SYNOPSYS INC

Previous wording

Unless otherwise noted, this Management’s Discussion and Analysis of Financial Condition and Results of Operations relates solely to our continuing operations and does not include the operations of our Software Integrity business. See “Recent Developments” below and Note 3. Discontinued Operations of the Notes to Condensed Consolidated Financial Statementsfor additional information about the Software Integrity Divestiture.

Current wording

Unless otherwise noted, this Management’s Discussion and Analysis of Financial Condition and Results of Operations relates solely to our continuing operations and does not include the operations of our Software Integrity business. See “Pending Software Integrity Divestiture” below and Note 3. Discontinued Operations of the Notes to Condensed Consolidated Financial Statementsfor additional information about the Software Integrity Divestiture.

Previous wording

The following table sets forth some of our key quarterly unaudited financial information:

Current wording

For the third quarter of fiscal 2024, our results reflect continued, strong execution and the resiliency of our business. We have seen our customer set expand as more companies in more industries define and optimize system performance at the silicon level. We also continue to see our total cost of revenue and operating expenses increase as we invest in our workforce and further grow organically and through acquisitions. The following table sets forth some of our key quarterly unaudited financial information:

Previous wording

•Revenues were $1.5 billion, an increase of $192.0 million or 15%, primarily due to revenue growth across all products and geographies.

Current wording

•Revenues were $1.5 billion, an increase of $171.3 million or 13%, primarily due to revenue growth across a majority of products and geographies.

Previous wording

•Total cost of revenue and operating expenses was $1.1 billion, an increase of $152.3 million or 16%, primarily due to an increaseof $50.3 million in employee-related costs resulting from headcount increases through organic growth and acquisitions.

Current wording

•Total cost of revenue and operating expenses was $1.2 billion, an increase of $111.3 million or 11%, primarily due to an increaseof $49.6 million in employee-related costs resulting from headcount increases through organic growth and acquisitions.

Previous wording

•Operating income was $332.1 million, an increase of $39.7 million or 14%.

Current wording

•Operating income was $360.2 million, an increase of $60.1 million or 20%.

Previous wording

Six months ended April 30, 2024 compared to the same period of fiscal 2023 financial performance summary

Current wording

Nine months ended July 31, 2024 compared to the same period of fiscal 2023 financial performance summary

Previous wording

•Revenues were $3.0 billion, an increase of $469.5 million or 19%, primarily due to revenue growth across all products and geographies and the impact of the extra week in the first quarter of fiscal 2024.1

Current wording

•Revenues were $4.5 billion, an increase of $640.9 million or 17%, primarily due to revenue growth across all products and geographies and the impact of the extra week in the first quarter of fiscal 2024.1

Previous wording

•Total cost of revenue and operating expenses was $2.3 billion, an increase of $333.8 million or 17%, primarily due to an increaseof $178.0 million in employee-related costs resulting from headcount increases through organic growth and acquisitions, and the impact of the extra week in the first quarter of fiscal 2024.

Current wording

•Total cost of revenue and operating expenses was $3.4 billion, an increase of $445.0 million or 15%, primarily due to an increaseof $227.6 million in employee-related costs resulting from headcount increases through organic growth and acquisitions, and the impact of the extra week in the first quarter of fiscal 2024.

Previous wording

Under the terms of the Merger Agreement, at the effective time of the Ansys Merger (the Effective Time), each share of Ansys common stock issued and outstanding immediately prior to the Effective Time (with certain exceptions set forth in the Merger Agreement) will be converted into the right to receive 0.3450 (the Exchange Ratio) of a share of Synopsys common stock and $197.00 in cash, without interest. The Exchange Ratio is expected to result in Ansys equityholders and Synopsys equityholders owning approximately 16.5% and 83.5%, respectively, of the combined company on a pro forma basis following the Effective Time. The Merger Agreement also provides for Synopsys’ assumption of certain outstanding Ansys options and other unvested Ansys equity awards held by continuing Ansys employees. If the stock consideration to be issued by Synopsys in connection with the Ansys Merger would exceed 19.9999% of the shares of Synopsys common stock issued and outstanding immediately prior to the Effective Time, the Exchange Ratio will be reduced to the minimum extent necessary to ensure that the aggregate number of shares of Synopsys common stock to be issued in connection with the Ansys Merger does not exceed such threshold, and the cash consideration will be correspondingly increased to offset such adjustment.

