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With a market cap of $71.5 billion, Synopsys, Inc. (SNPS) is a leading provider of engineering solutions spanning silicon to systems, helping customers accelerate the development of AI-powered products. The company offers industry-leading silicon design, IP, simulation and analysis solutions, and design services to enhance R&D productivity and drive innovation across diverse industries.
The Sunnyvale, California-based company is slated to announce its fiscal Q3 2026 results soon. Ahead of the release, analysts expect Synopsys to report EPS of $2.67, a 16.1% rise from $2.30 in the year-ago quarter. It has exceeded Wall Street's earnings expectations in three of the past four quarters while missing on another occasion.
For fiscal 2026, analysts predict the chip design software provider to report EPS of $10.65, a 23.1% increase from $8.65 in fiscal 2025.
Shares of Synopsys have dipped 34.7% over the past 52 weeks, lagging behind the broader S&P 500 Index's ($SPX) 16.1% gain and the State Street Technology Select Sector SPDR ETF's (XLK) 32.7% return over the same period.
Synopsys shares tumbled 8.6% following its Q2 2026 results on May 27 as investors focused on weakness in its high-margin Design IP business, where revenue declined 6% year-over-year to $454 million. The drop overshadowed otherwise strong results, including adjusted EPS of $3.35 and revenue of $2.28 billion (up 41.9%), both above the consensus. Although the company raised its full-year guidance to $9.63 billion - $9.71 billion in revenue and $14.72 - $14.80 in adjusted EPS, concerns over weakness in the profitable Design IP segment weighed on the stock.
However, analysts' consensus view on SNPS stock remains bullish, with an overall "Strong Buy" rating. Out of 21 analysts covering the stock, 16 recommend a "Strong Buy," one "Moderate Buy," three "Holds," and one "Strong Sell." The average analyst price target is $567.68, indicating a potential upside of 46% from the current levels.
