Is the business good?
How good a business is SNPS?
Synopsys, Inc. earns 1.7% on the capital it employs against a 9.0% cost of capital, so growth costs more than it returns.
1.7%
Return on invested capital · cost of capital 9.0% · 7.3 points below what the capital costs: growth destroys value
- Operating margin
- 8.5%
Operating margin · Software - Infrastructure median 6.1% · 12 months to Q3 2026
- Cash conversion
- 2.55×
Cash conversion · 0.64× a year ago · every dollar of reported profit arrived as cash, and more
- Share count, year on year
- +19%
Share count, year on year · shareholders own a smaller slice than a year ago
| Year | Operating margin |
|---|---|
| FY2020 | 17% |
| FY2021 | 17% |
| FY2022 | 23% |
| FY2023 | 24% |
| FY2024 | 22% |
| FY2025 | 13% |
Details›
- Gross margin12 months to Q3 2026
- 72%
- Operating margin12 months to Q3 2026
- 8.5%
- Net margin12 months to Q3 2026
- 11%
- Free cash flow margin
- 29%
- R&D as % of revenue
- 31%
- Revenue, trailing twelve months
- $9.42B
- Free cash flow, trailing twelve months
- $2.75B
- Net income, trailing twelve months
- $1.08B
- Return on invested capitaloperating profit after tax ÷ debt + equity − cash
- 1.7%
Margins, capital and share counts from the statements as filed with the SEC; cash conversion from the cash flow statement.
Software - Infrastructure
Ranks #51 of 64 by Smart Score