Synopsys plans to cut 10% of its global workforce as the company looks to “drive business efficiencies” in the wake of a recent merger.
Regulatory filings show the company plans to cut roughly 2,000 jobs beginning immediately as part of a restructuring plan set to finish in fiscal year 2027.
The layoffs follow its acquisition of engineering design company Ansys for $35 billion, with the deal announced in January last year and completed in July of this year after regulator scrutiny.
Synopsys missed analyst predictions in its latest earnings results, announced in September, posting $1.74 billion in third quarter revenue – that was up 14% year-on-year, but below expectations, sending shares down.
Last week, Synopsys was hit by a class-action lawsuit that claimed its increased focus on AI was damaging the profitability of its existing design business.
In its third quarter results, Synopsys posted an increase in design automation revenue of 23%, but a decline of 8% in design IP revenue.
The firm also announced that chief revenue officer Rick Mahoney was departing last week, but is yet to confirm a replacement.
Synopsys restructuring takes shape
Synopsys said the layoffs were due to a restructuring plan to "invest in key growth opportunities and drive business efficiencies" following the Ansys acquisition.
A spokesperson told the San Francisco Chronicle the aim here is to “improve our efficiency” and capitalize on the “highest-growth opportunities”.
"These initiatives will result in reducing our global workforce over the course of our fiscal year 2026,” the spokesperson added.
“We do not take these measures lightly and are committed to treating impacted employees with respect and providing support through the transition."
Regulatory filings show the company faces charges up to $350 million to cover the cost of layoffs and closing some sites.
ITPro approached Synopsys for comment, but did not receive a response by time of publication.
Synopsys staff have been preparing for cuts
Rumors of layoffs at Synopsys have been swirling on comment boards for more than a month, with apparent employees from both companies posting on TheLayoff asking questions about severance packages and headcount reductions back in September.
Some rightly predicted that the announcement would come for the end of the full fiscal year in November.
The comment boards featured plenty of complaints about the acquisition between the two companies, pinning the blame for layoffs on the deal.
"Ansys was a great company to work for," noted one post from an employee reporting they'd been laid off. " I didn't get that same impression from Synopsys, but I guess that comes with working for a much larger company."
"I'm Ansys, too, and this acquisition was the worst thing for us," noted one post, lamenting the deal with Synopsys.
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