Earnings Call Intelligence Subscribe
Home › Call Sheets › SNPS › Q1'26
Call sheet · Q1'26

Synopsys (SNPS)

Q1'26 earnings call · held February 25, 2026 · compared with the Q4'25 call · management-credibility review
10/12
Disclosure score
4 medium, 2 low flags
Financial quality
Bottom line
The sleeper story everyone's missing: Ansys is becoming the real growth engine while the market obsesses over EDA/IP struggles. Yes, IP is still transitional and China share losses are accelerating to domestic competitors, but Ansys delivered a 33% sequential beat and management said 'our confidence in this business is only increasing.' The binding constraint isn't demand - it's execution on integration and IP title delivery. Ghazi's most revealing quote: 'We're seeing domestic competitors in China because obviously if customers cannot use our technology, they're looking for alternatives' - first honest admission of structural market share loss. My view changes if they miss the midyear IP delivery commitment or if Ansys growth decelerates in Q2 when tough comps hit.

The 30-second version

  • The sleeper story: Ansys is quietly becoming the growth engine
  • IP business bleeding stops, but the patient is still weak
  • China share loss accelerating to domestic competitors

What changed this quarter

MetricQ4'25Q1'26Change
Total Revenue$2.25B (Q4)$2.41B (Q1)+7% sequential, high end of guidance
Ansys Revenue$668M (Q4)$886M (Q1)+33% sequential, beat expectations
Design IP Revenue$407M (Q1 '25)$407M (Q1 '26)-6% YoY, flat sequentially
Non-GAAP EPS$2.90 (Q4)$3.77 (Q1)+30% sequential, ahead of guidance
Non-GAAP Operating Margin36.5% (Q4)42.1% (Q1)+560 bps sequential improvement
Design IP Operating Margin24% (FY '25)16.2% (Q1)-780 bps margin compression
Free Cash Flow$1.35B (FY '25)$822M (Q1)Strong quarterly performance
Backlog$11.4B (Q4)$11.3B (Q1)-$100M sequential decline
China Revenue Growth-18% (FY '25)+21% YoY (incl. Ansys)Ansys masking organic decline
Cash Position$2.96B (Q4)$2.2B (Q1)-$760M after term loan repayment

Accountability tracked

7 new promises made4 narrative shifts flagged7 prior promises scored
Inside the full report
The complete write-up covers the full promise ledger with kept/missed calls, disclosure-quality scoring, the metrics-vanished check, verification items, and the questions to ask next quarter.
Read the full SNPS Q1'26 report Subscribe
About Research ↗Call SheetsCredibility IndexMissed PromisesScreens13F BooksData & InstitutionalPrivacyTermsSubscribe
This is a free preview. The full write-up and promise ledger are published to subscribers on Substack.
Scores, kept-promise rates, and flags on this site reflect the author's opinion, applying a stated methodology to statements management made on public earnings calls. Informational and educational purposes only - not investment advice, a recommendation, or an offer to buy or sell any security. Sources believed reliable but not guaranteed; the author may hold positions in the securities discussed.

Follow what management promises next

Get free previews of our earnings-call research: the key changes, management scores, and questions worth investigating. Subscribe for full call sheets and deeper analysis.

Subscriptions are managed by Substack. If the form does not load, subscribe directly. Or follow the RSS feed.