Document and Entity Information
Document and Entity Information - USD ($) $ in Billions | 12 Months Ended | ||
Oct. 31, 2020 | Dec. 10, 2020 | Apr. 30, 2020 | |
Cover [Abstract] | |||
Document Type | 10-K | ||
Document Annual Report | true | ||
Document Period End Date | Oct. 31, 2020 | ||
Document Transition Report | false | ||
Entity File Number | 0-19807 | ||
Entity Registrant Name | SYNOPSYS, INC. | ||
Entity Incorporation, State or Country Code | DE | ||
Entity Tax Identification Number | 56-1546236 | ||
Entity Address, Address Line One | 690 East Middlefield Road, | ||
Entity Address, City or Town | Mountain View, | ||
Entity Address, State or Province | CA | ||
Entity Address, Postal Zip Code | 94043 | ||
City Area Code | 650 | ||
Local Phone Number | 584-5000 | ||
Title of 12(b) Security | Common Stock, $0.01 par value | ||
Trading Symbol | SNPS | ||
Security Exchange Name | NASDAQ | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Interactive Data Current | Yes | ||
Entity Filer Category | Large Accelerated Filer | ||
Entity Small Business | false | ||
Entity Emerging Growth Company | false | ||
ICFR Auditor Attestation Flag | false | ||
Entity Shell Company | false | ||
Entity Public Float | $ 17.7 | ||
Entity Common Stock, Shares Outstanding | 153,032,497 | ||
Amendment Flag | false | ||
Document Fiscal Year Focus | 2020 | ||
Document Fiscal Period Focus | FY | ||
Entity Central Index Key | 0000883241 | ||
Current Fiscal Year End Date | --10-31 |
Consolidated Balance Sheets
Consolidated Balance Sheets - USD ($) $ in Thousands | Oct. 31, 2020 | Oct. 31, 2019 |
Current assets: | ||
Cash and cash equivalents | $ 1,235,653 | $ 728,597 |
Accounts receivable, net | 780,709 | 553,895 |
Inventories, net | 192,333 | 141,518 |
Income taxes receivable and prepaid taxes | 32,355 | 24,855 |
Prepaid and other current assets | 308,167 | 290,052 |
Total current assets | 2,549,217 | 1,738,917 |
Property and equipment, net | 483,818 | 429,532 |
Operating lease right-of-use assets, net | 465,818 | 0 |
Goodwill | 3,365,114 | 3,171,179 |
Intangible assets, net | 254,322 | 279,374 |
Long-term prepaid taxes | 8,276 | 15,503 |
Deferred income taxes | 497,546 | 390,129 |
Other long-term assets | 405,951 | 380,526 |
Total assets | 8,030,062 | 6,405,160 |
Current liabilities: | ||
Accounts payable and accrued liabilities | 623,664 | 506,459 |
Operating lease liabilities, current | 73,173 | 0 |
Accrued income taxes | 27,738 | 15,904 |
Deferred revenue | 1,388,263 | 1,212,476 |
Short-term debt | 27,084 | 17,614 |
Total current liabilities | 2,139,922 | 1,752,453 |
Operating lease liabilities, non-current | 462,411 | 0 |
Long-term accrued income taxes | 25,178 | 29,911 |
Long-term deferred revenue | 104,850 | 90,102 |
Long-term debt | 100,823 | 120,093 |
Other long-term liabilities | 284,511 | 323,725 |
Total liabilities | 3,117,695 | 2,316,284 |
Stockholders’ equity: | ||
Preferred stock, $0.01 par value: 2,000 shares authorized; none outstanding | 0 | 0 |
Common stock, $0.01 par value: 400,000 shares authorized; 152,618 and 150,331 shares outstanding, respectively | 1,528 | 1,503 |
Capital in excess of par value | 1,653,166 | 1,635,455 |
Retained earnings | 3,795,397 | 3,164,144 |
Treasury stock, at cost: 4,643 and 6,930 shares, respectively | (488,613) | (625,642) |
Accumulated other comprehensive income (loss) | (54,074) | (92,447) |
Total Synopsys stockholders’ equity | 4,907,404 | 4,083,013 |
Non-controlling interest | 4,963 | 5,863 |
Total stockholders’ equity | 4,912,367 | 4,088,876 |
Total liabilities and stockholders’ equity | $ 8,030,062 | $ 6,405,160 |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) - $ / shares | Oct. 31, 2020 | Oct. 31, 2019 |
Statement of Financial Position [Abstract] | ||
Preferred Stock, par value (in USD per share) | $ 0.01 | $ 0.01 |
Preferred Stock, shares authorized (in shares) | 2,000,000 | 2,000,000 |
Preferred Stock, shares outstanding (in shares) | 0 | 0 |
Common Stock, par value (in USD per share) | $ 0.01 | $ 0.01 |
Common Stock, shares authorized (in shares) | 400,000,000 | 400,000,000 |
Common Stock, shares outstanding (in shares) | 152,618,000 | 150,331,000 |
Treasury stock, shares (in shares) | 4,643,000 | 6,930,000 |
Consolidated Statements Of Oper
Consolidated Statements Of Operations - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | ||
Oct. 31, 2020 | Oct. 31, 2019 | Oct. 31, 2018 | |
Revenue: | |||
Total revenue | $ 3,685,281 | $ 3,360,694 | $ 3,121,058 |
Cost of revenue: | |||
Amortization of intangible assets | 52,452 | 59,623 | 84,034 |
Total cost of revenue | 794,690 | 752,946 | 735,898 |
Gross margin | 2,890,591 | 2,607,748 | 2,385,160 |
Operating expenses: | |||
Research and development | 1,279,022 | 1,136,932 | 1,084,822 |
Sales and marketing | 632,010 | 632,890 | 622,978 |
General and administrative | 284,530 | 229,218 | 262,560 |
Amortization of intangible assets | 38,829 | 41,291 | 41,630 |
Restructuring charges | 36,059 | 47,186 | 12,945 |
Total operating expenses | 2,270,450 | 2,087,517 | 2,024,935 |
Operating income | 620,141 | 520,231 | 360,225 |
Other income (expense), net | 18,018 | 25,275 | 3,318 |
Income before income taxes | 638,159 | 545,506 | 363,543 |
Provision (benefit) for income taxes | (25,288) | 13,139 | (68,975) |
Net income | 663,447 | 532,367 | 432,518 |
Net income (loss) attributed to non-controlling interest | (900) | 0 | 0 |
Net income attributed to Synopsys | $ 664,347 | $ 532,367 | $ 432,518 |
Net income per share: | |||
Basic (in USD per share) | $ 4.40 | $ 3.55 | $ 2.90 |
Diluted (in USD per share) | $ 4.27 | $ 3.45 | $ 2.82 |
Shares used in computing per share amounts: | |||
Basic (shares) | 151,135 | 149,872 | 149,036 |
Diluted (shares) | 155,706 | 154,190 | 153,393 |
Time-based products | |||
Revenue: | |||
Total revenue | $ 2,365,199 | $ 2,197,965 | $ 2,303,317 |
Cost of revenue: | |||
Cost of revenue | 487,307 | 459,127 | 448,430 |
Upfront products | |||
Revenue: | |||
Total revenue | 735,572 | 619,791 | 357,698 |
Maintenance and service | |||
Revenue: | |||
Total revenue | 584,510 | 542,938 | 460,043 |
Cost of revenue: | |||
Cost of revenue | $ 254,931 | $ 234,196 | $ 203,434 |
Consolidated Statements Of Comp
Consolidated Statements Of Comprehensive Income - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 31, 2020 | Oct. 31, 2019 | Oct. 31, 2018 | |
Statement of Comprehensive Income [Abstract] | |||
Net income | $ 663,447 | $ 532,367 | $ 432,518 |
Other comprehensive income (loss): | |||
Change in foreign currency translation adjustment | 30,466 | 1,360 | (18,882) |
Cash flow hedges: | |||
Deferred gains (losses), net of tax of $(3,192), $(2,009), and $4,675 for fiscal years 2020, 2019 and 2018, respectively | 7,834 | 4,733 | (17,428) |
Reclassification adjustment on deferred (gains) losses included in net income, net of tax of $176, $(3,672), and $2,207 for fiscal years 2020, 2019 and 2018, respectively | 73 | 14,637 | (10,888) |
Other comprehensive income (loss), net of tax effects | 38,373 | 20,730 | (47,198) |
Comprehensive income | 701,820 | 553,097 | 385,320 |
Less: Net income (loss) attributed to non-controlling interest | (900) | 0 | 0 |
Comprehensive income attributed to Synopsys | $ 702,720 | $ 553,097 | $ 385,320 |
Consolidated Statements Of Co_2
Consolidated Statements Of Comprehensive Income (Parenthetical) - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 31, 2020 | Oct. 31, 2019 | Oct. 31, 2018 | |
Statement of Comprehensive Income [Abstract] | |||
Deferred gain (loss), tax | $ (3,192) | $ (2,009) | $ 4,675 |
Reclassification adjustment on deferred (gains) loss included in net income, tax | $ 176 | $ (3,672) | $ 2,207 |
Consolidated Statements of Stoc
Consolidated Statements of Stockholders' Equity - USD ($) shares in Thousands, $ in Thousands | Total | Cumulative effect, period of adoption, adjustment | Common Stock | Capital in Excess of Par Value | Retained Earnings | Retained EarningsCumulative effect, period of adoption, adjustment | Treasury Stock | Accumulated Other Comprehensive Income (Loss) | Total Synopsys Stockholders’ Equity | Total Synopsys Stockholders’ EquityCumulative effect, period of adoption, adjustment | Non-controlling Interest | |
Balance (in shares) at Oct. 31, 2017 | 150,445 | |||||||||||
Beginning balance at Oct. 31, 2017 | $ 3,279,724 | $ 1,505 | $ 1,622,429 | $ 2,143,873 | $ (426,208) | $ (65,979) | $ 3,275,620 | $ 4,104 | ||||
Beginning balance (Adjustment related to reclassification of certain tax effects from accumulated other comprehensive income (loss)) at Oct. 31, 2017 | $ (293) | $ (293) | $ (293) | |||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||
Net income | 432,518 | 432,518 | 432,518 | |||||||||
Other comprehensive income (loss), net of tax effects | $ (47,198) | (47,198) | (47,198) | |||||||||
Purchases of treasury stock (in shares) | (4,688) | [1] | (4,688) | |||||||||
Purchases of treasury stock, value | $ (420,000) | [1] | $ (47) | 47 | (420,000) | (420,000) | ||||||
Equity forward contract | $ 20,000 | 20,000 | 20,000 | |||||||||
Common stock issued, net of shares withheld for employee taxes (in shares) | 3,508 | 3,508 | ||||||||||
Common stock issued, net of shares withheld for employee taxes | $ 79,629 | $ 35 | (136,522) | (32,410) | 248,526 | 79,629 | ||||||
Stock-based compensation | 138,876 | 138,876 | 138,876 | |||||||||
Non-controlling interest in an equity investment | 1,759 | 0 | 1,759 | |||||||||
Balance (in shares) at Oct. 31, 2018 | 149,265 | |||||||||||
Ending balance at Oct. 31, 2018 | 3,485,015 | $ 1,493 | 1,644,830 | 2,543,688 | (597,682) | (113,177) | 3,479,152 | 5,863 | ||||
Ending balance (Adjustment due to adoption of accounting standards related to revenue) at Oct. 31, 2018 | 257,594 | 257,594 | 257,594 | |||||||||
Ending balance (Adjustment due to adoption of an accounting standard related to income taxes) at Oct. 31, 2018 | $ (130,544) | $ (130,544) | $ (130,544) | |||||||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||
Net income | 532,367 | 532,367 | 532,367 | |||||||||
Other comprehensive income (loss), net of tax effects | $ 20,730 | 20,730 | 20,730 | |||||||||
Purchases of treasury stock (in shares) | (2,732) | (2,732) | ||||||||||
Purchases of treasury stock, value | $ (329,185) | $ (27) | 27 | (329,185) | (329,185) | |||||||
Common stock issued, net of shares withheld for employee taxes (in shares) | 3,798 | 3,798 | ||||||||||
Common stock issued, net of shares withheld for employee taxes | $ 99,103 | $ 37 | (163,198) | (38,961) | 301,225 | 99,103 | ||||||
Stock-based compensation | 153,796 | 153,796 | 153,796 | |||||||||
Balance (in shares) at Oct. 31, 2019 | 150,331 | |||||||||||
Ending balance at Oct. 31, 2019 | 4,088,876 | $ 1,503 | 1,635,455 | 3,164,144 | (625,642) | (92,447) | 4,083,013 | 5,863 | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||||||
Net income | 663,447 | 664,347 | 664,347 | (900) | ||||||||
Other comprehensive income (loss), net of tax effects | $ 38,373 | 38,373 | 38,373 | |||||||||
Purchases of treasury stock (in shares) | (1,585) | (1,585) | ||||||||||
Purchases of treasury stock, value | $ (242,078) | $ (14) | 14 | (242,078) | (242,078) | |||||||
Common stock issued, net of shares withheld for employee taxes (in shares) | 3,872 | 3,872 | ||||||||||
Common stock issued, net of shares withheld for employee taxes | $ 115,165 | $ 39 | (230,887) | (33,094) | 379,107 | 115,165 | ||||||
Stock-based compensation | 248,584 | 248,584 | 248,584 | |||||||||
Balance (in shares) at Oct. 31, 2020 | 152,618 | |||||||||||
Ending balance at Oct. 31, 2020 | $ 4,912,367 | $ 1,528 | $ 1,653,166 | $ 3,795,397 | $ (488,613) | $ (54,074) | $ 4,907,404 | $ 4,963 | ||||
[1] | The first quarter of fiscal 2018 includes the settlement of the $20.0 million equity forward contract related to the September 2017 ASR. |
Consolidated Statements Of Cash
Consolidated Statements Of Cash Flows - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 31, 2020 | Oct. 31, 2019 | Oct. 31, 2018 | |
Cash flow from operating activities: | |||
Net income attributed to Synopsys | $ 664,347 | $ 532,367 | $ 432,518 |
Adjustments to reconcile net income to net cash provided by operating activities: | |||
Amortization and depreciation | 209,986 | 201,676 | 209,207 |
Reduction of operating lease right-of-use assets | 82,895 | 0 | 0 |
Amortization of capitalized costs to obtain revenue contracts | 61,185 | 62,750 | 0 |
Stock-based compensation | 248,584 | 155,001 | 140,032 |
Allowance for doubtful accounts | 20,875 | 11,669 | 3,368 |
(Gain) loss on sale of property and investments | (1,994) | (4,052) | (93) |
Deferred income taxes | (111,526) | (82,620) | (210,310) |
Other non-cash | 5,419 | (993) | (851) |
Net changes in operating assets and liabilities, net of acquired assets and liabilities: | |||
Accounts receivable | (236,806) | (8,575) | (95,785) |
Inventories | (55,024) | (17,396) | (65,751) |
Prepaid and other current assets | (11,298) | (49,779) | (12,652) |
Other long-term assets | (83,367) | (125,749) | (25,815) |
Accounts payable and accrued liabilities | 113,773 | (19,280) | 49,043 |
Operating lease liabilities | (78,578) | 0 | 0 |
Income taxes | 14,120 | 19,777 | (103,841) |
Deferred revenue | 148,722 | 125,717 | 105,329 |
Net cash provided by operating activities | 991,313 | 800,513 | 424,399 |
Cash flows from investing activities: | |||
Proceeds from sales and maturities of short-term investments | 0 | 0 | 12,449 |
Proceeds from sales of long-term investments | 2,151 | 6,361 | 494 |
Purchases of long-term investments | (2,762) | (3,245) | (3,561) |
Proceeds from sale of property and equipment | 0 | 0 | 1,662 |
Purchases of property and equipment | (154,717) | (198,129) | (98,976) |
Cash paid for acquisitions and intangible assets, net of cash acquired | (201,045) | (36,605) | (652,643) |
Capitalization of software development costs | (4,045) | (4,259) | (2,950) |
Net cash used in investing activities | (360,418) | (235,877) | (743,525) |
Cash flows from financing activities: | |||
Proceeds from credit facilities | 276,489 | 192,897 | 620,635 |
Repayment of debt | (288,879) | (524,063) | (295,313) |
Issuances of common stock | 197,403 | 156,364 | 123,829 |
Payments for taxes related to net share settlement of equity awards | (82,225) | (57,143) | (45,772) |
Purchases of treasury stock | (242,078) | (329,185) | (400,000) |
Other | (1,316) | (762) | 1,759 |
Net cash (used in) provided by financing activities | (140,606) | (561,892) | 5,138 |
Effect of exchange rate changes on cash, cash equivalents and restricted cash | 17,154 | 2,782 | (11,086) |
Net change in cash, cash equivalents and restricted cash | 507,443 | 5,526 | (325,074) |
Cash, cash equivalents and restricted cash, beginning of year | 730,527 | 725,001 | 1,050,075 |
Cash, cash equivalents and restricted cash, end of year | 1,237,970 | 730,527 | 725,001 |
Supplemental disclosure of cash flow information: | |||
Cash paid for income taxes during the year: | 70,711 | 75,744 | 252,522 |
Interest payments during the year: | $ 5,136 | $ 12,363 | $ 15,307 |
Description of Business
Description of Business | 12 Months Ended |
Oct. 31, 2020 | |
Accounting Policies [Abstract] | |
Description of Business | Description of Business Synopsys, Inc. (Synopsys or the Company) provides products and services used across the entire silicon to software spectrum, from engineers creating advanced semiconductors to software developers seeking to ensure the security and quality of their code. The Company is a global leader in supplying the electronic design automation (EDA) software that engineers use to design and test integrated circuits (ICs), also known as chips. The Company also offers semiconductor intellectual property (IP) products, which are pre-designed circuits that engineers use as components of larger chip designs rather than designing those circuits themselves. The Company provides software and hardware used to validate the electronic systems that incorporate chips and the software that runs on them. To complement these offerings, the Company provides technical services and support to help its customers develop advanced chips and electronic systems. These products and services are part of the Company’s Semiconductor & System Design segment. The Company is also a leading provider of software tools and services that improve the security, quality and compliance of software in a wide variety of industries, including electronics, financial services, automotive, medicine, energy and industrials. These tools and services are part of the Company’s Software Integrity segment. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Oct. 31, 2020 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies Fiscal Year End. The Company’s fiscal year generally ends on the Saturday nearest to October 31 and consists of 52 weeks, with the exception that approximately every five years, the Company has a 53-week year. When a 53-week year occurs, the Company includes the additional week in the first quarter to realign fiscal quarters with calendar quarters. Fiscal 2020 and fiscal 2019 were 52-week years ending on October 31, 2020 and November 2, 2019, respectively. Fiscal 2018 was a 53-week year and ended on November 3, 2018. For presentation purposes, the consolidated financial statements and accompanying notes refer to the closest calendar month end. Fiscal 2021 will be a 52-week year. Basis of Presentation. The consolidated financial statements include the accounts of the Company and all of its subsidiaries. All intercompany accounts and transactions have been eliminated. Use of Estimates. To prepare financial statements in conformity with U.S. generally accepted accounting principles (U.S. GAAP), management must make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Actual results could differ from these estimates and may result in material effects on the Company’s operating results and financial position. In addition, the Company has considered the potential impact of the COVID-19 pandemic on the business operations. Although no material impairment or other effects have been identified to date related to the COVID-19 pandemic, there is substantial uncertainty in the nature and degree of its continued effects over time. This uncertainty affects management’s accounting estimates and assumptions, which could result in greater variability in a variety of areas that depend on these estimates and assumptions as additional events and information are known. Foreign Currency Translation. The functional currency of the majority of the Company’s active foreign subsidiaries is the foreign subsidiary’s local currency. Assets and liabilities that are not denominated in the functional currency are remeasured into the functional currency with any related gain or loss recorded in earnings. The Company translates assets and liabilities of its non-U.S. dollar functional currency foreign operations into the U.S. dollar reporting currency at exchange rates in effect at the balance sheet date. The Company translates income and expense items of such foreign operations into the U.S. dollar reporting currency at average exchange rates for the period. Accumulated translation adjustments are reported in stockholders’ equity, as a component of accumulated other comprehensive income (loss). Foreign Currency Contracts. The Company operates internationally and is exposed to potentially adverse movements in currency exchange rates. The Company enters into hedges in the form of foreign currency forward contracts to reduce its exposure to foreign currency rate changes on non-functional currency denominated forecasted transactions and balance sheet positions. The assets or liabilities associated with the forward contracts are recorded at fair value in other current assets or accrued liabilities in the consolidated balance sheets. The accounting for gains and losses resulting from changes in fair value depends on the use of the foreign currency forward contract and whether it is designated and qualifies for hedge accounting. See Note 6. Financial Assets and Liabilities . Fair Values of Financial Instruments. The Company’s cash equivalents and foreign currency contracts are carried at fair value. The fair value of the Company’s accounts receivable and accounts payable approximates the carrying amount due to their short duration. Non-marketable equity securities are accounted for using either the measurement alternative or equity method of accounting, net of impairments. The Company performs periodic impairment analysis on these non-marketable equity securities. The carrying amount of the short-term debt approximates the estimated fair value. See Note 7. Fair Value Measures . Cash and Cash Equivalents . The Company classifies investments with original maturities of three months or less when acquired as cash equivalents. Concentration of Credit Risk . Financial instruments that potentially subject the Company to significant concentrations of credit risk consist principally of cash equivalents, marketable securities, foreign currency contracts, and accounts receivable from trade customers. The Company maintains cash equivalents primarily in highly rated taxable and tax-exempt money market funds located in the U.S. and in various overseas locations. The Company sells its products worldwide primarily to customers in the global electronics market. The Company performs on-going credit evaluations of its customers’ financial condition and does not require collateral. The Company establishes reserves for potential credit losses and such losses have been within management’s expectations and have not been material in any year presented. Accounts Receivable, Net. The balances consist of accounts receivable billed and unbilled. Unbilled accounts receivable represent amounts recorded as revenue which will be invoiced within one year of the balance sheet date. The following table represents the components of accounts receivable, net: October 31, 2020 2019 (in thousands) Accounts receivable $ 758,341 $ 524,766 Unbilled accounts receivable 50,932 38,175 Total accounts receivable 809,273 562,941 Less allowance for doubtful accounts (28,564 ) (9,046 ) Total accounts receivable, net $ 780,709 $ 553,895 Allowance for Doubtful Accounts. Trade accounts receivable are recorded at the invoiced amount and do not bear interest. The Company maintains allowances for doubtful accounts to reduce the Company’s receivables to their estimated net realizable value. The Company provides a general reserve on all accounts receivable based on a review of customer accounts. The following table presents the changes in the allowance for doubtful accounts: Fiscal Year Balance at Beginning of Period Provisions Write-offs (1) Balance at End of Period (in thousands) 2020 $ 9,046 $ 20,875 $ (1,357 ) $ 28,564 2019 $ 5,613 $ 11,669 $ (8,236 ) $ 9,046 2018 $ 5,165 $ 3,368 $ (2,920 ) $ 5,613 (1) Balances written off, net of recoveries. Inventories, net. Inventories are computed at standard costs which approximate actual costs, on a first-in, first-out basis and valued at the lower of cost or net realizable value. Inventories primarily include components and parts used in emulation and prototyping hardware systems. Valuation process include a review of the stage of the product life cycle and forecasts based upon future demand and market conditions. Inventory provisions are recorded when the costs are determined to be in excess of anticipated demand or considered obsolete. Income Taxes. The Company accounts for income taxes using the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. The Company accounts for uncertainty in income taxes using a two-step approach to recognizing and measuring uncertain tax positions. The first step is to evaluate the tax position for recognition by determining whether it is more likely than not that the position will be sustained on audit, including resolution of related appeals or litigation processes, if any. The second step is to measure the tax benefit as the largest amount which is more than 50% likely of being realized upon ultimate settlement. An uncertain tax position is considered effectively settled on completion of an examination by a taxing authority if certain other conditions are satisfied. Property and Equipment. Property and equipment is recorded at cost less accumulated depreciation. Assets, excluding land, are depreciated using the straight-line method over their estimated useful lives. Leasehold improvements are amortized using the straight-line method over the remaining term of the lease or the economic useful life of the asset, whichever is shorter. Depreciation expenses were $119.1 million , $100.4 million and $72.8 million in fiscal 2020 , 2019 and 2018 , respectively. Repair and maintenance costs are expensed as incurred and such costs were $62.1 million , $52.5 million and $45.7 million in fiscal 2020 , 2019 and 2018 , respectively. A summary of property and equipment, at cost less accumulated depreciation and amortization, as of October 31, 2020 and 2019 is as follows: October 31, 2020 2019 (in thousands) Computer and other equipment $ 788,105 $ 678,901 Buildings 129,746 68,708 Furniture and fixtures 72,702 72,437 Land 19,965 18,849 Leasehold improvements 242,830 273,985 1,253,348 1,112,880 Less accumulated depreciation and amortization (1) (769,530 ) (683,348 ) Total $ 483,818 $ 429,532 (1) Accumulated depreciation and amortization includes write-offs due to retirement of fully amortized fixed assets. The useful lives of depreciable assets are as follows: Useful Life in Years Computer and other equipment 3-8 Buildings 30 Furniture and fixtures 5 Leasehold improvements Shorter of the lease term or the estimated useful life Leases . In February 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2016-02, “Leases (Topic 842),” which supersedes the previous lease requirements in Topic 840. Topic 842 was subsequently amended by several ASUs. The new guidance requires a lessee to recognize a right-of-use (ROU) asset and a lease liability for most operating leases in the consolidated balance sheets. These ASUs also made minor changes to lessor accounting and aligned key aspects of the lessor accounting model with the new revenue recognition guidance. The new standard did not have a material impact on the consolidated financial statements for arrangements in which the Company is the lessor. The Company adopted Topic 842 at the beginning of fiscal 2020 using the modified retrospective method without restatement of comparative periods. The Company elected the package of practical expedients permitted under the transition guidance, which allows the carryforward of historical assessments about (1) lease classification, (2) whether a contract is or contains a lease, and (3) which costs qualify as initial direct costs for leases that existed prior to the adoption. The Company did not elect either the use of hindsight or land easements practical expedients available in transition. The adoption of the standard did not have an impact on the Company’s beginning retained earnings, results of operations, or cash flows. The operating lease liabilities equaled the present value of the remaining Topic 840 minimum rental payments for those leases, discounted at the Company’s incremental borrowing rate as of the date of adoption. The ROU assets were measured at the amount of the related lease liabilities plus any prepaid rental payments and less any unamortized lease incentives such as tenant improvement allowances. The Company recognized ROU assets of $475 million and operating lease liabilities of $540 million on the consolidated balance sheets. The Company determines if a contract is or contains a lease at inception. ROU assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make payments arising from the lease. Lease liabilities for operating and finance leases are recognized at the lease commencement date based on the present value of future lease payments over the remaining lease terms. ROU assets are derived from the carrying amount of the related lease liability plus any prepaid lease payments, less any lease incentives such as tenant improvement allowances. The Company primarily uses its incremental borrowing rate, determined as of the lease commencement date, to measure the present value of its future lease payments, as the rate implicit in the lease is generally not readily determinable. The Company uses a benchmark senior unsecured yield curve for debt instruments and considers specific credit quality, market conditions, tenor of lease arrangements, and quality of collateral to determine the incremental borrowing rate. Operating lease expense is recognized on a straight-line basis over the lease term of each lease. Variable payments, such as for maintenance, property taxes or insurance, are recognized on our consolidated statements of operations as incurred. The Company has adopted both (1) the practical expedient to not separate lease from non-lease components and (2) the short-term lease exemption. The Company has elected the practical expedient to not separate lease from non-lease components for all classes of underlying assets and the short-term lease exemption for all classes of underlying assets except real estate leases, with terms 12 months or less. Goodwill. Goodwill represents the excess of the aggregate purchase price over the fair value of the net tangible and identifiable intangible assets acquired by the Company. The carrying amount of goodwill at each reporting unit is tested for impairment annually as of October 31 , or more frequently if facts and circumstances warrant a review. The Company performs a qualitative analysis when testing a reporting unit’s goodwill for impairment. A qualitative goodwill impairment test is performed when the fair value of a reporting unit historically has significantly exceeded the carrying value of its net assets and based on current operations is expected to continue to do so. Otherwise, the Company is required to conduct a quantitative impairment test for each reporting unit and estimate the fair value of each reporting unit using a combination of an income approach based on discounted cash flow analysis and a market approach based on market multiples. The discount rate used in the income approach is based on the Company's weighted-average cost of capital and may be adjusted for the relevant risks pertaining to projecting future cash flows. If the fair value of a reporting unit is less than its carrying value, a goodwill impairment charge is recorded for the difference. As of October 31, 2020, the Company performed a qualitative impairment test on each of the reporting units and concluded there was no impairment of goodwill. Intangible Assets. Intangible assets consist of acquired technology, certain contract rights, customer relationships, trademarks and trade names, capitalized software, and in-process research and development. These intangible assets are acquired through business combinations, direct purchases, or internally developed capitalized software. Intangible assets are amortized