Current wording

Under the terms of the Merger Agreement, at the effective time of the Ansys Merger (the Effective Time), each share of Ansys common stock issued and outstanding immediately prior to the Effective Time (with certain exceptions set forth in the Merger Agreement) will be converted into the right to receive 0.3450 (the Exchange Ratio) of a share of Synopsys common stock and $197.00 in cash, without interest. The Exchange Ratio is expected to result in Ansys equityholders and Synopsys equityholders owning approximately 16.5% and 83.5%, respectively, of the combined company on a pro forma basis following the Effective Time. The Merger Agreement also provides for Synopsys’ assumption of certain outstanding Ansys options and other unvested Ansys equity awards held by continuing Ansys employees. If the stock consideration to be issued by Synopsys in connection with the Ansys Merger exceeds 19.9999% of the shares of Synopsys common stock issued and outstanding immediately prior to the Effective Time, the Exchange Ratio will be reduced to the minimum extent necessary to ensure that the aggregate number of shares of Synopsys common stock to be issued in connection with the Ansys Merger does not exceed such threshold, and the cash consideration will be correspondingly increased to offset such adjustment.

Previous wording

We are also actively monitoring geopolitical pressures around the world, including, among others, changes in China-Taiwan relations, the conflicts in Ukraine, the Middle East and other regional or global military conflicts. Any significant disruption caused by these or other geopolitical pressures or conflicts could materially affect our employees, business, operating results, financial condition or customers in those regions of the world. For example, Synopsys has employees, operations, customers and strategic partners in the Middle East and in Armenia, which are each experiencing geopolitical conflicts. While we are actively monitoring these conflicts, at this time, these geopolitical conflicts have not had a material impact on our business, operating results or financial condition.

Current wording

We are also actively monitoring geopolitical pressures around the world, including, among others, changes in China-Taiwan relations, the conflicts in Ukraine and the Middle East and other regional or global military conflicts. Any significant disruption caused by these or other geopolitical pressures or conflicts could materially affect our employees, business, operating results, financial condition or customers in those regions of the world. For example, Synopsys has employees, operations, customers and strategic partners in the Middle East and in Armenia, which are each impacted by geopolitical conflicts. While we are actively monitoring these conflicts, at this time, these geopolitical conflicts have not had a material impact on our business, operating results or financial condition.

Previous wording

On May 5, 2024, we entered into an Equity Purchase Agreement (the Purchase Agreement), by and between Synopsys, Inc. and Sapphire Software Buyer, Inc. (Buyer), an entity controlled by funds affiliated with Clearlake Capital Group, L.P. and Francisco Partners (together, the Sponsors). Pursuant to the Purchase Agreement, and subject to the satisfaction or waiver of customary closing conditions specified therein, we will sell our Software Integrity business to Buyer for a purchase price of up to $2.1 billion in cash, comprised of: (i) $1.5 billion, payable at closing; (ii) $125 million, payable in equal installments over five fiscal quarters beginning on the first business day after the day that is the 75th day of our first full fiscal quarter following the closing, subject to acceleration at our option prior to the closing of the Ansys Merger; and (iii) up to $475 million (the Conditional Transaction Consideration), payable upon the Sponsors achieving a specified rate of return in connection with one or more potential liquidity transactions. The Software Integrity Divestiture is currently expected to close in the second half of 2024, subject to customary closing conditions including the receipt of required regulatory approvals. The Software Integrity business met the criteria to be disclosed as discontinued operations in the second quarter of fiscal year 2024. See Note 3. Discontinued Operations of the Notes to Condensed Consolidated Financial Statements for additional information on discontinued operations.

