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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
(MARK ONE)
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE QUARTERLY PERIOD ENDED JULY 31, 2022
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
FOR THE TRANSITION PERIOD FROM                      TO
COMMISSION FILE NUMBER: 000-19807
snps-20220731_g1.jpg
SYNOPSYS, INC.
(Exact name of registrant as specified in its charter)
Delaware 56-1546236
(State or other jurisdiction of
incorporation or organization)
 (I.R.S. Employer
Identification Number)
690 EAST MIDDLEFIELD ROAD
MOUNTAIN VIEW, CA 94043
(Address of principal executive offices, including zip code)
(650) 584-5000
(Registrant’s telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading Symbol(s)Name of each exchange on which registered
Common Stock
(par value of $0.01 per share)
SNPSNasdaq Global Select Market
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  ý    No  ¨
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).    Yes  ý    No  ¨
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer ý  Accelerated Filer 
Non-accelerated filer 
¨  
  Smaller reporting company 
Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).    Yes      No  ý
As of August 17, 2022, there were 152,911,344 shares of the registrant’s common stock outstanding.



SYNOPSYS, INC.
QUARTERLY REPORT ON FORM 10-Q
FOR THE FISCAL QUARTER ENDED JULY 31, 2022
TABLE OF CONTENTS
  Page
PART I.
Item 1.
Item 2.
Item 3.
Item 4.
PART II.
Item 1.
Item 1A.
Item 2.
Item 6.




PART I. FINANCIAL INFORMATION
Item 1.Financial Statements
SYNOPSYS, INC.
UNAUDITED CONDENSED CONSOLIDATED BALANCE SHEETS
(in thousands, except par value amounts)
July 31,
2022
 October 31,
2021*
ASSETS
Current assets:
Cash and cash equivalents$1,383,559 $1,432,840 
Short-term investments147,599 147,949 
      Total cash, cash equivalents and short-term investments1,531,158 1,580,789 
Accounts receivable, net682,647 568,501 
Inventories219,736 229,023 
Prepaid and other current assets465,487 430,028 
Total current assets2,899,028 2,808,341 
Property and equipment, net486,872 472,398 
Operating lease right-of-use assets, net574,501 493,251 
Goodwill3,854,889 3,575,785 
Intangible assets, net404,652 279,132 
Deferred income taxes617,429 612,655 
Other long-term assets492,176 510,698 
Total assets$9,329,547 $8,752,260 
LIABILITIES, REDEEMABLE NON-CONTROLLING INTEREST AND STOCKHOLDERS’ EQUITY
Current liabilities:
Accounts payable and accrued liabilities$736,099 $741,191 
Operating lease liabilities, current54,170 79,678 
Deferred revenue1,755,594 1,517,623 
Short-term debt 74,992 
Total current liabilities2,545,863 2,413,484 
Operating lease liabilities, non-current592,930 487,003 
Long-term deferred revenue164,964 136,303 
Long-term debt21,960 25,094 
Other long-term liabilities352,188 391,433 
Total liabilities3,677,905 3,453,317 
Redeemable non-controlling interest43,516  
Stockholders’ equity:
Preferred stock, $0.01 par value: 2,000 shares authorized; none outstanding
  
Common stock, $0.01 par value: 400,000 shares authorized; 153,004 and 153,062 shares outstanding, respectively
1,530 1,531 
Capital in excess of par value1,415,244 1,576,363 
Retained earnings5,377,586 4,549,713 
Treasury stock, at cost: 4,257 and 4,198 shares, respectively
(1,034,841)(782,866)
Accumulated other comprehensive income (loss)(155,493)(49,604)
Total Synopsys stockholders’ equity5,604,026 5,295,137 
Non-controlling interest4,100 3,806 
Total stockholders’ equity5,608,126 5,298,943 
Total liabilities, redeemable non-controlling interest and stockholders’ equity$9,329,547 $8,752,260 
*Derived from audited financial statements.
See accompanying notes to unaudited condensed consolidated financial statements.
1


