Synopsys Inc. (NASDAQ:SNPS) Q3 2020 Earnings Conference Call - Final Transcript

Aug 19, 2020 • 05:00 pm ET

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Synopsys Inc. (NASDAQ:SNPS) Q3 2020 Earnings Conference Call - Final Transcript

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Presentation
Operator
Operator

Ladies and gentlemen, thank you for standing by, and welcome to the Synopsys Earnings Conference Call for the Third Quarter of Fiscal Year 2020. At this time, all participants are in a listen-only mode. Later, we will conduct a question-and-answer session and instructions will be given at that time. [Operator Instructions] Today's call will last one hour. Five minutes prior to the end of the call, we will announce the amount of time remaining in the conference. As a reminder, today's call is being recorded.

At this time, I would like to turn the conference over to Lisa Ewbank, Vice President of Investor Relations. Please go ahead.

Executive
Lisa L. Ewbank

Thank you Marcos and good afternoon, everyone. Hosting the call today are Aart de Geus, Chairman and co-CEO of Synopsys; and Trac Pham, Chief Financial Officer.

Before we begin, I'd like to remind everyone that during the course of this conference call, Synopsys will discuss forecasts, targets and other forward-looking statements regarding the company and its financial results. While these statements represent our best current judgment about future results and performance as of today, our actual results and performance are subject to many risks and uncertainties that could cause actual results to differ materially from what we expect. In addition to any risks that we highlight during the call, important factors that may affect our future results are described in our most recent SEC reports and today's earnings press release.

In addition, we will refer to non-GAAP financial measures during the discussion. Reconciliations to their most directly comparable GAAP financial measures and supplemental financial information can be found in the earnings press release, financial supplement and 8-K that we released earlier today. All of these items, plus the most recent investor presentation are available on our website at synopsys.com. In addition, the prepared remarks will be posted on the site at the conclusion of the call.

Finally, we are all participating from different locations today, please forgive any delays or technology glitches or awkward handoffs in the Q&A session that might occur as a result.

With that, I'll turn the call over to Aart de Geus.

Executive
Aart de Geus

Good afternoon. Synopsys continues to execute very well and delivered record revenue, non-GAAP earnings, and cash flow in the third quarter. Revenue was $964 million, with GAAP earnings per share of $1.62, non-GAAP earnings per share of $1.74, and $399 million of operating cash flow. Revenue growth was strong across all product groups and geographies. Orders were greater than our internal plan with particular strength in EDA software. We also continue to make excellent progress on our margin expansion goals. As a result of this over achievement and broad-based strength, we are raising fiscal 2020 revenue, operating margin, non-GAAP earnings and cash flow targets. Trac will discuss the financials in more detail.

Our excellent results and confidence reflect product differentiation and technical strength bolstered by an intense multi-year innovation push and high demand for advanced solutions. We're progressing rapidly towards crossing the $4 billion revenue milestone, while simultaneously