Synopsys, Inc. · NASDAQ:SNPS
Synopsys — Investor Presentation (August 2016)
28 slides from Synopsys's investor presentation, August 2016
Slide 1: Corporate Overview for Investors
Corporate Overview for Investors August 2016 May 2015
Slide 2: Forward-Looking Statements
Forward-Looking Statements This presentation contains forward-looking statements under the safe harbor provisions of Section 21E of the Securities Exchange Act of 1934, including but not limited to statements regarding projected financial results, long-term growth rates, expected share count, revenu
Slide 3: Synopsys: The Market & Technology Leader
Synopsys: The Market & Technology Leader FY15 FY16 (Target*) • Electronic Design Revenue: $2.242B $2.410 – $2.425B (7 ½-8%) Automation (EDA) NG EPS: $2.77 $3.00 – $3.03 (8-9%) OCF: $495M $525 – $545M • Semiconductor Intellectual Property (IP) Raised 2016 targets in May and August • Software Quality
Slide 4: Synopsys: The Market & Technology Leader
Synopsys: The Market & Technology Leader Software • TAM: ~$2.4B Leading SW quality & Integrity • Est. growth: ~20%* security platform • TAM: ~$3.2B High-impact outsourced IP IP • Est. growth: low to enable fast time to double digits* market; #2 vendor in world EDA leadership with • TAM: ~$6.1B state
Slide 5: Uniquely Positioned for Stability and Growth
Synopsys: The Market & Technology Leader Uniquely Positioned for Stability and Growth • Electronics complexity driving growth • Clear technology leadership • Financial strength and growth © 2016 Synopsys, Inc. 5
Slide 6: Helping Design the Chips Inside
Helping Design the Chips Inside Impacting Everyone, Everything, Everywhere, Every Day Cloud Infrastructure Medical Data Center & Networking Automotive Computing & Peripherals Mobile Digital Home Internet of Things Military / Aerospace Industrial © 2016 Synopsys, Inc. 6
Slide 7: Automotive Opportunity
Automotive Opportunity • Automotive industry is dramatically accelerating digital intelligence Infotainment V2V Comms. ADAS Autonomous • Over the past couple of years, we have substantially grown our Smart, Secure, portfolio – including design, verification, IP and and Safe security – in the auto ma
Slide 8: Moore's Law Continues
Moore’s Law Continues © 2016 Synopsys, Inc. 8
Slide 9: Leading the Way in FinFET
>350 FinFET designs and Leading the Way in FinFET tape-outs worldwide* 400 350 300 22nm 250 16nm 200 14nm 150 100 10nm 50 7nm… 0 Q2'09 Q3'09 Q4'09 Q1'10 Q2'10 Q3'10 Q4'10 Q1'11 Q2'11 Q3'11 Q4'11 Q1'12 Q2'12 Q3'12 Q4'12 Q1'13 Q2'13 Q3'13 Q4'13 Q1'14 Q2'14 Q3'14 Q4'14 Q1'15 Q2'15 Q3'15 Q4'15 Q1'16 Q2'
Slide 10: Uniquely Positioned for Stability and Growth
Synopsys: The Market & Technology Leader Uniquely Positioned for Stability and Growth • Electronics complexity driving growth • Clear technology leadership • Financial strength and growth © 2016 Synopsys, Inc. 10
Slide 11: EDA
© 2016 Synopsys, Inc. 11 SYNOPSYS’
Slide 12: Synopsys IC Compiler II: Game-Changer in Digital Design
Synopsys IC Compiler™ II: Game-Changer in Digital Design • Breakthrough in implementation that delivers a 10X improvement in throughput and better quality of results • Fastest-ramping product in our history* • Orders in Q316 were the highest in five quarters* • >90% of our installed base has at leas
Slide 13: Verification Continuum Platform
Verification™ Continuum Platform Industry’s #1, Industry’s Fastest • Built around fastest engines • Goal: speed software bring-up Debug & Coverage #1 by ~6 months #1 #1 #1 #1 • Key technology advancements in Virtual Static FPGA emulation, next-generation prototyping Simulation Emulation Proto. & For
Slide 14: Custom Compiler Custom Solution
Custom Compiler™ Custom Solution Visually-Assisted Automation • New custom design solution that closes the FinFET productivity gap by shortening Co-Design Layout Template custom design tasks from days to hours Assistants Assistants Assistants Digital • Visually-assisted automation speeds up IC Compi
