Synopsys, Inc. (NASDAQ:SNPS) stock rose 11.12% (As on May 19, 11:28:12 AM UTC-4, Source: Google Finance) after the company posted better than expected result for the second quarter of FY 22. Synopsys derives its revenue from three business segments. It said time-based products drove $723.8 million in sale, up 12% from a year ago, while upfront products added another $336.6 million, up more than 60%. Maintenance and service generated $218.7 million in sales, up 31% from a year earlier. Semiconductor & System Design segment revenue was $1.17 billion, up 25%, with robust demand for EDA software and hardware, and IP. Semiconductor & System Design adjusted operating margin was 39.2%. Software Integrity segment revenue was $113 million, up 20%. The adjusted operating margin was of 11.5%. The company has generated a record $750 million in operating cash flow. The company used $250 million of our cash for buybacks and have repurchased $890 million of stock in the trailing twelve months. Our balance sheet remains very strong. The company ended the quarter with cash and short-term investments of $1.72 billion, and debt of $24 million.
During the quarter, Synopsys made a key acquisition, buying the application security provider WhiteHat Security from Nippon Telegraph and Telephone Corp. for $330 million. The company said at the time it was buying significant software-as-a-service capabilities and market-leading dynamic application security testing technology that would help to boost its own portfolio of security testing tools. On a non-GAAP basis, net income for the second quarter of fiscal year 2022 was $390.8 million, compared to non-GAAP net income of $267.1 million for the second quarter of fiscal year 2021.
SNPS in the second quarter of FY 22 has reported the adjusted earnings per share of $2.50, beating the analysts’ estimates for the adjusted earnings per share of $2.37. The company had reported the adjusted revenue growth of 25 percent to $1.28 billion in the second quarter of FY 22, beating the analysts’ estimates for revenue of $1.25 billion.
For fiscal 2022, the company expects to grow annual revenue approximately 20% and pass the $5 billion milestone, drive further operating margin expansion, grow earnings per share by more than 25%, and generate approximately $1.6 billion in operating cash flow
On the other hand, in Q2, the company had enhanced the comprehensive AI IP portfolio with the introduction of the industry’s highest performance neural processor IP. Simultaneously, the company has extended the lead in the most advanced commercial processes. The company can report significant traction with the interface and foundation IP, achieving more than 30 3nm design wins for high-performance compute and networking, as well as notable wins in mobile applications.