Synopsys exits fab software to focus on AI design
US software giant Synopsys is abandoning the factory-floor tools that keep semiconductor plants running, a move that signals a deeper industry split between chip design and manufacturing that European fabs will have to navigate.
Synopsys has told more than 10 major chipmakers, including Samsung Electronics and SK Hynix, that its manufacturing control software has reached the end of its life. The notices, sent in April and May, mean the products will receive no future versions, only maintenance, with support talks due to conclude by July.
The affected tools, known as the Equipment Engineering System and Fault Detection and Classification, act as the nervous system of a fabrication plant. They monitor production equipment in real time, flagging anomalies before they become costly defects.
The retreat is driven by margins. Synopsys wants to reassign engineers from low-margin factory maintenance to the lucrative business of AI chip design, a field it expanded through its $35bn acquisition of Ansys in 2025. A spokesperson said the company was “discontinuing certain manufacturing analytics products, which are older diagnostic tools not in our customers’ critical paths of production.”
There is also a strategic calculation. Improving the factory software reportedly required chipmakers to share tightly held manufacturing data, while clients like Samsung were already developing in-house tools that eroded the competitiveness of the Synopsys offering.
This pullback highlights a widening split in the global semiconductor supply chain. As design software firms chase the higher profits of AI chip architecture, manufacturers are taking factory floor operations in-house. European semiconductor plants, which are actively ramping up capacity under the EU Chips Act, will face a similar landscape. They will increasingly need to rely on proprietary or startup-led solutions for production analytics rather than standardized US tools.
The transition carries risks. Sources cautioned that ending maintenance could dent production yields at some chipmakers over time, though others expected no impact at major manufacturers. Samsung confirmed the decision and stated it had lined up alternatives, expecting “no negative impact on production.”
The shift has a human cost, with a few dozen staff linked to the products already laid off. For Synopsys, the direction is clear: having secured a $2bn investment from Nvidia, it is betting that autonomous AI design software holds the next decade of growth. The company originally arrived at this software through its 2021 purchase of manufacturing solutions from South Korean firm BISTel, but following its March unveiling of AI agent design tools, it now wants to run towards a different future.
