Synopsys Q1 Beats Estimates, Cuts Guidance and Launches $2B Buyback
Synopsys posted Q1 adjusted EPS of $3.77 beating the $3.56 consensus while revenue of $2.41 billion topped $2.39 billion estimates. It cut GAAP EPS guidance below forecasts, set Q2 sales guidance of $2.225–2.275 billion, and approved a $2 billion share buyback replenishment.
1. First-Quarter Results
Synopsys delivered adjusted EPS of $3.77 in Q1, surpassing the $3.56 consensus, while revenue reached $2.41 billion versus $2.39 billion estimates, driven by robust system-level and semiconductor R&D spending on AI projects.
2. Guidance Update
The company trimmed its GAAP EPS outlook for fiscal 2026 below analyst forecasts and issued second-quarter revenue guidance of $2.225–2.275 billion, slightly under the $2.236 billion consensus range.
3. $2 Billion Buyback Replenishment
Synopsys’ board approved replenishing its repurchase program with up to $2 billion of common shares, extending the firm’s share reduction strategy.
4. Analyst Target Cut
Piper Sandler reduced its Synopsys price target from $520 to $430, citing flat sequential IP revenue, ongoing China restrictions and investor disappointment in a sharper IP rebound.