Synopsys beats Q2 earnings and revenue estimates but shares drop on weak chip IP sales

Synopsys reported fiscal Q2 results exceeding Wall Street expectations, with adjusted EPS of $3.35 beating the $3.15 estimate and revenue rising 41.9% to $2.28 billion, above the $2.25 billion forecast. The company raised its full-year revenue guidance to $9.63-$9.71 billion and non-GAAP EPS guidance to $14.72-$14.80, citing strong business performance and benefits from Ansys integration. However, shares fell over 7% due to a 6% year-over-year decline in its high-margin Design IP segment, which dropped to $454 million. Despite this, CEO Sassine Ghazi highlighted solid execution and growth momentum as a foundation for future expansion.