Current wording

On May 5, 2024, we entered into an Equity Purchase Agreement (the Purchase Agreement), by and between Synopsys, Inc. and Sapphire Software Buyer, Inc. (Buyer), an entity controlled by funds affiliated with Clearlake Capital Group, L.P. and Francisco Partners (together, the Sponsors). Pursuant to the Purchase Agreement, and subject to the satisfaction or waiver of customary closing conditions specified therein, we will sell our Software Integrity business to Buyer for a purchase price of up to $2.1 billion in cash, comprised of: (i) $1.5 billion, payable at closing; (ii) $125 million, payable in equal installments over five fiscal quarters beginning on the first business day after the 75th day of our first full fiscal quarter following the closing, subject to acceleration at our option prior to the closing of the Ansys Merger; and (iii) up to $475 million (the Conditional Transaction Consideration), payable upon the Sponsors achieving a specified rate of return in connection with one or more potential liquidity transactions. The Software Integrity Divestiture is currently expected to close in the second half of 2024, subject to customary closing conditions including the receipt of required regulatory approvals. The Software Integrity business met the criteria to be disclosed as discontinued operations in the second quarter of fiscal 2024. See Note 3. Discontinued Operations of the Notes to Condensed Consolidated Financial Statements for additional information on discontinued operations.

Previous wording

Our results of operations for the first six months of fiscal 2024 and 2023 included 27 weeks and 26 weeks, respectively, and ended on May 4, 2024 and April 29, 2023, respectively. The extra week in the first quarter of fiscal 2024 resulted in approximately $70.5 million of additional revenue, and approximately $61.0 million of additional expenses, including approximately $11.0 million in stock-based compensation costs. For presentation purposes, this Form 10-Q refers to the closest calendar month end.

Current wording

Our results of operations for the first nine months of fiscal 2024 and 2023 included 40 weeks and 39 weeks, respectively, and ended on August 3, 2024 and July 29, 2023, respectively. The extra week in the first quarter of fiscal 2024 resulted in approximately $70.5 million of additional revenue, and approximately $61.0 million of additional expenses, including approximately $11.0 million in stock-based compensation costs. For presentation purposes, this Form 10-Q refers to the closest calendar month end.

Previous wording

The amount and composition of unsatisfied performance obligations will fluctuate period to period. We do not believe the amount of unsatisfied performance obligations is indicative of future sales or revenue, or that such obligations at the end of any given period correlates with actual sales performance of a particular geography or particular products and services. For more information regarding our revenue during the three and six months ended April 30, 2024, including our contract balances as of such date, see Note 6. Revenue of the Notes to Condensed Consolidated Financial Statementsin this Quarterly Report.

Current wording

The amount and composition of unsatisfied performance obligations will fluctuate period to period. We do not believe the amount of unsatisfied performance obligations is indicative of future sales or revenue, or that such obligations at the end of any given period correlates with actual sales performance of a particular geography or particular products and services. For more information regarding our revenue during the three and nine months ended July 31, 2024, including our contract balances as of such date, see Note 6. Revenue of the Notes to Condensed Consolidated Financial Statementsin this Quarterly Report.

Previous wording

The increase in total revenues for the three and six months ended April 30, 2024 compared to the same periods in fiscal 2023 was due principally to the continued organic growth of our business across all product groups and geographies. The increase for the six-month period also included the impact of the extra week in the first quarter of fiscal 2024 of approximately $70.5 million.

Current wording

The increase in total revenues for the three and nine months ended July 31, 2024 compared to the same periods in fiscal 2023 was due principally to revenue growth across a majority of products and geographies. The increase for the nine-month period also included the impact of the extra week in the first quarter of fiscal 2024 of approximately $70.5 million.

Previous wording

The increase in time-based products revenue for the three and six months ended April 30, 2024 compared to the same periods in fiscal 2023 was primarily attributable to an increase in TSL license revenue from arrangements booked in prior periods. The increase for the six-month period also included the impact of the extra week in the first quarter of fiscal 2024.

Current wording

The increase in time-based products revenue for the nine months ended July 31, 2024 compared to the same period in fiscal 2023 was primarily attributable to an increase in TSL license revenue from arrangements booked in prior periods and the impact of the extra week in the first quarter of fiscal 2024.

