Income Tax Expense (Benefit)
Effective Income Tax Rate (EITR)
Components of Deferred Tax Assets and Liabilities
Deferred Tax Assets and Liabilities, Classification
Adjustments to Financial Statements: Removal of Deferred Taxes
Adjusted Financial Ratios: Removal of Deferred Taxes (Summary)
Adjusted Net Profit Margin
Adjusted Total Asset Turnover
Adjusted Financial Leverage
Adjusted Return on Equity (ROE)
Adjusted Return on Assets (ROA)

Synopsys Inc., income tax expense (benefit), continuing operations

US$ in thousands

12 months ended:	Oct 31, 2024	Oct 31, 2023	Oct 31, 2022	Oct 31, 2021	Oct 31, 2020	Oct 31, 2019
Federal	345,859)	244,523)	105,493)	85,950)	29,272)	22,821)
State	19,808)	22,193)	23,201)	11,898)	1,863)	11,846)
Foreign	110,021)	27,986)	45,297)	79,890)	55,103)	61,092)
Current	475,688)	294,702)	173,991)	177,738)	86,238)	95,759)
Federal	(312,677)	(192,762)	(42,086)	(108,530)	(84,739)	(41,219)
State	(39,164)	(1,842)	1,519)	1,796)	(20,233)	(7,227)
Foreign	(24,129)	(16,441)	3,654)	(21,849)	(6,554)	(34,174)
Deferred	(375,970)	(211,045)	(36,913)	(128,583)	(111,526)	(82,620)
Provision (benefit) for income taxes	99,718)	83,657)	137,078)	49,155)	(25,288)	13,139)

Based on: 10-K (reporting date: 2024-10-31), 10-K (reporting date: 2023-10-31), 10-K (reporting date: 2022-10-31), 10-K (reporting date: 2021-10-31), 10-K (reporting date: 2020-10-31), 10-K (reporting date: 2019-10-31).

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Item	Description	The company
Current	Amount of current income tax expense (benefit) pertaining to taxable income (loss) from continuing operations.	Synopsys Inc. current increased from 2022 to 2023 and from 2023 to 2024.
Deferred	Amount of deferred income tax expense (benefit) pertaining to income (loss) from continuing operations.	Synopsys Inc. deferred decreased from 2022 to 2023 and from 2023 to 2024.
Provision (benefit) for income taxes	Amount of current income tax expense (benefit) and deferred income tax expense (benefit) pertaining to continuing operations.	Synopsys Inc. provision (benefit) for income taxes decreased from 2022 to 2023 but then slightly increased from 2023 to 2024.

Synopsys Inc., effective income tax rate (EITR) reconciliation

		Oct 31, 2024	Oct 31, 2023	Oct 31, 2022	Oct 31, 2021	Oct 31, 2020	Oct 31, 2019
	Statutory federal income tax rate	21.00%	21.00%	21.00%	21.00%	21.00%	21.00%
	Effective income tax rate	6.59%	6.43%	12.29%	6.10%	-3.96%	2.41%

Based on: 10-K (reporting date: 2024-10-31), 10-K (reporting date: 2023-10-31), 10-K (reporting date: 2022-10-31), 10-K (reporting date: 2021-10-31), 10-K (reporting date: 2020-10-31), 10-K (reporting date: 2019-10-31).

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Item	Description	The company
Effective income tax rate	Percentage of current income tax expense (benefit) and deferred income tax expense (benefit) pertaining to continuing operations.	Synopsys Inc. effective income tax rate decreased from 2022 to 2023 but then slightly increased from 2023 to 2024.

