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Synopsys Inc (NASDAQ:SNPS) disclosed plans to cut about 10% of its workforce, roughly 2,000 employees, to redirect resources toward higher-growth areas. The decision follows its $35 billion cash-and-stock acquisition of engineering design firm Ansys earlier this year, and comes after Synopsys missed Wall Street's third-quarter revenue estimates in September. The chip-design software maker, which employed around 20,000 people at the end of fiscal 2024. Also Read: Synopsys’ Ansys Taps Nvidia Omniverse To Accelerate AI-Driven Engineering It expects to record pre-tax charges of $300 million to $350 million, primarily related to severance, one-time termination benefits, and costs tied to specific site closures. Synopsys stock tanked 18% year-to-date after missing the revenue and adjusted EPS estimates in at least two out of the last three quarters. On September 9, Synopsys reported third-quarter adjusted earnings per share of $3.39, missing the consensus estimate of $3.74 and sales of $1.73 billion, missing the consensus estimate of $1.76 billion, but representing a 14% year-over-year increase. The company sees adjusted earnings per share between $2.76 and $2.80, below the consensus estimate of $4.51 and sales between $2.23 billion and $2.26 billion, versus the consensus estimate of $2.09 billion. Synopsys generates most of its revenue by offering software, intellectual property (IP), and services used to design and test integrated circuits and electronic systems. Sales decline in Synopsys’ design IP business, and concerns surrounding the impact of the company’s AI strategy and geopolitical factors, particularly in China took a toll on the stock. Price Action: SNPS stock traded higher by 1.11% at $399.98 at last check Wednesday. Read Next: GlobalFoundries Gains From Auto And Data Center Strength Image: Shutterstock