Previous wording

The increase in upfront products revenue for the three and six months ended April 30, 2024 compared to the same periods in fiscal 2023 was primarily due to an increase in the sale of IP and hardware products, driven by higher demand from customers.

Current wording

The increase in upfront products revenue for the three and nine months ended July 31, 2024 compared to the same periods in fiscal 2023 was primarily due to an increase in the sale of IP and hardware products, driven by higher demand from customers.

Previous wording

The increase in maintenance revenue for the three and six months ended April 30, 2024 compared to the same periods in fiscal 2023 was primarily due to an increase in the volume of arrangements that include maintenance.

Current wording

The decrease in maintenance revenue for the three months ended July 31, 2024 compared to the same period in fiscal 2023 was primarily due to a decrease in the volume of arrangements that include maintenance. The increase in maintenance revenue for the nine months ended July 31, 2024 compared to the same period in fiscal 2023 was primarily due to an increase in the volume of arrangements that include maintenance.

Previous wording

The increase in professional service and other revenue for the three and six months ended April 30, 2024 compared to the same periods in fiscal 2023 was primarily due to the timing of IP customization projects.

Current wording

The increase in professional service and other revenue for the three and nine months ended July 31, 2024 compared to the same periods in fiscal 2023 was primarily due to the timing of IP customization projects.

Previous wording

The increase in cost of revenue for the three months ended April 30, 2024 compared to the same period in fiscal 2023 was primarily due to increases of $25.1 million in hardware-related costs including inventory provisions, $12.4 million in costs to fulfill IP consulting arrangements, $5.1 million in employee-related costs as a result of headcount increases from hiring, and $3.0 million in amortization of acquired technology-related intangible assets.

Current wording

The increase in cost of revenue for the three months ended July 31, 2024 compared to the same period in fiscal 2023 was primarily due to increases of $16.1 million in costs to fulfill IP consulting arrangements, $7.2 million in employee-related costs as a result of headcount increases from hiring, $3.9 million in hardware-related costs including inventory provisions, and $3.5 million in amortization of acquired technology-related intangible assets.

Previous wording

The increase in cost of revenue for the six months ended April 30, 2024 compared to the same period in fiscal 2023 was primarily due to increases of $30.7 million in hardware-related costs including inventory provisions, $29.0 million in costs to fulfill IP consulting arrangements, $22.8 million in employee-related costs as a result of headcount increases from hiring, and $5.0 million in amortization of acquired technology-related intangible assets.

Current wording

The increase in cost of revenue for the nine months ended July 31, 2024 compared to the same period in fiscal 2023 was primarily due to increases of $45.1 million in costs to fulfill IP consulting arrangements, $34.6 million in hardware-related costs including inventory provisions, $30.0 million in employee-related costs as a result of headcount increases from hiring, $8.5 million in amortization of acquired technology-related intangible assets, and $2.1 million in depreciation and maintenance expense.

Previous wording

The increase in research and development expenses for the six months ended April 30, 2024 compared to the same period in fiscal 2023 was primarily due to increases of $85.8 million in employee-related costs as a result of headcount increases as we continue to expand and enhance our product portfolio, $13.4 million in the change in the fair value of our executive deferred compensation plan assets, $9.3 million in consultant and contractor costs, and $6.5 million in facility costs.

Current wording

The increase in research and development expenses for the three months ended July 31, 2024 compared to the same period in fiscal 2023 was primarily due to increases of $16.3 million in employee-related costs as a result of headcount increases as we continue to expand and enhance our product portfolio, and $2.5 million in the change in the fair value of our executive deferred compensation plan assets.

Previous wording

The increase in research and development expenses for the three months ended April 30, 2024 compared to the same period in fiscal 2023 was primarily due to increases of $20.3 million in employee-related costs as a result of headcount increases as we continue to expand and enhance our product portfolio, $5.9 million in consultant and contractor costs, $5.0 million in the change in the fair value of our executive deferred compensation plan assets, and $4.0 million in facility costs.

