--Strong demand seen in Asian markets, including China and Taiwan
--Expects double-digit increase for the top and bottom line in fiscal year as customers respond to technology
--Shares up in after-hours trading as results exceed expectations
(Updates throughout with CEO comments, new stock quote)
By John Kell
Of DOW JONES NEWSWIRES
NEW YORK (Dow Jones)--Synopsys Inc.'s (SNPS) 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.
Shares rose 4.4% to $24.47 in after-hours trading, as results in the latest quarter also exceeded the company's expectation.
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.
Chief Executive Aart de Geus told Dow Jones Newswires the company continued to see strong demand in the major Asian markets of China, South Korea, Taiwan and India, while the rest of the regions Synopsys serves were stable. He said Synopsys has yet to see a change in Japan after the tsunami, saying it would take about a year before any disruptions were to occur.
Synopsys is unique in that it typically enters a quarter with about 90% of revenue on hand, giving the company a high degree of stability. The company's average customers buy the products they need for three years and Synopsys then recognizes that revenue daily over the length of the contract.
De Geus said Synopsys will post a double-digit increase for the top and bottom line in the fiscal year, saying in general, the company's technology is "doing quite well with our customers."
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 rose 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.
Backlog at the end of the prior fiscal year stood at about $2.4 billion, a figure de Geus said doesn't change much from year to year. The company only shares that metric once at the end of every fiscal year.
-By John Kell, Dow Jones Newswires; 212-416-2480; email@example.com