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Key Takeaways
- SNPS shares surged 11% to reach $483.59, leading the Nasdaq 100 index during Thursday’s trading session.
- The chip design software firm introduced GPT-Synopsys, an AI-driven design model created through a multiyear revenue-sharing agreement with OpenAI.
- A custom chip development contract with Amazon valued at over $1 billion was announced.
- Synopsys elevated its revenue growth forecast to midteens annually through the end of fiscal 2030.
- Analysts at Rosenblatt Securities increased their price objective to $620, suggesting 43% potential upside from previous trading levels.
Shares of Synopsys advanced 11% to $483.59 during early Thursday trading, positioning it as the strongest performer within the Nasdaq 100 for that session.
This significant move followed Wednesday’s 4.8% increase. Combined, these two consecutive sessions marked the company’s strongest two-day performance since September 2025.
The momentum originated from the company’s Investor Day presentation held in New York on Wednesday, where Synopsys unveiled two significant AI-focused strategic partnerships.
The first collaboration involves OpenAI. Together, they’re introducing GPT-Synopsys, a purpose-built artificial intelligence model designed specifically for semiconductor design applications.
While specific financial terms weren’t disclosed, both organizations confirmed the arrangement operates on a multiyear revenue-sharing framework.
According to Synopsys, discussions are already underway with leading semiconductor manufacturers regarding adoption of this innovative design tool.
Amazon Partnership Details
The second major announcement centers on Amazon. Synopsys secured an agreement valued above $1 billion to collaborate with Amazon on proprietary chip development.
This arrangement builds upon Amazon’s current utilization of Synopsys software platforms and intellectual property assets. It also represents a fundamental change in the company’s compensation structure.
The contract employs a license-plus-royalty framework, meaning revenue will scale proportionally with manufacturing volume rather than remaining static.
Both collaborations address a persistent concern that has shadowed Synopsys recently. Market participants had expressed anxiety that AI capabilities might enable chip manufacturers to internalize more design functions, potentially reducing demand for Synopsys services.
CFO Shelagh Glaser dismissed these concerns in a conversation with Barron’s. “Everybody’s building their own chips, and we have insatiable demand,” she said.
Elevated Growth Projections
Synopsys also upgraded its forward-looking financial targets. The organization now anticipates midteens compound annual revenue expansion through fiscal 2030, representing an increase from its earlier double-digit projection.
For fiscal 2027 in particular, Synopsys forecasts approximately 15% revenue growth. The company also projects adjusted operating margin will climb to roughly 50% by fiscal 2030, compared to 44% expected in fiscal 2027.
Management announced plans to repurchase approximately $1 billion worth of shares in upcoming months, contingent upon market conditions.
StoneX analyst Gary Mobley maintained his Buy recommendation and $570 price objective, noting that AI agents are designed to assist engineers rather than displace fundamental design platforms.
Rosenblatt Securities elevated its price target to $620 from $575 following the investor presentation. This target represents 43% upside potential from the stock’s pre-rally price of $434.94.
Rosenblatt also highlighted Synopsys’ recent operational performance, noting 46% revenue growth over the trailing twelve months alongside an 83% gross margin.
Despite Thursday’s rally, Synopsys stock remained down 7.4% year-to-date entering the session. Competitor Cadence Design Systems has posted a 5.6% gain during the same period and also climbed 6.1% Thursday.
Glaser attributed the stock’s previous underperformance to concerns about AI-driven disruption and the ongoing integration of Ansys, which Synopsys acquired last year in a $35 billion transaction.
“We had said 2026 was going to be a transitional year,” Glaser explained, citing the Amazon partnership as evidence of that strategic plan materializing.
Additional analysts have recently adopted more optimistic positions as well. HSBC elevated the stock to Buy with a street-leading $700 price target, while both Morgan Stanley and Baird upgraded their ratings during the current year.
The post Synopsys (SNPS) Stock Surges 11% on OpenAI Partnership and Amazon’s $1B+ Chip Deal appeared first on Blockonomi.
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