Synopsys shifts resources away from manufacturing software
Synopsys (NASDAQ:SNPS) is preparing to discontinue a suite of semiconductor manufacturing process control software as the company redirects investment towards higher-margin artificial intelligence design technologies, according to six sources familiar with the plans.
Sources said the US chip design software company informed more than 10 semiconductor manufacturers during April and May that several manufacturing analytics products had reached “end of life.” Customers reportedly include Samsung Electronics, SK Hynix, Kioxia Holdings and Qorvo.
Under the move, Synopsys will stop developing new versions of the affected software while continuing to meet existing maintenance and contractual support commitments.
Manufacturing tools affected by the decision
The software being phased out includes the Equipment Engineering System (EES) and Fault Detection and Classification (FDC) platforms. These applications are used within semiconductor fabrication plants to monitor production equipment, identify faults and help prevent manufacturing defects before they affect production yields.
According to two of the sources, the software plays a central role in monitoring fabrication processes across advanced chip manufacturing facilities.
Three sources also said Synopsys has already reduced headcount by several dozen employees, while one added that discussions with customers regarding future maintenance arrangements are expected to conclude by July.
A Synopsys spokesperson confirmed to Reuters that the company is withdrawing certain legacy manufacturing analytics products in order to concentrate investment on higher-value technologies, although it did not identify the specific software involved.
“While we are discontinuing certain manufacturing analytics products, which are older diagnostic tools not in our customers’ critical paths of production, we continue to invest in new capabilities in this area of our portfolio and are honoring all existing contractual and support obligations as we take this action,” the spokesperson said.
The company declined to comment on whether the changes included job reductions.
AI investment becomes the priority
The reported strategy reflects broader changes across the semiconductor software industry, where developers are increasingly prioritising AI-driven chip design tools while manufacturers expand their own internal software capabilities.
Synopsys entered the manufacturing analytics market through its acquisition of South Korean company BISTel’s semiconductor manufacturing solutions business in 2021. One source said the company has since sought to reduce ongoing support obligations tied to legacy software and reassign engineering resources towards higher-margin AI design products following its US$35 billion acquisition of engineering software company Ansys in 2025.
Two sources suggested that discontinuing the software could eventually affect production yields if maintenance and software updates become limited. However, four other sources said they do not expect any meaningful impact on production at major semiconductor manufacturers.
Customers increasingly develop proprietary solutions
Sources also indicated that one reason behind the decision was the growing reluctance of semiconductor manufacturers to share sensitive production data required to improve the software’s capabilities.
Samsung confirmed that Synopsys had informed customers of the end-of-life programme and said discussions remain ongoing regarding the software transition.
The company added that it has already developed compatible internal alternatives and expects “no negative impact on production.”
SK Hynix declined to comment, while Kioxia and Qorvo did not respond to requests for comment.
Synopsys has long been one of the world’s leading providers of electronic design automation software used to develop advanced semiconductor chips. Earlier this year, the company unveiled new technology designed to enable AI agents to automate a growing number of chip design tasks, highlighting its increasing emphasis on artificial intelligence.