Synopsys, Inc. (SNPS) Securities Class Action Lawsuit Filed [November 7, 2025]

Introduction to Synopsys, Inc. (SNPS) Securities Class Action Lawsuit

A securities fraud class action has been filed against Synopsys, Inc. (NASDAQ: SNPS) covering trades from December 4, 2024 through September 9, 2025. Investors allege the company and senior executives promoted growth and stability while concealing that a shift toward artificial intelligence customers—and the extra customization they require—was hurting the economics of Synopsys's Design IP segment and that certain road map and resource choices were unlikely to work. The complaint says management repeatedly highlighted strong results and reaffirmed guidance through mid-2025. On September 9, 2025, the company disclosed that the IP business had underperformed, missed revenue guidance, and showed a year-over-year decline in Design IP revenue, with management acknowledging decisions that did not yield intended results. Following these revelations, Synopsys's stock fell sharply, causing significant investor losses.

Synopsys, Inc. (SNPS) Securities Lawsuit Case Details

Case Name: Kim v. Synopsys, Inc., et al.
Case No.: 3:25-cv-09410
Jurisdiction: U.S. District Court, Northern District of California
Filed on: October 31, 2025

Synopsys, Inc. (SNPS) Company Profile

Synopsys provides electronic design automation software used to design and test integrated circuits and operates in two segments: Design Automation and Design IP. The Design IP segment offers pre-designed, silicon-proven components—such as interface, foundation, security, and embedded processor IP—that help chipmakers build chips and SoCs more quickly and cost-effectively.

Synopsys, Inc. (SNPS) Securities Lawsuit Class Period

December 4, 2024–September 9, 2025, inclusive.

All persons and entities that purchased or otherwise acquired Synopsys securities during the Class Period and who were damaged thereby may be eligible to join the Synopsys, Inc. (SNPS) class action lawsuit.

Allegations in the Synopsys, Inc. (SNPS) Securities Class Action Lawsuit

The complaint targets Synopsys, Inc., Chief Executive Officer Sassine Ghazi, and Chief Financial Officer Shelagh Glaser. According to investors, the company emphasized growth and resilience while failing to disclose that an increased focus on AI customers—who require more customization—was weakening the economics of the Design IP business and that certain road map and resource decisions would not achieve their intended results.

On December 4, 2024, Synopsys issued a press release announcing record quarterly revenue of $1.636 billion—about 11% year over year—and stated it expected to deliver double-digit revenue growth in 2025 while preparing to close the Ansys acquisition. On December 19, 2024, the company filed its Form 10-K, describing the Design IP portfolio and framing AI initiatives in risk language—"We may not be successful in our AI initiatives"—which investors allege was misleading given what the company knew about IP segment pressures.

During the first half of 2025, Synopsys continued to reinforce its outlook. On February 26, 2025, the company reported first-quarter revenue of $1.455 billion, exceeding the midpoint of guidance, and reaffirmed full-year 2025 guidance in a press release and Form 10-Q. On May 28, 2025, Synopsys again exceeded the midpoint of guidance with $1.604 billion in second-quarter revenue and reaffirmed full-year revenue and non-GAAP operating margin guidance. By July 30, 2025, the company's stock closed at a Class Period high of $645.35 per share, reflecting investor reliance on these statements.

Investors allege that, throughout this period, the Company failed to disclose that growing AI-customer customization was extending timelines, consuming more resources, and deteriorating the Design IP unit's economics, all of which materially affected financial results.

The Truth Emerges

On September 9, 2025, Synopsys released third-quarter 2025 results and held an earnings call. Management disclosed that the company's IP business had underperformed expectations, that quarterly revenue was $1.740 billion—below prior guidance of $1.755 to $1.785 billion—and that Design IP revenue declined 7.7% year over year to $426.6 million. The company further indicated that guidance implied Design IP revenues would decline at least 5% for the full year.

During the call, CEO Sassine Ghazi stated that results were primarily impacted by IP underperformance, that expected deals did not materialize, and that "certain road map and resource decisions" did not yield intended results. He explained that rising customization, particularly for interface IP, was shifting work from off-the-shelf delivery to subsystem delivery, which takes longer and requires more resources. These admissions highlighted issues that, according to the complaint, were not disclosed in the earlier emphasis on growth and the reaffirmed guidance communicated on December 4, 2024, February 26, 2025, and May 28, 2025.

Market Reaction

After Synopsys released its results after market hours on September 9, 2025, the stock reacted the next day. On September 10, 2025, the share price fell $216.59, or 35.8%, to close at $387.78 on unusually heavy trading volume. This drop followed a Class Period high of $645.35 on July 30, 2025.

Next Steps

• Submissions for lead plaintiff are due: December 30, 2025.
• The Court will issue its order for lead plaintiff and counsel in the weeks after submissions are due.
• The Court will then consider motion for class certification.
• The Court will later consider a Motion to Dismiss.

To learn if you are eligible for recovery under the SNPS securities class action lawsuit, visit the case submission page here.

Disclaimer: This shareholder alert is for informational purposes only and does not constitute legal advice. Consult a qualified attorney for personalized guidance. No specific outcomes are guaranteed.