SYNOPSYS INC SNPS

40% shingled-prose overlap between the two filings.

2025: 74,986 chars · 2026: 75,335 chars

• Committee Report:63% overlap (5,322 → 5,489 chars)
• Pay Ratio (Item 402(u)):56% overlap (7,296 → 7,275 chars)
• Say-on-Pay proposal:3% overlap (24,999 → 880 chars)

• changedThis Compensation Discussion and Analysis (CD&A) discusses the compensation of our NEOs for fiscal 2025. 2024.
• newFiscal 2025 NEOs
• changedde GeusExecutive Chair Shelagh GlaserChief FinancialOfficerJanet LeeGeneral Counsel and Corporate SecretaryRick FinancialOfficerRickMahoney Former Chief RevenueOfficerJohn F.
• changedRunkel, Jr.Former General Jr.GeneralCounsel and Corporate Secretary
• newExecutive Summary53Fiscal 2025 Executive Compensation59Base Salary60Short-Term Cash Incentives61Equity Awards67Other Benefits71Severance and Change of Control Benefits72Key Fiscal 2026 NEO Compensation Decisions73Our Compensation Decision-Making Process74Executive Compensation Risk Management78Conclusion78
• new52
• changedPROPOSAL 3 4— Advisory Vote to Approve Executive Compensation
• changedFiscal 2025 2024Performance Overview
• newSynopsys delivered on key strategic and business initiatives in fiscal 2025 while refocusing our IP business in the face of market pivots and competitive challenges.
• newIn July 2025, we acquired Ansys, which we believe will accelerate our silicon to systems strategy and drive long-term growth.
• newWith the acquisition of Ansys, we strengthened our capabilities in advanced chip design technology and accelerated our expansion into new growth verticals.
• newWe are also focusing our investments and execution on the highest growth opportunities, including in our IP business, to better meet the market’s needs and enhance our competitiveness.
• newExecutive Officer Transitions
• newIn July 2025, in connection with the Closing, John F.
• newRunkel, Jr. was succeeded by Janet Lee as our General Counsel and Corporate Secretary.
• newMs. Lee served as Ansys’ Senior Vice President, General Counsel and Secretary prior to the Closing.
• newMr. Runkel served in an advisory role as our Chief Legal Officer from July 2025 until January 2026 to ensure a successful transition and to provide support as we closed our 2025 fiscal year, following which his position was eliminated.
• newIn November 2025, Mr. Mahoney ceased serving as Synopsys’ Chief Revenue Officer.
• newMr. Mahoney served in an advisory role as Executive Advisor from November 2025 until February 2026 to support the company in the 2025 fiscal year closing and to successfully transition key customer and partner relationships, following which his position was eliminated.
• newBoth Mr. Runkel and Mr. Mahoney’s departures constitute Involuntary Terminations Without Cause, under and as defined in Synopsys’ Executive Severance Benefit and Transition Plan, entitling them to all the benefits set forth therein, subject to their execution of a separation and release agreement and compliance with certain restrictive covenants.
• newThese benefits include: (i) one year of base salary; (ii) pro-rated annual bonus for fiscal year 2025; (iii) 12 months of COBRA premium coverage; (iv) six months of accelerated vesting on time-based equity awards; and (v) continued compensation and benefits during their respective transition services periods.
• changedSee the subsection titled “Potential Payments upon Termination of Employment or Change of Control” in the “Executive Compensation Tables” section below for more information regarding this plan eachoftheseplansorarrangementsas well as our potential or actual payment obligations as of the last day of fiscal 2025. 2024.
• changed(1)Reflects results as of the end of fiscal 2025. 2024.
• changedPlease (2)Pleasesee Appendix B Cfor a reconciliation of non-GAAP operating margin and non-GAAP EPS to operating margin and EPS, the most directly comparable measures measurereported under U.S. generally accepted accounting principles (GAAP) as well as information regarding how these measures are calculated.
• changed(2)Free (3)Freecash flow is calculated as cash provided from operating activities less capital expenditures and capitalization of software development costs.
