Free cash flow remained a pronounced strength: free cash flow in FY2024 was $751.7 million, representing a free cash flow margin of 29.60% (free cash flow divided by revenue). The company converted reported net income into free cash at a high rate — free cash flow divided by net income is roughly 130.5%, a notable conversion backed by positive operating cash flow of $795.74 million in the year (ANSYS cash flow statement. That structural cash generation is why Synopsys was willing to pay a strategic premium: ANSYS brings durable margins and cash conversion that accelerate the buyer’s deleveraging and synergy realization.

Table 1 below summarizes the headline income statement figures for FY2021–FY2024 from ANSYS’ filings and illustrates the multi‑year trend of revenue growth and margin expansion.

Year	Revenue (USD)	Operating Income (USD)	Net Income (USD)	EBITDA (USD)	Operating Margin
2024	2,540,000,000	717,890,000	575,690,000	908,560,000	28.28%
2023	2,270,000,000	626,130,000	500,410,000	758,640,000	27.58%
2022	2,070,000,000	592,660,000	523,710,000	707,220,000	28.62%
2021	1,910,000,000	513,270,000	454,630,000	620,140,000	26.86%

(Income statement figures from ANSYS FY2021–2024 filings; values rounded to nearest thousand where reported) ANSYS filings.

The growth cadence is clear: from FY2023 to FY2024 revenue rose by +11.89% (2,270 → 2,540), while net income grew +15.04% (500.41 → 575.69). Over the three-year span from 2021 to 2024 revenue compounded at a roughly +10.00% CAGR, consistent with a mature software company that mixes subscription and license revenue with heavy R&D investment.

Balance sheet and liquidity: net-cash position on close#

ANSYS closed FY2024 with cash and cash equivalents of $1.45 billion and total debt of $841.14 million, producing a calculated net cash position of roughly -$608.9 million on a debt-minus-cash basis (i.e., net debt ≈ -$608.9 million, a net cash figure). The company’s reported netDebt number is - $605.6 million — the small difference arises from whether short‑term investments or quarter‑end cash definitions are used in the aggregation (ANSYS balance sheet. The balance sheet showed a material increase in cash year-over-year (cash at end of period up from $860.2 million in FY2023 to $1.45 billion in FY2024), driven by strong operating cash flow and light capex (capital expenditures of $44.05 million in FY2024).

There is a minor but important data inconsistency to surface: using the line items reported for FY2024, the current ratio (total current assets $2.83 billion / total current liabilities $941.18 million) calculates to ~3.01x, whereas the company’s TTM key metrics summary reports a current ratio of 3.66x. The discrepancy is likely due to timing differences between trailing‑twelve‑month aggregation and year‑end snapshots (for example, inclusion of certain liquid investments in the TTM metric). For financial analysis, the year‑end balance‑sheet computed ratio (≈3.01x) is the conservative, easily reproducible figure and confirms ample short‑term liquidity heading into the integration period.

Table 2 summarizes balance-sheet and cash-flow items that matter for integration planning and leverage mechanics.

Year	Cash & Equivalents (USD)	Total Assets (USD)	Total Debt (USD)	Net Debt (USD, calc)	Free Cash Flow (USD)
2024	1,450,000,000	8,050,000,000	841,140,000	-608,860,000	751,700,000
2023	860,200,000	7,320,000,000	854,400,000	-5,800,000	691,800,000
2022	614,390,000	6,690,000,000	753,570,000	139,180,000	606,630,000
2021	667,670,000	6,320,000,000	753,580,000	85,910,000	526,460,000

(Balance-sheet and cash-flow figures from ANSYS FY2021–2024 filings) ANSYS filings.

The takeaway: ANSYS finished the last full fiscal year with a clean balance sheet, low gross leverage and a strong cash runway — precisely the type of asset that a buyer can use to finance acquisition premiums or accelerate deleveraging. That profile materially reduces the financing risk for Synopsys relative to a cash‑poor target.

