Semiconductor design software company, Synopsys, halts China sales and postpones financial forecasts - Synopsys halts sales to China following fresh restrictions on software exports from Washington.
In a surprising turn of events, Synopsys, a leading global supplier of EDA software for semiconductor design, has hit a roadblock. On May 29, the company suspended its financial guidance for the third quarter of FY 2025 and the full fiscal year 2025, following a letter from the Bureau of Industry and Security (BIS) of the U.S. Department of Commerce.
This letter heralded new export restrictions on semiconductor software, particularly EDA tools, that will impact China. Initially, Synopsys denied receiving any such information until the letter, apparently still in transit, arrived.
According to internal reports, Synopsys has now instructed its China staff to halt all sales and services, and stop taking new orders. This move seemingly complies with the restrictions, which require companies to obtain licenses for exporting EDA software to China. Previously issued licenses for certain vendors have been revoked, effectively putting a hold on shipments without a new license [1][3].
The new regulations aim to limit China's access to advanced technology, especially in AI chip development [1][3]. Other major EDA software providers, such as Siemens EDA and Cadence, have also reportedly received notices about these new restrictions.
These export controls target strategic bottlenecks, aiming to disrupt China's semiconductor design efforts by limiting access to key technologies [3]. Companies like Synopsys may still face operational challenges, despite not yet having received a formal notification letter from the BIS [3].
The new restrictions could reduce revenue from Chinese customers and potentially disrupt global supply chains [3]. In response to the broader industry uncertainty and related export control changes, Synopsys has suspended its financial forecast for the third quarter and full year of 2025 [1].
Stay tuned as companies adjust their business strategies to comply with the new regulations. This could potentially lead to exploring alternative markets or technology collaborations [1][3]. Overall, these restrictions are part of a broader strategy by the U.S. to maintain technological dominance and limit adversaries' access to sensitive technologies.
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- The new export restrictions on semiconductor software have forced Synopsys to instruct its China staff to halt sales and services, potentially impacting the company's finance and technology sectors significantly.
- As other major EDA software providers like Siemens EDA and Cadence also receive similar notices, the global semiconductor industry could face operational challenges, particularly in areas of finance and technology, as they navigate the new regulatory landscape.
