Exclusive-Synopsys halts China sales due to US export restrictions, internal memo shows

Yahoo

6 days ago

By Liam Mo and Brenda Goh
BEIJING (Reuters) -Semiconductor design software firm Synopsys has told staff in China to halt services and sales in the country and stop taking new orders to comply with new U.S. export restrictions, according to an internal letter reviewed by Reuters.
The U.S. has ordered a broad swathe of companies to stop shipping goods to China without a license and revoked licenses already granted to certain suppliers, Reuters reported on Wednesday, citing people familiar with the matter.
Products affected include design software and chemicals for semiconductors, they said.
Synopsys on Thursday suspended its annual and quarterly forecasts after it received a letter from the Bureau of Industry and Security of the U.S. Department of Commerce, informing it of new export restrictions related to China.
The internal letter sent to staff in China on Friday said "based on our initial interpretation, these new restrictions broadly prohibit the sales of our products and services in China and are effective as of May 29, 2025."
To ensure compliance, Synopsys said it was blocking sales and fulfillment in China and halting new orders until it receives further clarification.
The measures affect all customers in China, including employees of global customers working at sites in China and Chinese military users wherever they are located, the letter added.
The steps Synopsys is taking in light of the new restrictions have not been previously reported.
Synopsys did not immediately reply to a request for comment.
Alongside Cadence and Siemens EDA, Synopsys is among the top three companies that dominate electronic design automation (EDA) software that chipmakers can use to design semiconductors used in everything from smartphones to computers and cars.
Restricting Chinese firms' access to EDA tools would be a big blow to the industry as Chinese chip design customers heavily rely on top-of-the-line U.S. software.
Synopsys, Cadence and Siemens's Mentor Graphics control more than 70% of China's EDA market, Chinese state news agency Xinhua reported in April.
Chinese companies that have said they use Synopsys and Cadence software include design firm Brite Semiconductor, Zhuhai Jieli and semiconductor IP portfolio provider VeriSilicon.
The letter sent to staff in China on Friday also said that Chinese customers' access to its customer support portal SolvNetPlus had been disabled.