Synopsys was at $415 on 29 September and it is around $495 now, so about 19% in four trading days, and most of that came the day after the investor day, when it jumped 12.8% on the OpenAI deal and the Amazon licence.
So I have gone through the investor day release to see how much of these deals is actually in next year's numbers. The fiscal 2027 guide (their year ends in October) is $11.1 to $11.2 billion of revenue, so around 15% growth, at about a 44% non-GAAP operating margin. From what management said on the webcast, as it was reported, **the Amazon royalties only start once those chips are in production, roughly 14 months away**, so none of that is in 2027. And for OpenAI there is no number at all, no percentage, no dollar figure, no contract length, only that the revenue share depends on how much the model improves a chip design.
That means the 15% has to come from the business Synopsys already has. Three weeks ago, on 15 September, the same stock closed at $368, around its 52-week low, because people were worried AI would hollow out EDA and because of the China export curbs.
So my question for anyone who follows this name: is the market paying for the core business growing faster, which the guide does back up, or for OpenAI and Amazon upside that nobody outside the company can put a number on yet? I honestly cannot tell which one the 19% is.
Positions: no position in SNPS or CDNS. (Was thinking about adding it when it dropped, but missed it, now I feel like it's too volatile for my taste)