• changed(3)“Backlog” (4)“Backlog”means contracted but unsatisfied or partially unsatisfied performance obligations as of October 31, 2025, November2,2024,which includes non-cancellable Flexible Spending Account (FSA) commitments from customers where actual product selection and quantities of specific products or services are to be determined by customers at a later date, and excludes future sales-based royalty payments from the remaining performance obligations.
• changedApproximately 45% 41%of the backlog as of October 31, 2025, November2,2024,excluding non-cancellable FSA, is expected to be recognized as revenue over the next 12 months, with the remainder recognized thereafter. months.
• changedThe majority of the remaining backlog is expected to be recognized in the following nextthree years.
• new2026 Proxy Statement53
• newWe provide software and hardware that our customers use to validate the electronic systems that incorporate chips and the software that runs on them, and technical services and support to help our customers develop advanced chips and electronic systems.Our Ansys engineering S&A software products and services are part of our Design Automation segment and are widely used by engineers, designers, researchers and students across a broad spectrum of industries and academia, including high-tech, aerospace and defense, automotive, energy, industrial equipment, materials and chemicals, consumer products, healthcare and construction.
• newThese products enable customers to analyze designs on-premises and/or via the cloud, providing a common platform for fast, efficient and cost-conscious product development, from design concept to final-stage testing, validation and deployment.
• new•Design Automation achieved fiscal 2025 revenue of $5.30 billion, up 25.6% year-over-year, with an adjusted operating margin of 41.7%.
• new•We demonstrated the value of our GenAI capabilities to accelerate design workflows from days to hours, and hours to minutes, while introducing the foundation for the next frontier in AI—AgentEngineerTM technology for chip design.•We introduced new AI features across the Ansys portfolio, including Ansys Engineering Copilot™, a new multifunctional virtual AI assistant integrated into Ansys simulation and analysis products.•We integrated NVIDIA Omniverse technology into Ansys S&A products to accelerate physical AI development and create enhanced digital twins.•We partnered with the world’s leading foundries to usher in the angstrom era of semiconductor manufacturing.
• new•Through collaboration with NVIDIA, we are enhancing AI integrations for smarter manufacturing, chip design, and physics simulation, enabling AI and GPU-accelerated computing across engineering workloads to make engineering smarter, faster, and more intuitive.•We introduced Synopsys HAPS-200 prototyping and ZeBu-200 emulation systems, expanding our leading hardware-assisted verification portfolio to advance the pace and impact of next-generation AI chip design.Design IPOur Design IP segment offers a broad and comprehensive portfolio of semiconductor IP solutions, which are pre-designed circuits that engineers use as components of larger chip designs to reduce integration risk and speed time to market.
• changedWe also provide architecture design expertise, including signal and power integrity analysis and IP hardening, to accelerate IP integration and silicon bring-up.•Design IP achieved fiscal 2025 2024revenue of $1.75 $1.91billion, up23.6%year-over-year,with an adjusted operating margin of 23.9%. 38.3%.
• new•We announced the industry's first Ultra Ethernet IP and UALink IP solutions, including controllers, PHYs, and verification IP, to meet the demand for standards-based, high-bandwidth, and low-latency HPC and AI accelerator interconnects.•Our collaboration with Broadcom in AI infrastructures achieved interoperability between Synopsys' PCIe 6.x IP solution and Broadcom's PEX90000 series switch.•We initiated a collaboration with Sima.ai, applying Synopsys' automotive IP and design tools to develop advanced chiplet architectures and reference SoC designs optimized for Advanced Driver Assistance Systems (ADAS) and In-Vehicle Infotainment (IVI).
• changedAppendix B Cincludes a reconciliation of items that apply for a particular segment.
• new54
• changedFiscal 2025 2024Executive Compensation Overview
• changedOver 90% of the average total ourNEOs’fiscal 2025 2024compensation of our current NEOs is performance-based and/or at risk.
