Synopsys Surges 13% After OpenAI and AWS Deals and FY27 Targets That Beat Analyst Expectations

Synopsys shares jumped 13% on October 1 after the chip-design software maker held its 2026 Investor Day in New York and announced multi-year agreements with OpenAI and Amazon Web Services, alongside fiscal 2027 financial targets that exceeded analyst expectations. The stock was among the best performers in the S&P 500 and Nasdaq on the day, having already gained 4.8% in prior trading on enterprise demand for its AI-driven electronic design automation tools.

At the Investor Day, management projected mid-teen revenue growth and mid-20s non-GAAP EPS growth, with FY27 revenue targeted at up to $11.2 billion, figures that Seeking Alpha analysis characterized as proof that consensus estimates had been set too low. Bank of America and KeyBanc both raised their price targets following the event, with at least one analyst assigning a Strong Buy rating and a $771 price target.

The Amazon relationship includes a deal valued at more than $1 billion, and the OpenAI partnership positions Synopsys for leadership in custom silicon and AI-driven chip design. The company's so-called Factory 2 model and an upcoming royalty business are expected to generate margin-accretive recurring revenue beginning in fiscal year 2028, supporting what analysts describe as durable mid-teen growth. The earlier acquisition of Ansys was also highlighted as securing an end-to-end chip design lifecycle, adding to revenue predictability. Persistent demand from next-generation chipmakers for semiconductor design automation tools and simulation software was cited as the structural driver behind the upgraded outlook.