Valuation multiples at close and what they imply about expectations#

At the reported stock price of $374.30 and the FY2024 EPS in the dataset (EPS = 6.74 reported in the last market quote), the simple trailing P/E is ~55.53x (374.30 / 6.74). Using the slightly different TTM EPS figure (TTM EPS 6.78), the trailing P/E is ~55.20x, consistent with the TTM P/E metric reported in the dataset. ANSYS also carried a high price‑to‑sales ratio (reported TTM ~12.74x) and an enterprise‑value/EBITDA multiple in the mid‑30s (our calculated EV/EBITDA using market cap, net cash and FY2024 EBITDA is ~35.5x — small differences versus the dataset’s 34.53x arise from which exact market-cap snapshot and which EBITDA window are used).

Those multiples reflect market expectations for sustained high‑margin software economics plus double‑digit top‑line growth decelerating to mid‑single digits in terminal periods. The premium multiple also helps explain why Synopsys paid a material acquisition price: the buyer priced in synergies (management projected synergy targets north of $400 million annual by 2027 per public statements) that are expected to expand adjusted margins and accelerate cash generation across the combined franchise.

Strategic fit: why Synopsys paid up (and why that matters)#

The strategic rationale in public materials and analyst notes is straightforward: ANSYS’ multiphysics simulation portfolio — thermal, electromagnetic, mechanical and system‑level tools — plugs into Synopsys’ EDA and silicon design workflows to create a silicon‑to‑systems offering that can materially reduce design cycles and first‑pass silicon risk for AI accelerators, advanced packaging and heterogeneous integration. The buyer projects that embedding signoff‑grade multiphysics earlier in the EDA flow reduces rework and expands monetizable use cases across automotive, aerospace and hyperscale AI customers.

From a purely financial lens, the combination converts ANSYS’ strong standalone operating margins and free cash flow into faster deleveraging and a higher return on the merged R&D investment because cross‑sell and integration can reduce duplicate engineering effort and accelerate bookings from large customers that value end‑to‑end workflows. The buyer’s public synergy target of ~$400 million (annual run‑rate by 2027) is plausible given ANSYS’ FY2024 operating income base (≈$718 million) and the potential to rationalize overlapping S,G&A and accelerate scaled cloud/HPC offerings at higher margins.

Execution risks and regulatory frictions#

The strategic upside is not automatic. Execution risks fall into three buckets: (1) product‑integration execution, (2) customer transition and retention, and (3) regulatory and divestiture conditionality. The blog draft and public reporting note that China’s SAMR granted conditional approval requiring certain divestitures tied to local competition concerns. Conditional approvals and required divestitures can reduce the scope of addressable synergies if divested assets are part of targeted cross‑sell plans. Additionally, merging two complex engineering software stacks is an engineering and go‑to‑market challenge; customers in regulated end markets (automotive, aerospace) demand continuity and deep verification before moving mission‑critical flows to a combined vendor.

Operationally, the key execution metrics to watch in the next 12–24 months are the pace of integrated product releases (Synopsys management set an early target of delivering initial integrated capabilities in H1 2026), retention and expansion rates among top accounts, and the run‑rate capture of cost synergies versus one‑time integration costs. On the financing side, the buyer’s deleveraging cadence will be a function of realized free cash flow from the two companies post‑close and the net cost of any acquisition financing; ANSYS’ pre‑close net cash position materially eases that path, but whether the combined entity can hit synergy ramp targets is the critical variable.

Competitive dynamics: how the market landscape shifts#

The combination creates a new competitive dynamic between the merged Synopsys‑ANSYS stack and existing rivals such as Cadence and Siemens EDA. The market shift is not simply size: it is the vertical integration of signoff‑grade multiphysics into an EDA flow, which increases switching costs for large customers who value first‑pass yield and shortened time to market. Competitors will have choices — deepen their own simulation capabilities organically, partner with best‑of‑breed simulation vendors, or pursue M&A — but the net effect is higher consolidation pressure and rising expectations for integrated workflows in AI‑hardware design.

