11.200 billion, exceeding the consensus estimate of $10.730 billion.
The company outlined a long-term financial framework for fiscal 2026 through fiscal 2030, targeting mid-teens annual revenue growth of about 15%, a fiscal 2030 operating margin of around 50%, and free cash flow growth in the mid-20% range.
Synopsys Plans $1 Billion Share Buyback
The company also plans to repurchase about $1 billion of its shares in the coming months, subject to market conditions, signaling confidence in its long-term cash generation.
Shelagh Glaser, Synopsys CFO, said, “Our updated financial framework reflects confidence in both our growth trajectory and our ability to scale efficiently while helping customers re-engineer their engineering to accelerate AI-powered products. We remain focused on disciplined execution, converting growth into expanding margins and strong free cash flow, while continuing to invest in innovation and deliver sustainable long-term value for our shareholders.”
Synopsys, OpenAI Partner on AI Model for Chip Design
Separately, Synopsys announced strategic partnerships with both OpenAI and Amazon.com, Inc. (NASDAQ:AMZN). Synopsys and OpenAI signed a multi-year agreement to jointly develop GPT-Synopsys, a specialized AI model optimized to use Synopsys’ electronic design automation tools for semiconductor design workflows. OpenAI will license Synopsys’ EDA tools to help develop the model, with the two companies collaborating on research and development alongside joint go-to-market initiatives under a shared revenue-sharing framework.
“The future of semiconductor engineering requires dramatic acceleration of the chip design process without compromising PPA or first-time-right silicon,” said Sassine Ghazi, President and CEO of Synopsys. “Together with OpenAI, we’re bringing frontier intelligence to chip design to help more companies develop and accelerate advanced silicon, while maintaining the rigor and trust required for manufacturing success.”
Synopsys Lands $1B-Plus Deal With Amazon
Synopsys also announced a multi-year agreement worth more than $1 billion with Amazon to accelerate the engineering of Amazon’s custom chips and AWS infrastructure using Synopsys’ silicon IP and AI-powered engineering software. The deal marks an expansion of Synopsys’ silicon IP business toward a license-plus-royalty model as production volumes grow, with Amazon serving as the lead customer for application-optimized IP.
Synopsys Shares Edge Higher
SNPS Price Action: At the time of publication, Synopsys shares are trading 3.46% higher at $450.00, according to data from Benzinga Pro.
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