Current wording

The increase in research and development expenses for the nine months ended July 31, 2024 compared to the same period in fiscal 2023 was primarily due to increases of $102.2 million in employee-related costs as a result of headcount increases as we continue to expand and enhance our product portfolio, $15.9 million in the change in the fair value of our executive deferred compensation plan assets, $9.1 million in consultant and contractor costs, and $6.6 million in facility costs.

Previous wording

The increase in sales and marketing expenses for the six months ended April 30, 2024 compared to the same period in fiscal 2023 was primarily due to increases of $51.8 million in employee-related costs due to headcount increases, $12.0 million in the change in the fair value of our executive deferred compensation plan assets, $3.6 million in travel and marketing costs due to an increased number of in-person meetings and events, and $1.8 million in facility costs.

Current wording

The increase in sales and marketing expenses for the three months ended July 31, 2024 compared to the same period in fiscal 2023 was primarily due to increases of $16.6 million in employee-related costs due to headcount increases, and $2.2 million in the change in the fair value of our executive deferred compensation plan assets.

Previous wording

The increase in sales and marketing expenses for the three months ended April 30, 2024 compared to the same period in fiscal 2023 was primarily due to increases of $17.5 million in employee-related costs due to headcount increases, $2.2 million in travel and marketing costs due to an increased number of in-person meetings and events, and $1.9 million in the change in the fair value of our executive deferred compensation plan assets.

Current wording

The increase in sales and marketing expenses for the nine months ended July 31, 2024 compared to the same period in fiscal 2023 was primarily due to increases of $68.3 million in employee-related costs due to headcount increases, $14.1 million in the change in the fair value of our executive deferred compensation plan assets, and $4.4 million in travel and marketing costs due to an increased number of in-person meetings and events.

Previous wording

The increase in general and administrative expenses for the three months ended April 30, 2024 compared to the same period in fiscal 2023 was primarily due to increases of $15.8 million in legal, consulting and other professional fees mainly in connection with the Ansys Merger, $7.4 million in employee-related costs due to headcount increases from hiring, and $6.5 million in depreciation and maintenance expense.

Current wording

The increase in general and administrative expenses for the three months ended July 31, 2024 compared to the same period in fiscal 2023 was primarily due to increases of $39.2 million in legal, consulting and other professional fees mainly in connection with the Ansys Merger, $9.5 million in employee-related costs due to headcount increases from hiring, and $3.3 million in depreciation and maintenance expense.

Previous wording

The increase in general and administrative expenses for the six months ended April 30, 2024 compared to the same period in fiscal 2023 was primarily due to increases of $42.0 million in legal, consulting and other professional fees mainly in connection with the Ansys Merger, $17.6 million in employee-related costs due to headcount increases from hiring, and $10.4 million in depreciation and maintenance expense.

Current wording

The increase in general and administrative expenses for the nine months ended July 31, 2024 compared to the same period in fiscal 2023 was primarily due to increases of $81.2 million in legal, consulting and other professional fees mainly in connection with the Ansys Merger, $27.1 million in employee-related costs due to headcount increases from hiring, and $13.7 million in depreciation and maintenance expense.

Previous wording

The increase in amortization of acquired intangible assets for the three and six months ended April 30, 2024 compared to the same periods in fiscal 2023 was primarily due to amortization expense related to intangible assets acquired during the three and six months ended April 30, 2024, partially offset by certain intangible assets becoming fully amortized.

Current wording

The increase in amortization of acquired intangible assets for the three and nine months ended July 31, 2024 compared to the same periods in fiscal 2023 was primarily due to amortization expense related to intangible assets acquired during the three and nine months ended July 31, 2024, partially offset by certain intangible assets becoming fully amortized.

Previous wording

The increase in interest and other income (expense) for the three and six months ended April 30, 2024 as compared to the same periods in fiscal 2023 was primarily due to the change in the fair value of our executive deferred compensation plan assets. The increase for the six-month period also included the impact of gain recognized from the sale of strategic investments.

Current wording

The increase in interest and other income (expense) for the three and nine months ended July 31, 2024 as compared to the same periods in fiscal 2023 was primarily due to the change in the fair value of our executive deferred compensation plan assets. The increase for the nine-month period also included the impact of gain recognized from the sale of strategic investments.

