An operating lease is treated like a rental contract. Neither the leased asset nor the associated liability is reported on the lessee balance sheet, but the rights may be very similar to the rights of an owner. The lessee only records the lease payments as a rental expense in income statement.

Adjustments to Financial Statements for Operating Leases
Adjusted Financial Ratios for Operating Leases (Summary)
Adjusted Total Asset Turnover
Adjusted Debt to Equity
Adjusted Return on Assets (ROA)

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)
Add: Operating lease right-of-use asset (before adoption of FASB Topic 842)¹	—)	—)	—)	—)	—)	622,599)
Total assets (adjusted)	13,073,561)	10,333,131)	9,418,087)	8,752,260)	8,030,062)	7,027,759)
Adjustment to Total Debt
Total debt (as reported)	15,601)	18,078)	20,824)	100,086)	127,907)	137,707)
Add: Operating lease liability (before adoption of FASB Topic 842)²	—)	—)	—)	—)	—)	622,599)
Add: Current operating lease liabilities	94,791)	85,690)	54,274)	79,678)	73,173)	—)
Add: Long-term operating lease liabilities	574,065)	584,035)	581,273)	487,003)	462,411)	—)
Total debt (adjusted)	684,457)	687,803)	656,371)	666,767)	663,491)	760,306)

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).

^{1, 2} Equal to total present value of future operating lease payments.

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
Total Asset Turnover¹
Reported total asset turnover	0.47	0.57	0.54	0.48	0.46	0.52
Adjusted total asset turnover	0.47	0.57	0.54	0.48	0.46	0.48
Debt to Equity²
Reported debt to equity	0.00	0.00	0.00	0.02	0.03	0.03
Adjusted debt to equity	0.08	0.11	0.12	0.13	0.14	0.19
Return on Assets³ (ROA)
Reported ROA	17.31%	11.90%	10.45%	8.66%	8.27%	8.31%
Adjusted ROA	17.31%	11.90%	10.45%	8.66%	8.27%	7.58%

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).

¹ See details »

² See details »

³ See details »

Financial 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.
Adjusted debt to equity	A solvency ratio calculated as adjusted total debt divided by total shareholders’ equity.	Synopsys Inc. adjusted debt to equity ratio improved from 2022 to 2023 and from 2023 to 2024.
Adjusted ROA	A profitability ratio calculated as net income divided by adjusted total assets.	Synopsys Inc. adjusted ROA improved from 2022 to 2023 and from 2023 to 2024.

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)
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 Operating Leases
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	13,073,561)	10,333,131)	9,418,087)	8,752,260)	8,030,062)	7,027,759)
Activity Ratio
Adjusted total asset turnover²	0.47	0.57	0.54	0.48	0.46	0.48

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 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 ÷ 13,073,561 = 0.47

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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 debt	15,601)	18,078)	20,824)	100,086)	127,907)	137,707)
Total Synopsys stockholders’ equity	8,990,702)	6,147,308)	5,515,725)	5,295,137)	4,907,404)	4,083,013)
Solvency Ratio
Debt to equity¹	0.00	0.00	0.00	0.02	0.03	0.03
Adjusted for Operating Leases
Selected Financial Data (US$ in thousands)
Adjusted total debt	684,457)	687,803)	656,371)	666,767)	663,491)	760,306)
Total Synopsys stockholders’ equity	8,990,702)	6,147,308)	5,515,725)	5,295,137)	4,907,404)	4,083,013)
Solvency Ratio
Adjusted debt to equity²	0.08	0.11	0.12	0.13	0.14	0.19

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 Debt to equity = Total debt ÷ Total Synopsys stockholders’ equity
= 15,601 ÷ 8,990,702 = 0.00

² Adjusted debt to equity = Adjusted total debt ÷ Total Synopsys stockholders’ equity
= 684,457 ÷ 8,990,702 = 0.08

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Solvency ratio	Description	The company
Adjusted debt-to-equity	A solvency ratio calculated as adjusted total debt divided by total shareholders’ equity.	Synopsys Inc. adjusted debt-to-equity ratio improved 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 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 Operating Leases
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)
Adjusted total assets	13,073,561)	10,333,131)	9,418,087)	8,752,260)	8,030,062)	7,027,759)
Profitability Ratio
Adjusted ROA²	17.31%	11.90%	10.45%	8.66%	8.27%	7.58%

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 × Net income attributed to Synopsys ÷ Adjusted total assets
= 100 × 2,263,380 ÷ 13,073,561 = 17.31%

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

Synopsys Inc. (NASDAQ:SNPS)

Analysis of Operating Leases

Adjustments to Financial Statements for Operating Leases

Synopsys Inc., Financial Data: Reported vs. Adjusted

Adjusted Financial Ratios for Operating Leases (Summary)

Synopsys Inc., Financial Ratios: Reported vs. Adjusted

Adjusted Total Asset Turnover

Adjusted Debt to Equity

Adjusted Return on Assets (ROA)