Synopsys Inc.'s /quotes/zigman/78740/quotes/nls/snps SNPS +2.77% fiscal third-quarter profit grew 32% as the software company reported strong revenue growth, driven by demand for mobile devices, cloud infrastructure and electronic products.
The company also forecast adjusted fiscal fourth-quarter earnings of 44 cents to 46 cents a share on revenue of $386 million to $392 million. Analysts surveyed by Thomson Reuters expected 43 cents and $383 million, respectively.
For the year, Synopsys now sees earnings of $1.79 to $1.81 a share on revenue of $1.53 billion to $1.54 billion, up from the June view of $1.70 to $1.77 in profit on $1.5 billion to $1.53 billion in revenue.
The maker of software used to design semiconductors and other electronic products has seen fairly stable results because most of its revenue is from license agreements signed in previous years. The company has also beefed up its portfolio with a string of acquisitions.
For the quarter ended July 31, Synopsys reported a profit of $52.1 million, or 35 cents a share, up from $39.3 million, or 26 cents a share, a year earlier. Excluding stock-based compensation and other impacts, per-share earnings grew to 46 cents from 39 cents.
Revenue jumped 15% to $386.8 million.
In May, the company projected adjusted earnings of 41 cents to 43 cents on revenue of $378 million to $386 million.
Operating margin narrowed to 15% from 15.1%.
Ahead of the results, D.A. Davidson said bookings growth and a continued high level of research and development spending by the company's large customers should drive "meaningful earnings growth over the next few years." The investment firm said that while there was some cautiousness among the customers of electronic design automation software vendors, research budgets from semiconductors remain intact.