SYNOPSYS, INC.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(in thousands, except per share amounts)
 Three Months Ended 
 July 31,
Nine Months Ended 
 July 31,
 2022202120222021
Revenue:
Time-based products$754,322 $665,563 $2,185,626 $1,945,647 
Upfront products268,584 203,301 973,483 586,798 
Maintenance and service224,860 188,266 638,141 519,329 
Total revenue1,247,766 1,057,130 3,797,250 3,051,774 
Cost of revenue:
Products164,077 127,592 480,166 389,677 
Maintenance and service87,774 65,604 253,665 202,210 
Amortization of intangible assets19,330 11,870 47,145 35,164 
Total cost of revenue271,181 205,066 780,976 627,051 
Gross margin976,585 852,064 3,016,274 2,424,723 
Operating expenses:
Research and development444,826 371,146 1,218,761 1,090,959 
Sales and marketing199,246 171,428 571,329 514,810 
General and administrative91,461 83,846 246,426 234,028 
Amortization of intangible assets7,124 8,570 23,036 25,273 
Restructuring charges 15,151 12,057 15,151 
Total operating expenses742,657 650,141 2,071,609 1,880,221 
Operating income233,928 201,923 944,665 544,502 
Other income (expense), net2,426 11,414 (41,280)61,934 
Income before income taxes236,354 213,337 903,385 606,436 
Provision for income taxes16,708 14,945 76,506 51,214 
Net income$219,646 $198,392 $826,879 $555,222 
Net income (loss) attributed to non-controlling interest and redeemable non-controlling interest(2,980)(254)(4,215)(847)
Net income attributed to Synopsys$222,626 $198,646 $831,094 $556,069 
Net income per share attributed to Synopsys:
Basic$1.46 $1.30 $5.43 $3.64 
Diluted$1.43 $1.27 $5.31 $3.54 
Shares used in computing per share amounts:
Basic152,938 152,635 153,082 152,619 
Diluted155,806 156,907 156,545 157,158 
See accompanying notes to unaudited condensed consolidated financial statements.

2


SYNOPSYS, INC.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
(in thousands)
 Three Months Ended 
 July 31,
Nine Months Ended 
 July 31,
 2022202120222021
Net income$219,646 $198,392 $826,879 $555,222 
Other comprehensive income (loss):
Change in foreign currency translation adjustment(23,378)(5,905)(63,989)8,857 
Changes in unrealized gains (losses) on available-for-sale securities, net of tax of $0 for periods presented(1)15 (1,674)15 
Cash flow hedges:
Deferred gains (losses), net of tax $6,780 and $16,191, for the three and nine months ended July 31, 2022, respectively, and of $(909) and $(1,876) for each of the same periods in fiscal 2021, respectively.
(19,051)3,664 (41,769)8,971 
Reclassification adjustment on deferred (gains) losses included in net income, net of tax of $(28) and $(499), for the three and nine months ended July 31, 2022, respectively, and of $1,460 and $3,808 for each of the same periods in fiscal 2021, respectively.
36 (4,830)1,543 (12,180)
Other comprehensive income (loss), net of tax effects(42,394)(7,056)(105,889)5,663 
Comprehensive income177,252 191,336 720,990 560,885 
Less: net income (loss) attributed to non-controlling interest and redeemable non-controlling interest(2,980)(254)(4,215)(847)
Comprehensive income attributed to Synopsys$180,232 $191,590 $725,205 $561,732 
See accompanying notes to unaudited condensed consolidated financial statements.

