Synopsys, a leading chip-design software maker, has announced plans to lay off approximately 10% of its workforce, totaling around 2,000 employees. This decision comes as the company looks to redirect its investments towards growth opportunities, following its recent $35 billion acquisition of engineering design firm Ansys earlier this year. The move also comes after Synopsys fell short of analysts’ revenue estimates for the third quarter.
According to a regulatory filing on Wednesday, Synopsys anticipates incurring pretax charges ranging from $300 million to $350 million for severance, one-time termination benefits, and costs associated with certain site closures. The company expects the majority of the layoffs to take place in fiscal year 2026, with the restructuring plan set to be substantially completed by the end of fiscal 2027.
This announcement is part of a larger trend of layoffs affecting global companies this year, with U.S.-based employers cutting over 150,000 jobs in October alone, the largest reduction for the month in over two decades. Tech firms have been at the forefront of job cuts in the private sector, followed by retailers and the services sector, according to a report by Challenger, Gray & Christmas.
Synopsys, a key partner for companies like Nvidia, Intel, and Qualcomm, provides essential software and hardware for designing advanced processors. The company has faced challenges in China due to new export restrictions disrupting design starts in the country and issues with a major foundry customer.
In early July, the U.S. lifted restrictions on exports to China for chip design software developers, aiming to alleviate some of the challenges faced by companies like Synopsys. As the company navigates these industry shifts and focuses on growth opportunities, the layoffs are a strategic move to realign resources and drive future success.
Overall, Synopsys remains committed to innovation and delivering cutting-edge solutions for its partners in the semiconductor industry. The company’s restructuring plan reflects its determination to adapt to changing market dynamics and position itself for continued growth and success in the years ahead.
This article was reported by Jaspreet Singh in Bengaluru and edited by Anil D’Silva and Maju Samuel.
