By Jaspreet Singh and Max A. Cherney
(Reuters) - Chip design software company Synopsys (NASDAQ:SNPS) on Wednesday named 25-year-veteran Sassine Ghazi as its CEO and president, and forecast better-than-expected fourth-quarter results as artificial intelligence (AI) innovations fuel demand for custom semiconductor design.
The company said Ghazi, who brings with him decades of chip design and applications engineering experience, will succeed Aart de Geus next January. Geus, co-founder of Synopsys, will move to the role of executive chair.
“I've been with the company for 25 years,” Ghazi said. “So the last three years has been fairly planned discussion with Aart and the board regarding the transition."
Investors should be comfortable and confident with Ghazi, said Baird Equity Research, noting he has already helped make Synopsys a faster-growing and more profitable company.
Synopsis shares were up 2.3% in extended trading.
Intel (NASDAQ:INTC) and Synopsys on Monday announced a deal - an important step for Intel's contract manufacturing business as it strives to become a viable alternative to Taiwan Semiconductor Manufacturing Co or Samsung Electronics (OTC:SSNLF) Co. As part of the deal, Synopsys will develop intellectual property for Intel's advanced manufacturing processes.
“The moment you're in a foundry business, you really need an IP portfolio to enable your customers to come into your foundry business, Ghazi said.
Synopsys forecast fourth-quarter adjusted earnings per share of $3.01 to $3.06, above analysts' average estimate of $2.91, according to Refinitiv data.
Revenue expectations of $1.57 billion to $1.60 billion were also better than analysts' average estimate of $1.57 billion.
The company reported revenue of $1.49 billion in the third quarter ended July 31, above estimate of $1.48 billion. Adjusted profit per share of $2.88 also beat estimates of $2.74.
Revenue from its Design Automation unit jumped about 23% to $1 billion. It is the company's largest segment, which includes digital and custom integrated circuit (IC) design software.