3


SYNOPSYS, INC.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY
(in thousands)
 Capital in
Excess of
Par
Value
Retained
Earnings
Treasury
Stock
Accumulated
Other
Comprehensive
Income (Loss)
Total 
Synopsys
Stockholders’
Equity
Non-controlling
Interest
Stockholders’
Equity
Common Stock
 SharesAmount
Balance at April 30, 2022
152,955 $1,530 $1,517,481 $5,157,633 $(999,234)$(113,099)$5,564,311 $3,119 $5,567,430 
Net income222,626 222,626 (307)222,319 
Other comprehensive income (loss), net of tax effects(42,394)(42,394)(42,394)
Purchases of treasury stock(715)(8)8 (217,266)(217,266)(217,266)
Equity forward contract, net(40,000)(40,000)(40,000)
Common stock issued, net of shares withheld for employee taxes764 8 (188,562)181,659 (6,895)(6,895)
Stock-based compensation126,317 126,317 1,288 127,605 
Adjustments to redeemable non-controlling interest(2,673)(2,673)(2,673)
Balance at July 31, 2022
153,004 $1,530 $1,415,244 $5,377,586 $(1,034,841)$(155,493)$5,604,026 $4,100 $5,608,126 
Balance at October 31, 2021
153,062 $1,531 $1,576,363 $4,549,713 $(782,866)$(49,604)$5,295,137 $3,806 $5,298,943 
Net income831,094 831,094 (994)830,100 
Other comprehensive income (loss), net of tax effects(105,889)(105,889)(105,889)
Purchases of treasury stock(2,400)(24)24 (752,266)(752,266)(752,266)
Equity forward contract, net(5,000)(5,000)(5,000)
Common stock issued, net of shares withheld for employee taxes2,342 23 (488,292)500,291 12,022 12,022 
Stock-based compensation332,149 332,149 1,288 333,437 
Adjustments to redeemable non-controlling interest(3,221)(3,221)(3,221)
Balance at July 31, 2022
153,004 $1,530 $1,415,244 $5,377,586 $(1,034,841)$(155,493)$5,604,026 $4,100 $5,608,126 
 Capital in
Excess of
Par
Value
Retained
Earnings
Treasury
Stock
Accumulated
Other
Comprehensive
Income (Loss)
Total 
Synopsys
Stockholders’
Equity
Non-controlling
Interest
Stockholders’
Equity
Common Stock
 SharesAmount
Balance at April 30, 2021
152,554 $1,526 $1,679,801 $4,149,620 $(701,457)$(41,355)$5,088,135 $4,370 $5,092,505 
Net income198,646 198,646 (254)198,392 
Other comprehensive income (loss), net of tax effects(7,056)(7,056)(7,056)
Purchases of treasury stock(521)(5)5 (140,000)(140,000)(140,000)
Equity forward contract, net(35,000)(35,000)(35,000)
Common stock issued, net of shares withheld for employee taxes564 5 (122,988)84,116 (38,867)(38,867)
Stock-based compensation85,162 85,162 85,162 
Balance at July 31, 2021
152,597 $1,526 $1,606,980 $4,348,266 $(757,341)$(48,411)$5,151,020 $4,116 $5,155,136 
Balance at October 31, 2020
152,618 $1,528 $1,653,166 $3,795,397 $(488,613)$(54,074)$4,907,404 $4,963 $4,912,367 
Net income556,069 556,069 (847)555,222 
Retained earnings adjustment due to adoption of ASC 326(1)
(3,200)(3,200)(3,200)
Other comprehensive income (loss), net of tax effects5,663 5,663 5,663 
Purchases of treasury stock(2,114)(21)21 (538,082)(538,082)(538,082)
Equity forward contract, net(35,000)(35,000)(35,000)
Common stock issued, net of shares withheld for employee taxes2,093 19 (259,737)269,354 9,636 9,636 
Stock-based compensation248,530 248,530 248,530 
Balance at July 31, 2021
152,597 $1,526 $1,606,980 $4,348,266 $(757,341)$(48,411)$5,151,020 $4,116 $5,155,136 
(1) At the beginning of fiscal 2021, we adopted the Accounting Standards Codification (ASC) 326, Measurement of Credit Losses on Financial Instruments, issued by the Financial Accounting Standards Board (FASB). ASC 326 replaced the incurred loss methodology with an expected loss methodology.