Synopsys Inc., components of deferred tax assets and liabilities

US$ in thousands

	Oct 31, 2024	Oct 31, 2023	Oct 31, 2022	Oct 31, 2021	Oct 31, 2020	Oct 31, 2019
Deferred revenue	37,849)	37,641)	41,941)	30,113)	2,367)	—)
Deferred compensation	73,869)	69,824)	67,782)	59,823)	55,172)	56,483)
Intangible and depreciable assets	65,489)	94,564)	119,791)	117,211)	115,097)	160,072)
Capitalized research and development costs	978,085)	592,536)	231,733)	203,052)	118,857)	48,804)
Stock-based compensation	74,934)	65,039)	60,537)	40,922)	28,478)	20,372)
Tax loss carryovers	37,787)	62,779)	59,754)	30,305)	35,571)	40,068)
Foreign tax credit carryovers	42,534)	41,972)	27,153)	32,498)	18,645)	20,187)
Research and other tax credit carryovers	107,643)	182,999)	316,650)	326,164)	320,317)	278,382)
Operating lease liabilities	108,235)	118,679)	119,575)	94,519)	101,386)	—)
Accruals and reserves	49,935)	27,636)	—)	—)	—)	—)
Other	—)	—)	16,887)	—)	—)	—)
Gross deferred tax assets	1,576,360)	1,293,669)	1,061,803)	934,607)	795,890)	624,368)
Valuation allowance	(170,672)	(229,259)	(198,213)	(174,117)	(158,895)	(157,343)
Deferred tax assets	1,405,688)	1,064,410)	863,590)	760,490)	636,995)	467,025)
Intangible assets	(80,034)	(116,465)	(102,796)	(61,448)	(45,915)	(58,697)
Operating lease right-of-use assets	(84,512)	(94,068)	(96,598)	(77,877)	(84,716)	—)
Accruals and reserves	—)	—)	(5,998)	(6,216)	(7,780)	(4,450)
Deferred revenue	—)	—)	—)	—)	—)	(6,611)
Undistributed earnings of foreign subsidiaries	(8,800)	(8,900)	(1,000)	(7,580)	(3,063)	(6,864)
Other	(21,641)	(18,006)	—)	(628)	(372)	(1,762)
Deferred tax liabilities	(194,987)	(237,439)	(206,392)	(153,749)	(141,846)	(78,384)
Net deferred tax assets (liabilities)	1,210,701)	826,971)	657,198)	606,741)	495,149)	388,641)

Based on: 10-K (reporting date: 2024-10-31), 10-K (reporting date: 2023-10-31), 10-K (reporting date: 2022-10-31), 10-K (reporting date: 2021-10-31), 10-K (reporting date: 2020-10-31), 10-K (reporting date: 2019-10-31).

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Item	Description	The company
Gross deferred tax assets	Amount before allocation of valuation allowances of deferred tax asset attributable to deductible temporary differences and carryforwards.	Synopsys Inc. gross deferred tax assets increased from 2022 to 2023 and from 2023 to 2024.
Deferred tax assets	Amount after allocation of valuation allowances of deferred tax asset attributable to deductible temporary differences and carryforwards.	Synopsys Inc. deferred tax assets increased from 2022 to 2023 and from 2023 to 2024.
Net deferred tax assets (liabilities)	Amount, after allocation of valuation allowances and deferred tax liability, of deferred tax asset attributable to deductible differences and carryforwards, without jurisdictional netting.	Synopsys Inc. net deferred tax assets (liabilities) increased from 2022 to 2023 and from 2023 to 2024.

Synopsys Inc., deferred tax assets and liabilities, classification

US$ in thousands

		Oct 31, 2024	Oct 31, 2023	Oct 31, 2022	Oct 31, 2021	Oct 31, 2020	Oct 31, 2019
	Deferred tax assets	1,247,258)	860,914)	670,653)	612,655)	497,546)	390,129)
	Deferred tax liabilities	36,557)	33,943)	13,455)	5,914)	2,397)	1,488)

Based on: 10-K (reporting date: 2024-10-31), 10-K (reporting date: 2023-10-31), 10-K (reporting date: 2022-10-31), 10-K (reporting date: 2021-10-31), 10-K (reporting date: 2020-10-31), 10-K (reporting date: 2019-10-31).

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Item	Description	The company
Deferred tax assets	Amount, after allocation of valuation allowances and deferred tax liability, of deferred tax asset attributable to deductible differences and carryforwards, with jurisdictional netting and classified as noncurrent.	Synopsys Inc. deferred tax assets increased from 2022 to 2023 and from 2023 to 2024.
Deferred tax liabilities	Amount, after deferred tax asset, of deferred tax liability attributable to taxable differences, with jurisdictional netting and classified as noncurrent.	Synopsys Inc. deferred tax liabilities increased from 2022 to 2023 and from 2023 to 2024.