on a straight-line basis over their estimated useful lives which range from one to ten years , except for in-process research and development (IPR&D) projects not yet completed. IPR&D assets are amortized over their estimated useful lives upon completion or are written off upon abandonment. The Company continually monitors events and changes in circumstances that could indicate carrying amounts of long-lived assets, including property and equipment and intangible assets, may not be recoverable. When such events or changes in circumstances occur, the Company assesses the recoverability of long-lived assets by determining whether the carrying value of such asset group will be recovered through the undiscounted future cash flow. If the undiscounted future cash flow is less than the carrying amount of the asset group, the Company recognizes an impairment loss based on the excess of the carrying amount over the fair value of the asset group. The Company had no material impairment charges for long-lived assets in fiscal 2018 and none in fiscal 2020 and 2019. Restructuring Charges. In the second quarter of fiscal 2019 , the Company initiated a restructuring plan for involuntary and voluntary employee termination and facility closure actions as part of a business reorganization to better position the Company for future growth by reallocating resources to priority areas, and to a lesser extent, eliminating operational redundancy. The total charges under the 2019 restructuring plan were $83.3 million and consisted primarily of severance, termination, and retirement benefits under the 2019 VRP. During fiscal 2020 , the Company incurred restructuring charges of $36.1 million under the 2019 restructuring plan. These charges consisted primarily of severance, termination, and retirement benefits. $57.4 million was paid in fiscal 2020 which included payments of remaining balances in fiscal 2019. As of October 31, 2020 , $1.3 million remained outstanding and was recorded in accounts payable and accrued liabilities as payroll and related benefits in the consolidated balance sheets. The remaining balance will be paid in fiscal 2021. During fiscal 2019 , the Company incurred restructuring charges of approximately $47.2 million for involuntary employee termination actions and the VRP. These charges consist primarily of severance, termination, and retirement benefits, of which $24.6 million was paid in fiscal 2019 . As of October 31, 2019 , $22.6 million remained outstanding and was recorded in accounts payable and accrued liabilities as payroll and related benefits in the consolidated balance sheets. The remaining balance was paid in fiscal 2020. During fiscal 2018 , the Company recorded $12.9 million of restructuring charges for severance and benefits due to involuntary employee termination actions. The restructuring actions were undertaken to position the Company for future growth, reallocate resources to priority areas and, to a lesser extent, eliminate operational redundancy. These charges consisted primarily of severance benefits. As of October 31, 2018, there was an $8.1 million outstanding balance remaining in accounts payable and accrued liabilities in the consolidated balance sheets. The majority of the balance was paid in fiscal 2019 and there was no remaining balance as of the end of fiscal 2020. Accounts Payable and Accrued Liabilities. The balance consisted of: October 31, 2020 2019 (in thousands) Payroll and related benefits $ 492,626 $ 417,157 Other accrued liabilities 101,035 69,487 Accounts payable 30,003 19,815 Total $ 623,664 $ 506,459 Other Long-term Liabilities. The balance consisted of: October 31, 2020 2019 (in thousands) Deferred compensation liability (See Note 12 ) $ 269,737 $ 249,822 Other long-term liabilities 14,774 73,903 Total $ 284,511 $ 323,725 Other Comprehensive Income (Loss). Other comprehensive income (loss) (OCI) includes all changes in equity during a period, such as accumulated net translation adjustments, unrealized gain (loss) on certain foreign currency forward contracts that qualify as cash flow hedges, reclassification adjustments related to cash flow hedges and unrealized gain (loss) on investments. See Note 10 . Accumulated Other Comprehensive Income (Loss) . Revenue Recognition. The Company adopted ASC 606 on November 4, 2018, the beginning of fiscal year 2019, using the modified retrospective method. The comparative information for periods prior to fiscal year 2019 has not been restated and continues to be reported under the accounting standards in effect for those periods. The core principle of ASC 606 is to recognize revenue for the transfer of services or products to customers in an amount that reflects the consideration to which the Company expects to be entitled in exchange for those services or products. The principle is achieved through the following five-step approach: • Identification of the contract, or contracts, with the customer • Identification of the performance obligation in the contract • Determination of the transaction price • Allocation of the transaction price to the performance obligations in the contract • Recognition of revenue when, or as, the Company satisfies a performance obligation Nature of Products and Services The Company generates revenue from the sale of products that include software licenses and, to a lesser extent, hardware products, maintenance and services. The various types are set forth below. Electronic Design Automation Software license revenue consists of fees associated with the licensing of the Company's software primarily through Technology Subscription License (TSL) contracts. TSLs are time-based licenses for a finite term and generally provide the customer with limited rights to receive, or to exchange certain quantities of licensed software for, unspecified future technology. The majority of the Company's arrangements are TSLs due to the nature of its business and customer requirements. In addition to the licenses, the arrangements also include: post-contract customer support, which includes providing frequent updates and upgrades to maintain the utility of the software due to rapid changes in technology; other intertwined services such as multiple copies of the tools; assisting the Company's customers in applying the Company's technology in the customers' development environment; and rights to remix licenses for other licenses. Payments are generally received in equal or near equal installments over the term of the arrangement. Under ASC 605, these arrangements were required to be recognized ratably over the contract terms. Under ASC 606, the Company has concluded that its software licenses in TSL contracts are not distinct from its obligation to provide unspecified software updates to the licensed software throughout the license term. Such updates represent inputs to a single, combined performance obligation, commencing upon the later of the arrangement effective date or transfer of the software license. Remix rights are not an additional promised good or service in the contract, and where unspecified additional software product rights are part of the contract with the customer, such rights are accounted for as part of the single performance obligation that includes the licenses, updates, and technical support because such rights are provided for the same period of time and have the same pattern of transfer to the customer over the duration of the subscription term. IP & System Integration The Company generally licenses IP under nonexclusive license agreements that provide usage rights for specific applications. Additionally, for certain IP license agreements, royalties are collected as customers sell their own products that incorporate the Company’s IP. Under ASC 605, the Company recognized revenue either upfront if certain criteria in ASC 605 were met, or over the contractual period for IP licensing and support arrangements if such arrangements were combined with other TSL arrangements. Under ASC 606, these arrangements generally have two distinct performance obligations that consist of transferring the licensed IP and the support service. Support services consist of a stand-ready obligation to provide technical support and software updates over the support term. Revenue allocated to the IP license is recognized at a point in time upon the later of the delivery date or the beginning of the license period, and revenue allocated to support services is recognized ratably over the support term. Royalties are recognized as revenue is earned, generally when the customer sells its products that incorporate the Company’s IP. Software Integrity Products Software Integrity product arrangements provide customers the right to software licenses, software updates and technical support. Under the term of these arrangements, the customer expects to receive integral updates to the software licenses that protect the customer’s software from potential security vulnerabilities. The licenses and software updates together serve to fulfill the Company’s commitment to the customer, as they represent inputs to a single, combined performance obligation that commences upon the later of the arrangement effective date or transfer of the software license. Software updates are part of the contract with the customer, and such rights are accounted for as part of the single performance obligation that includes the licenses, updates, and technical support because such rights are provided for the same period of time and have the same time-based pattern of transfer to the customer . Hardware The Company generally has two performance obligations in arrangements involving the sale of hardware products. The first performance obligation is to transfer the hardware product, which includes embedded software integral to the functionality of the hardware product. The second performance obligation is to provide maintenance on the hardware and its embedded software, including rights to technical support, hardware repairs and software updates that are all provided over the same term and have the same time-based pattern of transfer to the customer. The portion of the transaction price allocated to the hardware product is generally recognized as revenue at a point in time when the hardware is shipped to the customer. The Company has concluded that control generally transfers upon delivery because the customer has the ability to direct the use of the asset and an obligation to pay for the hardware. The portion of the transaction price allocated to maintenance is recognized as revenue that is ratable over the maintenance term. The adoption of ASC 606 did not change the timing of revenue recognition for hardware products and related services. Professional Services The Company's arrangements often include service elements (other than maintenance and support services). These services include training, design assistance, and consulting. Services performed on a time and materials basis are recognized over time, as the customer simultaneously receives and consumes the benefit provided. Certain arrangements also include the customization or modification of licensed IP. Revenue from these contracts is recognized over time as the services are performed, when the development is specific to the customer’s needs and Synopsys has enforceable rights to payment for performance completed. Inputs such as costs incurred and hours expended are used in order to measure progress of performance. The Company has a history of accurately estimating project status and the costs necessary to complete projects. A number of internal and external factors can affect these estimates, including labor rates, utilization and efficiency variances, specification and testing requirement changes, and changes in customer delivery priorities. Payments for services are generally due upon milestones in the contract or upon consumption of the hourly resources. Flexible Spending Accounts Some customers enter into a non-cancelable Flexible Spending Account arrangement (FSA) whereby the customer commits to a fixed dollar amount over a specified period of time that can be used to purchase from a list of Synopsys products or services. These arrangements do not meet the definition of a revenue contract until the customer executes a separate order to identify the required products and services that they are purchasing. The combination of the FSA arrangement and the subsequent order creates enforceable rights and obligations, thus meeting the definition of a revenue contract. Each separate order under the agreement is treated as an individual contract under the new standard and accounted for based on the respective performance obligations included within the FSA arrangements. Judgments The Company’s contracts with customers often include promises to transfer multiple products and services to a customer. Determining whether services and products are considered distinct performance obligations that should be accounted for separately versus together requires significant judgment . The Company has concluded that (1) its EDA software licenses in TSL contracts are not distinct from its obligation to provide unspecified software updates to the licensed software throughout the license term, because those promises represent inputs to a single, combined performance obligation, and (2) where unspecified additional software product rights are part of the contract with the customer, such rights are accounted for as part of the single performance obligation that includes the licenses, updates, and technical support, because such rights are provided for the same period of time and have the same time-based pattern of transfer to the customer. In reaching this conclusion, the Company considered the nature of the obligation to customers which is to provide an ongoing right to use the most up to date and relevant software. As EDA customers operate in a rapidly changing and competitive environment, satisfying the obligation requires providing critical updates to the existing software products, including ongoing iterative interaction with customers to make the software relevant to customers’ ability to meet the time to go to market with advanced products. Similarly, the Company also concluded that in its Software Integrity business, the licenses and maintenance updates serve together to fulfill the Company’s commitment to the customer as both work together to provide the functionality to the customer and represent a combined performance obligation because the updates are essential to the software’s central utility, which is to identify security vulnerabilities and other threats. Judgment is also required to determine the standalone selling price (SSP) for each distinct performance obligation. For non-software performance obligations (IP, Hardware, and services), SSP is established based on observable prices of products and services sold separately. SSP for license (and related updates and support) in a contract with multiple performance obligations is determined by applying a residual approach whereby all other non-software performance obligations within a contract are first allocated a portion of the transaction price based upon their respective SSP, using observable prices, with any residual amount of the transaction price allocated to the license because the Company does not sell the license separately, and the pricing is highly variable. Contract Balances The timing of revenue recognition may differ from the timing of invoicing to customers, and these timing differences result in receivables (billed or unbilled), contract assets, or contract liabilities (deferred revenue) on the Company’s consolidated balance sheet. The Company records a contract asset when revenue is recognized prior to the right to invoice, or deferred revenue when revenue is recognized subsequent to invoicing. For time-based software agreements, customers are generally invoiced in equal, quarterly amounts, although some customers prefer to be invoiced in single or annual amounts. The Company records an unbilled receivable when revenue is recognized and it has an unconditional right to invoice and receive payment. Warranties and Indemnities. The Company generally warrants its products to be free from defects in media and to substantially conform to material specifications for a period of 90 days for software products and for up to six months for hardware systems. In certain cases, the Company also provides its customers with limited indemnification with respect to claims that their use of the Company’s software products infringes on United States patents, copyrights, trademarks or trade secrets. The Company is unable to estimate the potential impact of these commitments on the future results of operations. To date, the Company has not been required to pay any material warranty claims. Net Income Per Share. The Company computes basic income per share by dividing net income available to common shareholders by the weighted average number of common shares outstanding during the period. Diluted net income per share reflects the dilution from potential common shares outstanding such as stock options and unvested restricted stock units and awards during the period using the treasury stock method. The table below reconciles the weighted average common shares used to calculate basic net inc |
Revenue
Revenue | 12 Months Ended |
Oct. 31, 2020 | |
Revenue from Contract with Customer [Abstract] | |
Revenue from Contract with Customer [Text Block] | Revenue Disaggregated Revenue The following table shows the percentage of revenue by product groups: 2020 2019 2018 EDA 57 % 59 % 62 % IP & System Integration 33 % 31 % 29 % Software Integrity Products & Services 10 % 10 % 9 % Other (1) 0 % 0 % 0 % Total 100 % 100 % 100 % (1) The percentage of revenue by Other is less than 1%. Contract Balances The contract assets indicated below are presented as prepaid and other current assets in the consolidated balance sheets. The contract assets are transferred to receivables when the rights to invoice and receive payment become unconditional. Unbilled receivables are presented as accounts receivable, net, in the consolidated balance sheets. Contract balances are as follows: As of October 31, 2020 2019 (in thousands) Contract assets $ 214,583 $ 210,557 Unbilled receivables $ 50,932 $ 38,175 Deferred revenue $ 1,493,113 $ 1,302,578 During fiscal 2020 , the Company recognized $1.1 billion of revenue that was included in the deferred revenue balance as of October 31, 2019 . During fiscal 2019 , the Company recognized $1.0 billion of revenue that was included in the deferred revenue balance as of October 31, 2018 . Contracted but unsatisfied or partially unsatisfied performance obligations were approximately $4.9 billion as of October 31, 2020 , which includes $673.8 million in non-cancellable FSA commitments from customers where actual product selection and quantities of specific products or services are to be determined by customers at a later date. The Company has elected to exclude future sales-based royalty payments from the remaining performance obligations. Approximately 61% of the contracted but unsatisfied or partially unsatisfied performance obligations as of October 31, 2020, excluding non-cancellable FSA, are expected to be recognized over the next 12 months with the remainder recognized thereafter. During fiscal 2020 , the Company recognized $102.4 million from performance obligations satisfied from sales-based royalties earned during the periods. During fiscal 2019 , the Company recognized $80.0 million from performance obligations satisfied from sales-based royalties earned during the periods. Costs of Obtaining a Contract with Customer The Company adopted ASC Subtopic 340-40, “Other Assets and Deferred Costs - Contracts with Customers (ASC 340-40)” on November 4, 2018, the beginning of fiscal year 2019, using the modified retrospective method. The comparative information for periods prior to fiscal year 2019 has not been restated and continues to be reported under the accounting standards in effect for those periods. The incremental costs of obtaining a contract with a customer, which consist primarily of direct sales commissions earned upon execution of the contract, are required to be capitalized under ASC 340-40 and amortized over the estimated period of which the benefit is expected to be received. As direct sales commissions paid for renewals are commensurate with the amounts paid for initial contracts, the deferred incremental costs will be recognized over the contract term. Total capitalized direct commission costs as of October 31, 2020 were $81.3 million and are included in other assets in the Company’s consolidated balance sheets. Amortization of these assets was $61.2 million during fiscal 2020 and is included in sales and marketing expense in the Company’s consolidated statements of operations. Total capitalized direct commission costs as of October 31, 2019 were $86.4 million and are included in other assets in the Company’s consolidated balance sheets. Amortization of these assets was $62.8 million during fiscal 2019 and is included in sales and marketing expense in the Company’s consolidated statements of operations. |
Business Combinations
Business Combinations | 12 Months Ended |
Oct. 31, 2020 | |
Business Combinations [Abstract] | |
Business Combinations | Business Combinations Fiscal 2020 Acquisitions During fiscal 2020, the Company completed several acquisitions for an aggregate consideration of $238.3 million , net of cash acquired as described below: • During the second quarter of fiscal 2020, the Company completed an acquisition for an aggregate consideration of $105.7 million ; including cash consideration of $75.7 million and the Company’s products exchanged in connection with the acquisition with a fair value of $30.0 million . The consideration of $105.7 million was allocated to $20.6 million of identifiable intangible assets, $4.2 million of net tangible assets, and $80.9 million in goodwill, on a preliminary basis. The fair value of these intangible assets was estimated using the income method. These transactions are not considered to be material to the Company’s consolidated statements of operations. The acquisition was attributable to the Semiconductor & System Design reporting segment. Concurrent to this transaction, the Company also executed a design service arrangement and recognized an asset of $10.7 million for the off-market component. The $10.7 million contract asset is expected to be amortized over the contractual period of the agreement of five years . • In addition to the above, the Company also completed several other acquisitions for an aggregate cash consideration of $132.6 million , net of cash acquired. The preliminary purchase allocations are $44.7 million of identifiable intangible assets and $92.8 million in goodwill, of which $13.3 million is attributable to the Software Integrity reporting segment. The fair value of these intangible assets and goodwill are estimated using the income method. The preliminary fair value estimates for the assets acquired and liabilities assumed for all acquisitions completed within 12 months from the applicable acquisition date are not yet finalized and may change as additional information becomes available during the respective measurement periods. The primary areas of those preliminary estimates relate to certain tangible assets and liabilities, identifiable intangible assets, and income taxes. The Company does not consider these acquisitions to be material, individually or in the aggregate, to the Company’s consolidated statements of operations. |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 12 Months Ended |
Oct. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets | Goodwill and Intangible Assets The Company has two reporting units and has assigned assets and liabilities to each of the reporting units based on each unit's operating activities. No impairment of goodwill was identified for any periods presented. Goodwill activity by reportable segment for the year ended October 31, 2020 consisted of the following: Semiconductor & System Design Software Integrity Total (in thousands) Balance at October 31, 2019 $ 2,758,926 $ 412,253 $ 3,171,179 Additions 160,447 13,285 173,732 Adjustments 59 — 59 Effect of foreign currency translation 20,080 64 20,144 Balance at October 31, 2020 $ 2,939,512 $ 425,602 $ 3,365,114 Goodwill activity by reportable segment for the year ended October 31, 2019 consisted of the following: Semiconductor & System Design Software Integrity Total (in thousands) Balance at October 31, 2018 $ 2,730,990 $ 412,259 $ 3,143,249 Additions 23,690 — 23,690 Effect of foreign currency translation 4,246 (6 ) 4,240 Balance at October 31, 2019 $ 2,758,926 $ 412,253 $ 3,171,179 In-process research and development (IPR&D) as of October 31, 2020 consisted of acquired projects that, if completed, will be reclassified to core/developed technology upon completion, or if abandoned, will be written off. Intangible assets as of October 31, 2020 consisted of the following: Gross Assets Accumulated Amortization Net Assets (in thousands) Core/developed technology $ 827,232 $ 703,009 $ 124,223 Customer relationships 380,838 277,219 103,619 Contract rights intangible 192,812 186,763 6,049 Trademarks and trade names 43,096 28,716 14,380 In-process research and development (IPR&D) 1,214 — 1,214 Capitalized software development costs 44,122 39,285 4,837 Total $ 1,489,314 $ 1,234,992 $ 254,322 Intangible assets as of October 31, 2019 consisted of the following: Gross Assets Accumulated Amortization Net Assets (in thousands) Core/developed technology $ 791,647 $ 655,119 $ 136,528 Customer relationships 358,661 242,058 116,603 Contract rights intangible 184,304 181,124 3,180 Trademarks and trade names 42,929 25,581 17,348 In-process research and development (IPR&D) 1,200 — 1,200 Capitalized software development costs 40,077 35,562 4,515 Total $ 1,418,818 $ 1,139,444 $ 279,374 Amortization expense related to intangible assets consisted of the following: Year Ended October 31, 2020 2019 2018 (in thousands) Core/developed technology $ 47,890 $ 56,163 $ 78,820 Customer relationships 35,075 37,533 37,395 Contract rights intangible 5,181 3,581 4,906 Trademarks and trade names 3,135 3,637 4,543 Capitalized software development costs (1) 3,723 2,868 3,599 Total $ 95,004 $ 103,782 $ 129,263 (1) Amortization of capitalized software development costs is included in cost of products revenue in the consolidated statements of operations. The following table presents the estimated future amortization of intangible assets as of October 31, 2020 : Fiscal Year (in thousands) 2021 $ 76,078 2022 61,242 2023 44,733 2024 34,398 2025 18,295 2026 and thereafter 18,362 IPR&D 1,214 Total $ 254,322 |
Financial Assets and Liabilitie
Financial Assets and Liabilities | 12 Months Ended |
Oct. 31, 2020 | |
Financial Assets And Liabilities [Abstract] | |
