Synopsys, the chip-design software provider, saw a boost in its shares following the announcement of higher-than-anticipated quarterly profits. For its fiscal third quarter, which ended on October 31, Synopsys reported a revenue of $1.599 billion, marking a 25% increase compared to the previous year. The reported figure slightly exceeded both the projected range of $1.567 billion to $1.597 billion provided by management and the Wall Street consensus forecast of $1.585 billion.
Adjusted earnings for the company stood at $3.17 per share, surpassing both the expected range of $3.01 to $3.06 per share and the Street consensus call of $3.04. According to generally accepted accounting principles, Synopsys earned $2.26 per share.
Furthermore, Synopsys recorded a 15% surge in revenue to reach $5.843 billion for the full year.
Looking ahead to the January quarter, Synopsys is predicting a revenue range between $1.63 billion and $1.66 billion, which exceeds the Street consensus forecast of $1.578 billion. The company also expects adjusted profits of $3.40 to $3.45 per share, surpassing the Street's call for $3.05.
For the fiscal year of October 2024, Synopsys projects revenue to fall between $6.57 billion and $6.63 billion, with non-GAAP profits ranging from $13.33 to $13.41 per share. The Street consensus had anticipated revenue of $6.59 billion and a profit of $12.68 per share.
Synopsys shares have experienced a notable 73% increase throughout this year, largely due to market expectations that the company will benefit from the rise of generative artificial intelligence software.
During an interview with _, the newly appointed CEO Sassine Ghazi expressed Synopsys' recognition of multiple opportunities to capitalize on AI within its business. Ghazi highlighted the company's plan to utilize AI to write code.
Moreover, Synopsys recently introduced Copilot software in collaboration with Microsoft, which Ghazi stated would enhance user productivity through simplification and acceleration. Ghazi also revealed Synopsys' future plans to offer an AI tool that allows users to specify design parameters using natural language, similar to interacting with a chatbot.
In premarket trading, Synopsys shares rose by 3% to $569.16.
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