Synopsys Inc., adjustments to financial statements

US$ in thousands

	Oct 31, 2024	Oct 31, 2023	Oct 31, 2022	Oct 31, 2021	Oct 31, 2020	Oct 31, 2019
Adjustment to Total Assets
Total assets (as reported)	13,073,561)	10,333,131)	9,418,087)	8,752,260)	8,030,062)	6,405,160)
Less: Noncurrent deferred tax assets, net	1,247,258)	860,914)	670,653)	612,655)	497,546)	390,129)
Total assets (adjusted)	11,826,303)	9,472,217)	8,747,434)	8,139,605)	7,532,516)	6,015,031)
Adjustment to Total Liabilities
Total liabilities (as reported)	4,050,355)	4,148,830)	3,858,897)	3,453,317)	3,117,695)	2,316,284)
Less: Noncurrent deferred tax liabilities, net	36,557)	33,943)	13,455)	5,914)	2,397)	1,488)
Total liabilities (adjusted)	4,013,798)	4,114,887)	3,845,442)	3,447,403)	3,115,298)	2,314,796)
Adjustment to Total Synopsys Stockholders’ Equity
Total Synopsys stockholders’ equity (as reported)	8,990,702)	6,147,308)	5,515,725)	5,295,137)	4,907,404)	4,083,013)
Less: Net deferred tax assets (liabilities)	1,210,701)	826,971)	657,198)	606,741)	495,149)	388,641)
Total Synopsys stockholders’ equity (adjusted)	7,780,001)	5,320,337)	4,858,527)	4,688,396)	4,412,255)	3,694,372)
Adjustment to Net Income Attributed To Synopsys
Net income attributed to Synopsys (as reported)	2,263,380)	1,229,888)	984,594)	757,516)	664,347)	532,367)
Add: Deferred income tax expense (benefit)	(375,970)	(211,045)	(36,913)	(128,583)	(111,526)	(82,620)
Net income attributed to Synopsys (adjusted)	1,887,410)	1,018,843)	947,681)	628,933)	552,821)	449,747)

Based on: 10-K (reporting date: 2024-10-31), 10-K (reporting date: 2023-10-31), 10-K (reporting date: 2022-10-31), 10-K (reporting date: 2021-10-31), 10-K (reporting date: 2020-10-31), 10-K (reporting date: 2019-10-31).

Synopsys Inc., Financial Data: Reported vs. Adjusted

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Synopsys Inc., adjusted financial ratios

	Oct 31, 2024	Oct 31, 2023	Oct 31, 2022	Oct 31, 2021	Oct 31, 2020	Oct 31, 2019
Net Profit Margin
Reported net profit margin	36.94%	21.05%	19.38%	18.02%	18.03%	15.84%
Adjusted net profit margin	30.80%	17.44%	18.65%	14.96%	15.00%	13.38%
Total Asset Turnover
Reported total asset turnover	0.47	0.57	0.54	0.48	0.46	0.52
Adjusted total asset turnover	0.52	0.62	0.58	0.52	0.49	0.56
Financial Leverage
Reported financial leverage	1.45	1.68	1.71	1.65	1.64	1.57
Adjusted financial leverage	1.52	1.78	1.80	1.74	1.71	1.63
Return on Equity (ROE)
Reported ROE	25.17%	20.01%	17.85%	14.31%	13.54%	13.04%
Adjusted ROE	24.26%	19.15%	19.51%	13.41%	12.53%	12.17%
Return on Assets (ROA)
Reported ROA	17.31%	11.90%	10.45%	8.66%	8.27%	8.31%
Adjusted ROA	15.96%	10.76%	10.83%	7.73%	7.34%	7.48%

Based on: 10-K (reporting date: 2024-10-31), 10-K (reporting date: 2023-10-31), 10-K (reporting date: 2022-10-31), 10-K (reporting date: 2021-10-31), 10-K (reporting date: 2020-10-31), 10-K (reporting date: 2019-10-31).

