Revenue

12 Months Ended

Oct. 31, 2025

Revenue from Contract with Customer [Abstract]

Revenue

Revenue

Disaggregated Revenue

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

	Year Ended October 31,
	2025		2024		2023
EDA	62.0	%	66.4	%	69.2	%
Design IP	24.8	%	31.1	%	29.0	%
Ansys	10.7	%	—	%	—	%
Other	2.5	%	2.5	%	1.8	%
Total	100.0	%	100.0	%	100.0	%

For additional information on our product groups and the revenue attributable to them by product type, refer to Part I, Item 1, Business in this Annual Report.

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) in our consolidated balance sheets. For specific software, hardware, and IP agreements with payment plans, we record 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 we have 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 and other long-term assets in our consolidated balance sheets.

Contract balances are as follows:

	As of October 31,
	2025		2024
	(in thousands)
Contract assets, net	$	1,222,029	$	757,075
Unbilled receivables	$	45,528	$	44,166
Deferred revenue	$	2,628,518	$	1,732,568

Long-term contract assets were $336.4 million as of October 31, 2025.

During fiscal 2025, we recognized revenue of $1.5 billion 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. During fiscal 2024, we recognized revenue of $1.5 billion, that was included in the deferred revenue balance as of October 31, 2023, 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 $11.4 billion as of October 31, 2025, which includes $2.0 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 45% of the backlog as of October 31, 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. The backlog was approximately $8.1 billion as of October 31, 2024, which included $1.2 billion in non-cancellable FSA commitments from customers.

During fiscal 2025 and 2024, we recognized $125.3 million and $104.4 million, respectively, from performance obligations satisfied from sales-based royalties earned during the periods.

Costs of Obtaining a Contract with Customer

The incremental costs of obtaining a contract with a customer, which consist primarily of direct sales commission earned upon execution of the contract, were capitalized in compliance with authoritative guidance, and amortized over the estimated period of which the benefit is expected to be received. As direct sales commission paid for renewals are commensurate with the amounts paid for initial contracts, the deferred incremental costs will be recognized over the contract term.

Capitalized commission costs, net of accumulated amortization, as of October 31, 2025 were $92.5 million, of which $13.4 million were included in prepaid and other current assets, and $79.1 million in other long-term assets in our consolidated balance sheets. Capitalized commission costs, net of accumulated amortization, as of October 31, 2024 were $72.8 million, included in other long-term assets in our consolidated balance sheets. Amortization of these assets were $53.2 million, $48.5 million and $52.1 million during fiscal 2025, 2024 and 2023, respectively, and are included in sales and marketing expense in our consolidated statements of income.