Synopsys : Corporate Overview for Investors

Corporate Overview for Investors

May 2024

Forward-Looking Statements

This presentation contains forward-looking statements, including, but not limited to, statements regarding Synopsys, Inc.'s (Synopsys, we or our) short-term and long-term financial targets, expectations and objectives, including, among others, our long-term financial objectives, which include the effects of our pending acquisition of ANSYS, Inc. (the Ansys Merger); strategies related to our products, technology and services; business and market outlook, opportunities, strategies and technological trends, such as artificial intelligence; the pending Ansys Merger, including, among other things, its anticipated benefits; planned dispositions and their expected impact, such as the previously announced divestiture of our Software Integrity business (the Software Integrity Divestiture); the potential impact of the uncertain macroeconomic and geopolitical environment on our financial results; the expected impact of U.S. and foreign government actions and regulatory changes, including export control restrictions, on our financial results; customer demand and market expansion; our planned product releases and capabilities; industry growth rates; the expected realization of our contracted but unsatisfied or partially unsatisfied performance obligations (backlog); software trends; planned stock repurchases; our expected tax rate; and the impact and result of pending legal, administrative and tax proceedings. 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 complete the Ansys Merger on the terms described in our filings with the SEC, if at all; failure to obtain required governmental approvals related to the Ansys Merger or the imposition of conditions to such governmental approvals that may have an adverse effect on us; failure to realize the benefits expected from the Ansys Merger; failure to complete the Software Integrity Divestiture, or the Software Integrity Divestiture disrupting our business or failing to achieve its intended benefits, 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 presentation 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. Synopsys' financial results for its second quarter of fiscal year 2024 are not necessarily indicative of Synopsys' operating results for any future periods. The information provided herein is as of May 22, 2024. Synopsys undertakes no duty to, and does not intend to, update any forward-looking statement, whether as a result of new information, future events or otherwise, unless required by law.

Regulation G

In addition to financial results prepared in accordance with Generally Accepted Accounting Principles (GAAP), this presentation also contains certain non-GAAP financial measures. When possible, Synopsys provides a reconciliation of non-GAAP financial measures to their most closely applicable GAAP financial measures. Reconciliations of certain of the non- GAAP financial measures (either contained in this presentation or given verbally) to their most comparable GAAP measures are included in the table at the end of this presentation, along with the second quarter of fiscal year 2024 earnings release and financial supplement, dated May 22, 2024, and available on Synopsys' website at https://investor.synopsys.com/overview/default.aspx. Synopsys is unable to provide a reconciliation of its long-term,multi-year target for annual non-GAAP EPS growth and certain third quarter and full fiscal year 2024 non-GAAP financial targets to the corresponding GAAP financial measures on a forward-looking basis because Synopsys believes that it would not be possible for it to have the required information necessary to quantitatively reconcile such measures with sufficient precision without unreasonable efforts due to, among other things, the potential variability and limited predictability of the excluded adjustment items necessary for a full reconciliation such as certain acquisition/divestiture related items, restructuring charges, tax deduction variability, changes in the fair value of non-qualified deferred compensation plan, and gains (losses) on the sale of strategic investments. For the same reasons, Synopsys is unable to address the probable significance of the unavailable information. Investors are encouraged to review Item 2.02 of Synopsys' Current Report on Form 8-K filed on May 22, 2024, for additional information about the measures Synopsys uses to evaluate its core business operations.

© 2024 Synopsys, Inc.

2

Empowering Customers' Innovation

PURPOSE		MISSION		VALUE PROPOSITION
To power innovation today		Empower technology		Maximize customers'
that ignites the ingenuity		innovators everywhere		R&D capabilities and multiply
of tomorrow				their productivity

© 2024 Synopsys, Inc.

3

Powering the Era of Pervasive Intelligence

Artificial intelligence		Silicon proliferation		Software-defined systems
Exponential productivity		More silicon content		New applications,
and efficiency gains		everywhere		new methodologies
Overcoming energy		Addressing productivity		Enabling increased complexity,
and compute limits		and talent gaps		enablement of new developers

SILICON-TO-SYSTEMS DESIGN SOLUTIONS

New design paradigm; Solving challenges and addressing complexity

© 2024 Synopsys, Inc.

4

Synopsys: The Market & Technology Leader

Broad Product

Portfolio

Electronic Design

Automation (EDA)

Semiconductor Intellectual Property (IP)

	FY23	FY24 Targets1, 2
Revenue:	$5.32B	$6.09B - $6.15B
Growth Rate:	15.2%	14.5 - 15.6%
Non-GAAP Operating Margin:	36.3%	~38.1%*
		*Midpoint of range
Non-GAAP Diluted EPS:	$10.54	$12.90 - $12.98
Growth Rate:	25.5%	22.4 - 23.1%
Business Model:	Time-based, recurring revenue model;
	Non-cancellable backlog

1. Targets and multi-year objectives provided as of May 22, 2024. See below for GAAP to non-GAAP reconciliations for more information.
2. On May 5, 2024, Synopsys entered into an agreement to sell its Software Integrity business. Unless otherwise noted, Synopsys' Software Integrity business has been presented as a discontinued operation in the Synopsys' consolidated financial statements for all periods presented in this presentation and all financial results and targets are presented herein on a continuing operations basis.

© 2024 Synopsys, Inc.

5

Long-term Financial Objectives on a Combined Company Basis1

Our combined company long-term,multi-year objectives are:

Revenue	Margin	Earnings
Industry-leadingdouble-digit	Long-termnon-GAAP	Non-GAAP
growth	operating margins	EPS growth in the
• Design Automation: double digits	in mid 40s	high-teens range
• Design IP: mid-teens	Long-term unlevered
	free cash flow margins
	in mid 30s

1 These multi-year objectives are provided as of May 22, 2024 and include the pending acquisition of Ansys.

© 2024 Synopsys, Inc.

6

Global Value Chain-2023

EDA & IP-At the Heart of Accelerating Electronics Innovation

EDA & IP	Embedded Software	Foundry	Semiconductors	Electronic Systems
$17.5B	$15.9B	$123B	$569B	$1.88T

Sources: ESD Alliance, Ipnest, MarketsandMarkets, IC Insights (2023)

© 2024 Synopsys, Inc.

7

Leader in EDA

Synopsys EDA is Mission Critical in the Era of Pervasive AI

Well Positioned with Breadth and Depth of Portfolio

Next-Gen Architecture to Rapidly Fuse Electronics & Multi-Physics

Pioneering in Emerging Areas Unleashes New Growth Vectors

© 2024 Synopsys, Inc.

8

Synopsys.ai: Industry's First Full-Stack,AI-Driven EDA Suite

Boost productivity for every stage of chip design

Generative AI

Data Analytics

AI-Driven

Optimization

Collaborative, generative, and autonomous design to accelerate innovation

AI-driven data analytics solution harnesses untapped insights to drive more intelligent decision making

AI-driven chip design solutions enhances silicon quality while minimizing costs

© 2024 Synopsys, Inc.

9