Company: SNPS
Filing Date: 2025-02-26
Form Type: 10-Q
Source: 0000883241-25-000014
Chunk: 80

Company: SYNOPSYS INC
Filing Date: 2025-02-26
Form: 10-Q
Item: Item 1
Chunk 80
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9 $175.5 $(6.6)(4)%Cost of maintenance and service revenue92.5 90.5 2.0 2 %Amortization of acquired intangible assets8.6 13.2 (4.6)(35)%Total$270.0 $279.2 $(9.2)(3)%Percentage of total revenue19 %18 %

We divide cost of revenue into three categories: cost of products revenue, cost of maintenance and service revenue, and amortization of acquired intangible assets.

Cost of products revenue. Cost of products revenue includes costs related to products sold and software licensed, hardware-related costs including inventory provisions, allocated operating costs related to product support and distribution, and royalties paid to third-party vendors.

Cost of maintenance and service revenue. Cost of maintenance and service revenue includes costs to deliver our maintenance services, such as hotline and on-site support, production services and documentation of maintenance updates.

Amortization of acquired intangible assets. Amortization of acquired intangible assets, included in cost of revenue, consists of the amortization and impairment charges of core/developed technology and certain contract rights intangible assets related to acquisitions.

The decrease in cost of revenue for the three months ended January 31, 2025 compared to the same period in fiscal 2024 was primarily due to decreases of $5.2 million in hardware-related costs including inventory provisions, $4.6 million in amortization of acquired technology-related intangible assets, $3.0 million in facility costs, and $2.4 million in costs to fulfill IP consulting arrangements, partially offset by an increase of $6.5 million in employee-related costs as a result of headcount increases from hiring.

Operating Expenses

Research and Development

 January 31,   20252024$ Change% Change (dollars in millions)Three months ended$553.2 $525.5 $27.7 5 %Percentage of total revenue38 %35 %

The increase in research and development expenses for the three months ended January 31, 2025 compared to the same period in fiscal 2024 was primarily due to increases of $19.4 million in employee-related costs as a result of headcount increases as we continue to expand and enhance our product portfolio, $10.3 million in consultant and contractor costs, and $7.4 million in facility costs, partially offset by a decrease of $7