• changedThe graphic below reflects the approximate general distribution of these three core elements of NEO target total direct compensation (Target TDC) awarded during fiscal 2025 2024as determined by our Compensation Committee.
• changedCHIEF EXECUTIVE OFFICER (MR. Transition
• newGHAZI)AVERAGE OF THE OTHER NEOs(1)
• new(1)Calculated as if Ms. Lee had served in her position as General Counsel and Corporate Secretary for the entirety of fiscal 2025.
• new2026 Proxy Statement55
• changedFiscal 2025 2024EIP and PRSU Funding Outcomes
• newOur performance against our fiscal 2025 goals for our fiscal 2025 Executive Incentive Plan (EIP) and outstanding PRSU awards reflects continued, strong execution and the resiliency of our business, offset by weakness in our business in China and in our Design IP segment.
• newOur funding outcomes reflect this performance.
• changedFISCAL 2025 2024EIP PERFORMANCE(1)
• newTargetPerformanceWeighting (%)PerformanceResultFUNDING THRESHOLD PAYMENT GOALFiscal 2025 Non-GAAP Operating Margin28.0%(2)N/A36.3% CORPORATE FINANCIAL PERFORMANCE GOALSFiscal 2025 Revenue$6.8 billion50.0$6.3 billionFiscal 2025 Non-GAAP Operating Margin40.0%50.036.3%REVENUE GROWTH GOALSFiscal 2026 Revenue Backlog$4.65 billionN/A100.5% of target Fiscal 2027 Revenue Backlog—(3)N/A112.3% of target
• newAchievement At TargetAchievement Above TargetAchievement Below Target
• changed(1)See footnotes in the table below titled titled,“Performance Against Fiscal 2025 2024Performance Measures" for more details.
• changed(2)Represents 70.0% of our Fiscal 2025 2024Non-GAAP Operating Margin target of 40.0%. 38.5%.
• changed20232024202520262027GoalsTargetPerformanceResultFiscal 2023202420252026GOALSTARGETPERFORMANCERESULTFiscal2023 Annual PRSUs(2023 - 2025 Performance Period)3 Out Of 3 Years ElapsedCAGRRevenueGrowth13.0%10.3%0%rTSR≥50thPercentile38th Percentile88%Fiscal 2024 Annual PRSUs(2024 - 2026 Performance Period)2 Out Of 3 Years ElapsedCAGR Revenue Growth(1)In ElapsedCAGRRevenueGrowth(1)InprogressIn progressrTSR≥50thPercentileIn progressIn progressFiscal 2025 2024Annual PRSUs (2025 PRSUs(2024- 2027 2026Performance Period)1 Out of 3 Years ElapsedCAGR Revenue Growth(1)In progressIn progressrTSR≥50thPercentileIn progressIn progress
• changed(1)We consider our Fiscal 2024 2023- 2026 2025CAGR Revenue Growth and Fiscal 2025 2024- 2027 2026CAGR Revenue Growth targets (the CAGR Targets) to be confidential, and the disclosure of the CAGR Targets prior to the completion of the performance period would cause us competitive harm.
• changedFor additional information on the status of the Fiscal 2023 AnnualPRSUsandtheFiscal2024Annual PRSUs, please refer to the “Payout Status of PRSU Awards” section beginning on page 70. 75.
• changedBased on the most recent voting results and the feedback that we received through our stockholder engagement efforts, the Compensation Committee did not make changes to our annual compensation program in fiscal 2025. 2024.
• changedFor additional information on our stockholder engagement efforts, please refer to the "Stockholder Engagement" section beginning on page 30.Approximately 91% 28.Approximately93%of voted shares (cast “for” or “against”) approved our NEO compensation last year.
• new2026 Proxy Statement57
• changedOur EIP and Equity Incentive 2006EmployeePlan maintain maximum payout caps to avoid excessive payments and risk takingü Compensation Recovery Policy.
• changedWe hold an annual advisory say-on-pay vote and approximately 91% 93%of votes cast approved our fiscal 2024 2023NEO compensation policies and proceduresü Equity Burn Rate Management.
