S.

Synopsys, Inc.

Q1 FY26Software

Synopsys, Inc. Q1 FY26 Results — Earnings Call Analysis

Q1 FY26 earnings call: what management guided on revenue, margins and order book.

Price₹481

Market cap₹92.1K Cr

P/E82.1

Updated29 May 2026

Read4 min read

What the Q1 FY26 call signalled

2 of 4 strong

RevenueModerate growth

MarginMargins steady

CapexCapex planned

Order bookOrder book rising

The short version

- Synopsys expects double-digit growth in EDA (Electronic Design Automation) and simulation & analysis segments. - Synopsys expects double-digit long-term growth in EDA software and simulation & analysis businesses.

From Synopsys, Inc.'s Q1 FY26 earnings-call transcript · updated 29 May 2026.

Revenue & Sales Performance

Moderate growth

Synopsys expects double-digit growth in EDA (Electronic Design Automation) and simulation & analysis segments.
IP (Intellectual Property) growth is projected at mid-teens long-term, though 2026 is seen as a transitional year with muted growth.
Ansys revenue is expected to grow double digits, contributing approximately $2.9 billion in FY 2026.
The company anticipates a sequential improvement in IP revenue in the second half of 2026, with a Q4 weighting.
Future growth is fueled by strong demand in AI infrastructure and robust design start activity for AI compute.
The integration of Ansys is expected to expand the customer base and address new market opportunities.

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Profitability & Margins

Synopsys expects double-digit long-term growth in EDA software and simulation & analysis businesses.
Design IP segment is projected to achieve mid-teens growth over the long term, despite 2026 being a transitional year.
The joint Synopsys-Ansys technology integration starting in 2026 is expected to drive growth beyond 2026.
Full-year 2026 revenue guidance is $9.56 billion to $9.66 billion, with Ansys revenue expected at $2.9 billion midpoint, growing double digits.
Non-GAAP operating margin targeted around 40.5% for 2026.
Non-GAAP EPS guidance for 2026 increased slightly to between $14.38 and $14.46 per share.
The company is confident in second-half IP revenue pickup, with improved roadmap alignment and delivery.

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Capital Expenditure Plans

Capex planned

Based on the information from the document: - Synopsys is investing in expanding and delivering IP titles, especially for hyperscalers, focusing on timely delivery and customization. - They have a joint R&D partnership with NVIDIA targeting GPU acceleration of EDA and Ansys products, aiming for significant performance gains in 2026. - Investment focus is on integrating Synopsys and Ansys technologies to offer combined joint solutions anticipated to monetize starting FY 2027. - The company is emphasizing AI capabilities, including agent engineers and orchestration layers, requiring investments in data infrastructure and orchestration tech. - Restructuring costs and amortization related to acquisitions are ongoing financial considerations affecting GAAP expenses.

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Fundraising & Capital Structure

No new fundraising through debt or equity was announced.
The company repaid the entirety of its $4.3 billion term loans recently, indicating debt reduction rather than new debt.
The board replenished the stock repurchase program with authorization to buy up to $2 billion of common stock, signaling share buybacks rather than equity issuance.

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Order Book & Pipeline

Order book rising

Synopsys reported a strong backlog (remaining performance obligations, RPO) of $11.3 billion as of the latest quarter.
Backlog provides confidence in customer demand and delivery commitments.
Bookings show typical seasonality and ebb and flow, with no unusual changes reported.
The backlog supports visibility into customer demands and revenue expectations.
The company experiences fluctuations due to renewal timings but maintains a strong pipeline.
Synopsys expects a pickup in design IP sales in the second half of the year, contributing to future order growth.

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Frequently Asked Questions

What were Synopsys, Inc. Q1 FY26 results?

- Synopsys expects double-digit growth in EDA (Electronic Design Automation) and simulation & analysis segments. - Synopsys expects double-digit long-term growth in EDA software and simulation & analysis businesses.

What is Synopsys, Inc. share price analysis?

Synopsys, Inc. currently shows a below-average growth signal. The stock trades at a P/E of 82.1 with a market cap of $92,072. Investors should review the full earnings analysis for detailed insights.

Is Synopsys, Inc. planning capital expenditure?

Based on the information from the document: - Synopsys is investing in expanding and delivering IP titles, especially for hyperscalers, focusing on timely delivery and customization.

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This analysis is AI-generated based on publicly available earnings data and the company's earnings call transcript. This is not investment advice. Please consult a SEBI-registered advisor before making investment decisions.