SNPS · CIK 883241
What Synopsys, Inc. told the SEC could break it.
China runs through much of what Synopsys flagged. U.S. export controls — including a Q3 2025 BIS license requirement on EDA software and technology for parties in China (since rescinded), the Entity List and advanced-packaging restrictions — weighed on its business, with China revenue down 22% in fiscal 2025, while China's national policies and government-backed funds are building independent EDA rivals in a key market. Its revenue is also concentrated in a small number of large customers — one accounted for about 12.6% of fiscal 2024 revenue, and weakness at a major foundry customer hurt fiscal 2025. On the hardware side, its emulation and prototyping products depend on a sole supplier for certain components, reducing its control over availability, quality and pricing.
4 self-disclosed vulnerabilities, pulled from its own filings — each in the company’s words, with the source. This is the risk register almost nobody reads.
In its own words
What could break it.
Regulatory & policy
- Chinese state-backed EDA competition + national policies favoring Chinese semiconductor independencemedium
China has implemented national policies favoring Chinese companies and formed government-backed investment funds to build independent EDA capabilities and compete in semiconductors, threatening Synopsys' position in a key market amid fluid U.S.-China trade/export policy.
“China has implemented national policies favoring Chinese companies and has formed government-backed investment funds as it seeks to build independent EDA capabilities and compete internationally in the semiconductor industry.”
- China export controls — BIS Q3 2025 EDA-software license requirement (ECCN 3D991/3E991), Entity List, ECAD restrictions; China revenue -22%medium
On May 29, 2025 Synopsys received a BIS 'is-informed' letter imposing a license requirement for export/reexport/in-country transfer of EDA software/technology (ECCNs 3D991/3E991) when a party is in China or a Chinese military end user (rescinded July 2, 2025); China export controls (Entity List, ECAD/advanced-packaging restrictions) negatively impacted its business, with China revenue down 22% in fiscal 2025 ex-Ansys.
“BIS imposing a license requirement for the export, reexport, or in-country transfer of EDA software and technology classified under export control classification numbers (ECCNs) 3D991 and 3E991 when a party to the transaction is located in China or is a Chinese “military end user,” wherever located (such restrictions, the Q3 2025 BIS Restrictions).”
Customer concentration
- one customer ~12.6%/13.5% of revenue (FY24/23); small number of large customers; major foundry customer weakness hit FY2025medium
Synopsys depends on a relatively small number of large customers — one customer (with subsidiaries) accounted for 12.6% and 13.5% of consolidated revenue in fiscal 2024 and 2023; weaker-than-expected demand from a major foundry customer negatively impacted fiscal 2025 results, and customer consolidation could increase bargaining power or reduce spending.
“we depend on a relatively small number of large customers for a large portion of our revenues. For example, challenges with a major foundry customer negatively impacted our financial results for fiscal year 2025.”
SEC filing →As of 2025
Sole-source dependency
- dependence on a sole supplier for certain hardware productsmedium
Synopsys' hardware (emulation/prototyping) business faces delays in production and delivery, including from difficulty scaling production capacity/yield and a dependence on a sole supplier for certain hardware products, which reduces its control over product availability, quality and pricing.
“a dependence on a sole supplier for certain hardware products, which may reduce our control over product availability, quality and pricing”
SEC filing →As of 2025
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