Financial ratio	Description	The company
Adjusted net profit margin	An indicator of profitability, calculated as adjusted net income divided by total revenue.	Synopsys Inc. adjusted net profit margin ratio deteriorated from 2022 to 2023 but then improved from 2023 to 2024 exceeding 2022 level.
Adjusted total asset turnover	An activity ratio calculated as total revenue divided by adjusted total assets.	Synopsys Inc. adjusted total asset turnover ratio improved from 2022 to 2023 but then deteriorated significantly from 2023 to 2024.
Adjusted financial leverage	A measure of financial leverage calculated as adjusted total assets divided by adjusted total equity. Financial leverage is the extent to which a company can effect, through the use of debt, a proportional change in the return on common equity that is greater than a given proportional change in operating income.	Synopsys Inc. adjusted financial leverage ratio decreased from 2022 to 2023 and from 2023 to 2024.
Adjusted ROE	A profitability ratio calculated as adjusted net income divided by adjusted shareholders’ equity.	Synopsys Inc. adjusted ROE deteriorated from 2022 to 2023 but then improved from 2023 to 2024 exceeding 2022 level.
Adjusted ROA	A profitability ratio calculated as adjusted net income divided by adjusted total assets.	Synopsys Inc. adjusted ROA deteriorated from 2022 to 2023 but then improved from 2023 to 2024 exceeding 2022 level.

Synopsys Inc., Financial Ratios: Reported vs. Adjusted

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	Oct 31, 2024	Oct 31, 2023	Oct 31, 2022	Oct 31, 2021	Oct 31, 2020	Oct 31, 2019
As Reported
Selected Financial Data (US$ in thousands)
Net income attributed to Synopsys	2,263,380)	1,229,888)	984,594)	757,516)	664,347)	532,367)
Revenue	6,127,436)	5,842,619)	5,081,542)	4,204,193)	3,685,281)	3,360,694)
Profitability Ratio
Net profit margin¹	36.94%	21.05%	19.38%	18.02%	18.03%	15.84%
Adjusted for Deferred Taxes
Selected Financial Data (US$ in thousands)
Adjusted net income attributed to Synopsys	1,887,410)	1,018,843)	947,681)	628,933)	552,821)	449,747)
Revenue	6,127,436)	5,842,619)	5,081,542)	4,204,193)	3,685,281)	3,360,694)
Profitability Ratio
Adjusted net profit margin²	30.80%	17.44%	18.65%	14.96%	15.00%	13.38%

Based on: 10-K (reporting date: 2024-10-31), 10-K (reporting date: 2023-10-31), 10-K (reporting date: 2022-10-31), 10-K (reporting date: 2021-10-31), 10-K (reporting date: 2020-10-31), 10-K (reporting date: 2019-10-31).

2024 Calculations

¹ Net profit margin = 100 × Net income attributed to Synopsys ÷ Revenue
= 100 × 2,263,380 ÷ 6,127,436 = 36.94%

² Adjusted net profit margin = 100 × Adjusted net income attributed to Synopsys ÷ Revenue
= 100 × 1,887,410 ÷ 6,127,436 = 30.80%

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Profitability ratio	Description	The company
Adjusted net profit margin	An indicator of profitability, calculated as adjusted net income divided by total revenue.	Synopsys Inc. adjusted net profit margin ratio deteriorated from 2022 to 2023 but then improved from 2023 to 2024 exceeding 2022 level.