Financial Assets and Liabilities | Financial Assets and Liabilities Cash equivalents. The Company classifies time deposits and other investments with original maturities less than three months as cash equivalents. As of October 31, 2020 , the balances of the Company's cash equivalents and non-marketable equity securities investments were: Cost Gross Gross Gross Estimated (1) (in thousands) Cash equivalents: Money market funds $ 304,127 $ — $ — $ — $ 304,127 Total: $ 304,127 $ — $ — $ — $ 304,127 Other long-term assets: Non-marketable equity securities $ 13,200 $ — $ — $ — $ 13,200 Total: $ 13,200 $ — $ — $ — $ 13,200 (1) See Note 7. Fair Value Measures for further discussion on fair values of cash equivalents. As of October 31, 2019 , the balances of our cash equivalents and non-marketable equity securities investments were: Cost Gross Gross Gross Estimated (1) (in thousands) Cash equivalents: Money market funds $ 166,024 $ — $ — $ — $ 166,024 Total: $ 166,024 $ — $ — $ — $ 166,024 Other long-term assets: Non-marketable equity securities $ 10,951 $ — $ — $ — $ 10,951 Total: $ 10,951 $ — $ — $ — $ 10,951 (1) See Note 7. Fair Value Measures for further discussion on fair values of cash equivalents. Restricted cash. The Company includes amounts generally described as restricted cash and restricted cash equivalents in cash and cash equivalents when reconciling beginning-of-period and end-of-period total amounts shown on the consolidated statements of cash flows. All restricted cash is primarily associated with office leases and has no material impact on the Company’s consolidated statements of cash flows. The following table provides a reconciliation of cash, cash equivalents and restricted cash included in the consolidated balance sheets: October 31, 2020 2019 (in thousands) Cash and cash equivalents $ 1,235,653 $ 728,597 Restricted cash included in Prepaid expenses and other current assets 1,523 1,174 Restricted cash included in Other long-term assets 794 756 Total cash, cash equivalents and restricted cash $ 1,237,970 $ 730,527 Non-marketable equity securities. The Company’s strategic investment portfolio consists of non-marketable equity securities in privately held companies. The investments that the Company does not have the ability to exercise significant influence are accounted using the measurement alternative when the fair value of the investment is not readily determinable. Securities accounted for as equity method investments are recorded at cost plus the proportional share of the issuers’ income or loss, which is recorded in the Company’s other income (expense), net. The cost basis of securities sold is based on the specific identification method. See Note 7. Fair Value Measures. Derivatives. In the first quarter of 2020, the Company adopted ASU 2017-12, Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedge Activities, which amends the hedge accounting recognition and presentation requirements of ASC 815. Pursuant to the provisions of ASU 2017-12, the Company is not required to separately measure and report hedge ineffectiveness, which was previously recorded in Other income (expense), net in our consolidated statements of operations. Also, prior to the adoption of ASU 2017-12, the forward point components of the cash flow hedges were excluded from assessing effectiveness of the hedging relationship and were recorded on the consolidated statements of operations in other income (expense), net. Following the Company's adoption of ASU 2017-12, the Company presents the related earning impact of the cash flow hedges in the same income statement section as the hedged items. Adoption of the guidance did not impact opening retained earnings or have a material impact on our financial statements. The Company recognizes derivative instruments as either assets or liabilities in the consolidated balance sheets at fair value and provides qualitative and quantitative disclosures about such derivatives. The Company operates internationally and is exposed to potentially adverse movements in foreign currency exchange rates. The Company enters into hedges in the form of foreign currency forward contracts to reduce its exposure to foreign currency rate changes on non-functional currency denominated forecasted transactions and balance sheet positions including: (1) certain assets and liabilities, (2) shipments forecasted to occur within approximately one month , (3) future billings and revenue on previously shipped orders, and (4) certain future intercompany invoices denominated in foreign currencies. The duration of forward contracts ranges from approximately one month to 22 months , the majority of which are short-term. The Company does not use foreign currency forward contracts for speculative or trading purposes. The Company enters into foreign exchange forward contracts with high credit quality financial institutions that are rated ‘A’ or above and to date has not experienced nonperformance by counterparties. In addition, the Company mitigates credit risk in derivative transactions by permitting net settlement of transactions with the same counterparty and anticipates continued performance by all counterparties to such agreements. The assets or liabilities associated with the forward contracts are recorded at fair value in other current assets or accrued liabilities in the consolidated balance sheets. The accounting for gains and losses resulting from changes in fair value depends on the use of the foreign currency forward contract and whether it is designated and qualifies for hedge accounting. The cash flow impact upon settlement of the derivative contracts will be included in “Net cash provided by operating activities” in the consolidated statements of cash flows. Cash Flow Hedging Activities Certain foreign exchange forward contracts are designated and qualify as cash flow hedges. These contracts have durations of approximately 22 months or less. Certain forward contracts are rolled over periodically to capture the full length of exposure to the Company’s foreign currency risk, which can be up to three years . To receive hedge accounting treatment, all hedging relationships are formally documented at the inception of the hedge, and the hedges must be highly effective in offsetting changes to future cash flows on the hedged transactions. The related gains or losses resulting from changes in fair value of these hedges is initially reported, net of tax, as a component of other comprehensive income (loss) (OCI), in stockholders’ equity and reclassified into revenue or operating expenses, as appropriate, at the time the hedged transactions affect earnings. The Company expects a majority of the hedge balance in OCI to be reclassified to the statements of operations within the next twelve months . Prior to adoption of ASU 2017-12, hedge effectiveness was evaluated monthly using spot rates, with any gain or loss caused by hedging ineffectiveness recorded in other income (expense), net. During fiscal 2020, 2019 and 2018, the amounts recognized in other income (expense) for ineffectiveness and excluded component were immaterial . Upon adoption of ASU 2017-12, the Company elected to use the forward method to measure hedge effectiveness for its Japanese yen revenue and foreign currency expense cash flow hedges. The Company did not change the process for its backlog cash flow hedges and continues to measure hedging effectiveness on a monthly basis. Non-designated Hedging Activities The Company’s foreign exchange forward contracts that are used to hedge non-functional currency denominated balance sheet assets and liabilities are not designated as hedging instruments. Accordingly, any gains or losses from changes in the fair value of the forward contracts are recorded in other income (expense), net. The gains and losses on these forward contracts generally offset the gains and losses associated with the underlying assets and liabilities, which are also recorded in other income (expense), net. The duration of the forward contracts for hedging the Company’s balance sheet exposure is approximately one month . The Company also has certain foreign exchange forward contracts for hedging certain international revenues and expenses that are not designated as hedging instruments. Accordingly, any gains or losses from changes in the fair value of the forward contracts are recorded in other income (expense), net. The gains and losses on these forward contracts generally offset the gains and losses associated with the foreign currency in operating income. The duration of these forward contracts is usually less than one year . The overall goal of the Company’s hedging program is to minimize the impact of currency fluctuations on its net income over its fiscal year. The effects of non-designated derivative instruments on the Company’s consolidated statements of operations for fiscal years 2020 , 2019 , and 2018 are summarized as follows: October 31, 2020 2019 2018 (in thousands) Gain (loss) recorded in other income (expense), net $ 1,957 $ 4,538 $ 3,361 The notional amounts in the table below for derivative instruments provide one measure of the transaction volume outstanding: October 31, 2020 2019 (in thousands) Total gross notional amount $ 981,234 $ 817,441 Net fair value $ 6,940 $ 3,494 The notional amounts for derivative instruments do not represent the amount of the Company’s exposure to market gain or loss. The Company’s exposure to market gain or loss will vary over time as a function of currency exchange rates. The amounts ultimately realized upon settlement of these financial instruments, together with the gains and losses on the underlying exposures, will depend on actual market conditions during the remaining life of the instruments. The following table represents the consolidated balance sheets location and amount of derivative instrument fair values segregated between designated and non-designated hedge instruments: Fair values of derivative instruments designated as hedging instruments Fair values of derivative instruments not designated as hedging instruments (in thousands) Balance at October 31, 2020 Other current assets $ 9,182 $ 138 Accrued liabilities $ 2,088 $ 292 Balance at October 31, 2019 Other current assets $ 7,327 $ 53 Accrued liabilities $ 3,715 $ 171 The following table represents, for designated hedge instruments, net of tax, the respective locations in the consolidated statements of operations and the amount of gains and losses on derivative instrument fair values: Location of gain (loss) recognized in OCI on derivatives Amount of gain (loss) recognized in OCI on derivatives (effective portion) Location of gain (loss) reclassified from OCI Amount of gain (loss) reclassified from OCI (effective portion) (in thousands) Fiscal year ended October 31, 2020 Foreign exchange contracts Revenue $ 3,034 Revenue $ 530 Foreign exchange contracts Operating expenses 4,800 Operating expenses (603 ) Total $ 7,834 $ (73 ) Fiscal year ended October 31, 2019 Foreign exchange contracts Revenue $ 278 Revenue $ 1,436 Foreign exchange contracts Operating expenses 4,455 Operating expenses (16,073 ) Total $ 4,733 $ (14,637 ) Fiscal year ended October 31, 2018 Foreign exchange contracts Revenue $ 693 Revenue $ 1,103 Foreign exchange contracts Operating expenses (18,121 ) Operating expenses 9,785 Total $ (17,428 ) $ 10,888 Other Commitments — Credit and Term Loan Facilities On November 28, 2016, the Company entered into an amended and restated credit agreement with several lenders (the Credit Agreement) providing for (i) a $650.0 million senior unsecured revolving credit facility (the Revolver) and (ii) a $150.0 million senior unsecured term loan facility (the Term Loan). The Credit Agreement amended and restated the Company’s previous credit agreement dated May 19, 2015, in order to increase the size of the revolving credit facility from $500.0 million to $650.0 million , provide a new $150.0 million senior unsecured term loan facility, and to extend the termination date of the revolving credit facility from May 19, 2020 to November 28, 2021. Subject to obtaining additional commitments from lenders, the principal amount of the loans provided under the Credit Agreement may be increased by the Company by up to an additional $150.0 million . The Credit Agreement contains financial covenants requiring the Company to operate within a maximum leverage ratio and maintain a minimum interest coverage ratio, as well as other non-financial covenants. As of October 31, 2020 , the Company was in compliance with all financial covenants. As of October 31, 2020 , the Company had an outstanding balance of $102.1 million , net of debt issuance costs, under the Term Loan, of which $75.0 million was classified as long-term liabilities. Outstanding principal payments under the Term Loan are due as follows: Fiscal year (in thousands) 2021 $ 27,187 2022 75,000 Total $ 102,187 As of October 31, 2019 , the Company had $119.8 million outstanding balance, net of debt issuance costs, under the Term Loan, of which $102.2 million was classified as long-term liabilities. There was no outstanding balance under the Revolver as of October 31, 2020 and October 31, 2019 . The Company expects its borrowings under the Revolver will fluctuate from quarter to quarter. The Term Loan and Revolver borrowings bear interest at a floating rate based on a margin over the Company’s choice of market observable base rates as defined in the Credit Agreement. As of October 31, 2020 , borrowings under the Term Loan bore interest at LIBOR +1.125% and the applicable interest rate for the Revolver was LIBOR +1.000% . In addition, commitment fees are payable on the Revolver at rates between 0.125% and 0.200% per year based on the Company’s leverage ratio on the daily amount of the revolving commitment. In July 2018, the Company entered into a 12 -year $220.0 million RMB (approximately $33.0 million ) credit agreement with a lender in China to support its facilities expansion. Borrowings bear interest at a floating rate based on the 5 year Loan Prime Rate plus 0.74% . As of October 31, 2020 , the Company had $25.8 million outstanding under the agreement. |
Fair Value Measures
Fair Value Measures | 12 Months Ended |
Oct. 31, 2020 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measures | Fair Value Measures Accounting Standards Codification (ASC) 820-10, Fair Value Measurements and Disclosures , defines fair value, establishes guidelines and enhances disclosure requirements for fair value measurements. The accounting guidance requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The accounting guidance also establishes a fair value hierarchy based on the independence of the source and objective evidence of the inputs used. There are three fair value hierarchies based upon the level of inputs that are significant to fair value measurement: Level 1 —Observable inputs that reflect quoted prices (unadjusted) for identical instruments in active markets; Level 2 —Observable inputs other than quoted prices included in Level 1 for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-driven valuations in which all significant inputs and significant value drivers are observable in active markets; and Level 3 —Unobservable inputs to the valuation derived from fair valuation techniques in which one or more significant inputs or significant value drivers are unobservable. On a recurring basis, the Company measures the fair value of certain of its assets and liabilities, which include cash equivalents, non-qualified deferred compensation plan assets, and foreign currency derivative contracts. The Company’s cash equivalents are classified within Level 1 or Level 2 because they are valued using quoted market prices in an active market or alternative independent pricing sources and models utilizing market observable inputs. The Company’s non-qualified deferred compensation plan assets consist of money market and mutual funds invested in domestic and international marketable securities that are directly observable in active markets and are therefore classified within Level 1. The Company’s foreign currency derivative contracts are classified within Level 2 because these contracts are not actively traded and the valuation inputs are based on quoted prices and market observable data of similar instruments. The Company’s borrowings under its credit and term loan facilities are classified within Level 2 because these borrowings are not actively traded and have a variable interest rate structure based upon market rates currently available to the Company for debt with similar terms and maturities. See Note 6. Financial Assets and Liabilities for more information on these borrowings. Assets/Liabilities Measured at Fair Value on a Recurring Basis Assets and liabilities measured at fair value on a recurring basis are summarized below as of October 31, 2020 : Fair Value Measurement Using Description Total Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) (in thousands) Assets Cash equivalents: Money market funds $ 304,127 $ 304,127 $ — $ — Prepaid and other current assets: Foreign currency derivative contracts 9,320 — 9,320 — Other long-term assets: Deferred compensation plan assets 269,737 269,737 — — Total assets $ 583,184 $ 573,864 $ 9,320 $ — Liabilities Accounts payable and accrued liabilities: Foreign currency derivative contracts $ 2,380 $ — $ 2,380 $ — Other long-term liabilities: Deferred compensation plan liabilities 269,737 269,737 — — Total liabilities $ 272,117 $ 269,737 $ 2,380 $ — Assets and liabilities measured at fair value on a recurring basis are summarized below as of October 31, 2019 : Description Total Fair Value Measurement Using Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) (in thousands) Assets Cash equivalents: Money market funds $ 166,024 $ 166,024 $ — $ — Prepaid and other current assets: Foreign currency derivative contracts 7,380 — 7,380 — Other long-term assets: Deferred compensation plan assets 249,822 249,822 — — Total assets $ 423,226 $ 415,846 $ 7,380 $ — Liabilities Accounts payable and accrued liabilities: Foreign currency derivative contracts $ 3,886 $ — $ 3,886 $ — Other long-term liabilities: Deferred compensation plan liabilities 249,822 249,822 — — Total liabilities $ 253,708 $ 249,822 $ 3,886 $ — Assets/Liabilities Measured at Fair Value on a Non-Recurring Basis Non-Marketable Equity Securities Equity investments in privately-held companies, also called non-marketable equity securities, are accounted for using either the measurement alternative or equity method of accounting. The non-marketable equity securities are measured and recorded at fair value when an event or circumstance which impacts the fair value of these securities indicates that the securities are impaired and the fair value of the securities is less than the carrying value. In such events, these equity investments would be classified within Level 3 as they are valued using significant unobservable inputs or data in an inactive market, and the valuation requires management judgment due to the absence of market price and inherent lack of liquidity. The Company monitors these investments and generally uses the income approach to assess impairments based primarily on the financial conditions of these companies. |
Leases
Leases | 12 Months Ended |
Oct. 31, 2020 | |
Leases [Abstract] | |
Leases | Leases The Company has operating lease arrangements for office space, data center, equipment and other corporate assets. These leases have various expiration dates through March 31, 2032 , some of which include options to extend the leases for up to 10 years . Because the Company is not reasonably certain to exercise these renewal options, the options are not considered in determining the lease term and associated potential option payments are excluded from lease payments. The components of the Company’s lease expense during the period presented are as follows: Year Ended October 31, 2020 (in thousands) Operating lease expense $ 93,636 Variable lease expense (1) 5,147 Total lease expense $ 98,783 (1) Variable lease expense includes payments to lessors that are not fixed or determinable at lease commencement date. These payments primarily consist of maintenance, property taxes, insurance and variable indexed based payments. Supplemental cash flow information during the period presented is as follows: Year Ended October 31, 2020 (in thousands) Cash paid for amounts included in the measurement of operating lease liabilities $ 72,828 ROU assets obtained in exchange for operating lease liabilities $ 69,439 Lease term and discount rate information related to the Company’s operating leases as of the end of the period presented are as follows: October 31, 2020 Weighted-average remaining lease term (in years) 8.62 Weighted-average discount rate 2.56 % The following represents the maturities of the Company’s future lease payments due under operating leases as of October 31, 2020 : Lease Payments Fiscal year (in thousands) 2021 $ 84,534 2022 79,886 2023 64,073 2024 59,751 2025 53,280 Thereafter 259,969 Total future minimum lease payments 601,493 Less: Imputed interest 65,909 Total lease liabilities $ 535,584 As of October 31, 2020 , the Company has additional operating leases for facilities that have not yet commenced with future undiscounted lease payments of $58.6 million . These operating leases will commence before March 1, 2021 , with lease terms between 3 years and 9 years . As of October 31, 2019, the future minimum lease payments due under non-cancellable operating leases were as follows: Minimum Lease Payments (1) (in thousands) Fiscal year 2020 $ 79,286 2021 79,703 2022 69,477 2023 53,909 2024 48,730 Thereafter 291,494 Total $ 622,599 (1) Amounts based on Topic 840, Leases. In addition, certain facilities owned by the Company were leased to 3rd parties under non-cancellable operating lease agreements. These leases have annual escalating payments and have expiration dates through March 31, 2031 in accordance with the terms and conditions of the existing agreement. Lease payments due to the Company, over the remaining life of the leases, are approximately $69.6 million as of October 31, 2020 . |
Contingencies
Contingencies | 12 Months Ended |
Oct. 31, 2020 | |
Commitments and Contingencies Disclosure [Abstract] | |
Contingencies | Contingencies Legal Proceedings The Company is subject to routine legal proceedings, as well as demands, claims and threatened litigation that arise in the normal course of its business. The ultimate outcome of any litigation is often uncertain and unfavorable outcomes could have a negative impact on the Company’s results of operations and financial condition. The Company regularly reviews the status of each significant matter and assesses its potential financial exposure. If the potential loss from any claim or legal proceeding is considered probable and the amount is estimable, the Company accrues a liability for the estimated loss. Legal proceedings are inherently uncertain and as circumstances change, it is possible that the amount of any accrued liability may increase, decrease, or be eliminated. The Company has determined that, except as set forth below, no disclosure of estimated loss is required for a claim against the Company because: (1) there is not a reasonable possibility that a loss exceeding amounts already recognized (if any) may be incurred with respect to such claim; (2) a reasonably possible loss or range of loss cannot be estimated; or (3) such estimate is immaterial. Mentor Patent Litigation Prior to the legal settlement as further described below, the Company was engaged in complex patent litigation with Mentor Graphics Corporation (Mentor) involving several actions in different forums. The Company succeeded to the litigation when it acquired Emulation & Verification Engineering S.A. on October 4, 2012. Legal Settlement In March 2017, Siemens PLM Software (Siemens) acquired Mentor. On June 29, 2018, the Company, Siemens and Mentor settled all outstanding patent litigation between the Company and Mentor for a $65.0 million payment made in the current quarter from the Company to Mentor. The Company had previously accrued $39.0 million and recorded the remaining $26.0 million as an expense in the quarter ended July 31, 2018. As a result of the settlement, the litigation with Mentor was dismissed and the injunction entered in connection with that litigation was vacated. The settlement included mutual seven -year patent cross-licenses between the Company and Siemens, and between the Company and Mentor. The Company and Mentor also amended an existing interoperability agreement to collaborate on a wide range of EDA products for the benefit of their mutual customers. The amendment includes a one-time termination charge between $0.0 and $25.0 million , payable to Mentor under certain conditions. Tax Matters The Company undergoes examination from time to time by U.S. and foreign authorities for non-income based taxes, such as sales, use and value-added taxes, and is currently under examination by tax authorities in certain jurisdictions. If the potential loss from such examinations is considered probable and the amount or the range of loss could be estimated, the Company would accrue a liability for the estimated expense. In addition to the foregoing, the Company is, from time to time, party to various other claims and legal proceedings in the ordinary course of its business, including with tax and other governmental authorities. For a description of certain of these other matters, refer to Note 13. Income Taxes. |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Income (Loss) | 12 Months Ended |
Oct. 31, 2020 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |
Accumulated Other Comprehensive Income (Loss) | Accumulated Other Comprehensive Income (Loss) Components of accumulated other comprehensive income (loss), on an after-tax basis where applicable, were as follows: Year Ended October 31, 2020 2019 (in thousands) Cumulative currency translation adjustments $ (57,463 ) $ (87,929 ) Unrealized gain (loss) on derivative instruments, net of taxes 3,389 (4,518 ) Total accumulated other comprehensive income (loss) $ (54,074 ) $ (92,447 ) The effect of amounts reclassified out of each component of accumulated other comprehensive income (loss) into net income was as follows: Year Ended October 31, 2020 2019 2018 (in thousands) Reclassifications from accumulated other comprehensive income (loss) into consolidated statements of operations: Gain (loss) on cash flow hedges, net of taxes Revenues $ 530 $ 1,436 $ 1,103 Operating expenses (603 ) (16,073 ) 9,785 Total reclassifications into net income $ (73 ) $ (14,637 ) $ 10,888 Amounts reclassified in fiscal 2020 , 2019 , and 2018 primarily consisted of gains (losses) from the Company’s cash flow hedging activities. See Note 6. Financial Assets and Liabilities. |
Stock Repurchase Program
Stock Repurchase Program | 12 Months Ended |
Oct. 31, 2020 | |
Stock Repurchase Program [Abstract] | |
Stock Repurchase Program | Stock Repurchase Program The Company’s Board of Directors (the Board) previously approved a stock repurchase program pursuant to which the Company was authorized to purchase up to $500.0 million of its common stock and has periodically replenished the stock repurchase program to such amount. The Board replenished the stock repurchase program up to $500.0 million on June 19, 2020. The program does not obligate the Company to acquire any particular amount of common stock, and the program may be suspended or terminated at any time by the Company's Chief Financial Officer or the Board. The Company repurchases shares to offset dilution caused by ongoing stock issuances from existing equity plans for equity compensation awards and issuances related to acquisitions, and when management believes it is a good use of cash. Repurchases are transacted in accordance with Rule 10b-18 of the Securities Exchange Act of 1934, as amended (the Exchange Act) and may be made through any means, including, but not limited to, open market purchases, plans executed under Rule 10b5-1(c) of the Exchange Act and structured transactions. As of October 31, 2020 , $457.9 million remained available for future repurchases under the program . In December 2019, the Company entered into an accelerated share repurchase agreement (the December 2019 ASR) to repurchase an aggregate of $100.0 million of the Company's common stock. Pursuant to the December 2019 ASR, the Company made a prepayment of $100.0 million to receive initial share deliveries of shares valued at $80.0 million . The remaining balance of $20.0 million was settled in February 2020. Total shares purchased under the December 2019 ASR were approximately 0.7 million shares, at an average purchase price of $149.75 per share. In February 2020, the Company entered into an accelerated share repurchase agreement (the February 2020 ASR) to repurchase an aggregate of $100.0 million of the Company’s common stock. Pursuant to the February 2020 ASR, the Company made a prepayment of $100.0 million to receive initial share deliveries of shares valued at $80.0 million . The remaining balance of $20.0 million was settled in May 2020. Total shares purchased under the February 2020 ASR were approximately 0.7 million shares, at an average purchase price of $ 140.41 per share. Stock repurchase activities as well as the reissuance of treasury stock for employee stock-based compensation purposes are as follows: Year Ended October 31, 2020 2019 2018 (in thousands, except per share price) Shares repurchased (1) 1,585 2,732 4,688 Average purchase price per share (1) $ 152.76 $ 120.49 $ 89.59 Aggregate purchase price (1) $ 242,078 $ 329,185 $ 420,000 Reissuance of treasury stock 3,872 3,798 3,508 (1) The first quarter of fiscal 2018 includes the settlement of the $20.0 million equity forward contract related to the September 2017 ASR. |
Employee Benefit Plans
Employee Benefit Plans | 12 Months Ended |
Oct. 31, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Employee Benefit Plans | Employee Benefit Plans Employee Stock Purchase Plan Under the Company’s Employee Stock Purchase Plan (ESPP), participating employees are granted the right to purchase shares of common stock at a price per share that is 85% of the lesser of the fair market value of the shares at (1) the beginning of an offering period (generally, a rolling two year period) or (2) the purchase date (generally occurring at the end of each semi-annual purchase period), subject to the terms of ESPP, including a limit on the number of shares that may be purchased in a purchase period. On April 9, 2020, the Company’s stockholders approved an amendment to the ESPP to increase the number of shares of common stock authorized for issuance under the plan by 5.0 million shares. During fiscal 2020 , 2019 and 2018 , the Company issued 1.0 million , 1.2 million , and 1.2 million shares, respectively, under the ESPP at average per share prices of $103.41 , $73.18 and $62.52 , respectively. As of October 31, 2020 , 13.8 million shares of common stock were reserved for future issuance under the ESPP. Equity Compensation Plans 2006 Employee Equity Incentive Plan. On April 25, 2006, the Company’s stockholders approved the 2006 Employee Equity Incentive Plan (2006 Employee Plan), which provides for the grant of incentive stock options, non-statutory stock options, restricted stock awards, restricted stock unit awards, stock appreciation rights and other forms of equity compensation, including performance stock awards and performance cash awards, as determined by the plan administrator. The terms and conditions of each type of award are set forth in the 2006 Employee Plan and in the award agreements governing particular awards. Options granted under this plan generally have a contractual term of seven years and generally vest over four years . On April 9, 2020, the Company's stockholders approved an amendment to, among other things, increase the number of shares of common stock reserved for future issuance under the 2006 Employee Plan by 3.5 million shares. As of October 31, 2020 , an aggregate of 3.9 million stock options and 4.1 million restricted stock units were outstanding, and 12.1 million shares were available for future issuance under the 2006 Employee Plan. 2005 and 2017 Non-Employee Directors Equity Incentive Plans. On April 6, 2017, the Company’s stockholders approved the 2017 Non-Employee Directors Equity Incentive Plan (2017 Directors Plan). In connection with stockholder approval of the 2017 Directors Plan, the 2005 Non-Employee Directors Equity Incentive Plan (2005 Directors Plan) was terminated as of April 6, 2017, and no awards can be granted under the 2005 Directors Plan after that date. Under the 2005 Directors Plan, the Company granted options to purchase 188,709 shares of common stock, which vest over a period of three to four years , with an aggregate grant date fair value of $6.7 million , to non-employee directors during fiscal 2007, fiscal 2011, fiscal 2015, and fiscal 2017. As of October 31, 2020 , 29,222 stock options were outstanding under the 2005 Directors Plan. The 2017 Directors Plan provides for equity awards to non-employee directors in the form of stock options, restricted stock units, restricted stock or a combination thereof. On April 6, 2017, the Company’s stockholders approved an aggregate of 0.45 million shares of common stock reserved under the 2017 Directors Plan. For the fiscal year ended October 31, 2020 , the Company issued an aggregate of 9,412 shares of restricted stock awards with an aggregate grant date fair value of approximately $1.3 million under the 2017 Directors Plan. Restricted stock awards generally vest on an annual basis under the 2017 Directors Plan. In addition, the Company granted options to purchase 5,998 shares of common stock, which vest over a period of three years , with an aggregate grant date fair value of $1.4 million . As of October 31, 2020 , 9,412 shares of restricted stock were unvested and 5,998 stock options were outstanding, and a total of 389,682 shares of common stock were reserved for future grant under the 2017 Directors Plan. Other Assumed Stock Plans through Acquisitions. In connection with the Company’s acquisitions in fiscal 2008, fiscal 2010, fiscal 2012, fiscal 2014, fiscal 2015, fiscal 2017, and fiscal 2018 the Company assumed certain outstanding stock awards of acquired companies. If these assumed equity awards are canceled, forfeited or expire unexercised, the underlying shares do not become available for future grant. As of October 31, 2020 , 0.1 million shares of the Company’s common stock remained subject to such outstanding assumed equity awards. Restricted Stock Units. Restricted stock units are granted under the 2006 Employee Plan as part of the Company’s incentive compensation program. In general, restricted stock units vest over three to four years and are subject to the employee's continuing service with the Company. Certain restricted stock units were granted with specific performance criteria and