Can advancements in AI-driven EDA and Ansys collaboration drive additional growth for SNPS shares?

Synopsys Q1 Fiscal 2026 Performance Overview

During the first quarter of fiscal 2026, Synopsys reported EDA segment revenues of $1.1 billion, representing 45.6% of its total income. The Ansys product line contributed 36.8%, highlighting robust demand for advanced simulation and digital engineering solutions.

Adjusted earnings per share came in at $3.77, surpassing the Zacks Consensus Estimate by 5.6%.

Total revenue for the quarter reached $2.41 billion, marking a 65.5% increase compared to the previous year and exceeding analyst expectations by 0.8%.

Synopsys Price, Consensus, and EPS Surprise

AI and Ansys Integration Fuel Synopsys Growth

Synopsys’ strong performance is largely attributed to increased semiconductor demand driven by AI and the positive impact of its acquisition of Ansys. The expansion of AI infrastructure has accelerated semiconductor research and development, as well as design starts, areas where Synopsys possesses significant expertise, proprietary technologies, and foundry optimization capabilities.

The company is integrating AI across its EDA platform, resulting in notable productivity improvements for clients. Synopsys is benefiting from broader adoption of Synopsys.ai, greater multi-die complexity, and ongoing activity in advanced nodes.

Users of the platform have reported up to 50% faster knowledge assistance, 70% quicker workflow support, and formal testbench generation speeds up to five times faster, demonstrating the advantages of AI-powered design processes.

The combined offerings from Synopsys and Ansys are well-positioned to leverage the industry’s shift from physical prototypes to digital twins, enabling more rapid and cost-effective product development in sectors such as aerospace, automotive, and hyperscale computing.

Synopsys Issues Upbeat Guidance

For fiscal 2026, Synopsys anticipates revenues between $9.56 billion and $9.66 billion, with Ansys expected to contribute $2.9 billion. The Zacks Consensus Estimate stands at $9.63 billion, suggesting a 36.5% year-over-year increase.

Non-GAAP earnings per share are projected to range from $14.38 to $14.46, up from the previous forecast. Non-GAAP expenses are expected to be between $5.69 billion and $5.75 billion. The Zacks Consensus Estimate for earnings is $14.39, indicating an 11.5% rise year over year.

For Q2 fiscal 2026, Synopsys expects revenues between $2.225 billion and $2.275 billion. The consensus estimate is $2.25 billion, reflecting a 40.3% increase from the prior year.

Management forecasts non-GAAP EPS between $3.11 and $3.17 for the quarter, with the consensus estimate at $3.13, representing a 14.7% decrease year over year.

Zacks Rankings and Notable Picks

Currently, Synopsys holds a Zacks Rank #4 (Sell).

Other highly ranked stocks in the Zacks Computer and Technology sector include Micron Technology, Credo Technology, and MongoDB, each with a Zacks Rank #1 (Strong Buy).

• Micron Technology shares have surged 308% over the past year and will announce Q2 2026 results on March 19.
• Credo Technology Group shares are up 79.4% in the last 12 months, with Q3 fiscal 2026 results expected on March 2.
• MongoDB shares have delivered a 25.2% return in the past year and will report Q4 2026 results on March 2.

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Free Stock Analysis Reports

• Micron Technology, Inc. (MU): Free Stock Analysis Report
• Synopsys, Inc. (SNPS): Free Stock Analysis Report
• MongoDB, Inc. (MDB): Free Stock Analysis Report
• Credo Technology Group Holding Ltd. (CRDO): Free Stock Analysis Report