Synopsys (SNPS) Mizuho Technology Conference 2026 summary

Financial performance and outlook

• Reported a strong Q2, exceeding guidance on revenue, EPS, and operating margin, leading to raised full-year outlook across all metrics.

• Third quarter post-Ansys acquisition, which is significantly expanding opportunities.

• Operating margin expected to increase by over 300 basis points this year, driven by portfolio optimization, workforce reduction, and accelerated synergy realization.

• Committed to reaching mid-40% operating margin, with continued focus on revenue growth and innovation.

Business segment updates

• EDA, IP, and simulation/analysis (Ansys) are the three main portfolio categories, each holding leadership positions.

• Core EDA growth remains committed to double digits, with trailing 12-month analysis preferred due to revenue lumpiness.

• IP business rebounded from a Q1 bottom, with sequential growth expected for the rest of the year.

• IP segment shifting to a dual business model: traditional (build once, sell many) and customized (factory two) with royalty upside.

Growth drivers and market trends

• Increasing chip complexity and design starts are key EDA growth drivers, especially as chips evolve into 3D IC systems.

• AI is transforming EDA workflows, enabling more efficient chip design and creating new monetization opportunities.

• Demand for IP is driven by chip starts and the need for customized silicon, especially for AI and hyperscaler applications.

• Factory one IP growth expected in the mid-teens, with factory two (customized IP) anticipated to grow even faster.