SYNOPSYS, INC.

Unaudited Consolidated Statements of Cash Flows ⁽¹⁾

(in thousands)

Nine Months Ended July 31,

2019

2018

CASH FLOWS FROM OPERATING ACTIVITIES:

Net income

$ 371,653

$  178,190

Adjustments to reconcile net income to net cash used in

Amortization and depreciation

152,133

150,245

Amortization of capitalized costs to obtain revenue contracts

46,230

-

Stock compensation

114,826

102,540

Allowance for doubtful accounts

8,950

3,368

(Gain) loss on sale of property and investments

(4,052)

(93)

Deferred income taxes

(9,664)

5,509

Net changes in operating assets and liabilities, net of

acquired assets and liabilities:

Accounts receivable

89,370

(41,695)

Inventories

(39,431)

(48,440)

Prepaid and other current assets

(38,224)

(9,766)

Other long-term assets

(114,344)

(31,652)

Accounts payable and accrued liabilities

(45,200)

(56,491)

Income taxes

(6,963)

(35,014)

Deferred revenue

53,980

76,780

Net cash provided by operating activities

579,264

293,481

CASH FLOWS FROM INVESTING ACTIVITIES:

Proceeds from sales and maturities of short-term investments

-

12,449

Proceeds from sales of long-term investments

6,361

494

Purchases of long-term investments

-

(645)

Proceeds from sales of property and equipment

-

1,662

Purchases of property and equipment

(122,358)

(70,469)

Cash paid for acquisitions and intangible assets, net of cash acquired

-

(646,687)

Capitalization of software development costs

(2,245)

(2,714)

Net cash used in investing activities

(118,242)

(705,910)

CASH FLOWS FROM FINANCING ACTIVITIES:

Proceeds from credit facility

192,897

615,000

Repayment of debt

(520,312)

(137,500)

Issuances of common stock

107,354

72,722

Payments for taxes related to net share settlement of equity awards

(52,309)

(42,636)

Purchase of equity forward contract

(20,000)

(33,000)

Purchases of treasury stock

(209,185)

(367,000)

Other

(762)

1,759

Net cash (used in) provided by financing activities

(502,317)

109,345

Effect of exchange rate changes on cash, cash equivalents and restricted cash

4,975

(3,826)

Net change in cash, cash equivalents and restricted cash

(36,320)

(306,910)

Cash, cash equivalents and restricted cash, beginning of the year

725,001

1,050,075

Cash, cash equivalents and restricted cash, end of the period

$ 688,681

$  743,165

(1) Synopsys' third quarter of fiscal year 2019 and 2018 ended on August 3, 2019 and August 4, 2018, respectively. For presentation purposes, we refer to the closest calendar month end. The first quarter of fiscal 2018 included an extra week.