According to a regulatory filing submitted on November 9, the restructuring plan—approved by the company's board of directors—seeks to "invest in key growth opportunities and drive business efficiencies." Synopsys expects to incur pretax charges of $300 million to $350 million, covering severance packages, site closures, and other one-time termination costs.

The company said the majority of layoffs will take place during fiscal year 2026, which began on November 1, 2025, with the restructuring expected to be substantially completed by the end of fiscal 2027.

"We are taking a number of targeted steps to improve our efficiency, accelerate our strategy, and capitalize on the highest-growth opportunities," Synopsys stated. "These initiatives will result in reducing our global workforce over the course of fiscal 2026. We do not take these measures lightly and are committed to treating impacted employees with respect and support."

The announcement follows Synopsys' $35 billion cash-and-stock acquisition of Pennsylvania-based engineering simulation firm Ansys, completed earlier this year after regulatory review. The acquisition expanded Synopsys' presence in the fast-growing simulation software sector but also raised concerns about overlapping operations and rising costs.

Synopsys, alongside rival Cadence Design Systems, dominates the electronic design automation (EDA) market, supplying essential software and hardware tools used by semiconductor leaders such as Nvidia, Intel, and Qualcomm to design advanced processors. The company generated nearly $9 billion in trailing 12-month revenue and invests roughly 25% of earnings in research and development.

However, the company has faced slowing momentum in China, where new U.S. export restrictions have disrupted chip design projects and affected a major foundry customer. Although the U.S. government lifted certain restrictions on exports of chip design software to China in early July, challenges remain.

Synopsys' cost-cutting move comes amid a broader wave of tech industry layoffs, as artificial intelligence reshapes the semiconductor landscape. According to a report released last week by Challenger, Gray & Christmas, U.S. employers announced over 150,000 job cuts in October, marking the largest reduction for that month in more than two decades. The report noted that technology companies led the layoffs, followed by retail and services sectors.

Analysts say the restructuring signals Synopsys' effort to balance integration costs from the Ansys deal with investment in high-growth fields such as AI, advanced packaging, and next-generation chip design automation—areas increasingly critical to maintaining competitiveness in the evolving semiconductor ecosystem.