See accompanying notes to unaudited condensed consolidated financial statements.
4


SYNOPSYS, INC.
UNAUDITED CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
 Nine Months Ended 
 July 31,
 20222021
Cash flows from operating activities:
Net income attributed to Synopsys$831,094 $556,069 
Adjustments to reconcile net income to net cash provided by operating activities:
Amortization and depreciation169,708 151,274 
Reduction of operating lease right-of-use assets65,980 64,920 
Amortization of capitalized costs to obtain revenue contracts54,438 46,973 
Stock-based compensation333,437 248,530 
Allowance for credit losses(4,516)13,813 
Deferred income taxes5,843 (33,116)
Other non-cash6,141 2,936 
Net changes in operating assets and liabilities, net of acquired assets and liabilities:
Accounts receivable(121,786)188,996 
Inventories118 (51,448)
Prepaid and other current assets(56,075)(62,201)
Other long-term assets(20,058)(117,922)
Accounts payable and accrued liabilities(46,356)51,991 
Operating lease liabilities(66,187)(61,666)
Income taxes(60,739)(29,414)
Deferred revenue254,353 152,328 
Net cash provided by operating activities1,345,395 1,122,063 
Cash flows from investing activities:
Proceeds from sales and maturities of short-term investments70,847 1,128 
Purchases of short-term investments(73,330)(146,082)
Proceeds from sales of long-term investments582  
Purchases of long-term investments(7,000)(7,591)
Purchases of property and equipment(102,934)(66,957)
Cash paid for acquisitions, net of cash acquired(416,323)(164,053)
Capitalization of software development costs(1,970)(1,517)
Other(1,200)(800)
Net cash used in investing activities(531,328)(385,872)
Cash flows from financing activities:
Repayment of debt(76,838)(21,637)
Issuances of common stock161,416 113,976 
Payments for taxes related to net share settlement of equity awards(149,130)(104,291)
Purchase of equity forward contract(40,000)(35,000)
Purchases of treasury stock(717,266)(538,082)
Other(3,413)(4,375)
Net cash used in financing activities(825,231)(589,409)
Effect of exchange rate changes on cash, cash equivalents and restricted cash(38,155)2,985 
Net change in cash, cash equivalents and restricted cash (49,319)149,767 
Cash, cash equivalents and restricted cash, beginning of year1,435,183 1,237,970 
Cash, cash equivalents and restricted cash, end of period$1,385,864 $1,387,737 
See accompanying notes to unaudited condensed consolidated financial statements.
5


