Synopsys Halts China Operations Amid New U.S. Export Curbs

Synopsys (NASDAQ:SNPS), a top U.S. semiconductor design software firm, has suspended all sales and services in China following new export restrictions from the U.S. Department of Commerce. An internal letter sent to Synopsys staff in China, reviewed by Reuters, instructed employees to stop accepting new orders and block ongoing fulfillment, citing compliance with the newly imposed rules effective May 29, 2025.

The U.S. government has significantly tightened export controls, revoking licenses and halting shipments of advanced technologies—including EDA (Electronic Design Automation) software and semiconductor chemicals—to China without special permission. Synopsys received an official notice from the Bureau of Industry and Security and has since withdrawn its annual and quarterly forecasts, pending further clarification.

These restrictions target not only Chinese customers but also global firms operating in China and entities linked to the Chinese military, regardless of location. As part of its compliance measures, Synopsys has disabled Chinese users’ access to its customer support portal, SolvNetPlus.

This marks a major setback for China’s chip design sector, which relies heavily on top-tier U.S. tools. Alongside Cadence and Siemens EDA (Mentor Graphics), Synopsys dominates the global EDA market, collectively controlling over 70% of China’s EDA software share, according to state media Xinhua. Affected Chinese firms reportedly using Synopsys and Cadence tools include Brite Semiconductor, Zhuhai Jieli, and VeriSilicon.

The move underscores escalating U.S.-China tech tensions, with Washington aiming to limit China's access to critical semiconductor technologies. Synopsys has yet to issue a public comment on the suspension, which could have broad implications for both its business in China and the broader global semiconductor supply chain.