Synopsys, one of the world’s leading providers of chip design software, is exploring potential collaborations with Chinese artificial intelligence (AI) developers to accelerate semiconductor design. The move, first reported by Nikkei Asia, comes after the company announced strategic agreements with OpenAI and Amazon and raised its revenue outlook for fiscal year 2027 to $11.15 billion at the midpoint of its guidance.
Synopsys and AI-driven chip design in 20 seconds
- Synopsys is studying collaborations with Chinese AI labs to adapt its semiconductor design tools.
- The company says it will comply with US restrictions on technology exports.
- On September 30, it announced a multi-year alliance with OpenAI to develop GPT-Synopsys.
- Amazon signed another multi-year deal worth more than $1 billion.
- Synopsys expects revenue of $11.15 billion for fiscal year 2027.
The US company wants to extend the use of artificial intelligence to one of the technology industry’s most complex tasks: designing and verifying increasingly sophisticated processors. Demand for chips used in data centers, AI model training, and inference is putting growing pressure on engineering teams, which need to shorten development times without compromising performance, power consumption, or reliability.
The possible collaboration with Chinese companies adds a geopolitical dimension to this strategy. Washington maintains restrictions on the export of certain advanced technologies to China, so any commercial initiative will need to comply with applicable rules. For now, no potential Chinese partners have been publicly identified, nor have any finalized agreements been announced with them.
Synopsys wants to bring AI to chip design tools
Electronic design automation (EDA) tools make it possible to develop, simulate, and verify integrated circuits before manufacturing. They are essential for turning a processor architecture into a physical design that a semiconductor fab can produce.
The process involves numerous technical tasks. Engineers must define circuits, check connections, analyze timing, detect errors, and adjust parameters to meet performance, power, and die-size targets. Every change can affect other parts of the design, so verifying the results requires specialized tools and considerable effort.
Synopsys aims to incorporate AI models into these workflows so they can interpret results, run engineering tools, and propose changes. The goal is for engineers to be able to evaluate more alternatives in less time and reduce the effort spent on repetitive tasks.
According to Nikkei Asia, the company is exploring collaborations with Chinese large language model developers to create versions of its tools adapted to the local market. Ravi Subramanian, head of product management at Synopsys, said the company will comply with US government rules in any expansion of its activities.
The initiative is still at an exploratory stage. No Chinese labs have been named, nor have the technical features of a potential solution, launch dates, or commercial terms been disclosed. Nor has any specific regulatory approval for a particular collaboration been announced.
The issue matters because EDA software occupies a sensitive position in the semiconductor supply chain. Although design software is not the same as chip manufacturing, its capabilities can influence the complexity of the processors a company is able to develop. For that reason, the scope of any agreement will depend on the technology involved, the recipients, and the restrictions that apply.
OpenAI and Amazon are already part of Synopsys’ strategy
The search for Chinese partners coincides with two agreements Synopsys announced on September 30, 2026, during its investor day.
The first is a multi-year alliance with OpenAI to develop GPT-Synopsys, a model specialized in semiconductor design that will combine OpenAI’s AI technology with Synopsys’ EDA tools and technical expertise.
The project aims for the model to be able to operate directly with the design tools, interpret their results, and carry out tasks related to circuit optimization and verification. Engineers will be able to set goals and review the results generated throughout the process.
The agreement covers joint research and development activities, commercialization, and revenue sharing. OpenAI will use Synopsys’ tools under license to develop the specialized model.
The companies have also said GPT-Synopsys will run on infrastructure hosted by OpenAI and will include enterprise-grade security and access controls. According to the announcement, specific customer data will not be used to train the model. The company has warned that the capabilities, timelines, and expected benefits are still subject to the uncertainties inherent to product development.
The second agreement, signed with Amazon, exceeds $1 billion and runs for several years. It expands the collaboration between the two companies in semiconductor intellectual property, design software, simulation and analysis, as well as AI-based engineering tools.
Amazon develops its own chips for different workloads, including Graviton for general-purpose computing and Trainium for AI training and inference. The agreement will expand the use of Synopsys technology in developing custom silicon for Amazon Web Services’ (AWS) services and infrastructure.
The companies also plan to collaborate on applying AI to engineering processes spanning everything from chip design to the full system. Synopsys, for its part, will use Amazon Web Services to develop its own products.
These agreements show two distinct commercial paths: building specialized design tools alongside an AI model provider, and supplying technology for custom chip development to a major cloud infrastructure customer. A potential collaboration with Chinese labs would add a third path, though it does not yet have public terms.
$11.15 billion forecast for fiscal year 2027
Synopsys expects to generate between $11.1 billion and $11.2 billion in revenue during its fiscal year 2027, which ends on October 31 of that year. The midpoint of the guidance is $11.15 billion, representing growth of roughly 15% compared with the prior fiscal year.
The company also expects adjusted earnings per share of between $19.04 and $19.12. Both estimates are above the average analyst expectations compiled by LSEG ahead of the announcement, according to Reuters.
The guidance reflects Synopsys’ expectations for demand for its engineering tools, growth in custom chip design, and the integration of AI into its products. However, the company has not attributed any specific portion of that projected revenue to a potential alliance with Chinese developers.
The company has also announced plans to buy back around $1 billion in shares over the following months, subject to market conditions. This is part of its capital allocation policy, under which it aims to return up to 50% of free cash flow to shareholders after funding investment in the business.
The technical challenge is to automate a larger share of engineering work without eliminating the checks needed to validate designs. An AI model can suggest changes or run sequences of tools, but the results must meet physical and electrical requirements before a chip can be manufactured.
In the Chinese market, the additional unknown is regulatory. Exploring commercial agreements does not mean that any tool can be offered without restrictions, nor that US authorities have approved a specific deal. The identity of potential partners, the functions of the tools, and the access conditions will determine the actual scope of the initiative.
Frequently asked questions
What does Synopsys want to do with Chinese AI labs?
The company is exploring potential collaborations with Chinese large language model developers to create AI-assisted chip design tools. It has not announced specific partners or finalized agreements.
What is GPT-Synopsys?
It is a specialized model that Synopsys and OpenAI have agreed to develop to automate tasks related to semiconductor design and verification using Synopsys’ EDA tools.
How much does Synopsys expect to earn in 2027?
The company expects revenue of between $11.1 billion and $11.2 billion in fiscal year 2027, with a midpoint of $11.15 billion. This is a corporate forecast, not revenue already earned.
How do US restrictions affect these agreements?
Synopsys says it will comply with US rules on technology exports. The feasibility of any specific collaboration will depend on the tools involved, the recipients, and the restrictions that apply.
