10-Q · May 27, 2026
Synopsys reported strong Q2 2026 results, with revenue of $2.276 billion and EPS of $3.35, both surpassing consensus estimates. The company benefitted from strong demand across its products and the contribution from its…
Earnings analysis · 10-Q
SNPS earnings analysis
Filed August 26, 2026 · Our reading of the company's report
The latest report
Synopsys delivered a strong Q3, with revenue of $2.476822 billion and diluted EPS of $3.91, beating consensus revenue of $2.439037664 billion and EPS of $3.47. Revenue increased approximately 8.6% sequentially and 42.4%…
Read full summary
Synopsys delivered a strong Q3, with revenue of $2.476822 billion and diluted EPS of $3.91, beating consensus revenue of $2.439037664 billion and EPS of $3.47. Revenue increased approximately 8.6% sequentially and 42.4% year over year, while EPS rose from $0.09 in Q2 2026 and $1.50 in Q3 2025. The principal financial concern is leverage following the Ansys transaction, with approximately $10.0 billion of total debt, alongside unresolved securities litigation and evolving trade and AI regulation.
Gross and operating margin
How much of each revenue dollar the business keeps.
One point per quarterly or annual filing. Both margins are shares of that report's revenue.
How we read each report
Our analysis across the last few reports.
Our model's reading of each filing, not the share price or the market's reaction. Annual and quarterly reports each occupy one position.
Reported figures
- Earnings per share
- $3.91
What stood out
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Revenue accelerated and beat consensus
Q3 revenue was $2.476822 billion, up approximately 8.6% from $2.28 billion in Q2 2026 and 42.4% from $1.74 billion in Q3 2025. Revenue exceeded the $2.439037664 billion consensus estimate by approximately 1.6%.
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EPS materially exceeded expectations
Diluted EPS was $3.91 versus $0.09 in Q2 2026 and $1.50 in Q3 2025, increases of approximately $3.82 and $2.41, respectively. EPS exceeded the $3.47 consensus estimate by approximately 12.7%.
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Fixed-rate debt limits rate exposure
The company had approximately $9.9 billion of Senior Notes outstanding as of July 31, 2026. The notes carry fixed annual interest rates, limiting economic interest-rate exposure on the obligations, although their fair values remain rate-sensitive.
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Substantial buyback capacity remains
Synopsys completed a $250.0 million accelerated stock repurchase agreement in March 2026 and repurchased approximately 564.7 thousand shares at an average price of $442.69 per share. As of July 31, 2026, $1.7 billion remained available under the repurchase program.
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Ansys integration controls remain effective
Management stated that disclosure controls were effective as of July 31, 2026, while the company continues integrating Ansys operations, control processes and information systems into its control environment.
What to watch
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High leverage constrains flexibility
Total debt was approximately $10.0 billion as of July 31, 2026, including approximately $9.9 billion of Senior Notes. The filing warns that debt may constrain financial flexibility, increase interest expense and limit funding for acquisitions, capital expenditures, repurchases and dividends.
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Multiple securities lawsuits unresolved
The filing describes three shareholder class actions filed between October 31 and December 30, 2025, plus three derivative actions filed between December 22, 2025 and March 5, 2026. No loss was accrued as of July 31, 2026 because the potential loss could not be determined or estimated, but unfavorable outcomes could negatively affect financial condition.
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Trade and AI regulation remain fluid
The filing highlights tariffs enacted beginning in 2025, evolving export controls and administrative subpoenas from the Bureau of Industry and Security concerning transactions with certain Chinese entities. It also states that AI-related products may face new legal and regulatory requirements, including in intellectual property, privacy, data protection and cybersecurity.
Management's outlook
The provided 10-Q text does not include quantitative revenue or EPS guidance. Separately, the August 26, 2026 earnings disclosure raised FY2026 revenue guidance to $9.690-$9.740 billion and non-GAAP EPS guidance to $15.04-$15.10, with Q4 revenue guidance of $2.530-$2.580 billion and non-GAAP EPS guidance of $4.10-$4.16.
Earlier filings 4
10-Q · February 25, 2026
Synopsys reported revenue of $2,408,798,000 for the quarter ended January 31, 2026, up $953,483,000 versus $1,455,315,000 in the prior-year quarter, driven by product and Ansys contributions. Gross margin was…
10-Q · May 28, 2025
Synopsys reported quarter revenue of $1,604,266,000, up from $1,454,712,000 a year earlier, with gross margin of $1,285,919,000 (≈80.2%) and operating income of $376,426,000 (≈23.5% of revenue). Diluted EPS was $2.21…
10-Q · February 26, 2025
Synopsys reported Q1 revenue of $1,455,315,000, down $55,674,000 (3.7%) versus the prior-year quarter, with gross margin steady at ~81.5% but operating income down materially to $251,839,000 (17.3% of revenue).…
This is our reading of a public filing, not the filing itself. Analysis can contain errors; check the source document for full context.