Synopsys Posts Financial Results for Fourth Quarter and Fiscal Year 2010

Synopsys had a strong year, relative to the industry and our expectations, and we enter fiscal 2011 with an even better outlook, said Aart de Geus, chairman and CEO of Synopsys. Building on significant technology and customer momentum, and an improved customer landscape, we expect to deliver growth in both traditional EDA and the adjacencies in which we've been steadily investing over the past several years.

GAAP Results

On a generally accepted accounting principles (GAAP) basis, net income for the fourth quarter of fiscal 2010 was $25.4 million, or $0.17 per share, compared to $19.5 million, or $0.13 per share, for the fourth quarter of fiscal 2009. GAAP net income for fiscal year 2010 was $237.1 million, or $1.56 per share, compared to $167.7 million, or $1.15 per share for fiscal 2009. Net income for fiscal year 2010 includes a one-time $94.3 million, or $0.62 per share, tax benefit associated with the IRS settlement for fiscal years 2002-2004, announced on January 12, 2010.

Non-GAAP Results

On a non-GAAP basis, net income for the fourth quarter of fiscal 2010 was $59.9 million, or $0.39 per share, compared to non-GAAP net income of $49.5 million, or $0.33 per share, for the fourth quarter of fiscal 2009. Non-GAAP net income for fiscal 2010 was $242.4 million, or $1.60 per share, compared to non-GAAP net income of $255.3 million, or $1.75 per share, for fiscal 2009. Reconciliation between GAAP and non-GAAP results is provided at the end of this press release.

Financial Targets

Synopsys also provided its financial targets for the first quarter and full fiscal year 2011. These targets do not include future acquisition-related expenses that may be incurred in fiscal 2011. These targets constitute forward-looking information and are based on current expectations. For a discussion of factors that could cause actual results to differ materially from these targets, see Forward-Looking Statements below.

First Quarter of Fiscal Year 2011 Targets:

* Revenue: $360 million - $368 million
* GAAP expenses: $305 million - $323 million
* Non-GAAP expenses: $278 million - $288 million
* Other income and expense: $0 - $2 million
* Tax rate applied in non-GAAP net income calculations: approximately 27 percent
* Fully diluted outstanding shares: 149 million - 154 million
* GAAP earnings per share: $0.21 - $0.28
* Non-GAAP earnings per share: $0.38 - $0.41
* Revenue from backlog: greater than 90 percent


Full Fiscal Year 2011 Targets:

* Revenue: $1.5 billion - $1.525 billion
* Other income and expense: $2 million - $6 million
* Tax rate applied in non-GAAP net income calculations: approximately 27 percent
* Fully diluted outstanding shares: 149 million - 154 million
* GAAP earnings per share: $1.06 - $1.24
* Non-GAAP earnings per share: $1.67 - $1.77
* Cash flow from operations: approximately $220 million - $240 million
* Revenue from backlog: greater than 80 percent