Synopsys

(2)

|
|
| 0.6
| %
|
|
|
|
|
|

Target non-GAAP operating margin

|
|
| 41.5
| %
|
|
|
|
|
| (1)
|

These numbers represent the midpoint of targets in the prepared remarks provided on August 26, 2026, and

do not represent official guidance for fiscal year 2026.

| (2)
|

Adjustments reflect actual expenses incurred by Synopsys as of July 31, 2026 and do not fully reflect all

potential adjustments for future periods for the reasons set forth in “GAAP to Non-GAAP Reconciliation” below.

7

Forward-Looking Statements

This press release and the investor conference call contain forward-looking statements, including, but not limited to, statements concerning our short-term and

long-term financial targets, expectations and objectives; our businesses, business segments, strategies, partnerships, initiatives and opportunities, including, among other things, the reallocation of resources in our Design IP segment to higher

growth opportunities and planned restructuring activities; industry growth and technological trends, such as artificial intelligence, including our development and planned commercialization thereof; business and market outlook; the potential impact

of the uncertain macroeconomic environment and global economic conditions on our financial results; the impact of current and future U.S. and foreign trade regulations, government actions and regulatory changes, such as export control restrictions

and tariffs; the ANSYS, Inc. (Ansys) integration and its expected impact, including expected synergies and the timing thereof, our ability to create joint solutions as a combined company, and related accounting changes; planned and recently

completed acquisitions or divestitures, and their anticipated timing and impact; our key customers, customer concentration, customer engagement, customer demand and market expansion; results and strategies related to our products, technology and

services, including product development and our planned product releases and capabilities; the expected realization of our contracted but unsatisfied or partially unsatisfied performance obligations (backlog); planned stock repurchases; our expected

tax rate; and the status, expected outcome or expected impact of litigation and/or regulatory investigations. These statements involve risks, uncertainties and other factors that could cause our actual results, time frames or achievements to differ

materially from those expressed or implied in such forward-looking statements. Such risks, uncertainties and factors include, but are not limited to: macroeconomic conditions and geopolitical uncertainty in the global economy; uncertainty in the

growth of the semiconductor and electronics industries; the highly competitive industry we operate in; actions by the U.S. or foreign governments, such as the imposition of additional export restrictions or tariffs; consolidation among our customers

and our dependence on a relatively small number of large customers; risks and compliance obligations relating to the global nature of our operations; failure to realize the benefits expected from the transactions we complete, including the

acquisition of Ansys (the Ansys Merger) or unexpected difficulties or expenditures arising therefrom; risks related to inaccuracies in, or failures to achieve, our operational and business metrics or forecasts of growth; and more. Additional

information on potential risks, uncertainties and other factors that could affect Synopsys’ results is included in filings we make with the SEC from time to time, including in the sections entitled “Risk Factors” in our latest

Annual Report on Form 10-K and in our latest Quarterly Report on Form 10-Q. The financial information contained in this press release should be read in conjunction with

the consolidated financial statements and notes thereto included in Synopsys’ most recent reports on Forms 10-K and 10-Q, each as may be amended from time to time.

A GAAP-to-non-GAAP reconciliation for Synopsys is referenced in accompanying tables not included in this excerpt.

A weakening U.S. dollar raises foreign subsidiaries' expenses on translation into U.S. dollars in consolidated statements of income, while a strengthening U.S. dollar relative to other currencies, including the renminbi or Yen, reduces revenue of foreign subsidiaries upon translation and consolidation.

Acquisition of Ansys. On July 17, 2025 (the Acquisition Date), we completed the acquisition of ANSYS, Inc. (Ansys), a provider of broad engineering simulation and analysis software and services for $199.91 in cash and 0.3399 of a share of our common stock in exchange for each ordinary share of Ansys for a total consideration of $34.9 billion.

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Table of Contents

We accounted for the acquisition of Ansys by applying the acquisition method of accounting for business combinations. The consolidated financial statements include the financial results of Ansys prospectively from the Acquisition Date. See Note 4. Business Combinations and Note 10. Senior Notes, Bridge Commitment Letter, Term Loan and Revolving Credit Facilities of the Notes to Consolidated Financial Statements in this Annual Report.

Acquisitions and strategic investments are an important part of our growth strategy. We have completed a significant number of acquisitions in recent years, including the Ansys Merger, which was completed in July 2025. We expect to make additional acquisitions and strategic investments in the future, but we may not find suitable acquisition or investment targets, or we may not be able to consummate desired acquisitions or investments due to, among other things, financial constraints, unfavorable credit markets, commercially unacceptable terms, failure to obtain regulatory approvals, competitive bid dynamics, outbound investment restrictions or other risks, which could harm our operating results.

Any acquisitions and strategic investments we may undertake, including the Ansys Merger, are difficult, time-consuming, and pose a number of risks, including, but not limited to:

•Potential negative impact on our net income resulting from acquisition or investment-related costs or on our earnings per share;

•Failure of acquired products to achieve projected sales or problems in integrating the acquired products with our products or in creating new joint solutions;

•Difficulties entering into new markets in which we are inexperienced or our competitors have stronger positions;

•Potential downward pressure on operating margins due to lower operating margins of acquired businesses, increased headcount costs, and other expenses associated with adding and supporting new products;

•Difficulties in retaining and integrating key employees;

•Substantial reductions of our cash resources and/or the incurrence of debt, which may be at higher than anticipated interest rates;

•Failure to realize expected synergies or cost savings, including within the anticipated time frames;

•Difficulties in integrating or expanding sales, marketing and distribution functions and administrative systems, including IT and human resources systems;

•Dilution of our current stockholders through the issuance of common stock as a part of transaction consideration;

•Difficulties in negotiating, governing and realizing value from strategic investments;

58

•Assumption of unknown liabilities, including tax, litigation, cybersecurity and commercial-related risks, and the related expenses and diversion of resources;

•Incurrence of costs and use of additional resources to remedy issues identified prior to or after an acquisition;

•Disruption of ongoing business operations, including diversion of management’s attention and uncertainty for employees and customers, particularly during the post-acquisition integration process;

•Potential negative impacts on our relationships with customers, distributors, business partners and channel partners;

•Exposure to new operational risks, regulations and business customs to the extent acquired businesses are located in regions where we are not currently conducting business;

•The need to implement controls, processes and policies appropriate for a public company at acquired companies that may have previously lacked such controls, processes and policies in areas such as cybersecurity, IT, privacy and more; and

•Requirements imposed by government regulators in connection with their review of an acquisition, including required divestitures or restrictions on the conduct of our business or the acquired business.