SYNOPSYS, INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
Note 1. Description of Business
Synopsys, Inc. (Synopsys, we, our or us) 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.
We are a global leader in electronic design automation (EDA) software that engineers use to design and test integrated circuits (ICs), also known as chips. We also offer 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. We provide software and hardware used to validate the electronic systems that incorporate chips and the software that runs on them. We also provide technical services and support to help our customers develop advanced chips and electronic systems. These products and services are part of our Semiconductor & System Design segment.
We are 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 our Software Integrity segment.
Note 2. Summary of Significant Accounting Policies
We have prepared the accompanying unaudited condensed consolidated financial statements pursuant to the rules and regulations of the Securities and Exchange Commission (SEC). Pursuant to these rules and regulations, we have condensed or omitted certain information and footnote disclosures we normally include in our annual consolidated financial statements prepared in accordance with U.S. generally accepted accounting principles (U.S. GAAP). In management’s opinion, we have made all adjustments (consisting only of normal, recurring adjustments, except as otherwise indicated) necessary to fairly present our unaudited condensed consolidated balance sheets, results of operations, comprehensive income, stockholders’ equity and cash flows. Our interim period operating results do not necessarily indicate the results that may be expected for any other interim period or for the full fiscal year. These financial statements and accompanying notes should be read in conjunction with the consolidated financial statements and notes thereto in our Annual Report on Form 10-K for the fiscal year ended October 31, 2021 as filed with the SEC on December 13, 2021 (our Annual Report).
Use of Estimates. To prepare financial statements in conformity with U.S. GAAP, management must make estimates and assumptions that affect the amounts reported in the unaudited condensed consolidated financial statements and accompanying notes. Actual results could differ from these estimates and may result in material effects on our operating results and financial position.
Principles of Consolidation. The unaudited condensed consolidated financial statements include our accounts and the accounts of our subsidiaries. All intercompany accounts and transactions have been eliminated.
Fiscal Year End. Our fiscal year generally ends on the Saturday nearest to October 31 and consists of 52 weeks, with the exception that approximately every five years, we have a 53-week year. When a 53-week year occurs, we include the additional week in the first quarter to realign fiscal quarters with calendar quarters. Fiscal 2022 and 2021 are both 52-week years. Fiscal 2022 will end on October 29, 2022. Fiscal 2021 ended on October 30, 2021. For presentation purposes, the unaudited condensed consolidated financial statements and accompanying notes refer to the closest calendar month end.
Significant Accounting Policies. There have been no material changes to our significant accounting policies included in our Annual Report, other than our accounting policy for redeemable non-controlling interest.
Redeemable Non-controlling Interest. Non-controlling interest that is not solely redeemable within our control is reported as the temporary equity in our unaudited condensed consolidated balance sheets. The carrying value of the redeemable non-controlling interest equals the redemption value at the end of each reporting period, after giving effect to the change from the net income (loss) attributable to the redeemable non-controlling interest. We adjust the redemption value of the non-controlling interest on a quarterly basis and changes in the estimated redemption value are recorded with corresponding adjustments against retained earnings.
Recently Adopted Accounting Pronouncements
6


In December 2019, the FASB issued Accounting Standards Update (ASU) 2019-12, Simplifying the Accounting for Income Taxes, which simplifies the accounting for income taxes, eliminates certain exceptions within ASC 740, Income Taxes, and clarifies certain aspects of the current guidance to promote consistency among reporting entities. We adopted the standard as of the beginning of fiscal 2022 on a prospective basis and the adoption of this standard did not have a material impact on our unaudited condensed consolidated financial statements.
In October 2021, the FASB issued ASU 2021-08, Business Combinations (Topic 805): Accounting for Contract Assets and Contract Liabilities from Contracts with Customers. The new guidance requires contract assets and contract liabilities acquired in a business combination to be recognized and measured by the acquirer on the acquisition date in accordance with ASC 606, Revenue from Contracts with Customers, as if the acquirer had originated the contracts. We early adopted the standard in the second quarter of fiscal 2022 and the adoption had no material impact on our unaudited condensed consolidated financial statements for acquisitions completed in the first two quarters of fiscal 2022. The adoption of ASU 2021-08 resulted in the recognition of deferred revenue at amounts consistent with those recorded by the acquiree immediately before the acquisition date rather than at fair value for the business acquisition completed in the third quarter of fiscal 2022. See Note 4. Business Combinations for further information.
Recently Issued Accounting Pronouncements
In June 2022, the FASB issued ASU 2022-03, Fair Value Measurement (Topic 820): Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions (ASU 2022-03), which applies to all equity securities measured at fair value that are subject to contractual sale restrictions. This change prohibits entities from taking into account contractual restrictions on the sale of equity securities when estimating fair value and introduces required disclosures for such transactions. The standard will become effective for us beginning on November 1, 2024 and should be applied prospectively. Early adoption is permitted. The adoption of this guidance is not expected to have a material impact on our unaudited condensed consolidated financial statements.
Note 3. Revenue
Disaggregated Revenue
The following table showed the percentage of revenue by product groups:
Three Months Ended 
 July 31,
Nine Months Ended 
 July 31,
2022202120222021
EDA50.0 %55.8 %49.9 %56.2 %
IP & System Integration39.7 %34.4 %40.7 %34.2 %
Software Integrity Products & Services9.5 %9.3 %8.9 %9.3 %
Other0.8 %0.5 %0.5 %0.3 %
Total100.0 %100.0 %100.0 %100.0 %
Contract Balances
The contract assets indicated below are presented as prepaid and other current assets in the unaudited condensed 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 unaudited condensed consolidated balance sheets.
7


