Slide 1: Corporate Overview for Investors
Corporate Overview for Investors August 2023
Slide 2: Forward-Looking Statements
Forward-Looking Statements This presentation contains forward-looking statements, including, but not limited to, statements regarding Synopsys’ short-term and long-term financial targets, expectations and objectives; strategies related to our products, technology and services; business and market ou
Slide 3: Synopsys: The Market & Technology Leader
Synopsys: The Market & Technology Leader FY22 FY23 Targets1, 2 Broad Product Revenue: $5.08B $5.81B – $5.84B Portfolio Growth Rate: 20.9% 14–15% Electronic Design Non-GAAP Operating Margin: 33.0% ~35.0%* Automation (EDA) *Midpoint of range Semiconductor Intellectual Non-GAAP Diluted EPS: $8.90 $11.0
Slide 4: Synopsys: The Market & Technology Leader
Synopsys: The Market & Technology Leader Design Software Design IP Automation Integrity ~ 35 ~ 65% > 25 ~ 25% ~ 9 ~ 10% years of of revenue years of revenue years of revenue investment and execution Industry Leader, Market Leader #2 IP Vendor Broadest Portfolio © 2023 Synopsys, Inc. 4
Slide 5: Long-term Financial Objectives
Long-term Financial Objectives1 While the results in any given period will vary due to timing of product deliverables, acquisitions or other near-term priorities, our long-term, multi-year objectives2 are: Revenue Margin Earnings Annual double-digit growth Annual non-GAAP Annual non-GAAP • Design Au
Slide 6: Synopsys: The Market and Technology Leader
Synopsys: The Market and Technology Leader Uniquely Positioned for Growth and Stability Robust End Markets Clear Technology Leadership Financial Strength and Growth © 2023 Synopsys, Inc. 6
Slide 7: Global Value Chain—2022
Global Value Chain—2022 EDA & IP—At the Heart of Accelerating Electronics Innovation EDA & IP Embedded Software Foundry Semiconductors Electronic Systems $16.6B $15.0B $142B $641B $1.86T Sources: ESD Alliance, Ipnest, MarketsandMarkets, IC Insights © 2023 Synopsys, Inc. 7
Slide 8: Blue Chip, Diversified Customer Base
Blue Chip, Diversified Customer Base Semiconductors Systems Software Developers • Semi R&D (including EDA) is a • ~45% of our revenue comes • Key function across all top investment priority for semi from systems companies industries: semis and systems, and system customers in all to enterprises in s
Slide 9: Dynamic Change in Many Markets
Dynamic Change in Many Markets HPC, Data Center (AI accelerators) Networking Mobile/5G Automotive AR / VR Healthcare Industrial Memory PC/Gaming Enterprise Financial Government & Automation Software Services Aerospace Innovation is fueled Demand for Smart Everything Driven by fusion of by semiconduc
Slide 10: Synopsys: The Market and Technology Leader
Synopsys: The Market and Technology Leader Uniquely Positioned for Growth and Stability Robust End Markets Clear Technology Leadership Financial Strength and Growth © 2023 Synopsys, Inc. 10
Slide 11: Synopsys at the Heart of Chip Design, From Silicon to Software
Synopsys at the Heart of Chip Design, From Silicon to Software Software Software: Application security IP: Broadest portfolio of interface, Software & quality testing foundation & physical IP Systems Systems System: HW/SW verification, Silicon: Tools for process optimization, virtual prototyping, VI
Slide 12: Leader in EDA
Leader in EDA • Market and technology leader in EDA, the tools and technologies used to design semiconductor chips and systems – ~$9.9 billion market*; generally tracks semiconductor R&D spend over time • Growth drivers: all aspects of chip and system complexity • All leading semiconductor companies
Slide 13: Synopsys.ai: Industry's First Full-Stack, AI-Driven EDA Suite
Synopsys.ai™: Industry’s First Full-Stack, AI-Driven EDA Suite For design, verification, testing & manufacturing of digital and analog chips Achieve power, performance and Design Space area (PPA) targets, and boost Optimization productivity with DSO.ai Verification Faster functional testing closure,
Slide 14: DSO.ai Success & Momentum
DSO.ai Success & Momentum AI driven EDA Innovation Industry first AI App for Implementation Deployed in 9 out of top 10 semi logos 270+ production tape-outs & counting © 2023 Synopsys, Inc. 14
Slide 15: Synopsys Digital Design Family
Synopsys Digital Design SYNOPSYS DIGITAL DESIGN FAMILY • #1 Anchors: synthesis, P&R, signoff SYSTEM DESIGN Fusion • Fusion of algorithms, engines, data model 3DIC Compiler Architecture • Two fusion types: test and signoff DIGITAL DESIGN RTL Architect • Industry-unique Fusion Compiler Test Fusion Inn
Slide 16: Verification Hardware: ZeBu Server
Verification Hardware: ZeBu® Server 5 Highest performance for large workloads Performance and throughput 2X higher than prior generation Ready for largest, multi-die designs Unmatched reliability 99.9+% projected uptime Best datacenter scalability through power and footprint © 2023 Synopsys, Inc. 16
Slide 17: Efficient Design Implementation for Multi-Die Systems
