Synopsys Posts Financial Results for Second Quarter Fiscal Year 2008

MOUNTAIN VIEW, Calif. -- May 21, 2008 -- Synopsys, Inc. (NASDAQ: SNPS), a world leader in software and IP for semiconductor design and manufacturing, today reported results for its second quarter ended April 30, 2008.

For the second quarter, Synopsys reported revenue of $324.6 million, a 10.8 percent increase compared to $292.9 million for the second quarter of fiscal 2007.

"Synopsys continues to deliver predictable revenue growth and solid earnings expansion," said Aart de Geus, chairman and CEO of Synopsys. "We are seeing good momentum as our leading technology, comprehensive solutions and strong field support make us a long-term, reliable partner to our customers."

GAAP Results

On a generally accepted accounting principles (GAAP) basis, net income for the second quarter of fiscal 2008 was $39.4 million, or $0.27 per share, compared to $41.3 million, or $0.28 per share, for the second quarter of fiscal 2007, which included a $12.5 million litigation settlement received from Magma Design Automation, recorded in other income, net.

Non-GAAP Results

On a non-GAAP basis, net income for the second quarter of fiscal 2008 was $59.7 million, or $0.41 per share, compared to non-GAAP net income of $53.2 million, or $0.35 per share, for the second quarter of fiscal 2007.

Non-GAAP net income consists of GAAP net income excluding employee share-based compensation expense calculated in accordance with FAS 123® and, to the extent incurred in a particular quarter or period, amortization of intangible assets (which could include in-process research and development charges), facilities realignment charges, and other significant items, and the related tax-effect of each, which, in the opinion of management, are infrequent or non-recurring. See "GAAP Reconciliation" below.

Financial Tables

Click here to read financial tables

Financial Targets

Synopsys also provided its operating model targets for the third quarter and full fiscal year 2008. These targets constitute forward-looking information and are based on current expectations.

Third Quarter of Fiscal Year 2008 Targets:
  -- Revenue: $335 million - $343 million
  -- GAAP expenses: $290 million - $308 million
  -- Non-GAAP expenses: $260 million - $270 million
  -- Other income and expense: $0 - $3 million
  -- Tax rate applied in non-GAAP net income calculations: 26 - 27 percent
  -- Fully diluted outstanding shares: 143 million - 148 million
  -- GAAP earnings per share: $0.18 - $0.24
  -- Non-GAAP earnings per share: $0.38 - $0.40
  -- Revenue from backlog: greater than 90 percent


Full Fiscal Year 2008 Targets:
  -- Revenue: $1.325 billion - $1.340 billion
  -- Tax rate applied in non-GAAP net income calculations: ~ 26 percent
  -- Fully diluted outstanding shares: 146 million - 149 million
  -- GAAP earnings per share: $0.99 - $1.11
  -- Non-GAAP earnings per share: $1.60 - $1.64
  -- Cash flow from operations: ~ $325 million

About Synopsys

Synopsys, Inc. (NASDAQ: SNPS) is a world leader in electronic design automation (EDA), supplying the global electronics market with the software, intellectual property (IP) and services used in semiconductor design and manufacturing. Synopsys' comprehensive, integrated portfolio of implementation, verification, IP, manufacturing and field-programmable gate array (FPGA) solutions helps address the key challenges designers and manufacturers face today, such as power and yield management, system-to-silicon verification and time-to-results. These technology-leading solutions help give Synopsys customers a competitive edge in bringing the best products to market quickly while reducing costs and schedule risk. Synopsys is headquartered in Mountain View, California, and has more than 60 offices located throughout North America, Europe, Japan, Asia and India. Visit Synopsys online at http://www.synopsys.com/.