Contract balances were as follows:
As of
July 31, 2022October 31, 2021
 (in thousands)
Contract assets, net$280,507 $284,574 
Unbilled receivables$41,863 $35,589 
Deferred revenue$1,920,558 $1,653,926 
During the three and nine months ended July 31, 2022, we recognized revenue of $171.2 million and $1.1 billion, respectively, that was included in the deferred revenue balance as of October 31, 2021.
Contracted but unsatisfied or partially unsatisfied performance obligations were approximately $7.1 billion as of July 31, 2022, which includes $998.1 million in non-cancellable Flexible Spending Account (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. We have elected to exclude future sales-based royalty payments from the remaining performance obligations. Approximately 42% of the contracted but unsatisfied or partially unsatisfied performance obligations as of July 31, 2022, excluding non-cancellable FSA, are expected to be recognized over the next 12 months, with the remainder recognized thereafter.
During the three and nine months ended July 31, 2022, we recognized $33.9 million and $103.5 million, respectively, from performance obligations satisfied from sales-based royalties earned during the periods. During the three and nine months ended July 31, 2021, we recognized $27.9 million and $88.7 million, respectively, from performance obligations satisfied from sales-based royalties earned during the periods.
Costs of Obtaining a Contract with Customer
Capitalized commission costs, net of accumulated amortization, as of July 31, 2022 were $105.0 million and included in other long-term assets in our unaudited condensed consolidated balance sheets. Amortization of these assets was $19.9 million and $54.4 million during the three and nine months ended July 31, 2022, respectively, and included in sales and marketing expense in our unaudited condensed consolidated statements of income. Amortization of these assets was $16.5 million and $47.0 million during the three and nine months ended July 31, 2021, respectively, and included in sales and marketing expense in our unaudited condensed consolidated statements of income.
Note 4. Business Combinations
On June 22, 2022, we completed the acquisition of all outstanding shares of NTT Security AppSec Solutions Inc. (which has operated under the name WhiteHat Security, or WhiteHat), a provider of dynamic application security testing solutions, from NTT Security Corporation for an aggregate purchase price of $330.1 million in cash. With this acquisition, we have broadened our product offering in the application security testing market.
Preliminary Purchase Price Allocation
The aggregate purchase consideration was preliminarily allocated as follows:
(in thousands)
Total purchase consideration$330,112 
Less: cash acquired22,849 
Total purchase consideration, net of cash acquired$307,263 
Allocations
Goodwill$247,734 
Intangible assets97,500 
Deferred revenue(40,367)
Other tangible assets, net2,396 
$307,263 
8