Previous wording

The increase in adjusted operating income for the three and six months ended April 30, 2024 compared to the same periods in fiscal 2023 was primarily due to an increase in revenue from arrangements booked in prior periods.

Current wording

The increase in adjusted operating income for the three and nine months ended July 31, 2024 compared to the same periods in fiscal 2023 was primarily due to an increase in revenue from arrangements booked in prior periods.

Previous wording

The increase in adjusted operating income for the three and six months ended April 30, 2024 compared to the same periods in fiscal 2023 was primarily due to an increase in the revenue of IP products driven by timing of customer demands.

Current wording

The increase in adjusted operating income for the three and nine months ended July 31, 2024 compared to the same periods in fiscal 2023 was primarily due to an increase in the revenue of IP products driven by timing of customer demands.

Previous wording

As of April 30, 2024, we held $1.7 billion in cash, cash equivalents and short-term investments. We also held $2.3 million in restricted cash primarily associated with deposits for office leases and employee loan programs. Our cash equivalents consisted primarily of taxable money market mutual funds, time deposits and highly liquid investments with maturities of three months or less. Our short-term investments include U.S. government and municipal obligations, investment-grade available-for-sale debt and asset backed securities with an overall weighted-average credit rating of approximately AA.

Current wording

As of July 31, 2024, we held $2.0 billion in cash, cash equivalents and short-term investments. We also held $2.2 million in restricted cash primarily associated with deposits for office leases and employee loan programs. Our cash equivalents consisted primarily of taxable money market mutual funds, time deposits and highly liquid investments with maturities of three months or less. Our short-term investments include U.S. government and municipal obligations, investment-grade available-for-sale debt and asset backed securities with an overall weighted-average credit rating of approximately AA.

Previous wording

As of April 30, 2024, approximately $771.6 million of our cash and cash equivalents were domiciled in various foreign jurisdictions. We have provided for foreign withholding taxes on the undistributed earnings of certain of our foreign subsidiaries to the extent such earnings are no longer considered to be indefinitely reinvested in the operations of those subsidiaries.

Current wording

As of July 31, 2024, approximately $968.1 million of our cash and cash equivalents were domiciled in various foreign jurisdictions. We have provided for foreign withholding taxes on the undistributed earnings of certain of our foreign subsidiaries to the extent such earnings are no longer considered to be indefinitely reinvested in the operations of those subsidiaries.

Previous wording

$19 billion cash consideration payment through a combination of cash and debt, and have fully-committed debt financing in place for $16.0 billion. Net cash proceeds received from certain debt and equity issuances or the sale of certain businesses and assets, including the pending Software Integrity Divestiture, as well as term loan commitments under certain qualifying term loan facilities, will result in mandatory commitment reductions under the Bridge Commitment. See Note 11. Bridge Commitment Letter, Term Loan and Revolving Credit Facilities of the Notes to Condensed Consolidated Financial Statements in this Quarterly Report for further discussion.

Current wording

We expect that the pending Ansys Merger is likely to result in a material increase in our debt and liquidity needs that will impact our capital needs during as well as beyond the next twelve months. We intend to fund our anticipated $19 billion cash consideration payment through a combination of cash and debt, and have fully-committed debt financing in place for $16.0 billion. Net cash proceeds received from certain debt and equity issuances or the sale of certain businesses and assets, including the pending Software Integrity Divestiture, as well as term loan commitments under certain qualifying term loan facilities, will result in mandatory commitment reductions under the Bridge Commitment. See Note 11. Bridge Commitment Letter, Term Loan and Revolving Credit Facilities of the Notes to Condensed Consolidated Financial Statements in this Quarterly Report for further discussion.

Previous wording

During the six months ended April 30, 2024, there were no other significant changes to our material cash requirements, including contractual and other obligations, as presented in Part II, Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations included in our Annual Report.

Current wording

During the nine months ended July 31, 2024, there were no other significant changes to our material cash requirements, including contractual and other obligations, as presented in Part II, Item 7, Management’s Discussion and Analysis of Financial Condition and Results of Operations included in our Annual Report.