That said, product integration and platform maturity matter more than ownership alone. Cadence and Siemens remain technically capable and will contest share vigorously in high‑value verticals. Execution speed, quality of customer migrations, and availability of integrated cloud/HPC capabilities will determine whether the merged Synopsys‑ANSYS platform translates strategic promise into durable market share gains.

Capital allocation and shareholder returns history (relevance to deal economics)#

Historically, ANSYS used excess cash to repurchase stock: common stock repurchased was meaningful in prior years (for example, ~$196.49 million repurchased in FY2023 and two prior years with similar activity). In FY2024 the company showed no repurchases and recorded a financing‑activity outflow of $98.54 million, reflecting a transition toward cash accumulation entering the deal. That shift to preserving cash and building liquidity ahead of the takeover reduced financing friction for the buyer and left a simpler balance sheet to integrate. From the buyer’s perspective, the cessation of buybacks pre‑close is an input into synergy calculus: available cash can be redeployed to integration or serve to reduce debt raised for the purchase.

What to watch next: integration KPIs and near‑term catalysts#

Over the next 12 months the most important, observable milestones that will signal success or disappointment include: (1) early integrated product releases and their adoption metrics, (2) realized synergy run‑rate disclosures and year‑over‑year margin impact at the combined entity, (3) customer retention/expansion among top 50 accounts in target verticals, and (4) completion and impact of any regulatory divestitures (particularly those required by China’s SAMR). Financially, rapid improvement in pro forma adjusted operating margin and acceleration of recurring revenue inside integrated suites will be the clearest evidence that the strategic premium paid will translate to higher cash returns.

Analysts have already taken public stances on likely upside. As noted in post‑close coverage, select sell‑side firms raised price targets on Synopsys in August 2025 citing synergy and margin upside (examples cited in market reports included targets in the $600–$700 range), underscoring sell‑side conviction that the deal is accretive if integration progresses per plan.

What this means for investors#

For stakeholders — customers, employees and capital providers — the transaction converts ANSYS’ standalone strengths (high margins, strong free cash flow, R&D depth) into assets under a broader strategic umbrella aimed at silicon‑to‑systems. The financial mechanics are supportive: ANSYS’ FY2024 free cash flow of $751.7 million, robust cash conversion and net‑cash balance reduce financing risk and create flexibility for the buyer to invest in product integration while shrinking net leverage.

That said, the premium multiples and the size of projected synergies mean the combined company must execute near‑perfectly on integration, product delivery and cross‑sell to realize the value implicit in the acquisition price. The immediate investor focus should be on integration KPIs and the pace at which pro forma margins expand and debt is reduced.

Bottom line: strengths, risks and the integration inflection#

ANSYS brought to the table at close a compelling set of attributes: durable high margins (operating margin ~28%), strong free cash flow ($751.7M in FY2024), and a net‑cash balance at year‑end. Those attributes make the company an unusually de‑risked target and explain why a buyer would pay a premium for embedded simulation capabilities that materially reduce time‑to‑market for advanced silicon and systems.

Risks that could erode the expected upside are familiar: failure to capture projected synergies, execution delays in integrating complex engineering software, customer churn during the transition, and regulatory conditions that remove key assets from the combined footprint. Given the size of the acquisition, even modest misses on synergy capture or revenue uplift could materially compress returns versus the paid premium.

In sum, ANSYS’ standalone financials told the story of a profitable, cash‑rich software company with a differentiated technical moat in multiphysics simulation. The acquisition converts that story into a larger, higher‑stakes integration exercise where the yield for stakeholders will be decided by execution discipline on product integration, customer retention and synergy realization.

Sources and data references#

Specific financial figures and year‑over‑year calculations are derived from ANSYS fiscal-year filings and results for FY2021–FY2024 (ANSYS Form 10‑K / FY2024 annual results) ANSYS investor relations and market data snapshots (Nasdaq ANSS quote. Synopsys’ public statements about the acquisition and timing are from Synopsys press releases and public filings (Synopsys newsroom.