May 27 - Synopsys raised its full-year outlook on Wednesday, pointing to persistent demand for its electronic design automation (EDA) tools as customers accelerate development of AI chips and the systems that support them.
The company now expects fiscal 2026 revenue to fall between $9.63 billion and $9.71 billion, up from its previous range of $9.56 billion to $9.66 billion. Synopsys also boosted its annual adjusted earnings-per-share guidance to a range of $14.72 to $14.80, compared with the prior outlook of $14.38 to $14.46.
Management attributed the upgrade to strong activity tied to AI. "AI is scaling semiconductor demand, architectural diversity and complexity of chips and the systems they power - driving demand across our portfolio," CEO Sassine Ghazi said.
For the third quarter, Synopsys forecast revenue between $2.41 billion and $2.46 billion. That guidance sits alongside analysts' average estimate of $2.41 billion, according to data compiled by LSEG.
The company reported total revenue of $2.28 billion for the second quarter, ahead of consensus estimates of $2.25 billion.
Context and implications
The revised full-year revenue and EPS ranges reflect continued investment by semiconductor companies and hyperscalers in more complex designs and intelligent systems. Synopsys framed the demand as being closely tied to AI-driven architectural and system complexity that requires advanced software tools across its product portfolio.
Financial detail
- Fiscal 2026 revenue guidance: $9.63 billion to $9.71 billion (previously $9.56 billion to $9.66 billion).
- Fiscal 2026 adjusted EPS guidance: $14.72 to $14.80 (previously $14.38 to $14.46).
- Third-quarter revenue guidance: $2.41 billion to $2.46 billion (analysts' average: $2.41 billion).
- Second-quarter reported revenue: $2.28 billion (consensus: $2.25 billion).
Bottom line
Synopsys' guidance raise underscores resilient demand for its chip design software driven by AI-related projects at chipmakers and hyperscalers, with near-term revenue guidance aligning with market expectations and quarterly results beating consensus.