This press release contains forward-looking statements, including, but not limited to, statements regarding Synopsys' executive management transition, short-term and long-term financial targets, expectations and objectives; strategies related to our products, technology and services; business and market outlook, opportunities and strategies; the expected impact of U.S. and foreign government actions and regulatory changes, including export control restrictions on our financial results; the potential impact of the uncertain macroeconomic environment on our financial results; customer demand and market expansion; our planned product releases and capabilities; industry growth rates; software trends; planned acquisitions and stock repurchases; our expected tax rate; and the impact and result of pending legal, administrative and tax proceedings. These statements involve risks, uncertainties and other factors that could cause our actual results, time frames or achievements to differ materially from those expressed or implied in such forward-looking statements. Such risks, uncertainties and factors include, but are not limited to: macroeconomic conditions and uncertainty in the global economy; uncertainty in the growth of the semiconductor and electronics industries; the highly competitive industry we operate in; actions by the U.S. or foreign governments, such as the imposition of additional export restrictions or tariffs; consolidation among our customers and our dependence on a relatively small number of large customers; risks and compliance obligations relating to the global nature of our operations; and more. Additional information on potential risks, uncertainties and other factors that could affect Synopsys' results is included in filings we make with the SEC from time to time, including in the sections entitled "Risk Factors" in our latest Annual Report on Form 10-K and in our latest Quarterly Report on Form 10-Q. The financial information contained in this press release should be read in conjunction with the consolidated financial statements and notes thereto included in Synopsys' most recent reports on Forms 10-K and 10-Q, each as may be amended from time to time. Synopsys' financial results for its third quarter of fiscal year 2023 are not necessarily indicative of Synopsys' operating results for any future periods. The information provided herein is as of August 16, 2023. Synopsys undertakes no duty to, and does not intend to, update any forward-looking statement, whether as a result of new information, future events or otherwise, unless required by law.
SYNOPSYS, INC. | |||||
Unaudited Condensed Consolidated Statements of Income (1) | |||||
(in thousands, except per share amounts) | |||||
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| Three Months Ended |
| Nine Months Ended | ||
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| July 31, |
| July 31, | ||
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| 2023 | 2022 |
| 2023 | 2022 |
Revenue: |
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Time-based products | $ 922,874 | $ 754,322 |
| $ 2,513,383 | $ 2,185,626 |
Upfront products | 297,967 | 268,584 |
| 980,149 | 973,483 |
Total products revenue | 1,220,841 | 1,022,906 |
| 3,493,532 | 3,159,109 |
Maintenance and service | 266,447 | 224,860 |
| 749,959 | 638,141 |
Total revenue | 1,487,288 | 1,247,766 |
| 4,243,491 | 3,797,250 |
Cost of revenue: |
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Products | 190,809 | 164,077 |
| 549,908 | 480,166 |
Maintenance and service | 98,299 | 87,774 |
| 285,056 | 253,665 |
Amortization of intangible assets | 18,374 | 19,330 |
| 54,886 | 47,145 |
| Total cost of revenue | 307,482 | 271,181 |
| 889,850 | 780,976 |
| Gross margin | 1,179,806 | 976,585 |
| 3,353,641 | 3,016,274 |
| Operating expenses: |
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| Research and development | 507,402 | 444,826 |
| 1,458,328 | 1,218,761 |
| Sales and marketing | 227,134 | 199,246 |
| 660,034 | 571,329 |
| General and administrative | 109,714 | 91,461 |
| 298,161 | 246,426 |
| Amortization of intangible assets | 6,697 | 7,124 |
| 19,996 | 23,036 |
| Restructuring charges | 33,385 | — |
| 78,384 | 12,057 |
| Total operating expenses | 884,332 | 742,657 |
| 2,514,903 | 2,071,609 |
| Operating income | 295,474 | 233,928 |
| 838,738 | 944,665 |
| Other income (expense), net | 25,808 | 2,426 |
| 53,353 | (41,280) |
| Income before income taxes | 321,282 | 236,354 |
| 892,091 | 903,385 |
| Provision (benefit) for income taxes | (11,773) | 16,708 |
| 20,461 | 76,506 |
| Net income | 333,055 | 219,646 |
| 871,630 | 826,879 |
| Net income (loss) attributed to non-controlling
| (3,197) | (2,980) |
| (9,068) | (4,215) |
| Net income attributed to Synopsys | $ 336,252 | $ 222,626 |
| $ 880,698 | $ 831,094 |
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| Net income per share attributed to Synopsys: |
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| Basic | $ 2.21 | $ 1.46 |
| $ 5.79 | $ 5.43 |
| Diluted | $ 2.17 | $ 1.43 |
| $ 5.68 | $ 5.31 |
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| Shares used in computing per share amounts: |
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| Basic | 152,023 | 152,938 |
| 152,204 | 153,082 |
| Diluted | 154,947 | 155,806 |
| 155,119 | 156,545 |
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| (1) Synopsys' third quarter of fiscal year 2023 and 2022 ended on July 29, 2023 and July 30, 2022, respectively. For presentation purposes,
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