Synopsys, Inc. (NASDAQ:SNPS) Beats Earnings Estimates

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Synopsys, Inc. (NASDAQ:SNPS) stock rose 4.63% (As on Dec 2, 1:34:47 AM UTC-4, Source: Google Finance) after the company beaten the earnings estimates for the fourth quarter of FY 21. The company has raised the long-term financial objectives to strong double-digit revenue growth, anchored in a step-up in EDA and IP targets, ongoing non-GAAP operating margin expansion, and non-GAAP earnings-per-share growth in the mid-teens range, all of which driving very strong cash flow. Semiconductor & System Design segment revenue was $3.8 billion, driven by broad-based strength across all product groups and geographies. Software Integrity segment revenue was $394 million, up 10% over the prior year, and exceeded the original plan. The company expects to return to the 15% to 20% growth objective in 2022. In addition, following the investments and operational adjustments we made this past year, the company expects to expand adjusted operating margin in 2022. Operating cash flow for the year was a record $1.49 billion, reflecting our strong results and robust collections. The company ended the year with cash and short-term investments of $1.58 billion and total debt of $100 million. During the year, the company completed buybacks of $788 million or 56% of free cash flow.

SNPS in the fourth quarter of FY 21 has reported the adjusted earnings per share of $1.82, beating the analysts’ estimates for the adjusted earnings per share of $1.78, according to figures compiled by Thomson Reuters. The company had reported the adjusted revenue growth of 12.7 percent to $1.15 billion in the fourth quarter of FY 21. The total non-GAAP costs and expenses were $2.9 billion, resulting in a non-GAAP operating margin of 30.5%.

For fiscal year 2022, the full year targets are revenue of $4.725 billion to $4.775 billion; total non-GAAP costs and expenses between $3.225 billion and $3.255 billion, resulting in non-GAAP operating margin improvement of more than 100 basis points; non-GAAP tax rate of 18%; non-GAAP earnings of $7.73 per share to $7.80 per share, representing mid-teens growth despite a higher tax rate; cash flow from operations of $1.4 billion to $1.5 billion.

For the first quarter; the company expects revenue between $1.25 billion and $1.28 billion; total non-GAAP costs and expenses between $802 million and $812 million; GAAP earnings of $1.75 per share to $1.92 per share and Non-GAAP earnings of $2.35 per share to $2.40 per share.

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