SUNNYVALE, Calif. - Synopsys, Inc. (NASDAQ:SNPS) reported a slight downturn in its stock price, falling 1.24% after announcing second-quarter financial results that fell short of Wall Street expectations.
The company's adjusted earnings per share (EPS) came in at $3.00, missing analysts' predictions by $0.05. Revenue also did not meet the anticipated target, registering at $1.46 billion against the consensus estimate of $1.51 billion.
The company's revenue for the quarter still saw a significant increase of approximately 15% compared to the same quarter last year, showcasing a strong year-over-year (YoY) growth. On a GAAP basis, net income for the second quarter of fiscal year 2024 was $299.1 million, or $1.92 per diluted share, compared to $275.6 million, or $1.78 per diluted share, for the same period the previous year. This reflects a solid performance despite the earnings and revenue shortfall relative to consensus estimates.
Synopsys' leadership attributed the robust quarterly performance to strong operational execution and business momentum. "We continued our strong operational execution and business momentum in Q2. Customers continue investing in Synopsys solutions to maximize their R&D and power their future innovations for this era of pervasive intelligence," said Sassine Ghazi, president and CEO of Synopsys.
Looking ahead, Synopsys provided guidance for the third quarter with revenue expected to range between $1.505 billion and $1.535 billion. The midpoint of this guidance, $1.52 billion, is slightly above the analyst consensus estimate of $1.51 billion.
For the full fiscal year 2024, the company anticipates revenue to be between $6.090 billion and $6.150 billion. The midpoint of this range, $6.12 billion, also surpasses the consensus estimate. Adjusted EPS guidance for the third quarter is set at $3.25 to $3.30, with the midpoint of $3.275 slightly below the consensus estimate of $3.30.
The company's CFO, Shelagh Glaser, expressed confidence in the business outlook, stating, "Synopsys' strong Q2 results were driven by our team's relentless focus on execution, our leading technology that is mission-critical to customers, and our resilient business model. We remain confident in our business, and as a result, we are again raising our full-year targets for revenue and adjusted EPS."
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