Synopsys Inc. increased its fiscal 2026 revenue target to between $9.69 billion and $9.74 billion, representing approximately 37% growth from the prior year, as the company integrates the recently acquired Ansys.
The chip design software provider also raised its non-GAAP diluted earnings per share guidance for fiscal 2026 to a range of $15.04 to $15.10, up from $12.91 in fiscal 2025. Non-GAAP operating margin is projected to expand to about 41.5% at the midpoint, a 420-basis-point improvement over the prior year’s 37.3%.
Synopsys reported third-quarter fiscal 2026 revenue of $2.477 billion, exceeding Wall Street expectations of $2.44 billion, while non-GAAP EPS reached $3.91, above the $3.67 forecast. The company also raised its full-year guidance, lifting the revenue midpoint by $50 million and the non-GAAP EPS midpoint by $0.31.
The Ansys deal contributed roughly $711 million to third-quarter revenue and is expected to add about $2.98 billion for the full fiscal year, according to the company. Synopsys also disclosed a total debt load of approximately $10 billion following the acquisition, while its backlog stands at $10.9 billion after the divestiture of its Processor IP Solutions business.
Cash flow from operations is projected at about $2.8 billion for fiscal 2026, with free cash flow expected at roughly $2.6 billion. Fourth-quarter guidance calls for revenue of $2.53 billion to $2.58 billion and non-GAAP EPS of $4.10 to $4.16.
Synopsys outlined long-term targets including mid-40s non-GAAP operating margins, mid-30s unlevered free cash flow margins, and high-teens EPS growth over a multi-year period. The company also highlighted its market leadership in electronic design automation and semiconductor IP, with more than 1,400 tape-outs at 16nm and below in 2025.
CEO Sassine Ghazi emphasized that rising AI compute demands are driving demand for Synopsys’ IP and design solutions, while addressing concerns about AI-native design software. CFO Shelagh Glaser described the third quarter as "outstanding," noting that revenue, margin, and EPS all beat the high end of guidance.
Synopsys is scheduled to host an Investor Day on September 30, 2026.
