Revenue

6 Months Ended

Apr. 30, 2025

Revenue from Contract with Customer [Abstract]

Revenue

Revenue

Disaggregated Revenue

The following table shows the percentage of revenue by product groups:

	Three Months Ended   April 30,				Six Months Ended   April 30,
	2025		2024		2025		2024
EDA	66.9	%	69.3	%	67.1	%	66.7	%
Design IP	30.0	%	27.5	%	30.0	%	31.2	%
Other	3.1	%	3.2	%	2.9	%	2.1	%
Total	100.0	%	100.0	%	100.0	%	100.0	%

Contract Balances

The timing of revenue recognition may differ from the timing of invoicing customers, resulting in receivables, contract assets, or contract liabilities (deferred revenue) on Synopsys's condensed consolidated balance sheets. For specific software, hardware, and IP agreements with payment plans, Synopsys records an unbilled receivable associated with revenue recognized upon transfer of control, as it holds an unconditional right to invoice and receive payment in the future for those transferred products or services.

A contract asset is recorded when revenue is recognized before invoicing and Synopsys lacks the unconditional right to invoice or retains performance risk concerning that performance obligation. These contract assets transition

to receivables when the rights become unconditional, generally upon the completion of a milestone. The contract assets listed below are included in prepaid and other current assets in the condensed consolidated balance sheets.

Contract balances are as follows:

	As of
	April 30, 2025		October 31, 2024
	(in thousands)
Contract assets, net	$	898,056	$	757,075
Unbilled receivables	$	46,161	$	44,166
Deferred revenue	$	1,706,531	$	1,732,568

During the three and six months ended April 30, 2025, we recognized revenue of $373.6 million and $1.1 billion, respectively, that was included in the deferred revenue balance as of October 31, 2024, including previously unfulfilled contracts that have expired and are no longer subject to an implied promise to provide future services.

Contracted but unsatisfied or partially unsatisfied performance obligations (backlog) were approximately $8.1 billion as of April 30, 2025, which includes $1.2 billion in non-cancellable Flexible Spending Account (FSA) commitments from customers where actual product selection and quantities of specific products or services are to be determined by customers at a later date. We have elected to exclude future sales-based royalty payments from the remaining performance obligations. Approximately 42% of the backlog as of April 30, 2025, excluding non-cancellable FSA, is expected to be recognized as revenue over the next 12 months, with the remainder to be recognized thereafter. The majority of the remaining backlog is expected to be recognized in the following three years.

During the three and six months ended April 30, 2025, we recognized $25.7 million and $50.7 million, respectively, from performance obligations satisfied from sales-based royalties earned during the periods. During the three and six months ended April 30, 2024, we recognized $27.4 million and $52.8 million, respectively, from performance obligations satisfied from sales-based royalties earned during the periods.

Costs of Obtaining a Contract with Customer

Capitalized commission costs, net of accumulated amortization, as of April 30, 2025 were $67.0 million and are included in other long-term assets in our condensed consolidated balance sheets. Amortization of these assets was $12.9 million and $25.4 million during the three and six months ended April 30, 2025, respectively, and are included in sales and marketing expense in our condensed consolidated statements of income. Amortization of these assets was $12.4 million and $23.7 million during the three and six months ended April 30, 2024, respectively, and are included in sales and marketing expense in our condensed consolidated statements of income.