	Oct 31, 2024	Oct 31, 2023	Oct 31, 2022	Oct 31, 2021	Oct 31, 2020	Oct 31, 2019
As Reported
Selected Financial Data (US$ in thousands)
Revenue	6,127,436)	5,842,619)	5,081,542)	4,204,193)	3,685,281)	3,360,694)
Total assets	13,073,561)	10,333,131)	9,418,087)	8,752,260)	8,030,062)	6,405,160)
Activity Ratio
Total asset turnover¹	0.47	0.57	0.54	0.48	0.46	0.52
Adjusted for Deferred Taxes
Selected Financial Data (US$ in thousands)
Revenue	6,127,436)	5,842,619)	5,081,542)	4,204,193)	3,685,281)	3,360,694)
Adjusted total assets	11,826,303)	9,472,217)	8,747,434)	8,139,605)	7,532,516)	6,015,031)
Activity Ratio
Adjusted total asset turnover²	0.52	0.62	0.58	0.52	0.49	0.56

Based on: 10-K (reporting date: 2024-10-31), 10-K (reporting date: 2023-10-31), 10-K (reporting date: 2022-10-31), 10-K (reporting date: 2021-10-31), 10-K (reporting date: 2020-10-31), 10-K (reporting date: 2019-10-31).

2024 Calculations

¹ Total asset turnover = Revenue ÷ Total assets
= 6,127,436 ÷ 13,073,561 = 0.47

² Adjusted total asset turnover = Revenue ÷ Adjusted total assets
= 6,127,436 ÷ 11,826,303 = 0.52

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Activity ratio	Description	The company
Adjusted total asset turnover	An activity ratio calculated as total revenue divided by adjusted total assets.	Synopsys Inc. adjusted total asset turnover ratio improved from 2022 to 2023 but then deteriorated significantly from 2023 to 2024.

	Oct 31, 2024	Oct 31, 2023	Oct 31, 2022	Oct 31, 2021	Oct 31, 2020	Oct 31, 2019
As Reported
Selected Financial Data (US$ in thousands)
Total assets	13,073,561)	10,333,131)	9,418,087)	8,752,260)	8,030,062)	6,405,160)
Total Synopsys stockholders’ equity	8,990,702)	6,147,308)	5,515,725)	5,295,137)	4,907,404)	4,083,013)
Solvency Ratio
Financial leverage¹	1.45	1.68	1.71	1.65	1.64	1.57
Adjusted for Deferred Taxes
Selected Financial Data (US$ in thousands)
Adjusted total assets	11,826,303)	9,472,217)	8,747,434)	8,139,605)	7,532,516)	6,015,031)
Adjusted total Synopsys stockholders’ equity	7,780,001)	5,320,337)	4,858,527)	4,688,396)	4,412,255)	3,694,372)
Solvency Ratio
Adjusted financial leverage²	1.52	1.78	1.80	1.74	1.71	1.63

Based on: 10-K (reporting date: 2024-10-31), 10-K (reporting date: 2023-10-31), 10-K (reporting date: 2022-10-31), 10-K (reporting date: 2021-10-31), 10-K (reporting date: 2020-10-31), 10-K (reporting date: 2019-10-31).

2024 Calculations

¹ Financial leverage = Total assets ÷ Total Synopsys stockholders’ equity
= 13,073,561 ÷ 8,990,702 = 1.45

² Adjusted financial leverage = Adjusted total assets ÷ Adjusted total Synopsys stockholders’ equity
= 11,826,303 ÷ 7,780,001 = 1.52

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Solvency ratio	Description	The company
Adjusted financial leverage	A measure of financial leverage calculated as adjusted total assets divided by adjusted total equity. Financial leverage is the extent to which a company can effect, through the use of debt, a proportional change in the return on common equity that is greater than a given proportional change in operating income.	Synopsys Inc. adjusted financial leverage ratio decreased from 2022 to 2023 and from 2023 to 2024.

	Oct 31, 2024	Oct 31, 2023	Oct 31, 2022	Oct 31, 2021	Oct 31, 2020	Oct 31, 2019
As Reported
Selected Financial Data (US$ in thousands)
Net income attributed to Synopsys	2,263,380)	1,229,888)	984,594)	757,516)	664,347)	532,367)
Total Synopsys stockholders’ equity	8,990,702)	6,147,308)	5,515,725)	5,295,137)	4,907,404)	4,083,013)
Profitability Ratio
ROE¹	25.17%	20.01%	17.85%	14.31%	13.54%	13.04%
Adjusted for Deferred Taxes
Selected Financial Data (US$ in thousands)
Adjusted net income attributed to Synopsys	1,887,410)	1,018,843)	947,681)	628,933)	552,821)	449,747)
Adjusted total Synopsys stockholders’ equity	7,780,001)	5,320,337)	4,858,527)	4,688,396)	4,412,255)	3,694,372)
Profitability Ratio
Adjusted ROE²	24.26%	19.15%	19.51%	13.41%	12.53%	12.17%