Efficient Design Implementation for Multi-Die Systems UNIFIED EXPLORATION-TO-SIGNOFF DIE-TO-DIE IP 3DIC COMPILER UCIe Die-to-Die IP Exploration Complete architecture-to-signoff PHY Delivers up to & Creation solution in a consolidated 4Tbps bandwidth in a Implementation user environment Controller mu
Slide 18: Leader in Design IP
Leader in Design IP • #2 market share in IP, the reusable building blocks that are used for chip designs – Leading supplier of interface, memory, analog and physical IP – ~$6.7 billion market*, benefitting from our customers’ move to outsourcing more and more complex IP • IP reuse reduces our custom
Slide 19: Broadest and Most Comprehensive IP Portfolio
Broadest and Most Comprehensive IP Portfolio SYNOPSYS IP PORTFOLIO Foundation IP, Software Broadest analog, interfaces, Portfolio security, processors, DDR/HBM PCIe HDMI/DP USB 10G to Die-to-Die subsystems C/D-PHY M-PHY PHY PHY PHY PHY 224G PHY PHY CPUs Safety MPUs Security DDR/HBM PCIe HDMI/DP USB
Slide 20: High-Impact Markets: Increasing Technology Complexity
High-Impact Markets: Increasing Technology Complexity Driving Growth in Third-Party IP Demand AI Automotive Cloud IoT Machine Learning, ADAS, Networking, Smart Home, Deep Neural Infotainment, Servers AI Industrial, Networks Connected Vehicle Accelerators Wearables © 2023 Synopsys, Inc. 20
Slide 21: Leader in Software Integrity
Leader in Software Integrity • Assembled and developed the broadest portfolio of solutions on the market; >$0.5 billion TTM revenue • Solutions that enable organizations to manage application security, quality and compliance risks at the speed their business demands • Approximately $2.5–3 billion se
Slide 22: Software Security & Quality Market
Software Security & Quality Market Evolving market, ~15% growth TAM ~$4.5–6.5B Growth drivers • Ubiquity and growth of software • Cloud transformation • Significant business risk from breaches • Rise of open source SAM • Software supply chain complexities ~$2.5–3.0B Synopsys L-T multi-year growth ob
Slide 23: Software Integrity Portfolio
Software Integrity Portfolio Static Analysis Open Source Analysis Interactive AST Fuzzing Software Coverity Black Duck Seeker Defensics Developer Plug-in AST Orchestration Correlation/Prioritization Code Sight Intelligent Orchestration Code Dx SaaS Dynamic Analysis Static Analysis Open Source Analys
Slide 24: The Recognized Leader in Application Security Testing
The Recognized Leader in Application Security Testing Magic Quadrant for Forrester Wave™: Forrester Wave™: Application Security Testing Static Application Security Testing Software Composition Analysis Sources: Gartner, Forrester. © 2023 Synopsys, Inc. 24
Slide 25: Synopsys: The Market and Technology Leader
Synopsys: The Market and Technology Leader Uniquely Positioned for Growth and Stability Robust End Markets Clear Technology Leadership Financial Strength and Growth © 2023 Synopsys, Inc. 25
Slide 26: Excellent Financial Execution
Excellent Financial Execution Revenue (M) Non-GAAP EPS $11.04 – $11.09 (24–25% y/y) $5,810– $5,840 (14–15% y/y) $5,082 $8.90 $4,204 $6.84 $3,685 $3,361 $5.55 $3,121 $4.56 $3.91 FY18 FY19 FY20 FY21 FY22 FY23E* FY18 FY19 FY20 FY21 FY22 FY23E Recurring revenue model with $7.1B non-cancellable Strong fi
Slide 27: Cash Flow & Capital Allocation
Cash Flow & Capital Allocation Operating Cash Flow (M) Stock Repurchases (M) $1,100 $1,739 ~ $1,650 $1,493 $906 $788 $991 $801 $400 $329 $424 $242 FY18 FY19 FY20 FY21 FY22 FY23E* FY18 FY19 FY20 FY21 FY22 FY23 YTD • Roughly tracks EBITDA less cash taxes on multi year basis • Repurchased ~$3.8B in sto
Slide 28: GAAP to Non-GAAP Reconciliation
GAAP to Non-GAAP Reconciliation1 Earnings Per Share—Full Fiscal Year 2023 Targets Range for Fiscal Year Ending October 31, 2023 Low High Target GAAP earnings per diluted share attributed to Synopsys $ 7.85 $ 7.96 Adjustments: Amortization of intangible assets 0.64 0.62 Stock compensation 3.74 3.70 A
Slide 29: GAAP to Non-GAAP Reconciliation
GAAP to Non-GAAP Reconciliation1, 2 Operating Margin—Midpoint of Fiscal Year 2023 Targets Twelve Months Ending October 31, 2023 At midpoint of revenue and expense guidance ranges GAAP operating margin 21.8 % Amortization of intangible assets 1.7 % Stock compensation 9.9 % Acquisition-related items 0
Slide 30: Smart Future ESG Strategy
Smart Future ESG Strategy Our Smart Future ESG strategy provides a framework to assess and manage the ESG matters that are relevant to our business, generate value for our stockholders, and at the same time, make meaningful progress with respect to environmental and social issues within our ecosyste
Slide 31: Synopsys 2022 ESG Progress Highlights
Synopsys 2022 ESG Progress Highlights Environment • Our low power electronic design automation (EDA) solutions allow our customers to achieve an additional 25% power reduction for their systems-on-chip (SoCs) • Developed new Greenhouse Gas (GHG) emissions reduction targets for review and validation
Slide 32: Thank You
Thank You