Slide 15: Semiconductor IP
Semiconductor IP © 2016 Synopsys, Inc. 15
Slide 16: Third-Party IP – Synopsys Differentiator
Third-Party IP – Synopsys Differentiator Established Provider 15+ years of investment Specialty I/O Application Application Graphic and execution RAM RAM ROM LVDS, Etc CPU CPU Core(s) Flash Flash Storage RAM RAM RAM RAM Interface Resource Commitment On-Chip Bus DDR DDR memory Interface ~2,750 IP Eng
Slide 17: IP Business Models
IP Business Models Single Use Multi-Use Agreement Engineering Service • Customer buys IP for • Customer buys a pool • Customer pays for a specific project of IP that can be used porting IP to specific over a multi-year semiconductor • Revenue recognized period until the pool is process or up front e
Slide 18: Software Quality & Security
Software Quality & Security © 2016 Synopsys, Inc. 18
Slide 19: Software Megatrends
Software Megatrends Lines of Code 400M 100M • Size of applications continues to grow 40M 145K 2.3M 50K Apollo 11 Windows Windows Auto Auto SNPS 1969 1992 2009 1981 2014 Source: Information is Beautiful © 2016 Synopsys, Inc. 19
Slide 20: Software Megatrends
Software Megatrends Worldwide SW Developer Population (in million) 30 25 20 • Number of developers 15 increases steadily 10 5 0 2015 2016 2017 2018 2019 2020 APAC EMEA NAM LATAM Source: Evans Data Corp. 2015 Global Developer Population Survey © 2016 Synopsys, Inc. 20
Slide 21: Synopsys Software Integrity: Growing the Business
Synopsys Software Integrity: Growing the Business Acquired February 2014 Leader in Static Quality Testing April 2015 Expand into Dynamic Security Testing May 2015 Expand into Dynamic Web Application Security November 2015 Expand into Software Composition Analysis December 2015 Expand Static Code Ana
Slide 22: Uniquely Positioned for Stability and Growth
Synopsys: The Market & Technology Leader Uniquely Positioned for Stability and Growth • Electronics complexity driving growth • Clear technology leadership • Financial strength and growth © 2016 Synopsys, Inc. 22
Slide 23: Long-term Operating Model
Long-term Operating Model* Primary long-term objective is to drive high-single-digit EPS growth through a mix of the following elements: • Organically grow traditional EDA revenue generally in the low-to-mid single digit range • Organically grow IP/Systems/SW Integrity revenue generally in the low d
Slide 24: Growth and Predictability
Growth and Predictability Revenue ($M) 8% 5-yr CAGR NG EPS 9.5% 5-yr CAGR $2,500 $2,418 $3.02 $2,242 $3.00 $2.77 $1,962 $2,057 $2.53 $2.44 $2,000 $1,756 $2.50 $2.10 $1,500 $2.00 $1.50 $1,000 $1.00 $500 $0.50 $0 FY12 FY13 FY14 FY15 FY16 $0.00 Guide-Mid* FY12 FY13 FY14 FY15 FY16 Guide-Mid * • Predicta
Slide 25: Strong Operating Cash Flow
Strong Operating Cash Flow • Roughly tracks EBITDA Annual Operating Cash Flow less cash taxes over time $600 $497 $551 $495 $535 • OCF is lumpy $500 ‒ Difficult to forecast period to period $400 ‒ Timing of large contracts $ Millions $300 ‒ Disbursements (affected by M&A) $200 • 2015 OCF affected by
Slide 26: Returning Cash to Shareholders
Returning Cash to Shareholders • Spent $1.345B on buybacks since 2011 $500 $435 • Completed $125M Accelerated Share $400 Repurchase (ASR) on $325 August 10, 2016 $300 $280 • FY16 YTD buybacks will $ Millions reduce fully diluted share $200 count y/y* $145 $120 • Goal is to optimize the $100 use of o
Slide 27: Market and technology leader
Market and technology leader in: • Electronic Design Automation • Semiconductor Intellectual Property • Software Quality & Security Solid Financials: • Time-based revenue model • Large, non-cancellable backlog • Excellent execution © 2016 Synopsys, Inc. 27
Slide 28: Thank You!
Thank You! © 2016 Synopsys, Inc. 28