• changedWe continue to closely manage our equity budget and equity burn rate, limiting gross share usage to under 1.0% 1.2%in fiscal 2025û 2024ûNo Excessive Risks.
• changedOur Equity Incentive 2006EmployeePlan prohibits forbidsthe repricing and cash-out of underwater options without stockholder approvalû No Dividends on Unvested Equity Awards.
• changedOur Equity Incentive 2006EmployeePlan prohibits paying out dividends and dividend equivalents on unvested awardsû No Executive Pension Plans or SERPs.
• changedFiscal 2025 2024Executive Compensation
• changedCore Fiscal 2025 2024Compensation Element(1)PurposeKey ELEMENT(1)(2)(3)PURPOSEKEYCharacteristics BASE SALARYChief Executive OfficerAverage of Other NEOsCompensates our NEOs for expected levels of day-to-day performance.•Reflects expertise and scope of responsibilities in a competitive market for executive talent.
• changedANNUAL STOCK OPTIONSChief Executive OfficerAverage of Other NEOsAlign interests of NEOs with long-term stockholder interests through incentivizing long-term stock price growth and encourage retention. retention.•Four-yearvestingsubjecttocontinuedemployment.ANNUALRSUsChiefExecutiveOfficerAverageofOtherNEOsAligninterestsofNEOswithlong-termstockholderintereststhroughincentivizinglong-termstockpricegrowthandencourageretentionwhilemanagingdilution.
• newStock options are only valuable if our stock price increases over time.•Four-year vesting subject to continued employment.ANNUAL RSUsChief Executive OfficerAverage of Other NEOsAlign interests of NEOs with long-term stockholder interests through incentivizing long-term stock price growth and encourage retention while managing dilution.
• changedHave upside potential but deliver value even during periods of market or stock price underperformance.•Four-year vesting subject to continued employment.ANNUAL PRSUsChief Executive OfficerAverage of Other NEOsAlign interests of NEOs with long-term stockholder interests through incentivizing continued revenue growth and relative stock price performance over a multi-year performance period and encourage retention.
• changedThe rTSR modifier helps align payouts with stockholder experience.•Vesting subject to achievement of revenue growth and rTSR performance:•Three-year performance period.•Mandatory downward adjustment if rTSR below 50th percentile.
• new2026 Proxy Statement59
• changed•the resulting total target cash compensation that can be earned given the individual’s base salary and related target annual cash incentive opportunity.
• changedThe base salaries of our current NEOs for fiscal 2025 2024are set forth below.
• newIn connection with her hire and appointment as General Counsel and pursuant to her offer letter, Ms. Lee received an initial annual base salary of $410,000 per year, which was pro-rated for fiscal 2025, and reflects her role and responsibilities as well as internal pay equity, market competitiveness and historical pay considerations.
• newNEOFiscal 2025 Base Salary ($)Fiscal 2024 Base Salary ($)Base Salary Increase (Decrease) (%)Primary Reasons for the ChangeSassine Ghazi900,000 840,000 7.1 Reflects Mr. Ghazi's continued growth as our Chief Executive Officer and market competitiveness considerations.
• changedFollowing this adjustment, Mr. Ghazi's base salary was around setatthe median 25thpercentile for equivalent roles at our peers.Dr.
• newde Geus225,000 725,000 (69.0)Reflects evolution of Dr. de Geus' role and the transition of chief executive officer responsibilities to Mr. Ghazi.Shelagh Glaser600,000 600,000 — No increase.Janet Lee410,000 — — Not applicable as Ms. Lee was not employed in fiscal 2024.Rick Mahoney450,000 450,000 — No increase.John F.
• changedThe cash incentive targets, performance goals, payout matrices and payout formula for fiscal 2025 2024are described in the sections that follow.
• changedFiscal 2025 2024Cash Incentive Targets.
• changedA cash incentive target is the amount of cash incentive compensation that an NEO could earn if we achieve all of our performance goals.

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