Synopsys shares rise 10% after 2027 forecast — Channel NewsAsia

In the United States, shares of chip-design software developer Synopsys rose 10% on Thursday after the company presented its forecast for fiscal 2027, which exceeded analysts’ expectations, and announced agreements with OpenAI and Amazon Web Services. The day before, Synopsys held an investor day in New York.

As reported by Channel NewsAsia, Synopsys expects revenue of between $11.10 billion and $11.20 billion for the fiscal year ending October 31, 2027. The average forecast of analysts surveyed by LSEG was $10.81 billion.

Company forecast

The company also forecasts earnings per share in the range of $19.04 to $19.12, while analysts’ consensus forecast was $17.81. In the coming months, Synopsys plans to repurchase approximately $1 billion of its own shares.

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For the period from fiscal 2026 to fiscal 2030, the company set a target of average annual revenue growth of about 15%. By fiscal 2030, Synopsys also aims to achieve an adjusted operating margin of about 50%.

Deals with OpenAI and AWS

On Wednesday, Synopsys entered into a revenue-sharing agreement with OpenAI to develop an artificial intelligence model for the chip business. Amazon Web Services, for its part, signed a multi-year agreement worth more than $1 billion to license Synopsys intellectual property in chip design.

Brokerage firm Berenberg said in a note to clients that Synopsys’ investor day gave the market significantly more than expected. According to LSEG, of the 24 analysts covering Synopsys, 22 recommend buying the company’s shares or give them a higher rating, while two others advise holding them.