vest to the extent performance conditions are met. For each restricted stock unit granted under the 2006 Employee Plan, a share reserve ratio is applied for the purpose of determining the remaining number of shares reserved for future grants under the plan. As of October 31, 2020 , the share reserve ratio was 1.70 . The following table contains information concerning activities related to restricted stock units: Restricted Stock Units Weighted Average Grant Date Fair Value Weighted Average Remaining Contractual Life (In Years) Aggregate Fair Value (in thousands, except per share and life amounts) Balance at October 31, 2017 3,843 $ 57.26 1.54 Granted (2) 1,679 $ 89.35 Vested (1) (1,495 ) $ 52.55 $ 136,417 Forfeited (258 ) $ 67.04 Balance at October 31, 2018 3,769 $ 72.75 1.46 Granted 1,844 $ 119.27 Vested (1) (1,508 ) $ 65.97 $ 176,659 Forfeited (248 ) $ 79.49 Balance at October 31, 2019 3,857 $ 97.21 1.56 Granted 2,041 $ 168.15 Vested (1) (1,480 ) $ 88.70 $ 261,563 Forfeited (288 ) $ 104.67 Balance at October 31, 2020 4,130 $ 134.80 1.47 (1) The number of vested restricted stock units includes shares that were withheld on behalf of employees to satisfy the minimum statutory tax withholding requirements. (2) The Company assumed unvested restricted stock units from acquisitions including Black Duck. The following table contains additional information concerning activities related to stock options and restricted stock units under all equity plans, other than shares available for grant under the 2017 Directors Plan: Available for Grant (3) Options(2) Options Outstanding Weighted- Average Exercise Price per Share Weighted- Average Remaining Contractual Life (In Years) Aggregate Intrinsic Value (in thousands, except per share and life amounts) Balance at October 31, 2017 12,583 6,530 $ 46.83 4.60 $ 263,555 Options granted (1,134 ) 1,134 $ 89.52 Options assumed (2) 141 $ 18.66 Options exercised (1,336 ) $ 38.18 Options canceled/forfeited/expired 157 (178 ) $ 51.82 Restricted stock units granted (1) (2,541 ) Restricted stock units forfeited (1) 374 Additional shares reserved 3,000 Balance at October 31, 2018 12,439 6,291 $ 55.63 4.39 $ 214,432 Options granted (799 ) 799 $ 113.17 Options exercised (1,615 ) $ 44.29 Options canceled/forfeited/expired 129 (185 ) $ 58.02 Restricted stock units granted (1) (3,134 ) Restricted stock units forfeited (1) 373 Additional shares reserved 3,200 Balance at October 31, 2019 12,208 5,290 $ 65.57 4.08 $ 373,112 Options granted (694 ) 700 $ 143.44 Options exercised (1,891 ) $ 51.76 Options canceled/forfeited/expired 102 (106 ) $ 84.14 Restricted stock units granted (1) (3,469 ) Restricted stock units forfeited (1) 482 Additional shares reserved 3,500 Balance at October 31, 2020 12,129 3,993 $ 85.26 4.10 $ 513,845 Exercisable at October 31, 2020 2,311 $ 65.36 3.23 $ 343,230 (1) These amounts do not reflect the actual number of restricted stock units granted or forfeited but rather the effect on the total remaining shares available for future grants after the application of the share reserve ratio. For more information about the share reserve ratio, please see Restricted Stock Units above. (2) The Company assumed options outstanding under various plans through acquisitions. (3) Excluding shares reserved for future issuance under the 2017 Directors Plan. The aggregate intrinsic value in the preceding table represents the pretax intrinsic value based on stock options with an exercise price less than the Company’s closing stock price of $213.86 as of October 31, 2020 . The pretax intrinsic value of options exercised and their average exercise prices were: Year Ended October 31, 2020 2019 2018 (in thousands, except per share price) Intrinsic value $ 218,640 $ 110,815 $ 71,840 Average exercise price per share $ 51.76 $ 44.29 $ 38.18 Restricted stock award activities during fiscal 2020 under the 2005 Directors Plan and 2017 Directors Plan are summarized as follows: Restricted Shares Weighted-Average Grant Date Fair Value (in thousands, except per share) Unvested at October 31, 2017 38 $ 59.89 Granted 15 $ 82.96 Vested (32 ) $ 62.09 Forfeited (1 ) $ 48.27 Unvested at October 31, 2018 20 $ 73.95 Granted 11 $ 116.43 Vested (20 ) $ 73.95 Forfeited — $ — Unvested at October 31, 2019 11 $ 116.43 Granted 9 $ 140.97 Vested (11 ) $ 116.43 Forfeited — $ — Unvested at October 31, 2020 9 $ 140.97 Valuation and Expense of Stock-Based Compensation. The Company estimates the fair value of stock-based awards in the form of stock options and employee stock purchase rights under employee stock purchase plans on the grant date. The value of awards expected to vest is recognized as expense over the applicable service periods. The Company uses the straight-line attribution method to recognize stock-based compensation costs over the service period of the award except for performance grants with specific performance criteria. With respect to such performance grants in each reporting period, the Company estimates the probability of achievement of applicable performance goals and recognizes related stock-based compensation expense using the graded-vesting method. The amount of stock-based compensation expense recognized in any one period can vary based on the attainment or expected attainment of the various performance goals. If such performance goals are not ultimately met, no compensation expense is recognized and any previously recognized compensation expense is reversed. The Company uses the Black-Scholes option-pricing model to determine the fair value of stock options, stock appreciation rights and employee stock purchase plan awards . The Black-Scholes option-pricing model incorporates various subjective assumptions including expected volatility, expected term and interest rates. The expected volatility for both stock options and stock purchase rights under the ESPP is estimated by a combination of implied volatility for publicly traded options of the Company’s common stock with a term of six months or longer and the historical stock price volatility over the estimated expected term of the Company’s stock-based awards. The expected term of the Company’s stock-based awards is based on historical experience. Restricted stock units are valued based on the closing price of the Company’s common stock on the grant date. The assumptions presented in the following table were used to estimate the fair value of stock options and employee stock purchase rights granted under the Company’s stock plans or stock plans assumed from acquisitions: Year Ended October 31, 2020 2019 2018 Stock Options Expected life (in years) 4.1 4.1 4.1 Risk-free interest rate 0.26% - 1.71% 1.28% - 2.73% 2.10% - 2.95% Volatility 23.05% - 32.80% 23.16% - 24.76% 20.22% - 21.04% Weighted average estimated fair value $33.02 $22.86 $23.55 ESPP Expected life (in years) 0.5 - 2.0 0.5 - 2.0 0.5 - 2.0 Risk-free interest rate 0.09% - 1.24% 1.54% - 2.60% 1.80% - 2.73% Volatility 25.59% - 43.06% 23.73% - 27.86% 19.99% - 21.54% Weighted average estimated fair value $47.69 $35.18 $23.34 The compensation cost recognized in the consolidated statements of operations for the Company's stock compensation arrangements was as follows: Year Ended October 31, 2020 2019 2018 (in thousands) Cost of products $ 27,193 $ 17,193 $ 14,648 Cost of maintenance and service 9,327 6,385 5,467 Research and development expense 125,814 75,853 67,355 Sales and marketing expense 43,205 28,834 28,069 General and administrative expense 43,045 26,736 24,493 Stock-based compensation expense before taxes 248,584 155,001 140,032 Income tax benefit (39,077 ) (26,226 ) (26,578 ) Stock-based compensation expense after taxes $ 209,507 $ 128,775 $ 113,454 As of October 31, 2020 , the Company had $488.6 million of total unrecognized stock-based compensation expense relating to options and restricted stock units and awards, which is expected to be recognized over a weighted average period of 2.3 years. As of October 31, 2020 , the Company had $55.8 million of total unrecognized stock-based compensation expense relating to the ESPP, which is expected to be recognized over a period of 2.0 years . Deferred Compensation Plan. The Company maintains the Synopsys Deferred Compensation Plan (Deferred Plan), which permits eligible employees to defer up to 50% of their annual cash base compensation and up to 100% of their eligible cash variable compensation. Amounts may be withdrawn from the Deferred Plan pursuant to elections made by the employees in accordance with the terms of the plan. Since the inception of the Deferred Plan, the Company has not made any matching or discretionary contributions to the Deferred Plan. There are no Deferred Plan provisions that provide for any guarantees or minimum return on investments. Undistributed amounts under the Deferred Plan are subject to the claims of the Company’s creditors. The securities held by the Deferred Plan are classified as trading securities. Deferred plan assets and liabilities are as follows: As of October 31, 2020 As of October 31, 2019 (in thousands) Plan assets recorded in other long-term assets $ 269,737 $ 249,822 Plan liabilities recorded in other long-term liabilities (1) $ 269,737 $ 249,822 (1) Undistributed deferred compensation balances due to participants. Income or loss from the change in fair value of the Deferred Plan assets is recorded in other income (expense), net. The increase or decrease in the fair value of the undistributed Deferred Plan obligation is recorded in total cost of revenue and operating expense. The following table summarizes the impact of the Deferred Plan: Year Ended October 31, 2020 2019 2018 (in thousands) Increase (reduction) to cost of revenue and operating expense $ 21,469 $ 27,759 $ 4,636 Other income (expense), net 21,469 27,759 4,636 Net increase (decrease) to net income $ — $ — $ — Other Retirement Plans. The Company sponsors various retirement plans for its eligible U.S. and non-U.S. employees. Total contributions to these plans were $54.7 million , $50.7 million , and $56.5 million in fiscal 2020 , 2019 , and 2018 , respectively. For employees in the United States and Canada, the Company matches pretax employee contributions up to a maximum of U.S. $3,000 and Canadian $4,000 , respectively, per participant per year. |
Income Taxes
Income Taxes | 12 Months Ended |
Oct. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The domestic and foreign components of the Company’s total income (loss) before provision for income taxes are as follows: Year Ended October 31, 2020 2019 2018 (in thousands) United States $ 544,391 $ 487,430 $ (18,029 ) Foreign 93,768 58,076 381,572 Total income (loss) before provision for income taxes $ 638,159 $ 545,506 $ 363,543 The components of the provision (benefit) for income taxes were as follows: Year Ended October 31, 2020 2019 2018 (in thousands) Current: Federal $ 29,272 $ 22,821 $ (1,120 ) State 1,863 11,846 2,025 Foreign 55,103 61,092 140,430 86,238 95,759 141,335 Deferred: Federal (84,739 ) (41,219 ) (139,547 ) State (20,233 ) (7,227 ) (25,661 ) Foreign (6,554 ) (34,174 ) (45,102 ) (111,526 ) (82,620 ) (210,310 ) Provision (benefit) for income taxes $ (25,288 ) $ 13,139 $ (68,975 ) The provision (benefit) for income taxes differs from the taxes computed with the statutory federal income tax rate as follows: Year Ended October 31, 2020 2019 2018 (in thousands) Statutory federal tax $ 133,979 $ 114,557 $ 85,142 State tax (benefit), net of federal effect (29,096 ) 6,529 (32,351 ) Tax credits (39,206 ) (34,485 ) (35,142 ) Tax on foreign earnings (3,980 ) 23,467 (104,252 ) Foreign-derived intangible income deduction (24,282 ) (26,615 ) — Tax settlements (13,167 ) (10,953 ) (14,691 ) Stock-based compensation (50,047 ) (25,356 ) (19,293 ) Changes in valuation allowance (614 ) (42,144 ) 78,192 Integration of acquired technologies — — 27,927 Undistributed earnings of foreign subsidiaries — 6,341 (974 ) Impact of tax restructuring — — (171,979 ) Impact of Tax Act rate change — — 51,075 Transition tax — — 63,107 Other 1,125 1,798 4,264 Provision (benefit) for income taxes $ (25,288 ) $ 13,139 $ (68,975 ) The integration of acquired technologies represents the income tax effect resulting from the transfer of certain intangible assets among company-controlled entities. These intangible assets generally result from the acquisition of technology by a company-controlled entity as part of a business or asset acquisition. The Tax Cuts and Jobs Act (Tax Act), enacted on December 22, 2017, lowered the statutory federal corporate income tax rate from 35% to 21% effective on January 1, 2018. Beginning in the Company's fiscal 2019, the annual statutory federal corporate tax rate is 21% . The Tax Act includes certain new tax provisions listed below which apply to the Company beginning in fiscal 2019. • A tax on global intangible low-tax income (GILTI), which is determined annually based on the Company's aggregate foreign subsidiaries' income in excess of certain qualified business asset investment return. In fiscal 2019, the Company adopted an accounting policy to account for the tax effects of GILTI in the period that it is subject to such tax. • A base erosion and anti-abuse tax (BEAT), which functions as a minimum tax that partially disallows deductions for certain related party transactions and certain tax credits. • A special tax deduction for foreign-derived intangible income (FDII), which, in general, allows a deduction of certain intangible income earned in the U.S. and derived from foreign sources. The Tax Act also provides an exemption from federal income taxes for distributions from foreign subsidiaries made after December 31, 2017, that were not subject to the one-time transition tax. The Company has provided for foreign withholding taxes on undistributed earnings of certain of its foreign subsidiaries to the extent such earnings are no longer considered to be indefinitely reinvested in the operations of those subsidiaries. The Tax Act required the Company to pay a one-time transition tax of 15.5% on previously untaxed earnings represented by foreign cash and certain other net current assets, and 8% on the remaining earnings. In fiscal 2018, the Company recorded a tax expense of $63.1 million . Based on subsequent judicial rulings in fiscal 2019 (including Altera Corp. et al. v. Commissioner and the Hungarian Administrative Court ruling, see Non-U.S. Examinations below) the Company recorded a tax benefit of $17.9 million related to the one-time transition tax. On July 27, 2015, the United States Tax Court (Tax Court) issued an opinion ( Altera Corp. et al. v. Commissioner ) regarding the treatment of stock-based compensation expense in intercompany cost-sharing arrangements. In view of the Tax Court opinion, the Company amended its cost-sharing arrangement effective February 1, 2016 to exclude stock-based compensation expense on a prospective basis and reflected the corresponding benefits in its income tax expense for fiscal years 2016, 2017 and 2018. On July 24, 2018, the United States Court of Appeals for the Ninth Circuit (Ninth Circuit) reversed the decision of the Tax Court, and then subsequently withdrew its decision on August 7, 2018. A rehearing of the case was held on October 16, 2018 and on June 7, 2019, the Ninth Circuit overturned the July 27, 2015 Tax Court decision. In the third quarter of 2019, as a result of the Ninth Circuit decision, the Company recorded a tax expense of $18.3 million , which is net of estimated U.S. foreign tax credits for the tax assessments related to fiscal years 2016, 2017 and 2018. The Company's intercompany cost-sharing arrangement was terminated at the end of fiscal 2018 as part of the tax restructuring. The significant components of deferred tax assets and liabilities were as follows: October 31, 2020 2019 (in thousands) Net deferred tax assets: Deferred tax assets: Deferred revenue 2,367 — Deferred compensation 55,172 56,483 Intangible and depreciable assets 115,097 160,072 Capitalized research and development costs 118,857 48,804 Stock-based compensation 28,478 20,372 Tax loss carryovers 35,571 40,068 Foreign tax credit carryovers 18,645 20,187 Research and other tax credit carryovers 320,317 278,382 Operating Lease Liabilities 101,386 — Gross deferred tax assets 795,890 624,368 Valuation allowance (158,895 ) (157,343 ) Total deferred tax assets 636,995 467,025 Deferred tax liabilities: Intangible assets 45,915 58,697 Operating lease Right-of-Use-Assets 84,716 — Accruals and reserves 7,780 4,450 Deferred revenue — 6,611 Undistributed earnings of foreign subsidiaries 3,063 6,864 Other 372 1,762 Total deferred tax liabilities 141,846 78,384 Net deferred tax assets $ 495,149 $ 388,641 It is more likely than not that the results of future operations will be able to generate sufficient taxable income to realize the net deferred tax assets. The valuation allowance provided against the Company's deferred tax assets as of October 31, 2020 is mainly attributable to international foreign tax credits and the California research credits. The valuation allowance increased by a net of $1.6 million in fiscal 2020 primarily related to the realizability of U.S. foreign tax credits offset by the net increase of valuation allowance on California research credits. The Company has the following tax loss and credit carryforwards available to offset future income tax liabilities: Carryforward Amount Expiration Date (in thousands) Federal net operating loss carryforward $ 41,757 2021-2037 Federal research credit carryforward 176,616 2021-2040 Federal foreign tax credit carryforward 1,921 2021-2029 International foreign tax credit carryforward 15,681 Indefinite International net operating loss carryforward 81,069 2021-Indefinite California research credit carryforward 173,600 Indefinite Other state research credit carryforward 15,486 2024-2035 State net operating loss carryforward 70,251 2027-2039 The federal and state net operating loss carryforward is from acquired companies and the annual use of such loss is subject to significant limitations under Internal Revenue Code Section 382 and certain provisions of the Tax Act. Foreign tax credits may only be used to offset tax attributable to foreign source income. The gross unrecognized tax benefits decreased by approximately $33.1 million during fiscal 2020 resulting in gross unrecognized tax benefits of $83.1 million as of October 31, 2020 . A reconciliation of the beginning and ending balance of gross unrecognized tax benefits is summarized as follows: As of October 31, 2020 As of October 31, 2019 (in thousands) Beginning balance $ 116,212 $ 131,019 Increases in unrecognized tax benefits related to prior year tax positions 5,390 41,346 Decreases in unrecognized tax benefits related to prior year tax positions (43,783 ) (71,092 ) Increases in unrecognized tax benefits related to current year tax positions 9,226 16,927 Decreases in unrecognized tax benefits related to settlements with taxing authorities (1,411 ) (1,624 ) Reductions in unrecognized tax benefits due to lapse of applicable statute of limitations (2,472 ) (964 ) Increases in unrecognized tax benefits acquired 778 — Changes in unrecognized tax benefits due to foreign currency translation (791 ) 600 Ending balance $ 83,149 $ 116,212 As of October 31, 2020 and 2019 , approximately $83.1 million and $116.2 million , respectively, of the unrecognized tax benefits would affect the Company's effective tax rate if recognized upon resolution of the uncertain tax positions. Interest and penalties related to estimated obligations for tax positions taken in the Company’s tax returns are recognized as a component of income tax expense (benefit) in the consolidated statements of operations and totaled approximately $0.2 million , $0.3 million and $9.4 million for fiscal years 2020 , 2019 and 2018 , respectively. As of October 31, 2020 and 2019 , the combined amount of accrued interest and penalties related to tax positions taken on the Company’s tax returns was approximately $13.1 million and $12.8 million , respectively. The timing of the resolution of income tax examinations, and the amounts and timing of various tax payments that are part of the settlement process, are highly uncertain. Variations in such amounts and/or timing could cause large fluctuations in the balance sheet classification of current and non-current assets and liabilities. The Company believes that in the coming 12 months , it is reasonably possible that either certain audits and ongoing tax litigation will conclude or the statute of limitations on certain state and foreign income and withholding taxes will expire, or both. Given the uncertainty as to ultimate settlement terms, the timing of payment and the impact of such settlements on other uncertain tax positions, the range of the estimated potential decrease in underlying unrecognized tax benefits is between $0.0 and $42.5 million . The Company and/or its subsidiaries remain subject to tax examination in the following jurisdictions: Jurisdiction Year(s) Subject to Examination United States Fiscal 2019 and 2020 California Fiscal years after 2017 Hungary Fiscal years after 2018 Ireland Fiscal years after 2016 Japan and Taiwan Fiscal years after 2015 Korea Fiscal years after 2016 In addition, the Company has made acquisitions with operations in several of its significant jurisdictions which may have years subject to examination different from the years indicated in the above table. Intra-Entity Transfers of Assets In October 2016, the FASB issued ASU 2016-16, "Income Taxes (Topic 740), Intra-Entity Transfers of Assets Other Than Inventory.” This ASU requires the immediate recognition of current and deferred income tax effects of intra-entity transfers of assets other than inventory. This ASU was adopted on the first day of fiscal 2019. As a result of the adoption, the Company recorded a decrease of approximately $130.5 million in retained earnings as of the beginning of the period of adoption, with a corresponding decrease in prepaid taxes related to the unamortized tax expense attributed to intra-entity transfers of assets other than inventory previously deferred. The Company will recognize the income tax consequences of new intra-entity transfers of assets other than inventory in the consolidated statements of operations in the period when the transaction takes place. IRS Examinations In fiscal 2020, the Company reached partial settlement with the Examination Division of the IRS for fiscal 2019 and recognized approximately $6.3 million in unrecognized tax benefits, primarily due to the allowance of certain foreign tax credits and research tax credits. In fiscal 2019, the Company reached final settlement with the Examination Division of the IRS for fiscal 2018 and recognized approximately $5.4 million in unrecognized tax benefits and realized $28.1 million of foreign tax credits. In fiscal 2018, the Company reached final settlement with the Examination Division of the IRS for fiscal 2017 and recognized approximately $21.8 million in unrecognized tax benefits, primarily due to the allowance of certain foreign tax credits, and research tax credits from acquired companies. State Examinations In fiscal 2020, the Company reached final settlement with the California Franchise Tax Board for fiscal 2015, 2016, and 2017. As a result of the settlement, the Company recognized $20.2 million in unrecognized tax benefits and increased its valuation allowance by $20.2 million . Non-U.S. Examinations Hungarian Tax Authority In July 2017, the Hungarian Tax Authority (the HTA) issued a final assessment against the Company's Hungarian subsidiary (Synopsys Hungary) for fiscal years 2011 through 2013. The HTA has applied withholding taxes on certain payments made to affiliates, resulting in an aggregate tax assessment of approximately $25.0 million and interest and penalties of $11.0 million (at current exchange rates). On August 2, 2017, Synopsys Hungary filed a claim contesting the final assessment with the Hungarian Administrative Court. In the first quarter of fiscal 2018, Synopsys Hungary paid the assessments, penalties and interest as required by law and recorded these amounts as prepaid taxes on its balance sheet, while continuing its challenge to the assessment through the Hungarian Administrative Court. On April 30, 2019, the Hungarian Administrative Court (the Court) ruled against Synopsys Hungary. The Court's opinion was received on May 16, 2019 and the Company filed an appeal with the Hungarian Supreme Court on July 5, 2019. In the second quarter of 2019, as a result of the Court's decision, the Company recorded a tax expense due to an unrecognized tax benefit of $17.4 million , which is net of estimated U.S. foreign tax credits for the tax assessments. The Hungarian Supreme Court heard the Company's appeal on November 12, 2020 and issued a ruling from the bench to remand the case to the Hungarian Administrative Court for further proceedings. The Company expects to receive the Hungarian Supreme Court's written decision in the first quarter of fiscal 2021. In fiscal 2020, the Company reached final settlement with the HTA for fiscal years 2014 through 2018. As a result of the settlement, the Company recognized tax expense of $1.4 million , and recognized $6.9 million in unrecognized tax benefits. National Taxation Bureau of Taipei In fiscal 2019, the Company reached final settlement with the National Taxation Bureau of Taipei for fiscal year 2017 and recognized $5.5 million |
Other Income (Expense), Net
Other Income (Expense), Net | 12 Months Ended |
Oct. 31, 2020 | |
Other Income and Expenses [Abstract] | |
Other Income (Expense), Net | Other Income (Expense), Net The following table presents the components of other income (expense), net: Year Ended October 31, 2020 2019 2018 (in thousands) Interest income $ 3,561 $ 6,859 $ 5,323 Interest expense (5,140 ) (11,659 ) (15,607 ) Gain (loss) on assets related to deferred compensation plan 21,469 27,759 4,636 Foreign currency exchange gain (loss) 5,544 3,588 3,557 Other, net (7,416 ) (1,272 ) 5,409 Total $ 18,018 $ 25,275 $ 3,318 |
Segment Disclosure
Segment Disclosure | 12 Months Ended |
Oct. 31, 2020 | |
Segment Reporting [Abstract] | |
Segment Disclosure | Segment Disclosure Segment reporting is based upon the “management approach,” i.e., how management organizes the Company’s operating segments for which separate financial information is (1) available and (2) evaluated regularly by the CODMs in deciding how to allocate resources and in assessing performance. Synopsys’ CODMs are its two Co-Chief Executive Officers. Financial information provided to and used by the CODMs to assist in making operational decisions, allocating resources, and assessing performance reflects consolidated financial information as well as revenue, adjusted operating income, and adjusted operating margin information for the Semiconductor & System Design and Software Integrity segments, accompanied by disaggregated information relating to revenue by geographic region. Information by reportable segment was as follows: Year Ended October 31, 2020 2019 2018 (in thousands) Total Segments: Revenue $ 3,685,281 $ 3,360,694 $ 3,121,058 Adjusted operating income 1,031,630 838,821 690,681 Adjusted operating margin 28 % 25 % 22 % Semiconductor & System Design: Revenue $ 3,327,211 $ 3,026,097 $ 2,840,589 Adjusted operating income 990,837 806,618 701,283 Adjusted operating margin 30 % 27 % 25 % Software Integrity: Revenue $ 358,070 $ 334,597 $ 280,469 Adjusted operating income 40,793 32,203 (10,602 ) Adjusted operating margin 11 % 10 % (4 )% Certain operating expenses are not allocated to the segments and are managed at a consolidated level. The unallocated expenses managed at a consolidated level, including amortization of intangible assets, stock compensation and other operating expenses, are presented in the table below to provide a reconciliation of the total adjusted operating income from segments to the Company's consolidated operating income: Year Ended October 31, 2020 2019 2018 (in thousands) Total segment adjusted operating income $ 1,031,630 $ 838,821 $ 690,681 Reconciling items: Amortization of intangible expense (91,281 ) (100,914 ) (125,664 ) Stock-based compensation expense (248,584 ) (155,001 ) (140,032 ) Other (71,624 ) (62,675 ) (64,760 ) Total operating income $ 620,141 $ 520,231 $ 360,225 The CODMs do not use total assets by segment to evaluate segment performance or allocate resources. As a result, total assets by segment are not required to be disclosed. In allocating revenue to particular geographic areas, the CODMs consider where individual “seats” or licenses to the Company’s products are located. Revenue is defined as revenue from external customers. Revenue and property and equipment, net, related to operations in the United States and other geographic areas were: Year Ended October 31, 2020 2019 2018 (in thousands) Revenue: United States $ 1,774,348 $ 1,676,178 $ 1,508,224 Europe 385,287 349,033 369,125 China 420,829 321,777 259,279 Korea 389,008 353,358 307,974 Other 715,809 660,348 676,456 Consolidated $ 3,685,281 $ 3,360,694 $ 3,121,058 As of October 31, 2020 2019 (in thousands) Property and Equipment, net: United States $ 311,350 $ 293,725 Other countries 172,468 135,807 Total $ 483,818 $ 429,532 Geographic revenue data for multi-regional, multi-product transactions reflect internal allocations and are therefore subject to certain assumptions and to the Company’s methodology. One customer, including its subsidiaries, accounted for 12.4% , 12.8% , and 15.4% of the Company’s consolidated revenue in fiscal 2020 , 2019 , and 2018 |
Effect of New Accounting Pronou
Effect of New Accounting Pronouncements | 12 Months Ended |
Oct. 31, 2020 | |
Accounting Changes and Error Corrections [Abstract] | |
Effect of New Accounting Pronouncements | Note 16. Effect of New Accounting Pronouncements In June 2016, the FASB issued ASU 2016-13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments (ASU 2016-13) and subsequently issued amendments to the initial guidance: ASU 2018-19, ASU 2019-04 and ASU 2019-05 (collectively, Topic 326). Topic 326 requires measurement and recognition of expected credit losses for financial assets held. Topic 326 is effective for fiscal 2021, and earlier adoption is permitted beginning in the first quarter of fiscal 2020. The adoption of Topic 326 will not have material impact to the Company’s consolidated financial statements . |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Oct. 31, 2020 | |
Accounting Policies [Abstract] | |
Fiscal Year End | Fiscal Year End. The Company’s fiscal year generally ends on the Saturday nearest to October 31 and consists of 52 weeks, with the exception that approximately every five years, the Company has a 53-week year. When a 53-week year occurs, the Company includes the additional week in the first quarter to realign fiscal quarters with calendar quarters. Fiscal 2020 and fiscal 2019 were 52-week years ending on October 31, 2020 and November 2, 2019, respectively. Fiscal 2018 was a 53-week year and ended on November 3, 2018. For presentation purposes, the consolidated financial statements and accompanying notes refer to the closest calendar month end. Fiscal 2021 will be a 52-week year. |
