Executive Summary: Crisis Meets Paradox#

Synopsys, the $90.6 billion electronic design automation powerhouse, confronted its darkest trading day in company history on September 29, 2025, as shares collapsed 36 percent following the disclosure of operational problems with a major foundry customer during third-quarter earnings. The unprecedented selloff—described by Hagens Berman as the worst single-day performance ever recorded for SNPS—erased roughly $32 billion in market capitalization within hours and triggered a cascade of securities fraud investigations from at least three prominent plaintiff law firms. The violent market reaction exposed a tension at the heart of the company's investment thesis: while management reported record backlog levels and continued to secure strategic design wins with AI-accelerated solutions, the undisclosed nature of the foundry customer issue and the magnitude of the stock decline raised fundamental questions about disclosure practices, forward guidance credibility, and the structural resilience of what had been considered one of the semiconductor industry's most defensive business models.