The goodwill was primarily attributed to increased synergies that are expected to be achieved from the integration of WhiteHat. The $247.7 million of goodwill was assigned to the Software Integrity reporting unit and the amount recognized was not deductible for tax purposes. The acquired identifiable intangible assets of $97.5 million were valued using the income or cost approach. The intangible assets are being amortized over their respective useful lives ranging from 5 to 10 years.
Other Fiscal 2022 Acquisitions
During the three months ended January 31, 2022, we completed an acquisition for purchase consideration of $20.0 million, net of cash acquired. The preliminary purchase price was allocated as follows: $4.3 million to identifiable intangible assets and $15.7 million to goodwill, which were attributable to the Semiconductor & System Design reporting unit. There was no tax-deductible goodwill related to the acquisition.
During the three months ended April 30, 2022, we acquired 75% equity interest in OpenLight Photonics, Inc. (OpenLight) for cash consideration of $90.0 million. The remaining 25% equity interest in OpenLight is held by Juniper Networks, Inc. (the Minority Investor) from their contribution of IP and certain tangible assets.
The agreement with the Minority Investor contains redemption features whereby the interest held by the Minority Investor is redeemable either (i) at the option of the Minority Investor on or after the third anniversary of the acquisition or sooner in certain circumstances or (ii) at our option beginning on the third anniversary of the acquisition. This option is exercisable at the greater of fair value at the time of redemption or $30.0 million and was valued at $10.1 million, resulting in a total consideration of $100.1 million.
The preliminary purchase price was allocated as follows: $94.0 million to identifiable intangible assets and $45.1 million to goodwill, which were attributable to the Semiconductor & System Design reporting unit. The goodwill was mainly attributable to the assembled workforce and planned growth in new markets. There was no tax-deductible goodwill related to the acquisition.
From the date of acquisition through July 31, 2022, OpenLight incurred a net loss of $12.9 million, of which $3.2 million was attributable to redeemable non-controlling interest. As of July 31, 2022, the carrying amount of the redeemable non-controlling interest was recorded at its estimated fair value of $43.5 million in the unaudited condensed consolidated balance sheets.
We have included the financial results of these acquisitions in our unaudited condensed consolidated financial statements from the date of acquisition. We do not consider these acquisitions to be material, individually or in the aggregate, to our unaudited condensed consolidated financial statements.
Preliminary Fair Value Estimates
For all acquisitions completed, the purchase price was allocated to tangible and identifiable intangible assets acquired and liabilities assumed based on their preliminary estimated fair values, which were determined using generally accepted valuation techniques based on estimates and assumptions made by management at the time of acquisition. These estimates and assumptions are subject to change as additional information becomes available during the respective measurement period, which is not expected to exceed 12 months from applicable acquisition date.
Acquisition-Related Transaction Costs
Transaction costs were $5.2 million and $11.3 million during the three and nine months ended July 31, 2022, respectively. Transaction costs were $5.7 million and $11.6 million during the three and nine months ended July 31, 2021, respectively. These costs mainly consisted of professional fees and administrative costs and were expensed as incurred in our unaudited condensed consolidated statements of income.
Note 5. Goodwill and Intangible Assets
Goodwill
The changes in the carrying amount of goodwill during the nine months ended July 31, 2022 were as follows:
9


 (in thousands)
Balance at October 31, 2021
$3,575,785 
Additions308,532 
Adjustments1,285 
Effect of foreign currency translation(30,713)
Balance at July 31, 2022
$3,854,889 
During the nine months ended July 31, 2022, we finalized certain estimates impacting total purchase consideration for certain acquisitions and recorded the resulting measurement period adjustments which increased goodwill.
Intangible Assets
Intangible assets as of July 31, 2022 consisted of the following:
Gross Carrying AmountAccumulated
Amortization
Net Amount
 (in thousands)
Core/developed technology$1,078,103 $793,937 $284,166 
Customer relationships423,739 328,459 95,280 
Contract rights intangible191,430 188,524 2,906 
Trademarks and trade names52,795 33,157 19,638 
Capitalized software development costs48,068 45,406 2,662 
Total$1,794,135 $1,389,483 $404,652 
Intangible assets as of October 31, 2021 consisted of the following:
Gross Carrying AmountAccumulated
Amortization
Net Amount
 (in thousands)
Core/developed technology$911,903 $748,759 $163,144 
Customer relationships404,571 308,355 96,216 
Contract rights intangible193,317 188,231 5,086 
Trademarks and trade names43,095 31,155 11,940 
Capitalized software development costs46,098