Basis of Presentation | Basis of Presentation. |
Use of Estimates | Use of Estimates. To prepare financial statements in conformity with U.S. generally accepted accounting principles (U.S. GAAP), management must make estimates and assumptions that affect the amounts reported in the consolidated financial statements and accompanying notes. Actual results could differ from these estimates and may result in material effects on the Company’s operating results and financial position. |
Foreign Currency Translation | Foreign Currency Translation. The functional currency of the majority of the Company’s active foreign subsidiaries is the foreign subsidiary’s local currency. Assets and liabilities that are not denominated in the functional currency are remeasured into the functional currency with any related gain or loss recorded in earnings. The Company translates assets and liabilities of its non-U.S. dollar functional currency foreign operations into the U.S. dollar reporting currency at exchange rates in effect at the balance sheet date. The Company translates income and expense items of such foreign operations into the U.S. dollar reporting currency at average exchange rates for the period. Accumulated translation adjustments are reported in stockholders’ equity, as a component of accumulated other comprehensive income (loss). |
Foreign Currency Contracts | Foreign Currency Contracts. The Company operates internationally and is exposed to potentially adverse movements in currency exchange rates. The Company enters into hedges in the form of foreign currency forward contracts to reduce its exposure to foreign currency rate changes on non-functional currency denominated forecasted transactions and balance sheet positions. The assets or liabilities associated with the forward contracts are recorded at fair value in other current assets or accrued liabilities in the consolidated balance sheets. The accounting for gains and losses resulting from changes in fair value depends on the use of the foreign currency forward contract and whether it is designated and qualifies for hedge accounting. See Note 6. Financial Assets and Liabilities . |
Fair Values of Financial Instruments | Fair Values of Financial Instruments. The Company’s cash equivalents and foreign currency contracts are carried at fair value. The fair value of the Company’s accounts receivable and accounts payable approximates the carrying amount due to their short duration. Non-marketable equity securities are accounted for using either the measurement alternative or equity method of accounting, net of impairments. The Company performs periodic impairment analysis on these non-marketable equity securities. The carrying amount of the short-term debt approximates the estimated fair value. See Note 7. Fair Value Measures . |
Cash and Cash Equivalents | Cash and Cash Equivalents . The Company classifies investments with original maturities of three months or less when acquired as cash equivalents. |
Concentration of Credit Risk | Concentration of Credit Risk . Financial instruments that potentially subject the Company to significant concentrations of credit risk consist principally of cash equivalents, marketable securities, foreign currency contracts, and accounts receivable from trade customers. The Company maintains cash equivalents primarily in highly rated taxable and tax-exempt money market funds located in the U.S. and in various overseas locations. The Company sells its products worldwide primarily to customers in the global electronics market. The Company performs on-going credit evaluations of its customers’ financial condition and does not require collateral. The Company establishes reserves for potential credit losses and such losses have been within management’s expectations and have not been material in any year presented. |
Accounts Receivable, net and Allowance for Doubtful Accounts | Allowance for Doubtful Accounts. Accounts Receivable, Net. |
Inventories, net | Inventories, net. Inventories are computed at standard costs which approximate actual costs, on a first-in, first-out basis and valued at the lower of cost or net realizable value. Inventories primarily include components and parts used in emulation and prototyping hardware systems. Valuation process include a review of the stage of the product life cycle and forecasts based upon future demand and market conditions. Inventory provisions are recorded when the costs are determined to be in excess of anticipated demand or considered obsolete. |
Income Taxes | Income Taxes. The Company accounts for income taxes using the asset and liability method. Deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases and operating loss and tax credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date. The Company accounts for uncertainty in income taxes using a two-step approach to recognizing and measuring uncertain tax positions. The first step is to evaluate the tax position for recognition by determining whether it is more likely than not that the position will be sustained on audit, including resolution of related appeals or litigation processes, if any. The second step is to measure the tax benefit as the largest amount which is more than 50% likely of being realized upon ultimate settlement. An uncertain tax position is considered effectively settled on completion of an examination by a taxing authority if certain other conditions are satisfied. |
Property and Equipment | Property and Equipment. |
Leases | Leases . In February 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2016-02, “Leases (Topic 842),” which supersedes the previous lease requirements in Topic 840. Topic 842 was subsequently amended by several ASUs. The new guidance requires a lessee to recognize a right-of-use (ROU) asset and a lease liability for most operating leases in the consolidated balance sheets. These ASUs also made minor changes to lessor accounting and aligned key aspects of the lessor accounting model with the new revenue recognition guidance. The new standard did not have a material impact on the consolidated financial statements for arrangements in which the Company is the lessor. The Company adopted Topic 842 at the beginning of fiscal 2020 using the modified retrospective method without restatement of comparative periods. The Company elected the package of practical expedients permitted under the transition guidance, which allows the carryforward of historical assessments about (1) lease classification, (2) whether a contract is or contains a lease, and (3) which costs qualify as initial direct costs for leases that existed prior to the adoption. The Company did not elect either the use of hindsight or land easements practical expedients available in transition. The adoption of the standard did not have an impact on the Company’s beginning retained earnings, results of operations, or cash flows. The operating lease liabilities equaled the present value of the remaining Topic 840 minimum rental payments for those leases, discounted at the Company’s incremental borrowing rate as of the date of adoption. The ROU assets were measured at the amount of the related lease liabilities plus any prepaid rental payments and less any unamortized lease incentives such as tenant improvement allowances. The Company recognized ROU assets of $475 million and operating lease liabilities of $540 million on the consolidated balance sheets. The Company determines if a contract is or contains a lease at inception. ROU assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make payments arising from the lease. Lease liabilities for operating and finance leases are recognized at the lease commencement date based on the present value of future lease payments over the remaining lease terms. ROU assets are derived from the carrying amount of the related lease liability plus any prepaid lease payments, less any lease incentives such as tenant improvement allowances. The Company primarily uses its incremental borrowing rate, determined as of the lease commencement date, to measure the present value of its future lease payments, as the rate implicit in the lease is generally not readily determinable. The Company uses a benchmark senior unsecured yield curve for debt instruments and considers specific credit quality, market conditions, tenor of lease arrangements, and quality of collateral to determine the incremental borrowing rate. Operating lease expense is recognized on a straight-line basis over the lease term of each lease. Variable payments, such as for maintenance, property taxes or insurance, are recognized on our consolidated statements of operations as incurred. The Company has adopted both (1) the practical expedient to not separate lease from non-lease components and (2) the short-term lease exemption. The Company has elected the practical expedient to not separate lease from non-lease components for all classes of underlying assets and the short-term lease exemption for all classes of underlying assets except real estate leases, with terms 12 months or less. |
Goodwill | Goodwill. Goodwill represents the excess of the aggregate purchase price over the fair value of the net tangible and identifiable intangible assets acquired by the Company. The carrying amount of goodwill at each reporting unit is tested for impairment annually as of October 31 , or more frequently if facts and circumstances warrant a review. |
Intangible Assets | Intangible Assets. Intangible assets consist of acquired technology, certain contract rights, customer relationships, trademarks and trade names, capitalized software, and in-process research and development. These intangible assets are acquired through business combinations, direct purchases, or internally developed capitalized software. Intangible assets are amortized on a straight-line basis over their estimated useful lives which range from one to ten years , except for in-process research and development (IPR&D) projects not yet completed. IPR&D assets are amortized over their estimated useful lives upon completion or are written off upon abandonment. The Company continually monitors events and changes in circumstances that could indicate carrying amounts of long-lived assets, including property and equipment and intangible assets, may not be recoverable. When such events or changes in circumstances occur, the Company assesses the recoverability of long-lived assets by determining whether the carrying value of such asset group will be recovered through the undiscounted future cash flow. If the undiscounted future cash flow is less than the carrying amount of the asset group, the Company |
Other Comprehensive Income (Loss) | Other Comprehensive Income (Loss). Other comprehensive income (loss) (OCI) includes all changes in equity during a period, such as accumulated net translation adjustments, unrealized gain (loss) on certain foreign currency forward contracts that qualify as cash flow hedges, reclassification adjustments related to cash flow hedges and unrealized gain (loss) on investments. See Note 10 . Accumulated Other Comprehensive Income (Loss) . |
Revenue Recognition | Revenue Recognition. The Company adopted ASC 606 on November 4, 2018, the beginning of fiscal year 2019, using the modified retrospective method. The comparative information for periods prior to fiscal year 2019 has not been restated and continues to be reported under the accounting standards in effect for those periods. The core principle of ASC 606 is to recognize revenue for the transfer of services or products to customers in an amount that reflects the consideration to which the Company expects to be entitled in exchange for those services or products. The principle is achieved through the following five-step approach: • Identification of the contract, or contracts, with the customer • Identification of the performance obligation in the contract • Determination of the transaction price • Allocation of the transaction price to the performance obligations in the contract • Recognition of revenue when, or as, the Company satisfies a performance obligation Nature of Products and Services The Company generates revenue from the sale of products that include software licenses and, to a lesser extent, hardware products, maintenance and services. The various types are set forth below. Electronic Design Automation Software license revenue consists of fees associated with the licensing of the Company's software primarily through Technology Subscription License (TSL) contracts. TSLs are time-based licenses for a finite term and generally provide the customer with limited rights to receive, or to exchange certain quantities of licensed software for, unspecified future technology. The majority of the Company's arrangements are TSLs due to the nature of its business and customer requirements. In addition to the licenses, the arrangements also include: post-contract customer support, which includes providing frequent updates and upgrades to maintain the utility of the software due to rapid changes in technology; other intertwined services such as multiple copies of the tools; assisting the Company's customers in applying the Company's technology in the customers' development environment; and rights to remix licenses for other licenses. Payments are generally received in equal or near equal installments over the term of the arrangement. Under ASC 605, these arrangements were required to be recognized ratably over the contract terms. Under ASC 606, the Company has concluded that its software licenses in TSL contracts are not distinct from its obligation to provide unspecified software updates to the licensed software throughout the license term. Such updates represent inputs to a single, combined performance obligation, commencing upon the later of the arrangement effective date or transfer of the software license. Remix rights are not an additional promised good or service in the contract, and where unspecified additional software product rights are part of the contract with the customer, such rights are accounted for as part of the single performance obligation that includes the licenses, updates, and technical support because such rights are provided for the same period of time and have the same pattern of transfer to the customer over the duration of the subscription term. IP & System Integration The Company generally licenses IP under nonexclusive license agreements that provide usage rights for specific applications. Additionally, for certain IP license agreements, royalties are collected as customers sell their own products that incorporate the Company’s IP. Under ASC 605, the Company recognized revenue either upfront if certain criteria in ASC 605 were met, or over the contractual period for IP licensing and support arrangements if such arrangements were combined with other TSL arrangements. Under ASC 606, these arrangements generally have two distinct performance obligations that consist of transferring the licensed IP and the support service. Support services consist of a stand-ready obligation to provide technical support and software updates over the support term. Revenue allocated to the IP license is recognized at a point in time upon the later of the delivery date or the beginning of the license period, and revenue allocated to support services is recognized ratably over the support term. Royalties are recognized as revenue is earned, generally when the customer sells its products that incorporate the Company’s IP. Software Integrity Products Software Integrity product arrangements provide customers the right to software licenses, software updates and technical support. Under the term of these arrangements, the customer expects to receive integral updates to the software licenses that protect the customer’s software from potential security vulnerabilities. The licenses and software updates together serve to fulfill the Company’s commitment to the customer, as they represent inputs to a single, combined performance obligation that commences upon the later of the arrangement effective date or transfer of the software license. Software updates are part of the contract with the customer, and such rights are accounted for as part of the single performance obligation that includes the licenses, updates, and technical support because such rights are provided for the same period of time and have the same time-based pattern of transfer to the customer . Hardware The Company generally has two performance obligations in arrangements involving the sale of hardware products. The first performance obligation is to transfer the hardware product, which includes embedded software integral to the functionality of the hardware product. The second performance obligation is to provide maintenance on the hardware and its embedded software, including rights to technical support, hardware repairs and software updates that are all provided over the same term and have the same time-based pattern of transfer to the customer. The portion of the transaction price allocated to the hardware product is generally recognized as revenue at a point in time when the hardware is shipped to the customer. The Company has concluded that control generally transfers upon delivery because the customer has the ability to direct the use of the asset and an obligation to pay for the hardware. The portion of the transaction price allocated to maintenance is recognized as revenue that is ratable over the maintenance term. The adoption of ASC 606 did not change the timing of revenue recognition for hardware products and related services. Professional Services The Company's arrangements often include service elements (other than maintenance and support services). These services include training, design assistance, and consulting. Services performed on a time and materials basis are recognized over time, as the customer simultaneously receives and consumes the benefit provided. Certain arrangements also include the customization or modification of licensed IP. Revenue from these contracts is recognized over time as the services are performed, when the development is specific to the customer’s needs and Synopsys has enforceable rights to payment for performance completed. Inputs such as costs incurred and hours expended are used in order to measure progress of performance. The Company has a history of accurately estimating project status and the costs necessary to complete projects. A number of internal and external factors can affect these estimates, including labor rates, utilization and efficiency variances, specification and testing requirement changes, and changes in customer delivery priorities. Payments for services are generally due upon milestones in the contract or upon consumption of the hourly resources. Flexible Spending Accounts Some customers enter into a non-cancelable Flexible Spending Account arrangement (FSA) whereby the customer commits to a fixed dollar amount over a specified period of time that can be used to purchase from a list of Synopsys products or services. These arrangements do not meet the definition of a revenue contract until the customer executes a separate order to identify the required products and services that they are purchasing. The combination of the FSA arrangement and the subsequent order creates enforceable rights and obligations, thus meeting the definition of a revenue contract. Each separate order under the agreement is treated as an individual contract under the new standard and accounted for based on the respective performance obligations included within the FSA arrangements. Judgments The Company’s contracts with customers often include promises to transfer multiple products and services to a customer. Determining whether services and products are considered distinct performance obligations that should be accounted for separately versus together requires significant judgment . The Company has concluded that (1) its EDA software licenses in TSL contracts are not distinct from its obligation to provide unspecified software updates to the licensed software throughout the license term, because those promises represent inputs to a single, combined performance obligation, and (2) where unspecified additional software product rights are part of the contract with the customer, such rights are accounted for as part of the single performance obligation that includes the licenses, updates, and technical support, because such rights are provided for the same period of time and have the same time-based pattern of transfer to the customer. In reaching this conclusion, the Company considered the nature of the obligation to customers which is to provide an ongoing right to use the most up to date and relevant software. As EDA customers operate in a rapidly changing and competitive environment, satisfying the obligation requires providing critical updates to the existing software products, including ongoing iterative interaction with customers to make the software relevant to customers’ ability to meet the time to go to market with advanced products. Similarly, the Company also concluded that in its Software Integrity business, the licenses and maintenance updates serve together to fulfill the Company’s commitment to the customer as both work together to provide the functionality to the customer and represent a combined performance obligation because the updates are essential to the software’s central utility, which is to identify security vulnerabilities and other threats. Judgment is also required to determine the standalone selling price (SSP) for each distinct performance obligation. For non-software performance obligations (IP, Hardware, and services), SSP is established based on observable prices of products and services sold separately. SSP for license (and related updates and support) in a contract with multiple performance obligations is determined by applying a residual approach whereby all other non-software performance obligations within a contract are first allocated a portion of the transaction price based upon their respective SSP, using observable prices, with any residual amount of the transaction price allocated to the license because the Company does not sell the license separately, and the pricing is highly variable. Contract Balances The timing of revenue recognition may differ from the timing of invoicing to customers, and these timing differences result in receivables (billed or unbilled), contract assets, or contract liabilities (deferred revenue) on the Company’s consolidated balance sheet. The Company records a contract asset when revenue is recognized prior to the right to invoice, or deferred revenue when revenue is recognized subsequent to invoicing. For time-based software agreements, customers are generally invoiced in equal, quarterly amounts, although some customers prefer to be invoiced in single or annual amounts. The Company records an unbilled receivable when revenue is recognized and it has an unconditional right to invoice and receive payment. |
Warranties and Indemnities | Warranties and Indemnities. The Company generally warrants its products to be free from defects in media and to substantially conform to material specifications for a period of 90 days for software products and for up to six months for hardware systems. In certain cases, the Company also provides its customers with limited indemnification with respect to claims that their use of the Company’s software products infringes on United States patents, copyrights, trademarks or trade secrets. The Company is unable to estimate the potential impact of these commitments on the future results of operations. To date, the Company has not been required to pay any material warranty claims. |
Net Income Per Share | Net Income Per Share. The Company computes basic income per share by dividing net income available to common shareholders by the weighted average number of common shares outstanding during the period. Diluted net income per share reflects the dilution from potential common shares outstanding such as stock options and unvested restricted stock units and awards during the period using the treasury stock method. |
Effect of New Accounting Pronouncements | In the first quarter of 2020, the Company adopted ASU 2017-12, Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedge Activities, which amends the hedge accounting recognition and presentation requirements of ASC 815. Pursuant to the provisions of ASU 2017-12, the Company is not required to separately measure and report hedge ineffectiveness, which was previously recorded in Other income (expense), net in our consolidated statements of operations. Also, prior to the adoption of ASU 2017-12, the forward point components of the cash flow hedges were excluded from assessing effectiveness of the hedging relationship and were recorded on the consolidated statements of operations in other income (expense), net. Following the Company's adoption of ASU 2017-12, the Company presents the related earning impact of the cash flow hedges in the same income statement section as the hedged items. Adoption of the guidance did not impact opening retained earnings or have a material impact on our financial statements. In June 2016, the FASB issued ASU 2016-13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments (ASU 2016-13) and subsequently issued amendments to the initial guidance: ASU 2018-19, ASU 2019-04 and ASU 2019-05 (collectively, Topic 326). Topic 326 requires measurement and recognition of expected credit losses for financial assets held. Topic 326 is effective for fiscal 2021, and earlier adoption is permitted beginning in the first quarter of fiscal 2020. The adoption of Topic 326 will not have material impact to the Company’s consolidated financial statements . |
Fair Value Measurement and Disclosures | Accounting Standards Codification (ASC) 820-10, Fair Value Measurements and Disclosures , defines fair value, establishes guidelines and enhances disclosure requirements for fair value measurements. The accounting guidance requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. The accounting guidance also establishes a fair value hierarchy based on the independence of the source and objective evidence of the inputs used. There are three fair value hierarchies based upon the level of inputs that are significant to fair value measurement: Level 1 —Observable inputs that reflect quoted prices (unadjusted) for identical instruments in active markets; Level 2 —Observable inputs other than quoted prices included in Level 1 for similar instruments in active markets, quoted prices for identical or similar instruments in markets that are not active, and model-driven valuations in which all significant inputs and significant value drivers are observable in active markets; and Level 3 —Unobservable inputs to the valuation derived from fair valuation techniques in which one or more significant inputs or significant value drivers are unobservable. |
Restricted cash | Restricted cash. The Company includes amounts generally described as restricted cash and restricted cash equivalents in cash and cash equivalents when reconciling beginning-of-period and end-of-period total amounts shown on the consolidated statements of cash flows. All restricted cash is primarily associated with office leases and has no material impact on the Company’s consolidated statements of cash flows. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Oct. 31, 2020 | |
Accounting Policies [Abstract] | |
Schedule of Accounts Receivable, net | The following table represents the components of accounts receivable, net: October 31, 2020 2019 (in thousands) Accounts receivable $ 758,341 $ 524,766 Unbilled accounts receivable 50,932 38,175 Total accounts receivable 809,273 562,941 Less allowance for doubtful accounts (28,564 ) (9,046 ) Total accounts receivable, net $ 780,709 $ 553,895 |
Changes in Allowance for Doubtful Accounts | The following table presents the changes in the allowance for doubtful accounts: Fiscal Year Balance at Beginning of Period Provisions Write-offs (1) Balance at End of Period (in thousands) 2020 $ 9,046 $ 20,875 $ (1,357 ) $ 28,564 2019 $ 5,613 $ 11,669 $ (8,236 ) $ 9,046 2018 $ 5,165 $ 3,368 $ (2,920 ) $ 5,613 (1) Balances written off, net of recoveries. |
Components of Property and Equipment | A summary of property and equipment, at cost less accumulated depreciation and amortization, as of October 31, 2020 and 2019 is as follows: October 31, 2020 2019 (in thousands) Computer and other equipment $ 788,105 $ 678,901 Buildings 129,746 68,708 Furniture and fixtures 72,702 72,437 Land 19,965 18,849 Leasehold improvements 242,830 273,985 1,253,348 1,112,880 Less accumulated depreciation and amortization (1) (769,530 ) (683,348 ) Total $ 483,818 $ 429,532 (1) Accumulated depreciation and amortization includes write-offs due to retirement of fully amortized fixed assets. |
Useful Lives of Depreciable Assets | The useful lives of depreciable assets are as follows: Useful Life in Years Computer and other equipment 3-8 Buildings 30 Furniture and fixtures 5 Leasehold improvements Shorter of the lease term or the estimated useful life |
Components of Accounts Payable and Accrued Liabilities | The balance consisted of: October 31, 2020 2019 (in thousands) Payroll and related benefits $ 492,626 $ 417,157 Other accrued liabilities 101,035 69,487 Accounts payable 30,003 19,815 Total $ 623,664 $ 506,459 |
Components of Other Long Term Liabilities | The balance consisted of: October 31, 2020 2019 (in thousands) Deferred compensation liability (See Note 12 ) $ 269,737 $ 249,822 Other long-term liabilities 14,774 73,903 Total $ 284,511 $ 323,725 |
Reconciliation of Weighted Average Common Shares Used to Calculate Basic Net Income Per Share | The table below reconciles the weighted average common shares used to calculate basic net income per share with the weighted average common shares used to calculate diluted net income per share: Year Ended October 31, 2020 2019 2018 (in thousands, except per share amounts) Numerator: Net income attributed to Synopsys $ 664,347 $ 532,367 $ 432,518 Denominator: Weighted average common shares for basic net income per share 151,135 149,872 149,036 Dilutive effect of common share equivalents from equity-based compensation 4,571 4,318 4,357 Weighted average common shares for diluted net income per share 155,706 154,190 153,393 Net income per share: Basic $ 4.40 $ 3.55 $ 2.90 Diluted $ 4.27 $ 3.45 $ 2.82 Anti-dilutive employee stock-based awards excluded (1) 97 171 850 (1) These stock options and unvested restricted stock units were anti-dilutive for the respective periods and are excluded in calculating diluted net income per share. While such awards were anti-dilutive for the respective periods, they could be dilutive in the future. |