Previous wording

The following sections discuss changes in our condensed consolidated statements of cash flows and other commitments of our liquidity and capital resources during the six months ended April 30, 2024.

Current wording

The following sections discuss changes in our condensed consolidated statements of cash flows and other commitments of our liquidity and capital resources during the nine months ended July 31, 2024.

Previous wording

The decrease in cash provided by operating activitiesfor the six months ended April 30, 2024 compared to the same period in fiscal 2023 was primarily due to higher federal tax payments of $358.0 million, which included $187.0 million of fiscal 2023 federal tax payments that were paid in fiscal 2024 as a result of payment deadline extensions due to IRS tax relief for the California winter storms. This decrease in cash was partially offset by higher net income and higher accounts receivable collections.

Current wording

The decrease in cash provided by operating activitiesfor the nine months ended July 31, 2024 compared to the same period in fiscal 2023 was primarily due to higher federal tax payments of $417.0 million, which included $187.0 million of fiscal 2023 federal tax payments that were paid in fiscal 2024 as a result of payment deadline extensions due to IRS tax relief for the California winter storms.

Previous wording

The increase in cash used in investing activities for the six months ended April 30, 2024 compared to the same period in fiscal 2023 was primarily due to higher cash paid for acquisitions of $98.2 million, partially offset by higher proceeds from the sales and maturities of investments of $43.9 million and lower purchases of property and equipment of $12.6 million.

Current wording

The increase in cash used in investing activities for the nine months ended July 31, 2024 compared to the same period in fiscal 2023 was primarily due to higher cash paid for acquisitions of $105.6 million, partially offset by higher proceeds from the maturities and sales of investments of $42.8 million and lower purchases of property and equipment of $17.7 million.

Previous wording

The decrease in cash used in financing activities for the six months ended April 30, 2024 compared to the same period in fiscal 2023 was primarily due to lower stock repurchases of $605.7 million, as we have suspended the Program in connection with the pending Ansys Merger until we reduce our expected debt levels, partially offset by higher income taxes paid for net share settlements of $95.7 million, the payment of bridge financing and term loan costs of $54.7 million in connection with the Ansys Merger, and lower proceeds from the issuance of common stock of $17.7 million.

Current wording

The decrease in cash used in financing activities for the nine months ended July 31, 2024 compared to the same period in fiscal 2023 was primarily due to lower stock repurchases of $905.7 million, as we have suspended the Program in connection with the pending Ansys Merger until we reduce our expected debt levels, partially offset by higher income taxes paid for net share settlements of $79.6 million, the payment of bridge financing and term loan costs of $72.3 million in connection with the Ansys Merger, and lower proceeds from the issuance of common stock of $21.7 million.

Previous wording

We will also pay a ticking fee under the Term Loan Agreement in an amount equal to a rate per annum equal to 0.10% times the actual daily undrawn portion of the commitments in respect of the term loan facility, from and including May 14, 2024 to but excluding the earlier of (i) termination or expiration of the commitments under the term loan facility or (ii) the funding of the commitments.

Current wording

On May 14, 2024, a ticking fee began to accrue under the Term Loan Agreement in an amount equal to a rate per annum equal to 0.10% times the actual daily undrawn portion of the commitments in respect of the term loan facility. This ticking fee will accrue until the earlier of (i) termination or expiration of the commitments under the term loan facility or (ii) the funding of the commitments, at which point the accrued amount of the ticking fee will become payable.

Previous wording

In July 2018, we entered into a 12-year 220.0 million Renminbi (approximately $33.0 million) credit agreement with a lender in China to support our facilities expansion. Borrowings bear interest at a floating rate based on the 5 year Loan Prime Rate plus 0.74%. As of April 30, 2024, we had $17.0 million outstanding balance under the agreement.

Current wording

In July 2018, we entered into a 12-year 220.0 million Renminbi (approximately $33.0 million) credit agreement with a lender in China to support our facilities expansion. Borrowings bear interest at a floating rate based on the 5 year Loan Prime Rate plus 0.74%. As of July 31, 2024, we had $15.6 million outstanding balance under the agreement.