10:50 AM EDT, 09/10/2025 (MT Newswires) -- Synopsys ( SNPS ) reset its guidance in its fiscal Q3 results as its "good" performance in its core electronic design automation business was overshadowed by challenges in China and the failure to close a major contract, Deutsche Bank said in a note emailed Wednesday.

The company on late Tuesday slashed its fiscal 2025 non-GAAP EPS guidance to a range of $12.76 to $12.80 from the previous range of $15.11 to $15.19. Revenue projection for the fiscal year was raised to $7.03 billion to $7.06 billion from prior range of $6.75 billion to $6.81 billion.

Synopsys' ( SNPS ) sales in China were weaker than expected, largely due to the lingering impact of a six-week export ban on semiconductor equipment to China by the US Bureau of Industry and Security, which delayed the decision-making of local customers, Deutsche Bank analysts said.

Synopsys ( SNPS ) also invested significantly in developing intellectual property for a major foundry client believed to be Intel ( INTC ) , but the anticipated contract with the client did not materialize, causing a shortfall in revenue, the analysts said. The company expects this issue to impact results in Q4 and beyond, according to the note.

Further, Synopsys ( SNPS ) is looking to reduce its global headcount by 10% by the end 2026, targeting a better cost structure after its acquisition of Ansys, the analysts noted.

Deutsche Bank's rating on the company's stock is buy with a price target of $580.

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