Revenue (Tables)
Revenue (Tables) | 12 Months Ended |
Oct. 31, 2020 | |
Revenue from Contract with Customer [Abstract] | |
Disaggregation of Revenue | The following table shows the percentage of revenue by product groups: 2020 2019 2018 EDA 57 % 59 % 62 % IP & System Integration 33 % 31 % 29 % Software Integrity Products & Services 10 % 10 % 9 % Other (1) 0 % 0 % 0 % Total 100 % 100 % 100 % (1) The percentage of revenue by Other is less than 1%. |
Contract with Customer, Asset and Liability | Contract balances are as follows: As of October 31, 2020 2019 (in thousands) Contract assets $ 214,583 $ 210,557 Unbilled receivables $ 50,932 $ 38,175 Deferred revenue $ 1,493,113 $ 1,302,578 |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 12 Months Ended |
Oct. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Summary of Goodwill | Goodwill activity by reportable segment for the year ended October 31, 2020 consisted of the following: Semiconductor & System Design Software Integrity Total (in thousands) Balance at October 31, 2019 $ 2,758,926 $ 412,253 $ 3,171,179 Additions 160,447 13,285 173,732 Adjustments 59 — 59 Effect of foreign currency translation 20,080 64 20,144 Balance at October 31, 2020 $ 2,939,512 $ 425,602 $ 3,365,114 Goodwill activity by reportable segment for the year ended October 31, 2019 consisted of the following: Semiconductor & System Design Software Integrity Total (in thousands) Balance at October 31, 2018 $ 2,730,990 $ 412,259 $ 3,143,249 Additions 23,690 — 23,690 Effect of foreign currency translation 4,246 (6 ) 4,240 Balance at October 31, 2019 $ 2,758,926 $ 412,253 $ 3,171,179 |
Summary of Intangible Assets | In-process research and development (IPR&D) as of October 31, 2020 consisted of acquired projects that, if completed, will be reclassified to core/developed technology upon completion, or if abandoned, will be written off. Intangible assets as of October 31, 2020 consisted of the following: Gross Assets Accumulated Amortization Net Assets (in thousands) Core/developed technology $ 827,232 $ 703,009 $ 124,223 Customer relationships 380,838 277,219 103,619 Contract rights intangible 192,812 186,763 6,049 Trademarks and trade names 43,096 28,716 14,380 In-process research and development (IPR&D) 1,214 — 1,214 Capitalized software development costs 44,122 39,285 4,837 Total $ 1,489,314 $ 1,234,992 $ 254,322 Intangible assets as of October 31, 2019 consisted of the following: Gross Assets Accumulated Amortization Net Assets (in thousands) Core/developed technology $ 791,647 $ 655,119 $ 136,528 Customer relationships 358,661 242,058 116,603 Contract rights intangible 184,304 181,124 3,180 Trademarks and trade names 42,929 25,581 17,348 In-process research and development (IPR&D) 1,200 — 1,200 Capitalized software development costs 40,077 35,562 4,515 Total $ 1,418,818 $ 1,139,444 $ 279,374 |
Amortization Expense Related to Intangible Assets | Amortization expense related to intangible assets consisted of the following: Year Ended October 31, 2020 2019 2018 (in thousands) Core/developed technology $ 47,890 $ 56,163 $ 78,820 Customer relationships 35,075 37,533 37,395 Contract rights intangible 5,181 3,581 4,906 Trademarks and trade names 3,135 3,637 4,543 Capitalized software development costs (1) 3,723 2,868 3,599 Total $ 95,004 $ 103,782 $ 129,263 (1) |
Estimated Future Amortization of Intangible Assets | The following table presents the estimated future amortization of intangible assets as of October 31, 2020 : Fiscal Year (in thousands) 2021 $ 76,078 2022 61,242 2023 44,733 2024 34,398 2025 18,295 2026 and thereafter 18,362 IPR&D 1,214 Total $ 254,322 |
Financial Assets and Liabilit_2
Financial Assets and Liabilities (Tables) | 12 Months Ended |
Oct. 31, 2020 | |
Financial Assets And Liabilities [Abstract] | |
Summary of Cash Equivalents and Non-Marketable Equities | As of October 31, 2020 , the balances of the Company's cash equivalents and non-marketable equity securities investments were: Cost Gross Gross Gross Estimated (1) (in thousands) Cash equivalents: Money market funds $ 304,127 $ — $ — $ — $ 304,127 Total: $ 304,127 $ — $ — $ — $ 304,127 Other long-term assets: Non-marketable equity securities $ 13,200 $ — $ — $ — $ 13,200 Total: $ 13,200 $ — $ — $ — $ 13,200 (1) See Note 7. Fair Value Measures for further discussion on fair values of cash equivalents. As of October 31, 2019 , the balances of our cash equivalents and non-marketable equity securities investments were: Cost Gross Gross Gross Estimated (1) (in thousands) Cash equivalents: Money market funds $ 166,024 $ — $ — $ — $ 166,024 Total: $ 166,024 $ — $ — $ — $ 166,024 Other long-term assets: Non-marketable equity securities $ 10,951 $ — $ — $ — $ 10,951 Total: $ 10,951 $ — $ — $ — $ 10,951 (1) See Note 7. Fair Value Measures for further discussion on fair values of cash equivalents. |
Schedule of Cash, Cash Equivalents And Restricted Cash | The following table provides a reconciliation of cash, cash equivalents and restricted cash included in the consolidated balance sheets: October 31, 2020 2019 (in thousands) Cash and cash equivalents $ 1,235,653 $ 728,597 Restricted cash included in Prepaid expenses and other current assets 1,523 1,174 Restricted cash included in Other long-term assets 794 756 Total cash, cash equivalents and restricted cash $ 1,237,970 $ 730,527 |
Effects on Changes in Fair Values of Non-Designated Forward Contracts | The effects of non-designated derivative instruments on the Company’s consolidated statements of operations for fiscal years 2020 , 2019 , and 2018 are summarized as follows: October 31, 2020 2019 2018 (in thousands) Gain (loss) recorded in other income (expense), net $ 1,957 $ 4,538 $ 3,361 |
Notional Amounts of Derivative Instruments | The notional amounts in the table below for derivative instruments provide one measure of the transaction volume outstanding: October 31, 2020 2019 (in thousands) Total gross notional amount $ 981,234 $ 817,441 Net fair value $ 6,940 $ 3,494 |
Fair Values of Derivative Instrument Designated and Non-Designated as Hedging Instruments in Balance Sheet | The following table represents the consolidated balance sheets location and amount of derivative instrument fair values segregated between designated and non-designated hedge instruments: Fair values of derivative instruments designated as hedging instruments Fair values of derivative instruments not designated as hedging instruments (in thousands) Balance at October 31, 2020 Other current assets $ 9,182 $ 138 Accrued liabilities $ 2,088 $ 292 Balance at October 31, 2019 Other current assets $ 7,327 $ 53 Accrued liabilities $ 3,715 $ 171 |
Income Statement Location and Amount of Gains and Losses on Derivative Instrument Fair Values for Designated Hedge Instruments, Net of Tax | The following table represents, for designated hedge instruments, net of tax, the respective locations in the consolidated statements of operations and the amount of gains and losses on derivative instrument fair values: Location of gain (loss) recognized in OCI on derivatives Amount of gain (loss) recognized in OCI on derivatives (effective portion) Location of gain (loss) reclassified from OCI Amount of gain (loss) reclassified from OCI (effective portion) (in thousands) Fiscal year ended October 31, 2020 Foreign exchange contracts Revenue $ 3,034 Revenue $ 530 Foreign exchange contracts Operating expenses 4,800 Operating expenses (603 ) Total $ 7,834 $ (73 ) Fiscal year ended October 31, 2019 Foreign exchange contracts Revenue $ 278 Revenue $ 1,436 Foreign exchange contracts Operating expenses 4,455 Operating expenses (16,073 ) Total $ 4,733 $ (14,637 ) Fiscal year ended October 31, 2018 Foreign exchange contracts Revenue $ 693 Revenue $ 1,103 Foreign exchange contracts Operating expenses (18,121 ) Operating expenses 9,785 Total $ (17,428 ) $ 10,888 |
Schedule of Maturities of Long-term Debt | Outstanding principal payments under the Term Loan are due as follows: Fiscal year (in thousands) 2021 $ 27,187 2022 75,000 Total $ 102,187 |
Fair Value Measures (Tables)
Fair Value Measures (Tables) | 12 Months Ended |
Oct. 31, 2020 | |
Fair Value Disclosures [Abstract] | |
Assets and Liabilities Measured at Fair Value on Recurring Basis | Assets and liabilities measured at fair value on a recurring basis are summarized below as of October 31, 2020 : Fair Value Measurement Using Description Total Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) (in thousands) Assets Cash equivalents: Money market funds $ 304,127 $ 304,127 $ — $ — Prepaid and other current assets: Foreign currency derivative contracts 9,320 — 9,320 — Other long-term assets: Deferred compensation plan assets 269,737 269,737 — — Total assets $ 583,184 $ 573,864 $ 9,320 $ — Liabilities Accounts payable and accrued liabilities: Foreign currency derivative contracts $ 2,380 $ — $ 2,380 $ — Other long-term liabilities: Deferred compensation plan liabilities 269,737 269,737 — — Total liabilities $ 272,117 $ 269,737 $ 2,380 $ — Assets and liabilities measured at fair value on a recurring basis are summarized below as of October 31, 2019 : Description Total Fair Value Measurement Using Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) (in thousands) Assets Cash equivalents: Money market funds $ 166,024 $ 166,024 $ — $ — Prepaid and other current assets: Foreign currency derivative contracts 7,380 — 7,380 — Other long-term assets: Deferred compensation plan assets 249,822 249,822 — — Total assets $ 423,226 $ 415,846 $ 7,380 $ — Liabilities Accounts payable and accrued liabilities: Foreign currency derivative contracts $ 3,886 $ — $ 3,886 $ — Other long-term liabilities: Deferred compensation plan liabilities 249,822 249,822 — — Total liabilities $ 253,708 $ 249,822 $ 3,886 $ — |
Leases (Tables)
Leases (Tables) | 12 Months Ended |
Oct. 31, 2020 | |
Leases [Abstract] | |
Lease, Cost | The components of the Company’s lease expense during the period presented are as follows: Year Ended October 31, 2020 (in thousands) Operating lease expense $ 93,636 Variable lease expense (1) 5,147 Total lease expense $ 98,783 (1) Variable lease expense includes payments to lessors that are not fixed or determinable at lease commencement date. These payments primarily consist of maintenance, property taxes, insurance and variable indexed based payments. Supplemental cash flow information during the period presented is as follows: Year Ended October 31, 2020 (in thousands) Cash paid for amounts included in the measurement of operating lease liabilities $ 72,828 ROU assets obtained in exchange for operating lease liabilities $ 69,439 |
Lessee, Lease Term and Discount Rate | Lease term and discount rate information related to the Company’s operating leases as of the end of the period presented are as follows: October 31, 2020 Weighted-average remaining lease term (in years) 8.62 Weighted-average discount rate 2.56 % |
Lessee, Operating Lease, Liability, Maturity | The following represents the maturities of the Company’s future lease payments due under operating leases as of October 31, 2020 : Lease Payments Fiscal year (in thousands) 2021 $ 84,534 2022 79,886 2023 64,073 2024 59,751 2025 53,280 Thereafter 259,969 Total future minimum lease payments 601,493 Less: Imputed interest 65,909 Total lease liabilities $ 535,584 |
Schedule of Future Minimum Rental Payments for Operating Leases | As of October 31, 2019, the future minimum lease payments due under non-cancellable operating leases were as follows: Minimum Lease Payments (1) (in thousands) Fiscal year 2020 $ 79,286 2021 79,703 2022 69,477 2023 53,909 2024 48,730 Thereafter 291,494 Total $ 622,599 (1) Amounts based on Topic 840, Leases. |
Accumulated Other Comprehensi_2
Accumulated Other Comprehensive Income (Loss) (Tables) | 12 Months Ended |
Oct. 31, 2020 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |
Components of Accumulated Other Comprehensive Income (Loss) | Components of accumulated other comprehensive income (loss), on an after-tax basis where applicable, were as follows: Year Ended October 31, 2020 2019 (in thousands) Cumulative currency translation adjustments $ (57,463 ) $ (87,929 ) Unrealized gain (loss) on derivative instruments, net of taxes 3,389 (4,518 ) Total accumulated other comprehensive income (loss) $ (54,074 ) $ (92,447 ) |
Effect of Amounts Reclassified out of Each Component of Accumulated Other Comprehensive Income (Loss) into Net Income | The effect of amounts reclassified out of each component of accumulated other comprehensive income (loss) into net income was as follows: Year Ended October 31, 2020 2019 2018 (in thousands) Reclassifications from accumulated other comprehensive income (loss) into consolidated statements of operations: Gain (loss) on cash flow hedges, net of taxes Revenues $ 530 $ 1,436 $ 1,103 Operating expenses (603 ) (16,073 ) 9,785 Total reclassifications into net income $ (73 ) $ (14,637 ) $ 10,888 |
Stock Repurchase Program (Table
Stock Repurchase Program (Tables) | 12 Months Ended |
Oct. 31, 2020 | |
Stock Repurchase Program [Abstract] | |
Stock Repurchase And Reissuance Activities | Stock repurchase activities as well as the reissuance of treasury stock for employee stock-based compensation purposes are as follows: Year Ended October 31, 2020 2019 2018 (in thousands, except per share price) Shares repurchased (1) 1,585 2,732 4,688 Average purchase price per share (1) $ 152.76 $ 120.49 $ 89.59 Aggregate purchase price (1) $ 242,078 $ 329,185 $ 420,000 Reissuance of treasury stock 3,872 3,798 3,508 (1) The first quarter of fiscal 2018 includes the settlement of the $20.0 million equity forward contract related to the September 2017 ASR. |
Employee Benefit Plans (Tables)
Employee Benefit Plans (Tables) | 12 Months Ended |
Oct. 31, 2020 | |
Share-based Payment Arrangement [Abstract] | |
Restricted Stock Units | The following table contains information concerning activities related to restricted stock units: Restricted Stock Units Weighted Average Grant Date Fair Value Weighted Average Remaining Contractual Life (In Years) Aggregate Fair Value (in thousands, except per share and life amounts) Balance at October 31, 2017 3,843 $ 57.26 1.54 Granted (2) 1,679 $ 89.35 Vested (1) (1,495 ) $ 52.55 $ 136,417 Forfeited (258 ) $ 67.04 Balance at October 31, 2018 3,769 $ 72.75 1.46 Granted 1,844 $ 119.27 Vested (1) (1,508 ) $ 65.97 $ 176,659 Forfeited (248 ) $ 79.49 Balance at October 31, 2019 3,857 $ 97.21 1.56 Granted 2,041 $ 168.15 Vested (1) (1,480 ) $ 88.70 $ 261,563 Forfeited (288 ) $ 104.67 Balance at October 31, 2020 4,130 $ 134.80 1.47 (1) The number of vested restricted stock units includes shares that were withheld on behalf of employees to satisfy the minimum statutory tax withholding requirements. (2) The Company assumed unvested restricted stock units from acquisitions including Black Duck. |
Stock Options and Restricted Stock Units Under all Equity Plans (Except 2005 Directors Plan) | The following table contains additional information concerning activities related to stock options and restricted stock units under all equity plans, other than shares available for grant under the 2017 Directors Plan: Available for Grant (3) Options(2) Options Outstanding Weighted- Average Exercise Price per Share Weighted- Average Remaining Contractual Life (In Years) Aggregate Intrinsic Value (in thousands, except per share and life amounts) Balance at October 31, 2017 12,583 6,530 $ 46.83 4.60 $ 263,555 Options granted (1,134 ) 1,134 $ 89.52 Options assumed (2) 141 $ 18.66 Options exercised (1,336 ) $ 38.18 Options canceled/forfeited/expired 157 (178 ) $ 51.82 Restricted stock units granted (1) (2,541 ) Restricted stock units forfeited (1) 374 Additional shares reserved 3,000 Balance at October 31, 2018 12,439 6,291 $ 55.63 4.39 $ 214,432 Options granted (799 ) 799 $ 113.17 Options exercised (1,615 ) $ 44.29 Options canceled/forfeited/expired 129 (185 ) $ 58.02 Restricted stock units granted (1) (3,134 ) Restricted stock units forfeited (1) 373 Additional shares reserved 3,200 Balance at October 31, 2019 12,208 5,290 $ 65.57 4.08 $ 373,112 Options granted (694 ) 700 $ 143.44 Options exercised (1,891 ) $ 51.76 Options canceled/forfeited/expired 102 (106 ) $ 84.14 Restricted stock units granted (1) (3,469 ) Restricted stock units forfeited (1) 482 Additional shares reserved 3,500 Balance at October 31, 2020 12,129 3,993 $ 85.26 4.10 $ 513,845 Exercisable at October 31, 2020 2,311 $ 65.36 3.23 $ 343,230 (1) These amounts do not reflect the actual number of restricted stock units granted or forfeited but rather the effect on the total remaining shares available for future grants after the application of the share reserve ratio. For more information about the share reserve ratio, please see Restricted Stock Units above. (2) The Company assumed options outstanding under various plans through acquisitions. (3) Excluding shares reserved for future issuance under the 2017 Directors Plan. |
Pretax Intrinsic Value of Options Exercised and Their Average Exercise Prices | The pretax intrinsic value of options exercised and their average exercise prices were: Year Ended October 31, 2020 2019 2018 (in thousands, except per share price) Intrinsic value $ 218,640 $ 110,815 $ 71,840 Average exercise price per share $ 51.76 $ 44.29 $ 38.18 |
Summary of Restricted Stock Award Activities Under 2005 Directors Plan | Restricted stock award activities during fiscal 2020 under the 2005 Directors Plan and 2017 Directors Plan are summarized as follows: Restricted Shares Weighted-Average Grant Date Fair Value (in thousands, except per share) Unvested at October 31, 2017 38 $ 59.89 Granted 15 $ 82.96 Vested (32 ) $ 62.09 Forfeited (1 ) $ 48.27 Unvested at October 31, 2018 20 $ 73.95 Granted 11 $ 116.43 Vested (20 ) $ 73.95 Forfeited — $ — Unvested at October 31, 2019 11 $ 116.43 Granted 9 $ 140.97 Vested (11 ) $ 116.43 Forfeited — $ — Unvested at October 31, 2020 9 $ 140.97 |
Stock Option Plans and Stock Purchase Rights Granted Under ESPP | The assumptions presented in the following table were used to estimate the fair value of stock options and employee stock purchase rights granted under the Company’s stock plans or stock plans assumed from acquisitions: Year Ended October 31, 2020 2019 2018 Stock Options Expected life (in years) 4.1 4.1 4.1 Risk-free interest rate 0.26% - 1.71% 1.28% - 2.73% 2.10% - 2.95% Volatility 23.05% - 32.80% 23.16% - 24.76% 20.22% - 21.04% Weighted average estimated fair value $33.02 $22.86 $23.55 ESPP Expected life (in years) 0.5 - 2.0 0.5 - 2.0 0.5 - 2.0 Risk-free interest rate 0.09% - 1.24% 1.54% - 2.60% 1.80% - 2.73% Volatility 25.59% - 43.06% 23.73% - 27.86% 19.99% - 21.54% Weighted average estimated fair value $47.69 $35.18 $23.34 |
Stock Compensation Expense | The compensation cost recognized in the consolidated statements of operations for the Company's stock compensation arrangements was as follows: Year Ended October 31, 2020 2019 2018 (in thousands) Cost of products $ 27,193 $ 17,193 $ 14,648 Cost of maintenance and service 9,327 6,385 5,467 Research and development expense 125,814 75,853 67,355 Sales and marketing expense 43,205 28,834 28,069 General and administrative expense 43,045 26,736 24,493 Stock-based compensation expense before taxes 248,584 155,001 140,032 Income tax benefit (39,077 ) (26,226 ) (26,578 ) Stock-based compensation expense after taxes $ 209,507 $ 128,775 $ 113,454 |
Deferred Plan Assets and Liabilities | Deferred plan assets and liabilities are as follows: As of October 31, 2020 As of October 31, 2019 (in thousands) Plan assets recorded in other long-term assets $ 269,737 $ 249,822 Plan liabilities recorded in other long-term liabilities (1) $ 269,737 $ 249,822 (1) Undistributed deferred compensation balances due to participants. |
Summary of Impact of Deferred Plan | The following table summarizes the impact of the Deferred Plan: Year Ended October 31, 2020 2019 2018 (in thousands) Increase (reduction) to cost of revenue and operating expense $ 21,469 $ 27,759 $ 4,636 Other income (expense), net 21,469 27,759 4,636 Net increase (decrease) to net income $ — $ — $ — |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Oct. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
Domestic and Foreign Components of Total Income Before Provision for Income Tax | The domestic and foreign components of the Company’s total income (loss) before provision for income taxes are as follows: Year Ended October 31, 2020 2019 2018 (in thousands) United States $ 544,391 $ 487,430 $ (18,029 ) Foreign 93,768 58,076 381,572 Total income (loss) before provision for income taxes $ 638,159 $ 545,506 $ 363,543 |
Components of (Benefit) Provision for Income Taxes | The components of the provision (benefit) for income taxes were as follows: Year Ended October 31, 2020 2019 2018 (in thousands) Current: Federal $ 29,272 $ 22,821 $ (1,120 ) State 1,863 11,846 2,025 Foreign 55,103 61,092 140,430 86,238 95,759 141,335 Deferred: Federal (84,739 ) (41,219 ) (139,547 ) State (20,233 ) (7,227 ) (25,661 ) Foreign (6,554 ) (34,174 ) (45,102 ) (111,526 ) (82,620 ) (210,310 ) Provision (benefit) for income taxes $ (25,288 ) $ 13,139 $ (68,975 ) |
Rate Reconciliation Between Provision for Income Taxes and Taxes Computed at Statutory Federal Rate | The provision (benefit) for income taxes differs from the taxes computed with the statutory federal income tax rate as follows: Year Ended October 31, 2020 2019 2018 (in thousands) Statutory federal tax $ 133,979 $ 114,557 $ 85,142 State tax (benefit), net of federal effect (29,096 ) 6,529 (32,351 ) Tax credits (39,206 ) (34,485 ) (35,142 ) Tax on foreign earnings (3,980 ) 23,467 (104,252 ) Foreign-derived intangible income deduction (24,282 ) (26,615 ) — Tax settlements (13,167 ) (10,953 ) (14,691 ) Stock-based compensation (50,047 ) (25,356 ) (19,293 ) Changes in valuation allowance (614 ) (42,144 ) 78,192 Integration of acquired technologies — — 27,927 Undistributed earnings of foreign subsidiaries — 6,341 (974 ) Impact of tax restructuring — — (171,979 ) Impact of Tax Act rate change — — 51,075 Transition tax — — 63,107 Other 1,125 1,798 4,264 Provision (benefit) for income taxes $ (25,288 ) $ 13,139 $ (68,975 ) |
Components of Deferred Tax Assets and Liabilities | The significant components of deferred tax assets and liabilities were as follows: October 31, 2020 2019 (in thousands) Net deferred tax assets: Deferred tax assets: Deferred revenue 2,367 — Deferred compensation 55,172 56,483 Intangible and depreciable assets 115,097 160,072 Capitalized research and development costs 118,857 48,804 Stock-based compensation 28,478 20,372 Tax loss carryovers 35,571 40,068 Foreign tax credit carryovers 18,645 20,187 Research and other tax credit carryovers 320,317 278,382 Operating Lease Liabilities 101,386 — Gross deferred tax assets 795,890 624,368 Valuation allowance (158,895 ) (157,343 ) Total deferred tax assets 636,995 467,025 Deferred tax liabilities: Intangible assets 45,915 58,697 Operating lease Right-of-Use-Assets 84,716 — Accruals and reserves 7,780 4,450 Deferred revenue — 6,611 Undistributed earnings of foreign subsidiaries 3,063 6,864 Other 372 1,762 Total deferred tax liabilities 141,846 78,384 Net deferred tax assets $ 495,149 $ 388,641 |
Tax Loss and Credit Carryforwards Available to Offset Future Income Tax Liabilities | The Company has the following tax loss and credit carryforwards available to offset future income tax liabilities: Carryforward Amount Expiration Date (in thousands) Federal net operating loss carryforward $ 41,757 2021-2037 Federal research credit carryforward 176,616 2021-2040 Federal foreign tax credit carryforward 1,921 2021-2029 International foreign tax credit carryforward 15,681 Indefinite International net operating loss carryforward 81,069 2021-Indefinite California research credit carryforward 173,600 Indefinite Other state research credit carryforward 15,486 2024-2035 State net operating loss carryforward 70,251 2027-2039 |
Summary of Reconciliation of Beginning and Ending Balance of Gross Unrecognized Tax Benefit | A reconciliation of the beginning and ending balance of gross unrecognized tax benefits is summarized as follows: As of October 31, 2020 As of October 31, 2019 (in thousands) Beginning balance $ 116,212 $ 131,019 Increases in unrecognized tax benefits related to prior year tax positions 5,390 41,346 Decreases in unrecognized tax benefits related to prior year tax positions (43,783 ) (71,092 ) Increases in unrecognized tax benefits related to current year tax positions 9,226 16,927 Decreases in unrecognized tax benefits related to settlements with taxing authorities (1,411 ) (1,624 ) Reductions in unrecognized tax benefits due to lapse of applicable statute of limitations (2,472 ) (964 ) Increases in unrecognized tax benefits acquired 778 — Changes in unrecognized tax benefits due to foreign currency translation (791 ) 600 Ending balance $ 83,149 $ 116,212 |
Subsidiaries Remain Subject to Tax Examination | The Company and/or its subsidiaries remain subject to tax examination in the following jurisdictions: Jurisdiction Year(s) Subject to Examination United States Fiscal 2019 and 2020 California Fiscal years after 2017 Hungary Fiscal years after 2018 Ireland Fiscal years after 2016 Japan and Taiwan Fiscal years after 2015 Korea Fiscal years after 2016 |
Other Income (Expense), Net (Ta
Other Income (Expense), Net (Tables) | 12 Months Ended |
Oct. 31, 2020 | |
Other Income and Expenses [Abstract] | |
Components of Other Income (Expense), Net | The following table presents the components of other income (expense), net: Year Ended October 31, 2020 2019 2018 (in thousands) Interest income $ 3,561 $ 6,859 $ 5,323 Interest expense (5,140 ) (11,659 ) (15,607 ) Gain (loss) on assets related to deferred compensation plan 21,469 27,759 4,636 Foreign currency exchange gain (loss) 5,544 3,588 3,557 Other, net (7,416 ) (1,272 ) 5,409 Total $ 18,018 $ 25,275 $ 3,318 |
Segment Disclosure (Tables)
Segment Disclosure (Tables) | 12 Months Ended |
Oct. 31, 2020 | |
Segment Reporting [Abstract] | |
Schedule of Segment Reporting Information, by Segment | Information by reportable segment was as follows: Year Ended October 31, 2020 2019 2018 (in thousands) Total Segments: Revenue $ 3,685,281 $ 3,360,694 $ 3,121,058 Adjusted operating income 1,031,630 838,821 690,681 Adjusted operating margin 28 % 25 % 22 % Semiconductor & System Design: Revenue $ 3,327,211 $ 3,026,097 $ 2,840,589 Adjusted operating income 990,837 806,618 701,283 Adjusted operating margin 30 % 27 % 25 % Software Integrity: Revenue $ 358,070 $ 334,597 $ 280,469 Adjusted operating income 40,793 32,203 (10,602 ) Adjusted operating margin 11 % 10 % (4 )% |
Reconciliation of Operating Profit (Loss) from Segments to Consolidated | The unallocated expenses managed at a consolidated level, including amortization of intangible assets, stock compensation and other operating expenses, are presented in the table below to provide a reconciliation of the total adjusted operating income from segments to the Company's consolidated operating income: Year Ended October 31, 2020 2019 2018 (in thousands) Total segment adjusted operating income $ 1,031,630 $ 838,821 $ 690,681 Reconciling items: Amortization of intangible expense (91,281 ) (100,914 ) (125,664 ) Stock-based compensation expense (248,584 ) (155,001 ) (140,032 ) Other (71,624 ) (62,675 ) (64,760 ) Total operating income $ 620,141 $ 520,231 $ 360,225 |
Revenues Related to Operations by Geographic Areas | Revenue and property and equipment, net, related to operations in the United States and other geographic areas were: Year Ended October 31, 2020 2019 2018 (in thousands) Revenue: United States $ 1,774,348 $ 1,676,178 $ 1,508,224 Europe 385,287 349,033 369,125 China 420,829 321,777 259,279 Korea 389,008 353,358 307,974 Other 715,809 660,348 676,456 Consolidated $ 3,685,281 $ 3,360,694 $ 3,121,058 |
Property and Equipment by Geographic Areas | As of October 31, 2020 2019 (in thousands) Property and Equipment, net: United States $ 311,350 $ 293,725 Other countries 172,468 135,807 Total $ 483,818 $ 429,532 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies - Additional Information (Detail) - USD ($) | 12 Months Ended | |||
Oct. 31, 2020 | Oct. 31, 2019 | Oct. 31, 2018 | Nov. 01, 2019 | |
Summary Of Significant Accounting Policies [Line Items] | ||||
Cash and cash equivalent maturity period, months | 3 months | |||
Operating lease, right-of-use asset | $ 465,818,000 | $ 0 | ||
Operating Lease, Liability | 535,584,000 | |||
Depreciation expenses | 119,100,000 | 100,400,000 | $ 72,800,000 | |
Repair and maintenance costs | 62,100,000 | 52,500,000 | 45,700,000 | |
Goodwill impairment loss | 0 | 0 | 0 | |
Long-lived assets impairment loss | 0 | 0 | ||
Restructuring charges | $ 36,059,000 | 47,186,000 | 12,945,000 | |
Software product warranty period (in days) | 90 days | |||
Maximum | ||||
Summary Of Significant Accounting Policies [Line Items] | ||||
Hardware product warranty period (in months) | 6 months | |||
2019 Restructuring | ||||
Summary Of Significant Accounting Policies [Line Items] | ||||
Restructuring charges | 83,300,000 | |||
Employee Severance and Benefits | 2019 Restructuring | ||||
Summary Of Significant Accounting Policies [Line Items] | ||||
Restructuring charges | $ 36,100,000 | 47,200,000 | ||
Payments for restructuring charges | 57,400,000 | 24,600,000 | ||
Restructuring reserve | $ 1,300,000 | $ 22,600,000 | ||
Employee Severance and Benefits | 2018 Restructuring | ||||
Summary Of Significant Accounting Policies [Line Items] | ||||
Restructuring charges | 12,900,000 | |||
Restructuring reserve | $ 8,100,000 | |||
Intangible Assets | Minimum | ||||
Summary Of Significant Accounting Policies [Line Items] | ||||
Intangible assets amortization period | 1 year | |||
Intangible Assets | Maximum | ||||
Summary Of Significant Accounting Policies [Line Items] | ||||
Intangible assets amortization period | 10 years | |||
Accounting Standards Update 2016-02 | ||||
Summary Of Significant Accounting Policies [Line Items] | ||||
Operating lease, right-of-use asset | $ 475,000,000 | |||
Operating Lease, Liability | $ 540,000,000 |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies - Components of Accounts Receivables (Details) - USD ($) $ in Thousands | Oct. 31, 2020 | Oct. 31, 2019 | Oct. 31, 2018 | Oct. 31, 2017 |
Accounts Receivable, Net | ||||
Accounts receivable | $ 758,341 | $ 524,766 | ||
Unbilled accounts receivable | 50,932 | 38,175 | ||
Total accounts receivable | 809,273 | 562,941 | ||
Less allowance for doubtful accounts | (28,564) | (9,046) | $ (5,613) | $ (5,165) |
Total accounts receivable, net | $ 780,709 | $ 553,895 |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies - Changes in Allowance for Doubtful Accounts (Detail) - USD ($) $ in Thousands | 12 Months Ended | |||
Oct. 31, 2020 | Oct. 31, 2019 | Oct. 31, 2018 | ||
Allowance for Doubtful Accounts (Rollforward) | ||||
Balance at Beginning of Period | $ 9,046 | $ 5,613 | $ 5,165 | |
Provisions | 20,875 | 11,669 | 3,368 | |
