Synopsys Earnings Call Insights: More Stable Macro Environment and End-Market Demand

Synopsys (NASDAQ:SNPS) recently reported its first quarter earnings and discussed the following topics in its earnings conference call.

More Stable Macro Environment

Richard Valera – Needham & Company: Aart, you mentioned that you were seeing maybe a slightly more stable macro environment, but I would think that governments, agencies and perhaps aerospace companies that are exposed to government might be seeing some hesitation due to the potential for sequestration coming. Have you seen any of that and, if not, do you think it might?

Dr. Aart de Geus – Chairman and co-CEO: It’s a good question. We have indeed seen a little bit of that with some of the government related businesses that are just a little bit more careful before committing to whatever renewal they may have. At the same time, that is a relatively small portion of our business and it’s completely overshadowed by the much bigger companies, certainly bigger in terms of their ADA spending that are driving all the commercial markets and the global markets. So, I just happened to know of one case, where what you said is true and that’s all I know, so it’s not very heavy on our mind.

Richard Valera – Needham & Company: Then Aart, some pretty positive comments with respect to your positioning with respect of FinFET adoption and the move to kind of 3-D. Can you say, if you think you’re seeing incremental purchasing for FinFET implementation sort of above and beyond what you might have seen if folks have been sticking with 2-D or do you think this is sort of a normal progression that there’s sort of a continuous progression where there is always purchasing being done for sort of a next technology?