Synopsys $SNPS ( ▲ 2.1% ) is jumping after Nvidia $NVDA ( ▲ 3.74% ) announced a $2 billion investment in the electronic design automation giant as part of a deeper strategic partnership. Nvidia is buying Synopsys shares at $414.79 each and plans to work closely with the company to design, simulate, and verify next-generation intelligent products with more speed and precision.
Synopsys sits at a critical chokepoint in the semiconductor world, providing the software tools chipmakers rely on to actually design the chips powering the AI boom. Nvidia CEO Jensen Huang has talked about evolving from generative AI to physical AI, and this collaboration is aimed squarely at accelerating that shift with AI-enhanced engineering workflows.
The two companies also plan to team up on joint engineering and marketing efforts tied to these new capabilities. Shares of Synopsys surged in early trading, recently up more than 7 percent as investors cheered Nvidia’s backing and the long runway for AI-driven chip design.