Write-offs | [1] | (1,357) | (8,236) | (2,920) |
Balance at End of Period | $ 28,564 | $ 9,046 | $ 5,613 | |
[1] | Balances written off, net of recoveries. |
Summary of Significant Accoun_7
Summary of Significant Accounting Policies - Components of Property and Equipment (Detail) - USD ($) $ in Thousands | Oct. 31, 2020 | Oct. 31, 2019 | |
Property, Plant and Equipment, Net [Abstract] | |||
Computer and other equipment | $ 788,105 | $ 678,901 | |
Buildings | 129,746 | 68,708 | |
Furniture and fixtures | 72,702 | 72,437 | |
Land | 19,965 | 18,849 | |
Leasehold improvements | 242,830 | 273,985 | |
Property and equipment gross | 1,253,348 | 1,112,880 | |
Less accumulated depreciation and amortization | [1] | (769,530) | (683,348) |
Total | $ 483,818 | $ 429,532 | |
[1] | Accumulated depreciation and amortization includes write-offs due to retirement of fully amortized fixed assets. |
Summary of Significant Accoun_8
Summary of Significant Accounting Policies - Useful Lives of Depreciable Assets (Detail) | 12 Months Ended |
Oct. 31, 2020 | |
Computer and other equipment | Minimum | |
Property, Plant and Equipment [Line Items] | |
Useful lives of depreciable assets, years | 3 years |
Computer and other equipment | Maximum | |
Property, Plant and Equipment [Line Items] | |
Useful lives of depreciable assets, years | 8 years |
Buildings | |
Property, Plant and Equipment [Line Items] | |
Useful lives of depreciable assets, years | 30 years |
Furniture and fixtures | |
Property, Plant and Equipment [Line Items] | |
Useful lives of depreciable assets, years | 5 years |
Leasehold improvements | |
Property, Plant and Equipment [Line Items] | |
Useful lives of depreciable assets, description | Shorter of the lease term or the estimated useful life |
Summary of Significant Accoun_9
Summary of Significant Accounting Policies - Components of Accounts Payable and Accrued Liabilities (Detail) - USD ($) $ in Thousands | Oct. 31, 2020 | Oct. 31, 2019 |
Accounts payable and accrued liabilities Current | ||
Payroll and related benefits | $ 492,626 | $ 417,157 |
Other accrued liabilities | 101,035 | 69,487 |
Accounts payable | 30,003 | 19,815 |
Total | $ 623,664 | $ 506,459 |
Summary of Significant Accou_10
Summary of Significant Accounting Policies - Components of Other Long Term Liabilities (Detail) - USD ($) $ in Thousands | Oct. 31, 2020 | Oct. 31, 2019 |
Liabilities Other than long term debt non current | ||
Deferred compensation liability | $ 269,737 | $ 249,822 |
Other long-term liabilities | 14,774 | 73,903 |
Total | $ 284,511 | $ 323,725 |
Summary of Significant Accou_11
Summary of Significant Accounting Policies - Reconciliation of Weighted Average Common Shares Used to Calculate Basic Net Income Per Share (Detail) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 12 Months Ended | |||
Oct. 31, 2020 | Oct. 31, 2019 | Oct. 31, 2018 | ||
Earnings Per Share [Abstract] | ||||
Net income attributed to Synopsys | $ 664,347 | $ 532,367 | $ 432,518 | |
Weighted average common shares for basic net income per share (in shares) | 151,135 | 149,872 | 149,036 | |
Dilutive effect of common share equivalents from equity-based compensation (in shares) | 4,571 | 4,318 | 4,357 | |
Weighted average common shares for diluted net income per share (in shares) | 155,706 | 154,190 | 153,393 | |
Basic (in USD per share) | $ 4.40 | $ 3.55 | $ 2.90 | |
Diluted (in USD per share) | $ 4.27 | $ 3.45 | $ 2.82 | |
Anti-dilutive employee stock-based awards excluded (in shares) | [1] | 97 | 171 | 850 |
[1] | These stock options and unvested restricted stock units were anti-dilutive for the respective periods and are excluded in calculating diluted net income per share. While such awards were anti-dilutive for the respective periods, they could be dilutive in the future. |
Revenue - Schedule of Disaggreg
Revenue - Schedule of Disaggregation of Revenue (Details) - Operating Segments - Revenues | 12 Months Ended | |||
Oct. 31, 2020 | Oct. 31, 2019 | Oct. 31, 2018 | ||
Disaggregation of Revenue [Line Items] | ||||
Revenue percentage by product group | 100.00% | 100.00% | 100.00% | |
EDA | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue percentage by product group | 57.00% | 59.00% | 62.00% | |
IP & System Integration | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue percentage by product group | 33.00% | 31.00% | 29.00% | |
Software Integrity Products & Services | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue percentage by product group | 10.00% | 10.00% | 9.00% | |
Other | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue percentage by product group | [1] | 0.00% | 0.00% | 0.00% |
[1] | The percentage of revenue by Other is less than 1%. |
Revenue - Schedule of Contract
Revenue - Schedule of Contract Assets and Liabilities (Details) - USD ($) $ in Thousands | Oct. 31, 2020 | Oct. 31, 2019 |
Revenue from Contract with Customer [Abstract] | ||
Contract assets | $ 214,583 | $ 210,557 |
Unbilled receivables | 50,932 | 38,175 |
Deferred revenue | $ 1,493,113 | $ 1,302,578 |
Revenue (Details)
Revenue (Details) - USD ($) $ in Millions | 12 Months Ended | |
Oct. 31, 2020 | Oct. 31, 2019 | |
Revenue Recognition, Multiple-deliverable Arrangements [Line Items] | ||
Contract with customer, liability, revenue recognized | $ 1,100 | $ 1,000 |
Revenue, remaining performance obligation, amount | 4,900 | |
Revenue, remaining performance obligation, non-cancellable, amount | $ 673.8 | |
Revenue, remaining performance obligation, excluding non-cancellable, recognized over twelve month period, percent | 61.00% | |
Capitalized contract cost, net | $ 81.3 | 86.4 |
Amortization of capitalized costs to obtain revenue contracts | 61.2 | 62.8 |
Sales Based Royalties | ||
Revenue Recognition, Multiple-deliverable Arrangements [Line Items] | ||
Contract with customer, liability, revenue recognized | $ 102.4 | $ 80 |
Business Combinations - 2020 Ac
Business Combinations - 2020 Acquisitions (Details) - USD ($) $ in Thousands | 3 Months Ended | 12 Months Ended | ||
Apr. 30, 2020 | Oct. 31, 2020 | Oct. 31, 2019 | Oct. 31, 2018 | |
Business Acquisition [Line Items] | ||||
Total purchase consideration | $ 238,300 | |||
Goodwill | 3,365,114 | $ 3,171,179 | $ 3,143,249 | |
Design service arrangement | $ 10,700 | |||
Design service arrangement, period | 5 years | |||
Series of Individually Immaterial Business Acquisitions | ||||
Business Acquisition [Line Items] | ||||
Total purchase consideration | 132,600 | |||
Identifiable intangibles assets acquired | 44,700 | |||
Goodwill | 92,800 | |||
Semiconductor And System Design | ||||
Business Acquisition [Line Items] | ||||
Total purchase consideration | $ 105,700 | |||
Cash paid | 75,700 | |||
Consideration transferred, other | 30,000 | |||
Identifiable intangibles assets acquired | 20,600 | |||
Recognized identifiable assets acquired and liabilities assumed, net | 4,200 | |||
Goodwill | $ 80,900 | 2,939,512 | 2,758,926 | 2,730,990 |
Software Integrity | ||||
Business Acquisition [Line Items] | ||||
Goodwill | 425,602 | $ 412,253 | $ 412,259 | |
Software Integrity | Series of Individually Immaterial Business Acquisitions | ||||
Business Acquisition [Line Items] | ||||
Goodwill | $ 13,300 |
Goodwill and Intangible Asset_2
Goodwill and Intangible Assets - Textual (Details) | 12 Months Ended |
Oct. 31, 2020Segment | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Number of reporting units | 2 |
Goodwill and Intangible Asset_3
Goodwill and Intangible Assets - Summary of Goodwill (Detail) - USD ($) $ in Thousands | 12 Months Ended | |
Oct. 31, 2020 | Oct. 31, 2019 | |
Goodwill [Roll Forward] | ||
Beginning Balance | $ 3,171,179 | $ 3,143,249 |
Additions | 173,732 | 23,690 |
Adjustments | 59 | |
Effect of foreign currency translation | 20,144 | 4,240 |
Ending balance | 3,365,114 | 3,171,179 |
Semiconductor And System Design | ||
Goodwill [Roll Forward] | ||
Beginning Balance | 2,758,926 | 2,730,990 |
Additions | 160,447 | 23,690 |
Adjustments | 59 | |
Effect of foreign currency translation | 20,080 | 4,246 |
Ending balance | 2,939,512 | 2,758,926 |
Software Integrity | ||
Goodwill [Roll Forward] | ||
Beginning Balance | 412,253 | 412,259 |
Additions | 13,285 | 0 |
Adjustments | 0 | |
Effect of foreign currency translation | 64 | (6) |
Ending balance | $ 425,602 | $ 412,253 |
Goodwill and Intangible Asset_4
Goodwill and Intangible Assets - Summary of Intangible Assets (Detail) - USD ($) $ in Thousands | Oct. 31, 2020 | Oct. 31, 2019 |
Finite-Lived Intangible Assets [Line Items] | ||
Gross Assets | $ 1,489,314 | $ 1,418,818 |
Accumulated Amortization | 1,234,992 | 1,139,444 |
Net Assets | 254,322 | 279,374 |
Core/developed technology | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Assets | 827,232 | 791,647 |
Accumulated Amortization | 703,009 | 655,119 |
Net Assets | 124,223 | 136,528 |
Customer relationships | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Assets | 380,838 | 358,661 |
Accumulated Amortization | 277,219 | 242,058 |
Net Assets | 103,619 | 116,603 |
Contract rights intangible | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Assets | 192,812 | 184,304 |
Accumulated Amortization | 186,763 | 181,124 |
Net Assets | 6,049 | 3,180 |
Trademarks and trade names | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Assets | 43,096 | 42,929 |
Accumulated Amortization | 28,716 | 25,581 |
Net Assets | 14,380 | 17,348 |
In-process research and development (IPR&D) | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Assets | 1,214 | 1,200 |
Accumulated Amortization | 0 | 0 |
Net Assets | 1,214 | 1,200 |
Capitalized software development costs | ||
Finite-Lived Intangible Assets [Line Items] | ||
Gross Assets | 44,122 | 40,077 |
Accumulated Amortization | 39,285 | 35,562 |
Net Assets | $ 4,837 | $ 4,515 |
Goodwill and Intangible Asset_5
Goodwill and Intangible Assets - Amortization Expense Related to Intangible Assets (Detail) - USD ($) $ in Thousands | 12 Months Ended | |||
Oct. 31, 2020 | Oct. 31, 2019 | Oct. 31, 2018 | ||
Finite-Lived Intangible Assets [Line Items] | ||||
Amortization of intangible expense | $ 95,004 | $ 103,782 | $ 129,263 | |
Core/developed technology | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Amortization of intangible expense | 47,890 | 56,163 | 78,820 | |
Customer relationships | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Amortization of intangible expense | 35,075 | 37,533 | 37,395 | |
Contract rights intangible | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Amortization of intangible expense | 5,181 | 3,581 | 4,906 | |
Trademarks and trade names | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Amortization of intangible expense | 3,135 | 3,637 | 4,543 | |
Capitalized software development costs | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Amortization of intangible expense | [1] | $ 3,723 | $ 2,868 | $ 3,599 |
[1] | Amortization of capitalized software development costs is included in cost of products revenue in the consolidated statements of operations. |
Goodwill and Intangible Asset_6
Goodwill and Intangible Assets - Estimated Future Amortization of Intangible Assets (Detail) - USD ($) $ in Thousands | Oct. 31, 2020 | Oct. 31, 2019 |
Finite-Lived Intangible Assets, Net, Amortization Expense, Fiscal Year Maturity [Abstract] | ||
2021 | $ 76,078 | |
2022 | 61,242 | |
2023 | 44,733 | |
2024 | 34,398 | |
2025 | 18,295 | |
2026 and thereafter | 18,362 | |
IPR&D | 1,214 | |
Net Assets | $ 254,322 | $ 279,374 |
Financial Assets and Liabilit_3
Financial Assets and Liabilities - Summary of Cash Cash Equivalents and Investments (Detail) - USD ($) $ in Thousands | Oct. 31, 2020 | Oct. 31, 2019 | |
Cash equivalents: | |||
Cash, Cash Equivalents and Investments [Line Items] | |||
Cost | $ 304,127 | $ 166,024 | |
Gross Unrealized Gains | 0 | 0 | |
Gross Unrealized Losses Less than 12 Months | 0 | 0 | |
Gross Unrealized Losses 12 Months or Longer | 0 | 0 | |
Estimated Fair Value | [1] | 304,127 | 166,024 |
Other long-term assets: | |||
Cash, Cash Equivalents and Investments [Line Items] | |||
Non-marketable equity securities, Cost | 13,200 | 10,951 | |
Gross Unrealized Gains | 0 | 0 | |
Gross Unrealized Losses Less Than 12Months | 0 | 0 | |
Gross Unrealized Loss Position 12Months Or Longer | 0 | 0 | |
Non-marketable equity securities | [1] | 13,200 | 10,951 |
Money market funds | Cash equivalents: | |||
Cash, Cash Equivalents and Investments [Line Items] | |||
Cost | 304,127 | 166,024 | |
Gross Unrealized Gains | 0 | 0 | |
Gross Unrealized Losses Less than 12 Months | 0 | 0 | |
Gross Unrealized Losses 12 Months or Longer | 0 | 0 | |
Estimated Fair Value | [1] | 304,127 | 166,024 |
Non-marketable equity securities | Other long-term assets: | |||
Cash, Cash Equivalents and Investments [Line Items] | |||
Non-marketable equity securities, Cost | 13,200 | 10,951 | |
Gross Unrealized Gains | 0 | 0 | |
Gross Unrealized Losses Less Than 12Months | 0 | 0 | |
Gross Unrealized Loss Position 12Months Or Longer | 0 | 0 | |
Non-marketable equity securities | [1] | $ 13,200 | $ 10,951 |
[1] | See Note 7. Fair Value Measures for further discussion on fair values of cash equivalents. |
Financial Assets and Liabilit_4
Financial Assets and Liabilities - Schedule of Cash, Cash Equivalents And Restricted Cash (Details) - USD ($) $ in Thousands | Oct. 31, 2020 | Oct. 31, 2019 | Oct. 31, 2018 | Oct. 31, 2017 |
Restricted Cash and Cash Equivalents Items [Line Items] | ||||
Cash and cash equivalents | $ 1,235,653 | $ 728,597 | ||
Cash, Cash Equivalents, and Restricted Cash | 1,237,970 | 730,527 | $ 725,001 | $ 1,050,075 |
Restricted cash included in Prepaid expenses and other current assets | ||||
Restricted Cash and Cash Equivalents Items [Line Items] | ||||
Restricted cash | 1,523 | 1,174 | ||
Restricted cash included in Other long-term assets | ||||
Restricted Cash and Cash Equivalents Items [Line Items] | ||||
Restricted cash | $ 794 | $ 756 |
Financial Assets and Liabilit_5
Financial Assets and Liabilities - Additional Information (Detail) ¥ in Millions | Nov. 28, 2016USD ($) | Jul. 31, 2018USD ($) | Oct. 31, 2020USD ($) | Oct. 31, 2019USD ($) | Jul. 31, 2018CNY (¥) | May 19, 2015USD ($) |
Financial Assets And Liabilities [Line Items] | ||||||
Shipments period using hedges (in months) | 1 month | |||||
Period for hedge balance in OCI to be reclassified to statement of operations (in months) | 12 months | |||||
Long-term debt | $ 100,823,000 | $ 120,093,000 | ||||
Fair values of derivative instruments not designated as hedging instruments | ||||||
Financial Assets And Liabilities [Line Items] | ||||||
Maximum length of time, foreign currency cash flow hedge | 1 month | |||||
Foreign currency derivative contracts | Minimum | ||||||
Financial Assets And Liabilities [Line Items] | ||||||
Forward contracts terms (in months) | 1 month | |||||
Foreign currency derivative contracts | Maximum | ||||||
Financial Assets And Liabilities [Line Items] | ||||||
Forward contracts terms (in months) | 22 months | |||||
Foreign currency derivative contracts | Cash Flow Hedging | Maximum | ||||||
Financial Assets And Liabilities [Line Items] | ||||||
Forward contracts terms (in months) | 3 years | |||||
Foreign Exchange Forward | Cash Flow Hedging | Maximum | ||||||
Financial Assets And Liabilities [Line Items] | ||||||
Forward contracts terms (in months) | 22 months | |||||
Foreign Exchange Contracts | Maximum | ||||||
Financial Assets And Liabilities [Line Items] | ||||||
Duration of foreign exchange forward contracts | 1 year | |||||
Unsecured Debt | Revolving Credit Facility | The Credit Agreement | ||||||
Financial Assets And Liabilities [Line Items] | ||||||
Credit facility maximum borrowing capacity | $ 650,000,000 | $ 500,000,000 | ||||
Additional borrowings from credit facility | 150,000,000 | |||||
Line of credit, current | $ 0 | 0 | ||||
Unsecured Debt | Revolving Credit Facility | The Credit Agreement | Minimum | ||||||
Financial Assets And Liabilities [Line Items] | ||||||
Commitment fees percentage | 0.125% | |||||
Unsecured Debt | Revolving Credit Facility | The Credit Agreement | Maximum | ||||||
Financial Assets And Liabilities [Line Items] | ||||||
Commitment fees percentage | 0.20% | |||||
Unsecured Debt | Term Loan | The Credit Agreement | ||||||
Financial Assets And Liabilities [Line Items] | ||||||
Senior unsecured term loan facility, face amount | $ 150,000,000 | |||||
Total outstanding senior unsecured term loan facility | $ 102,100,000 | 119,800,000 | ||||
Long-term debt | 75,000,000 | $ 102,200,000 | ||||
Foreign Line of Credit | ||||||
Financial Assets And Liabilities [Line Items] | ||||||
Credit facility maximum borrowing capacity | $ 33,000,000 | ¥ 220 | ||||
Line of credit, current | $ 25,800,000 | |||||
Debt instrument, term | 12 years | |||||
London Interbank Offered Rate (LIBOR) | Unsecured Debt | Revolving Credit Facility | The Credit Agreement | ||||||
Financial Assets And Liabilities [Line Items] | ||||||
Borrowings, interest rate | 1.00% | |||||
London Interbank Offered Rate (LIBOR) | Unsecured Debt | Term Loan | The Credit Agreement | ||||||
Financial Assets And Liabilities [Line Items] | ||||||
Borrowings, interest rate | 1.125% | |||||
Prime Rate | Foreign Line of Credit | ||||||
Financial Assets And Liabilities [Line Items] | ||||||
Borrowings, interest rate | 0.74% | |||||
Debt instrument, term | 5 years |
Financial Assets and Liabilit_6
Financial Assets and Liabilities - Effects on Changes in Fair Values of Non-Designated Forward Contracts (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 31, 2020 | Oct. 31, 2019 | Oct. 31, 2018 | |
Financial Assets And Liabilities [Abstract] | |||
Gain (loss) recorded in other income (expense), net | $ 1,957 | $ 4,538 | $ 3,361 |
Financial Assets and Liabilit_7
Financial Assets and Liabilities - Notional Amounts of Derivative Instruments (Detail) - USD ($) $ in Thousands | Oct. 31, 2020 | Oct. 31, 2019 |
Financial Assets And Liabilities [Abstract] | ||
Total gross notional amount | $ 981,234 | $ 817,441 |
Net fair value | $ 6,940 | $ 3,494 |
Financial Assets and Liabilit_8
Financial Assets and Liabilities - Fair Values of Derivative Instrument Designated and Non-Designated as Hedging Instruments in Balance Sheet (Detail) - USD ($) $ in Thousands | Oct. 31, 2020 | Oct. 31, 2019 |
Fair values of derivative instruments designated as hedging instruments | Other current assets | ||
Financial Assets And Liabilities [Line Items] | ||
Fair values of derivative instruments, assets | $ 9,182 | $ 7,327 |
Fair values of derivative instruments designated as hedging instruments | Accrued liabilities | ||
Financial Assets And Liabilities [Line Items] | ||
Fair values of derivative instruments, liabilities | 2,088 | 3,715 |
Fair values of derivative instruments not designated as hedging instruments | Other current assets | ||
Financial Assets And Liabilities [Line Items] | ||
Fair values of derivative instruments, assets | 138 | 53 |
Fair values of derivative instruments not designated as hedging instruments | Accrued liabilities | ||
Financial Assets And Liabilities [Line Items] | ||
Fair values of derivative instruments, liabilities | $ 292 | $ 171 |
Financial Assets and Liabilit_9
Financial Assets and Liabilities - Income Statement Location and Amount of Gains and Losses on Derivative Instrument Fair Values for Designated Hedge Instruments, Net of Tax (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 31, 2020 | Oct. 31, 2019 | Oct. 31, 2018 | |
Financial Assets And Liabilities [Line Items] | |||
Amount of gain (loss) recognized in OCI on derivatives (effective portion) | $ 7,834 | $ 4,733 | $ (17,428) |
Amount of gain (loss) reclassified from OCI (effective portion) | (73) | (14,637) | 10,888 |
Foreign Exchange Contracts | Revenues | |||
Financial Assets And Liabilities [Line Items] | |||
Amount of gain (loss) recognized in OCI on derivatives (effective portion) | 3,034 | 278 | 693 |
Amount of gain (loss) reclassified from OCI (effective portion) | 530 | 1,436 | 1,103 |
Foreign Exchange Contracts | Operating expenses | |||
Financial Assets And Liabilities [Line Items] | |||
Amount of gain (loss) recognized in OCI on derivatives (effective portion) | 4,800 | 4,455 | (18,121) |
Amount of gain (loss) reclassified from OCI (effective portion) | $ (603) | $ (16,073) | $ 9,785 |
Financial Assets and Liabili_10
Financial Assets and Liabilities - Schedule of Maturities of Term Loan (Details) - Term Loan - Unsecured Debt - The Credit Agreement $ in Thousands | Oct. 31, 2020USD ($) |
Long-term Debt, Fiscal Year Maturity [Abstract] | |
2021 | $ 27,187 |
2022 | 75,000 |
Total | $ 102,187 |
Fair Value Measures - Assets an
Fair Value Measures - Assets and Liabilities Measured at Fair Value on Recurring Basis (Detail) - Fair Value, Measurements, Recurring - USD ($) $ in Thousands | Oct. 31, 2020 | Oct. 31, 2019 |
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Total assets | $ 583,184 | $ 423,226 |
Total liabilities | 272,117 | 253,708 |
Deferred compensation plan liabilities | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Other long-term liabilities | 269,737 | 249,822 |
Foreign currency derivative contracts | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Prepaid and other current assets | 9,320 | 7,380 |
Foreign Currency Contracts, Liability, Fair Value Disclosure | 2,380 | |
Accounts payable and accrued liabilities | 3,886 | |
Deferred compensation plan assets | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Other long-term assets | 269,737 | 249,822 |
Money market funds | Cash equivalents: | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Cash equivalents | 304,127 | 166,024 |
Quoted Prices in Active Markets for Identical Assets (Level 1) | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Total assets | 573,864 | 415,846 |
Total liabilities | 269,737 | 249,822 |
Quoted Prices in Active Markets for Identical Assets (Level 1) | Deferred compensation plan liabilities | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Other long-term liabilities | 269,737 | 249,822 |
Quoted Prices in Active Markets for Identical Assets (Level 1) | Foreign currency derivative contracts | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Prepaid and other current assets | 0 | 0 |
Accounts payable and accrued liabilities | 0 | 0 |
Quoted Prices in Active Markets for Identical Assets (Level 1) | Deferred compensation plan assets | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Other long-term assets | 269,737 | 249,822 |
Quoted Prices in Active Markets for Identical Assets (Level 1) | Money market funds | Cash equivalents: | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Cash equivalents | 304,127 | 166,024 |
Significant Other Observable Inputs (Level 2) | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Total assets | 9,320 | 7,380 |
Total liabilities | 2,380 | 3,886 |
Significant Other Observable Inputs (Level 2) | Deferred compensation plan liabilities | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Other long-term liabilities | 0 | 0 |
Significant Other Observable Inputs (Level 2) | Foreign currency derivative contracts | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Prepaid and other current assets | 9,320 | 7,380 |
Accounts payable and accrued liabilities | 2,380 | 3,886 |
Significant Other Observable Inputs (Level 2) | Deferred compensation plan assets | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Other long-term assets | 0 | 0 |
Significant Other Observable Inputs (Level 2) | Money market funds | Cash equivalents: | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Cash equivalents | 0 | 0 |
Significant Unobservable Inputs (Level 3) | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Total assets | 0 | 0 |
Total liabilities | 0 | 0 |
Significant Unobservable Inputs (Level 3) | Deferred compensation plan liabilities | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Other long-term liabilities | 0 | 0 |
Significant Unobservable Inputs (Level 3) | Foreign currency derivative contracts | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Prepaid and other current assets | 0 | 0 |
Accounts payable and accrued liabilities | 0 | 0 |
Significant Unobservable Inputs (Level 3) | Deferred compensation plan assets | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Other long-term assets | 0 | 0 |
Significant Unobservable Inputs (Level 3) | Money market funds | Cash equivalents: | ||
Fair Value, Balance Sheet Grouping, Financial Statement Captions [Line Items] | ||
Cash equivalents | $ 0 | $ 0 |
Leases - Components of Leases E
Leases - Components of Leases Expenses (Details) $ in Thousands | 12 Months Ended | |
Oct. 31, 2020USD ($) | ||
Leases [Abstract] | ||
Operating lease expense | $ 93,636 | |
Variable lease expense | 5,147 | [1] |
Total lease expense | $ 98,783 | |
[1] | Variable lease expense includes payments to lessors that are not fixed or determinable at lease commencement date. These payments primarily consist of maintenance, property taxes, insurance and variable indexed based payments. |
Leases - Supplemental Cash Flow
Leases - Supplemental Cash Flow Information (Details) $ in Thousands | 12 Months Ended |
Oct. 31, 2020USD ($) | |
Leases [Abstract] | |
Cash paid for amounts included in the measurement of operating lease liabilities | $ 72,828 |
ROU assets obtained in exchange for operating lease liabilities | $ 69,439 |
Leases - Lease Term and Discoun
Leases - Lease Term and Discount Rate Information (Details) | Oct. 31, 2020 |
Leases [Abstract] | |
Weighted Average remaining lease term (in years) | 8 years 7 months 13 days |
Weighted Average discount rate | 2.56% |
Leases - Future Minimum Payment
Leases - Future Minimum Payments (Details) $ in Thousands | Oct. 31, 2020USD ($) |
Leases [Abstract] | |
2021 | $ 84,534 |
2022 | 79,886 |
2023 | 64,073 |
2024 | 59,751 |
2025 | 53,280 |
Thereafter | 259,969 |
Total future minimum lease payments | 601,493 |
Less: Imputed interest | 65,909 |
Total lease liabilities | $ 535,584 |
Leases - Non-cancellable Operat
Leases - Non-cancellable Operating Leases (Details) $ in Thousands | Oct. 31, 2019USD ($) | [1] |
Leases [Abstract] | ||
2020 | $ 79,286 | |
2021 | 79,703 | |
2022 | 69,477 | |
2023 | 53,909 | |
2024 | 48,730 | |
Thereafter | 291,494 | |
Total | $ 622,599 | |
[1] | Amounts based on Topic 840, Leases. |
Leases (Details)
Leases (Details) $ in Millions | Oct. 31, 2020USD ($) |
Lessee, Lease, Description [Line Items] | |
Lessee, operating lease, lease not yet commenced, liability | $ 58.6 |
Lessor, operating lease, payments to be received | $ 69.6 |
Maximum | |
Lessee, Lease, Description [Line Items] | |
Lessee, operating lease, renewal Term | 10 years |
Lessee, operating lease, lease not yet commenced, term of contract | 9 years |
Minimum | |
Lessee, Lease, Description [Line Items] | |
Lessee, operating lease, lease not yet commenced, term of contract | 3 years |
Contingencies - Additional Info
Contingencies - Additional Information (Detail) - USD ($) | Jun. 29, 2018 | Jul. 31, 2018 | Oct. 31, 2020 |
Loss Contingencies [Line Items] | |||
Payments for legal settlements | $ 65,000,000 | ||
Release of loss contingency accrual | $ 39,000,000 | ||
Litigation settlement, expense | $ 26,000,000 | ||
Patent cross-license | 7 years | ||
Minimum | |||
Loss Contingencies [Line Items] | |||
Potential one-time termination charge | $ 0 | ||
Maximum | |||
Loss Contingencies [Line Items] | |||
Potential one-time termination charge | $ 25,000,000 |
Accumulated Other Comprehensi_3
Accumulated Other Comprehensive Income (Loss) - Components of Accumulated Other Comprehensive Income (Loss) (Detail) - USD ($) $ in Thousands | Oct. 31, 2020 | Oct. 31, 2019 |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | ||
Cumulative currency translation adjustments | $ (57,463) | $ (87,929) |
Unrealized gain (loss) on derivative instruments, net of taxes | 3,389 | (4,518) |
Total accumulated other comprehensive income (loss) | $ (54,074) | $ (92,447) |
Accumulated Other Comprehensi_4
Accumulated Other Comprehensive Income (Loss) - Effect of Amounts Reclassified out of Each Component of Accumulated Other Comprehensive Income (Loss) into Net Income (Detail) - Reclassification out of accumulated other comprehensive income (loss) - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 31, 2020 | Oct. 31, 2019 | Oct. 31, 2018 | |
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |||
Reclassifications into net income | $ (73) | $ (14,637) | $ 10,888 |
Revenues | Gain (loss) on cash flow hedges, net of taxes | |||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |||
Reclassifications into net income | 530 | 1,436 | 1,103 |
Operating expenses | Gain (loss) on cash flow hedges, net of taxes | |||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | |||
Reclassifications into net income | $ (603) | $ (16,073) | $ 9,785 |
Stock Repurchase Program - Addi
Stock Repurchase Program - Additional Information (Detail) - USD ($) | 1 Months Ended | 3 Months Ended | 4 Months Ended | 12 Months Ended | |||||||
May 31, 2020 | Feb. 29, 2020 | Dec. 31, 2019 | Feb. 29, 2020 | Jan. 31, 2018 | May 31, 2020 | Oct. 31, 2020 | Oct. 31, 2019 | Oct. 31, 2018 | [1] | Jun. 19, 2020 | |
Equity, Class of Treasury Stock [Line Items] | |||||||||||
Average purchase price (in USD per share) | $ 152.76 | $ 120.49 | $ 89.59 | ||||||||
Stock repurchase program authorized amount | $ 500,000,000 | $ 500,000,000 | |||||||||
Remaining amount available for further repurchases | $ 457,900,000 | ||||||||||
Purchases of treasury stock (in shares) | 1,585,000 | 2,732,000 | 4,688,000 | ||||||||
Accelerated Share Repurchase Program September 2017 | |||||||||||
Equity, Class of Treasury Stock [Line Items] | |||||||||||
Stock repurchase program, prepayment during period, derivative settlement | $ 20,000,000 | ||||||||||
Accelerated Share Repurchase Program December 2019 | |||||||||||
Equity, Class of Treasury Stock [Line Items] | |||||||||||
Average purchase price (in USD per share) | $ 149.75 | ||||||||||
Stock repurchase program authorized amount | $ 100,000,000 | ||||||||||
Prepayment during period | 100,000,000 | ||||||||||
Initial share delivery, amount | $ 80,000,000 | ||||||||||
Prepayment during prior period, derivative settlement | $ 20,000,000 | ||||||||||
Purchases of treasury stock (in shares) | 700,000 | ||||||||||
Accelerated Share Repurchase Program February 2020 ASR | |||||||||||
Equity, Class of Treasury Stock [Line Items] | |||||||||||
Average purchase price (in USD per share) | $ 140.41 | ||||||||||
Stock repurchase program authorized amount | 100,000,000 | $ 100,000,000 | |||||||||
Prepayment during period | 100,000,000 | ||||||||||
Initial share delivery, amount | $ 80,000,000 | $ 80,000,000 | |||||||||
Prepayment during prior period, derivative settlement | $ 20,000,000 | ||||||||||
Purchases of treasury stock (in shares) | 700,000 | ||||||||||
[1] | The first quarter of fiscal 2018 includes the settlement of the $20.0 million equity forward contract related to the September 2017 ASR. |
Stock Repurchase Program - Stoc
Stock Repurchase Program - Stock Repurchase Activities (Detail) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 12 Months Ended | |||