Based on: 10-K (reporting date: 2024-10-31), 10-K (reporting date: 2023-10-31), 10-K (reporting date: 2022-10-31), 10-K (reporting date: 2021-10-31), 10-K (reporting date: 2020-10-31), 10-K (reporting date: 2019-10-31).

2024 Calculations

¹ ROE = 100 × Net income attributed to Synopsys ÷ Total Synopsys stockholders’ equity
= 100 × 2,263,380 ÷ 8,990,702 = 25.17%

² Adjusted ROE = 100 × Adjusted net income attributed to Synopsys ÷ Adjusted total Synopsys stockholders’ equity
= 100 × 1,887,410 ÷ 7,780,001 = 24.26%

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Profitability ratio	Description	The company
Adjusted ROE	A profitability ratio calculated as adjusted net income divided by adjusted shareholders’ equity.	Synopsys Inc. adjusted ROE deteriorated from 2022 to 2023 but then improved from 2023 to 2024 exceeding 2022 level.

	Oct 31, 2024	Oct 31, 2023	Oct 31, 2022	Oct 31, 2021	Oct 31, 2020	Oct 31, 2019
As Reported
Selected Financial Data (US$ in thousands)
Net income attributed to Synopsys	2,263,380)	1,229,888)	984,594)	757,516)	664,347)	532,367)
Total assets	13,073,561)	10,333,131)	9,418,087)	8,752,260)	8,030,062)	6,405,160)
Profitability Ratio
ROA¹	17.31%	11.90%	10.45%	8.66%	8.27%	8.31%
Adjusted for Deferred Taxes
Selected Financial Data (US$ in thousands)
Adjusted net income attributed to Synopsys	1,887,410)	1,018,843)	947,681)	628,933)	552,821)	449,747)
Adjusted total assets	11,826,303)	9,472,217)	8,747,434)	8,139,605)	7,532,516)	6,015,031)
Profitability Ratio
Adjusted ROA²	15.96%	10.76%	10.83%	7.73%	7.34%	7.48%

Based on: 10-K (reporting date: 2024-10-31), 10-K (reporting date: 2023-10-31), 10-K (reporting date: 2022-10-31), 10-K (reporting date: 2021-10-31), 10-K (reporting date: 2020-10-31), 10-K (reporting date: 2019-10-31).

2024 Calculations

¹ ROA = 100 × Net income attributed to Synopsys ÷ Total assets
= 100 × 2,263,380 ÷ 13,073,561 = 17.31%

² Adjusted ROA = 100 × Adjusted net income attributed to Synopsys ÷ Adjusted total assets
= 100 × 1,887,410 ÷ 11,826,303 = 15.96%

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Profitability ratio	Description	The company
Adjusted ROA	A profitability ratio calculated as adjusted net income divided by adjusted total assets.	Synopsys Inc. adjusted ROA deteriorated from 2022 to 2023 but then improved from 2023 to 2024 exceeding 2022 level.

Synopsys Inc. (NASDAQ:SNPS)

Analysis of Income Taxes

Income Tax Expense (Benefit)

Effective Income Tax Rate (EITR)

Components of Deferred Tax Assets and Liabilities

Deferred Tax Assets and Liabilities, Classification

Adjustments to Financial Statements: Removal of Deferred Taxes

Synopsys Inc., Financial Data: Reported vs. Adjusted

Adjusted Financial Ratios: Removal of Deferred Taxes (Summary)

Synopsys Inc., Financial Ratios: Reported vs. Adjusted

Adjusted Net Profit Margin

Adjusted Total Asset Turnover

Adjusted Financial Leverage

Adjusted Return on Equity (ROE)

Adjusted Return on Assets (ROA)