Oct. 31, 2020 | Oct. 31, 2019 | Oct. 31, 2018 | ||
Stock Repurchase Program | ||||
Purchases of treasury stock (in shares) | 1,585 | 2,732 | 4,688 | [1] |
Average purchase price (in USD per share) | $ 152.76 | $ 120.49 | $ 89.59 | [1] |
Aggregate purchase price | $ 242,078 | $ 329,185 | $ 420,000 | [1] |
Reissuance of treasury stock | 3,872 | 3,798 | 3,508 | |
[1] | The first quarter of fiscal 2018 includes the settlement of the $20.0 million equity forward contract related to the September 2017 ASR. |
Employee Benefit Plans (Employe
Employee Benefit Plans (Employee Stock Purchase Plan) - Additional Information (Detail) - $ / shares shares in Millions | 12 Months Ended | |||
Oct. 31, 2020 | Oct. 31, 2019 | Oct. 31, 2018 | Apr. 09, 2020 | |
Share-based Payment Arrangement [Abstract] | ||||
Threshold for employee stock purchases under ESPP, maximum value | 85.00% | |||
ESPP offering period (in years) | 2 years | |||
Increase in number of shares authorized for issuance under plan (in shares) | 5 | |||
Shares issued (in shares) | 1 | 1.2 | 1.2 | |
Weighted average purchase price of stock purchased (in USD per share) | $ 103.41 | $ 73.18 | $ 62.52 | |
Shares reserved for future issuance under the ESPP (in shares) | 13.8 |
Employee Benefit Plans (Equity
Employee Benefit Plans (Equity Compensation Plans) - Additional Information (Detail) - USD ($) $ in Millions | Apr. 09, 2020 | Oct. 31, 2020 | Oct. 31, 2017 | Oct. 31, 2019 | Oct. 31, 2018 | Apr. 06, 2017 | |
Restricted Stock Units | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Aggregate restricted stock units outstanding (in shares) | 4,130,000 | 3,843,000 | 3,857,000 | 3,769,000 | |||
Restricted Stock Units | Minimum | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Vesting period, (in years) | 3 years | ||||||
Restricted Stock Units | Maximum | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Vesting period, (in years) | 4 years | ||||||
Restricted Stock | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Aggregate restricted stock units outstanding (in shares) | 9,000 | 38,000 | 11,000 | 20,000 | |||
Stock Option | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Shares available for future grant (in shares) | [1] | 12,129,000 | 12,583,000 | 12,208,000 | 12,439,000 | ||
2006 Employee Equity Incentive Plan | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Share based compensation arrangement for options contractual term (in years) | 7 years | ||||||
Vesting period, (in years) | 4 years | ||||||
Additional reserved for future issuance under the 2006 Employee Plan (in shares) | 3,500,000 | ||||||
Shares available for future grant (in shares) | 12,100,000 | ||||||
2006 Employee Equity Incentive Plan | Restricted Stock Units | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Aggregate restricted stock units outstanding (in shares) | 4,100,000 | ||||||
2006 Employee Equity Incentive Plan | Stock Option | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Aggregate stock options outstanding (in shares) | 3,900,000 | ||||||
2005 Non Employee Directors Plan | Stock Option | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Aggregate stock options outstanding (in shares) | 29,222 | ||||||
Aggregate stock options granted under director plan (in shares) | 188,709 | ||||||
Fair value of option shares granted | $ 6.7 | ||||||
2005 Non Employee Directors Plan | Stock Option | Minimum | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Vesting period, (in years) | 3 years | ||||||
2005 Non Employee Directors Plan | Stock Option | Maximum | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Vesting period, (in years) | 4 years | ||||||
2017 Directors Plan | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Reserved for future issuance (in shares) | 389,682 | 450,000 | |||||
Restricted stock awards issued (in shares) | 9,412 | ||||||
Aggregate grant date fair value of restricted stock awards | $ 1.3 | ||||||
2017 Directors Plan | Restricted Stock | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Aggregate restricted stock units outstanding (in shares) | 9,412 | ||||||
2017 Directors Plan | Stock Option | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Aggregate stock options outstanding (in shares) | 5,998 | ||||||
Aggregate stock options granted under director plan (in shares) | 5,998 | ||||||
Fair value of option shares granted | $ 1.4 | ||||||
2017 Directors Plan | Stock Option | Maximum | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Vesting period, (in years) | 3 years | ||||||
Other Assumed Stock Plans | |||||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||||
Assumed shares remaining outstanding (in shares) | 100,000 | ||||||
[1] | Excluding shares reserved for future issuance under the 2017 Directors Plan. |
Employee Benefit Plans (Restric
Employee Benefit Plans (Restricted Stock Units) - Additional Information (Detail) $ / shares in Units, $ in Millions | Oct. 31, 2020USD ($)$ / shares | Oct. 31, 2020USD ($)$ / shares |
Schedule Of Restricted Stock [Line Items] | ||
Closing stock price (in USD per share) | $ / shares | $ 213.86 | $ 213.86 |
Unamortized share-based compensation expense | $ 488.6 | $ 488.6 |
Weighted-average period of total compensation costs to be recognized over a period in years | 2 years 3 months 18 days | |
Restricted Stock Units | ||
Schedule Of Restricted Stock [Line Items] | ||
share reserve ratio | 1.70 | |
Restricted Stock Units | Minimum | ||
Schedule Of Restricted Stock [Line Items] | ||
Vesting period, (in years) | 3 years | |
Restricted Stock Units | Maximum | ||
Schedule Of Restricted Stock [Line Items] | ||
Vesting period, (in years) | 4 years | |
Employee Stock Purchase Plan | ||
Schedule Of Restricted Stock [Line Items] | ||
Unamortized share-based compensation expense | $ 55.8 | $ 55.8 |
Weighted-average period of total compensation costs to be recognized over a period in years | 2 years |
Employee Benefit Plans - Restri
Employee Benefit Plans - Restricted Stock Units (Detail) - Restricted Stock Units - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 12 Months Ended | |||||
Oct. 31, 2020 | Oct. 31, 2019 | Oct. 31, 2018 | Oct. 31, 2017 | |||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Number of Shares [Roll Forward] | ||||||
Beginning balance (in shares) | 3,857 | 3,769 | 3,843 | |||
Granted (in shares) | 2,041 | 1,844 | 1,679 | [1] | ||
Vested (in shares) | [2] | (1,480) | (1,508) | (1,495) | ||
Forfeited (in shares) | (288) | (248) | (258) | |||
Ending balance (in shares) | 4,130 | 3,857 | 3,769 | 3,843 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Equity Instruments Other than Options, Nonvested, Weighted Average Grant Date Fair Value [Abstract] | ||||||
Weighted Average Grant Date Fair Value, Beginning balance (in USD per share) | $ 97.21 | $ 72.75 | $ 57.26 | |||
Granted (in USD per share) | 168.15 | 119.27 | 89.35 | |||
Vested (in USD per share) | 88.70 | 65.97 | 52.55 | |||
Forfeited (in USD per share) | 104.67 | 79.49 | 67.04 | |||
Weighted Average Grant Date Fair Value, Ending balance (in USD per share) | $ 134.80 | $ 97.21 | $ 72.75 | $ 57.26 | ||
Weighted Average Remaining Contractual Life (In Years) | 1 year 5 months 19 days | 1 year 6 months 21 days | 1 year 5 months 15 days | 1 year 6 months 14 days | ||
Aggregate Fair Value | $ 261,563 | $ 176,659 | $ 136,417 | |||
[1] | The Company assumed unvested restricted stock units from acquisitions including Black Duck. | |||||
[2] | The number of vested restricted stock units includes shares that were withheld on behalf of employees to satisfy the minimum statutory tax withholding requirements. |
Employee Benefit Plans - Stock
Employee Benefit Plans - Stock Options and Restricted Stock Units Under all Equity Plans (Except 2005 Director's Plan) (Detail) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands | 12 Months Ended | ||||
Oct. 31, 2020 | Oct. 31, 2019 | Oct. 31, 2018 | Oct. 31, 2017 | ||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price [Abstract] | |||||
Weighted- Average Exercise Price per Share, Options exercised (in USD per share) | $ 51.76 | $ 44.29 | $ 38.18 | ||
Stock Option | |||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||||
Available for grant, beginning balance (in shares) | [1] | 12,208 | 12,439 | 12,583 | |
Available for Grant, Options granted (in shares) | [1] | (694) | (799) | (1,134) | |
Available for Grant, Options canceled/forfeited/expired (in shares) | [1] | 102 | 129 | 157 | |
Available for Grant, Restricted stock units granted (in shares) | [1],[2] | (3,469) | (3,134) | (2,541) | |
Available for Grant, Restricted stock units forfeited (in shares) | [1],[2] | 482 | 373 | 374 | |
Available for Grant, Additional shares reserved (in shares) | [1] | 3,500 | 3,200 | 3,000 | |
Available for grants, ending balance (in shares) | [1] | 12,129 | 12,208 | 12,439 | 12,583 |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward] | |||||
Options Outstanding, Options granted (in shares) | 700 | 799 | 1,134 | ||
Options Outstanding, Options assumed (in shares) | [3] | 141 | |||
Options Outstanding, Options exercised (in shares) | (1,891) | (1,615) | (1,336) | ||
Options Outstanding, Options canceled/forfeited/expired (in shares) | (106) | (185) | (178) | ||
Options Outstanding, Exercisable (in shares) | 2,311 | ||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding, Weighted Average Exercise Price [Abstract] | |||||
Weighted- Average Exercise Price per Share, Beginning balance (in USD per share) | $ 65.57 | $ 55.63 | $ 46.83 | ||
Weighted- Average Exercise Price per Share, Options granted (in USD per share) | 143.44 | 113.17 | 89.52 | ||
Weighted- Average Exercise Price per Share, Options assumed (in USD per share) | [3] | 18.66 | |||
Weighted- Average Exercise Price per Share, Options exercised (in USD per share) | 51.76 | 44.29 | 38.18 | ||
Weighted- Average Exercise Price per Share, Options canceled/forfeited/expired (in USD per share) | 84.14 | 58.02 | 51.82 | ||
Weighted- Average Exercise Price per Share, Ending balance (in USD per share) | 85.26 | $ 65.57 | $ 55.63 | $ 46.83 | |
Weighted- Average Exercise Price per Share, Exercisable (in USD per share) | $ 65.36 | ||||
Weighted Average Remaining Contractual Life, options outstanding | 4 years 1 month 6 days | 4 years 29 days | 4 years 4 months 20 days | 4 years 7 months 6 days | |
Weighted-Average Remaining Contractual Life , Exercisable | 3 years 2 months 23 days | ||||
Aggregate Intrinsic Value, Beginning balance | $ 373,112 | $ 214,432 | $ 263,555 | ||
Aggregate Intrinsic Value, ending Balance | 513,845 | $ 373,112 | $ 214,432 | $ 263,555 | |
Aggregate Intrinsic Value, Exercisable | $ 343,230 | ||||
Stock Option | All Stock Plans | |||||
Share-based Compensation Arrangement by Share-based Payment Award, Options, Outstanding [Roll Forward] | |||||
Options outstanding, beginning balance (in shares) | 5,290 | 6,291 | 6,530 | ||
Options outstanding, ending balance (in shares) | 3,993 | 5,290 | 6,291 | 6,530 | |
[1] | Excluding shares reserved for future issuance under the 2017 Directors Plan. | ||||
[2] | These amounts do not reflect the actual number of restricted stock units granted or forfeited but rather the effect on the total remaining shares available for future grants after the application of the share reserve ratio. For more information about the share reserve ratio, please see Restricted Stock Units above. | ||||
[3] | The Company assumed options outstanding under various plans through acquisitions. |
Employee Benefit Plans - Pretax
Employee Benefit Plans - Pretax Intrinsic Value of Options Exercised and Their Average Exercise Prices (Detail) - USD ($) $ / shares in Units, $ in Thousands | 12 Months Ended | ||
Oct. 31, 2020 | Oct. 31, 2019 | Oct. 31, 2018 | |
Share-based Payment Arrangement [Abstract] | |||
Intrinsic value | $ 218,640 | $ 110,815 | $ 71,840 |
Average exercise price per share (in USD per share) | $ 51.76 | $ 44.29 | $ 38.18 |
Employee Benefit Plans - Summar
Employee Benefit Plans - Summary of Restricted Stock Award Activities Under Twenty Zero Five Directors Plan (Detail) - Restricted Stock - $ / shares shares in Thousands | 12 Months Ended | ||
Oct. 31, 2020 | Oct. 31, 2019 | Oct. 31, 2018 | |
Restricted shares | |||
Beginning balance (in shares) | 11 | 20 | 38 |
Granted (in shares) | 9 | 11 | 15 |
Vested (in shares) | (11) | (20) | (32) |
Forfeited (in shares) | 0 | 0 | (1) |
Ending balance (in shares) | 9 | 11 | 20 |
Weighted Average Grant Date Fair Value | |||
Weighted Average Grant Date Fair Value, Beginning balance (in USD per share) | $ 116.43 | $ 73.95 | $ 59.89 |
Granted (in USD per share) | 140.97 | 116.43 | 82.96 |
Vested (in USD per share) | 116.43 | 73.95 | 62.09 |
Forfeited (in USD per share) | 0 | 0 | 48.27 |
Weighted Average Grant Date Fair Value, Ending balance (in USD per share) | $ 140.97 | $ 116.43 | $ 73.95 |
Employee Benefit Plans - Stoc_2
Employee Benefit Plans - Stock Option Plans and Stock Purchase Rights Granted Under ESPP (Detail) - $ / shares | 12 Months Ended | ||
Oct. 31, 2020 | Oct. 31, 2019 | Oct. 31, 2018 | |
Stock Option | |||
Schedule of Weighted Average Assumptions for Fair Values of Stock Options[Line Items] | |||
Expected life (in years) | 4 years 1 month 6 days | 4 years 1 month 6 days | 4 years 1 month 6 days |
Risk-free interest rate, minimum | 0.26% | 1.28% | 2.10% |
Risk-free interest rate, maximum | 1.71% | 2.73% | 2.95% |
Volatility, minimum | 23.05% | 23.16% | 20.22% |
Volatility, maximum | 32.80% | 24.76% | 21.04% |
Weighted average estimated fair value (in USD per share) | $ 33.02 | $ 22.86 | $ 23.55 |
Employee Stock Purchase Plan | |||
Schedule of Weighted Average Assumptions for Fair Values of Stock Options[Line Items] | |||
Risk-free interest rate, minimum | 0.09% | 1.54% | 1.80% |
Risk-free interest rate, maximum | 1.24% | 2.60% | 2.73% |
Volatility, minimum | 25.59% | 23.73% | 19.99% |
Volatility, maximum | 43.06% | 27.86% | 21.54% |
Weighted average estimated fair value (in USD per share) | $ 47.69 | $ 35.18 | $ 23.34 |
Employee Stock Purchase Plan | Minimum | |||
Schedule of Weighted Average Assumptions for Fair Values of Stock Options[Line Items] | |||
Expected life (in years) | 6 months | 6 months | 6 months |
Employee Stock Purchase Plan | Maximum | |||
Schedule of Weighted Average Assumptions for Fair Values of Stock Options[Line Items] | |||
Expected life (in years) | 2 years | 2 years | 2 years |
Employee Benefit Plans - Stoc_3
Employee Benefit Plans - Stock Compensation Expense (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 31, 2020 | Oct. 31, 2019 | Oct. 31, 2018 | |
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |||
Stock compensation expense before taxes | $ 248,584 | $ 155,001 | $ 140,032 |
Income tax benefit | (39,077) | (26,226) | (26,578) |
Stock compensation expense after taxes | 209,507 | 128,775 | 113,454 |
Cost of products | |||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |||
Stock compensation expense before taxes | 27,193 | 17,193 | 14,648 |
Cost of maintenance and service | |||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |||
Stock compensation expense before taxes | 9,327 | 6,385 | 5,467 |
Research and development expense | |||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |||
Stock compensation expense before taxes | 125,814 | 75,853 | 67,355 |
Sales and marketing expense | |||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |||
Stock compensation expense before taxes | 43,205 | 28,834 | 28,069 |
General and administrative expense | |||
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items] | |||
Stock compensation expense before taxes | $ 43,045 | $ 26,736 | $ 24,493 |
Employee Benefit Plans - (Other
Employee Benefit Plans - (Other Retirement Plans) - Additional Information (Detail) | 12 Months Ended | |||
Oct. 31, 2020USD ($) | Oct. 31, 2020CAD ($) | Oct. 31, 2019USD ($) | Oct. 31, 2018USD ($) | |
Other Retirement Plans [Line Items] | ||||
Deferred percentage of annual cash base compensation | 50.00% | 50.00% | ||
Deferred percentage of variable cash compensation | 100.00% | 100.00% | ||
Other Retirement Plans | ||||
Other Retirement Plans [Line Items] | ||||
Employer contribution | $ 54,700,000 | $ 50,700,000 | $ 56,500,000 | |
Maximum pretax annual company contribution match per employee | $ 3,000 | $ 4,000 |
Employee Benefit Plans - Deferr
Employee Benefit Plans - Deferred Plan Assets and Liabilities (Detail) - USD ($) $ in Thousands | Oct. 31, 2020 | Oct. 31, 2019 | |
Share-based Payment Arrangement [Abstract] | |||
Plan assets recorded in other long-term assets | $ 269,737 | $ 249,822 | |
Plan liabilities recorded in other long-term liabilities | [1] | $ 269,737 | $ 249,822 |
[1] | Undistributed deferred compensation balances due to participants. |
Employee Benefit Plans - Summ_2
Employee Benefit Plans - Summary of Impact of Deferred Plan (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 31, 2020 | Oct. 31, 2019 | Oct. 31, 2018 | |
Share-based Payment Arrangement [Abstract] | |||
Increase (reduction) to cost of revenue and operating expense | $ 21,469 | $ 27,759 | $ 4,636 |
Other income (expense), net | 21,469 | 27,759 | 4,636 |
Net increase (decrease) to net income | $ 0 | $ 0 | $ 0 |
Income Taxes - Domestic and For
Income Taxes - Domestic and Foreign Components of Total Income Before Provision for Income Tax (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 31, 2020 | Oct. 31, 2019 | Oct. 31, 2018 | |
Income Tax Disclosure [Abstract] | |||
United States | $ 544,391 | $ 487,430 | $ (18,029) |
Foreign | 93,768 | 58,076 | 381,572 |
Income before income taxes | $ 638,159 | $ 545,506 | $ 363,543 |
Income Taxes - Components of (B
Income Taxes - Components of (Benefit) Provision for Income Taxes (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 31, 2020 | Oct. 31, 2019 | Oct. 31, 2018 | |
Income Tax Disclosure [Abstract] | |||
Federal | $ 29,272 | $ 22,821 | $ (1,120) |
State | 1,863 | 11,846 | 2,025 |
Foreign | 55,103 | 61,092 | 140,430 |
Current income tax expense (benefit), total | 86,238 | 95,759 | 141,335 |
Federal | (84,739) | (41,219) | (139,547) |
State | (20,233) | (7,227) | (25,661) |
Foreign | (6,554) | (34,174) | (45,102) |
Deferred income tax expense (benefit), total | (111,526) | (82,620) | (210,310) |
Provision (benefit) for income taxes | $ (25,288) | $ 13,139 | $ (68,975) |
Income Taxes - Rate Reconciliat
Income Taxes - Rate Reconciliation Between Provision for Income Taxes and Taxes Computed at Statutory Federal Rate (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 31, 2020 | Oct. 31, 2019 | Oct. 31, 2018 | |
Income Tax Disclosure [Abstract] | |||
Statutory federal tax | $ 133,979 | $ 114,557 | $ 85,142 |
State tax (benefit), net of federal effect | (29,096) | 6,529 | (32,351) |
Tax credits | (39,206) | (34,485) | (35,142) |
Tax on foreign earnings | (3,980) | 23,467 | (104,252) |
Foreign-derived intangible income deduction | (24,282) | (26,615) | 0 |
Tax settlements | (13,167) | (10,953) | (14,691) |
Stock-based compensation | (50,047) | (25,356) | (19,293) |
Changes in valuation allowance | (614) | (42,144) | 78,192 |
Integration of acquired technologies | 0 | 0 | 27,927 |
Undistributed earnings of foreign subsidiaries | 0 | 6,341 | (974) |
Impact of tax restructuring | 0 | 0 | (171,979) |
Impact of Tax Act rate change | 0 | 0 | 51,075 |
Transition tax | 0 | 0 | 63,107 |
Other | 1,125 | 1,798 | 4,264 |
Provision (benefit) for income taxes | $ (25,288) | $ 13,139 | $ (68,975) |
Income Taxes - Additional Info
Income Taxes - Additional Information (Detail) - USD ($) | 1 Months Ended | 3 Months Ended | 12 Months Ended | ||||
Jul. 31, 2017 | Jul. 31, 2019 | Oct. 31, 2020 | Oct. 31, 2019 | Oct. 31, 2018 | Apr. 30, 2019 | Oct. 31, 2017 | |
Taxes [Line Items] | |||||||
Federal statutory income tax rate, percent | 21.00% | ||||||
Undistributed earnings of foreign subsidiaries | $ 0 | $ (6,341,000) | $ 974,000 | ||||
Tax Cuts And Jobs Act Of 2017, transition tax expense | 17,900,000 | 63,100,000 | |||||
Increase in valuation allowance | 1,600,000 | ||||||
Tax credits | 39,206,000 | 34,485,000 | 35,142,000 | ||||
Decrease in gross unrecognized tax benefits | 33,100,000 | ||||||
Gross unrecognized tax benefits | 83,149,000 | 116,212,000 | 131,019,000 | ||||
Unrecognized tax benefits affecting effective tax rate | 83,100,000 | 116,200,000 | |||||
The sum of the amounts of estimated penalties and interest recognized in the period arising from income tax examinations | 200,000 | 300,000 | 9,400,000 | ||||
The amount of estimated penalties and interest accrued as of the balance sheet date arising from income tax examinations | 13,100,000 | 12,800,000 | |||||
Cumulative effect of new accounting principle in period of adoption | 4,912,367,000 | 4,088,876,000 | 3,485,015,000 | $ 3,279,724,000 | |||
Decrease in unrecognized tax benefits resulting from settlement with taxing authorities | 1,411,000 | 1,624,000 | |||||
California Franchise Tax Board | Fiscal Year 2015 to 2017 | |||||||
Taxes [Line Items] | |||||||
Increase in valuation allowance | 20,200,000 | ||||||
Decrease in unrecognized tax benefits resulting from settlement with taxing authorities | 20,200,000 | ||||||
Internal Revenue Service (IRS) | Fiscal Year 2019 | |||||||
Taxes [Line Items] | |||||||
Decrease in unrecognized tax benefits resulting from settlement with taxing authorities | 6,300,000 | ||||||
Internal Revenue Service (IRS) | Fiscal Year 2018 | |||||||
Taxes [Line Items] | |||||||
Decrease in unrecognized tax benefits resulting from settlement with taxing authorities | 5,400,000 | ||||||
Foreign tax credits, resulting from settlements with taxing authorities | 28,100,000 | ||||||
Internal Revenue Service (IRS) | Fiscal Year 2017 | |||||||
Taxes [Line Items] | |||||||
Decrease in unrecognized tax benefits resulting from settlement with taxing authorities | 21,800,000 | ||||||
Hungary | Fiscal Year 2011 to 2013 | |||||||
Taxes [Line Items] | |||||||
Gross unrecognized tax benefits | $ 17,400,000 | ||||||
The sum of the amounts of estimated penalties and interest recognized in the period arising from income tax examinations | $ 11,000,000 | ||||||
Proposed tax assessment | $ 25,000,000 | ||||||
Hungary | Fiscal Year 2014 To 2018 | |||||||
Taxes [Line Items] | |||||||
Decrease in unrecognized tax benefits resulting from settlement with taxing authorities | 6,900,000 | ||||||
Tax impact from tax settlements | 1,400,000 | ||||||
Taiwan | Fiscal Year 2017 | |||||||
Taxes [Line Items] | |||||||
Tax impact from tax settlements | 5,500,000 | ||||||
Minimum | |||||||
Taxes [Line Items] | |||||||
Estimated potential decrease in underlying unrecognized tax benefits, minimum | 0 | ||||||
Maximum | |||||||
Taxes [Line Items] | |||||||
Estimated potential decrease in underlying unrecognized tax benefits, minimum | 42,500,000 | ||||||
Retained Earnings | |||||||
Taxes [Line Items] | |||||||
Cumulative effect of new accounting principle in period of adoption | $ 3,795,397,000 | 3,164,144,000 | $ 2,543,688,000 | $ 2,143,873,000 | |||
Altera | |||||||
Taxes [Line Items] | |||||||
Income tax expense, resulting from legal settlement | $ 18,300,000 | ||||||
Cumulative effect, period of adoption, adjustment | Accounting Standards Update 2016-16 | Retained Earnings | |||||||
Taxes [Line Items] | |||||||
Cumulative effect of new accounting principle in period of adoption | $ 130,500,000 |
Income Taxes - Components of De
Income Taxes - Components of Deferred Tax Assets and Liabilities (Detail) - USD ($) $ in Thousands | Oct. 31, 2020 | Oct. 31, 2019 |
Deferred tax assets: | ||
Deferred revenue | $ 2,367 | $ 0 |
Deferred compensation | 55,172 | 56,483 |
Intangible and depreciable assets | 115,097 | 160,072 |
Capitalized research and development costs | 118,857 | 48,804 |
Stock-based compensation | 28,478 | 20,372 |
Tax loss carryovers | 35,571 | 40,068 |
Foreign tax credit carryovers | 18,645 | 20,187 |
Research and other tax credit carryovers | 320,317 | 278,382 |
Operating Lease Liabilities | 101,386 | 0 |
Gross deferred tax assets | 795,890 | 624,368 |
Valuation allowance | (158,895) | (157,343) |
Total deferred tax assets | 636,995 | 467,025 |
Deferred tax liabilities: | ||
Intangible assets | 45,915 | 58,697 |
Operating lease Right-of-Use-Assets | 84,716 | 0 |
Accruals and reserves | 7,780 | 4,450 |
Deferred revenue | 0 | 6,611 |
Undistributed earnings of foreign subsidiaries | 3,063 | 6,864 |
Other | 372 | 1,762 |
Total deferred tax liabilities | 141,846 | 78,384 |
Net deferred tax assets | $ 495,149 | $ 388,641 |
Income Taxes - Tax Loss and Cre
Income Taxes - Tax Loss and Credit Carryforwards Available to Offset Future Income Tax Liabilities (Detail) $ in Thousands | Oct. 31, 2020USD ($) |
Federal | |
Net Operating Loss and Tax Credit Carryforward [Line Items] | |
Net operating loss carryforward | $ 41,757 |
Credit carryforward | 176,616 |
Federal foreign tax credit carryforward | |
Net Operating Loss and Tax Credit Carryforward [Line Items] | |
Credit carryforward | 1,921 |
International foreign tax credit carryforward | |
Net Operating Loss and Tax Credit Carryforward [Line Items] | |
Net operating loss carryforward | 81,069 |
Credit carryforward | 15,681 |
California research credit carryforward | |
Net Operating Loss and Tax Credit Carryforward [Line Items] | |
Credit carryforward | 173,600 |
Other state research credit carryforward | |
Net Operating Loss and Tax Credit Carryforward [Line Items] | |
Credit carryforward | 15,486 |
State net operating loss carryforward | |
Net Operating Loss and Tax Credit Carryforward [Line Items] | |
Net operating loss carryforward | $ 70,251 |
Income Taxes - Summary of Recon
Income Taxes - Summary of Reconciliation of Beginning and Ending Balance of Gross Unrecognized Tax Benefit (Detail) - USD ($) $ in Thousands | 12 Months Ended | |
Oct. 31, 2020 | Oct. 31, 2019 | |
Reconciliation of Unrecognized Tax Benefits [Roll Forward] | ||
Beginning balance | $ 116,212 | $ 131,019 |
Increases in unrecognized tax benefits related to prior year tax positions | 5,390 | 41,346 |
Decreases in unrecognized tax benefits related to prior year tax positions | (43,783) | (71,092) |
Increases in unrecognized tax benefits related to current year tax positions | 9,226 | 16,927 |
Decreases in unrecognized tax benefits related to settlements with taxing authorities | (1,411) | (1,624) |
Reductions in unrecognized tax benefits due to lapse of applicable statute of limitations | (2,472) | (964) |
Increases in unrecognized tax benefits acquired | 778 | 0 |
Changes in unrecognized tax benefits due to foreign currency translation | (791) | 600 |
Ending Balance | $ 83,149 | $ 116,212 |
Other Income (Expense), Net - C
Other Income (Expense), Net - Components of Other Income (expense), Net (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 31, 2020 | Oct. 31, 2019 | Oct. 31, 2018 | |
Other Income and Expenses [Abstract] | |||
Interest income | $ 3,561 | $ 6,859 | $ 5,323 |
Interest expense | (5,140) | (11,659) | (15,607) |
Gain (loss) on assets related to deferred compensation plan | 21,469 | 27,759 | 4,636 |
Foreign currency exchange gain (loss) | 5,544 | 3,588 | 3,557 |
Other, net | (7,416) | (1,272) | 5,409 |
Total | $ 18,018 | $ 25,275 | $ 3,318 |
Segment Disclosure - Additional
Segment Disclosure - Additional information (Detail) - Customer | 12 Months Ended | ||
Oct. 31, 2020 | Oct. 31, 2019 | Oct. 31, 2018 | |
Segment Reporting Information [Line Items] | |||
Number of major customers | 1 | 1 | 1 |
Customer Concentration Risk | Revenues | |||
Segment Reporting Information [Line Items] | |||
Percentage of revenues contributed by major customers | 12.40% | 12.80% | 15.40% |
Segment Disclosure - Reportable
Segment Disclosure - Reportable Segment Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 31, 2020 | Oct. 31, 2019 | Oct. 31, 2018 | |
Segment Reporting Information [Line Items] | |||
Revenues | $ 3,685,281 | $ 3,360,694 | $ 3,121,058 |
Adjusted operating income | 620,141 | 520,231 | 360,225 |
Operating Segments | |||
Segment Reporting Information [Line Items] | |||
Adjusted operating income | $ 1,031,630 | $ 838,821 | $ 690,681 |
Adjusted operating margin | 28.00% | 25.00% | 22.00% |
Operating Segments | Semiconductor And System Design | |||
Segment Reporting Information [Line Items] | |||
Revenues | $ 3,327,211 | $ 3,026,097 | $ 2,840,589 |
Adjusted operating income | $ 990,837 | $ 806,618 | $ 701,283 |
Adjusted operating margin | 30.00% | 27.00% | 25.00% |
Operating Segments | Software Integrity | |||
Segment Reporting Information [Line Items] | |||
Revenues | $ 358,070 | $ 334,597 | $ 280,469 |
Adjusted operating income | $ 40,793 | $ 32,203 | $ (10,602) |
Adjusted operating margin | 11.00% | 10.00% | (4.00%) |
Segment Disclosure - Reportab_2
Segment Disclosure - Reportable Information (Details) - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 31, 2020 | Oct. 31, 2019 | Oct. 31, 2018 | |
Segment Reporting Information [Line Items] | |||
Adjusted operating income | $ 620,141 | $ 520,231 | $ 360,225 |
Stock compensation expense before taxes | 248,584 | 155,001 | 140,032 |
Other income (expense), net | 21,469 | 27,759 | 4,636 |
Operating Segments | |||
Segment Reporting Information [Line Items] | |||
Adjusted operating income | 1,031,630 | 838,821 | 690,681 |
Segment Reconciling Items | |||
Segment Reporting Information [Line Items] | |||
Amortization of intangible expense | (91,281) | (100,914) | (125,664) |
Stock compensation expense before taxes | (248,584) | (155,001) | (140,032) |
Other income (expense), net | $ (71,624) | $ (62,675) | $ (64,760) |
Segment Disclosure - Revenues R
Segment Disclosure - Revenues Related to Operations by Geographic Areas (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Oct. 31, 2020 | Oct. 31, 2019 | Oct. 31, 2018 | |
Schedule of Revenues from External Customers [Line Items] | |||
Total revenue | $ 3,685,281 | $ 3,360,694 | $ 3,121,058 |
United States | |||
Schedule of Revenues from External Customers [Line Items] | |||
Total revenue | 1,774,348 | 1,676,178 | 1,508,224 |
Europe | |||
Schedule of Revenues from External Customers [Line Items] | |||
Total revenue | 385,287 | 349,033 | 369,125 |
China | |||
Schedule of Revenues from External Customers [Line Items] | |||
Total revenue | 420,829 | 321,777 | 259,279 |
Korea | |||
Schedule of Revenues from External Customers [Line Items] | |||
Total revenue | 389,008 | 353,358 | 307,974 |
Other | |||
Schedule of Revenues from External Customers [Line Items] | |||
Total revenue | $ 715,809 | $ 660,348 | $ 676,456 |
Segment Disclosure - Property a
Segment Disclosure - Property and Equipment By Geographic Areas (Detail) - USD ($) $ in Thousands | Oct. 31, 2020 | Oct. 31, 2019 |
Long-Lived Assets by Geographical Areas [Line Items] | ||
Property and equipment, net | $ 483,818 | $ 429,532 |
United States | ||
Long-Lived Assets by Geographical Areas [Line Items] | ||
Property and equipment, net | 311,350 | 293,725 |
Other countries | ||
Long-Lived Assets by Geographical Areas [Line Items] | ||
Property and equipment, net | $ 172,468 | $ 135,807 |