By Patrick Moorhead - November 20, 2023

The Six Five team discusses Copilot.

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Daniel Newman: Pat. Dude, two weeks in a row Synopsys.

Patrick Moorhead: I know, I know.

Daniel Newman: I know they’re a very cool company and they’re kind of on the rise, the second-largest provider of IP after ARM. Not a lot of people know that. So it’s important that the world is aware that this company’s doing a lot of things. One of the areas that Synopsys really leads is an EDA, which is all about tools for design and in the era of where you’re hearing exactly what we just talked about with Maya and Cobalt, Boost, companies like Synopsys tend to be very important in that process of building and designing and taking next generation ships to market.

And what would be cooler than taking the generative AI trend and coupling it with some very powerful tools that have been built for designing silicon and then putting the two things together to solve the big problem, Pat? You know what the big problem is, not enough engineers. There are not enough people in the business right now that understand how to design semiconductors.

And as the demand is rising and as the need for next generation silicon is moving at a pace that’s much faster than any company can keep up, we need to be leveraging the same tools that we’re going to use as a byproduct of the silicon to help us design the next generation silicon.

So there’s already what they call at Synopsys, AI, and that’s their high driven suite and what they’ve added now to it is the Copilot. So they basically are partnering with Microsoft and there was joint announcements that came out both ways. They’re basically using the Copilot now, engineers, and I would say, Pat, my experience in having been demonstrated this, this is not something that’s going to enable you and me, maybe people that roughly understand, but for someone that is a real engineer that’s part of designing circuits and designing silicon, this is going to allow them to use native natural language to get code sets, to get data sets, geometry, calculus and answers that they need in a quick timeframe where they can use that data, use best practices. It’s almost like having Copilot and GitHub, but it’s for silicon designers where they can basically get the information they need to be able to shorten the time to design and allow more design work to be done with fewer engineers.

I’m going to double down on that right now. There is a massive shortage in the market of engineers and with the speed that we are innovating around silicon and the number of companies that are trying to build ASICs, FPGAs as well as larger integrated designs, Pat, there isn’t enough of these people. So Synopsys has raised its hand and said, Hey, we’re going to be a company that’s going to help solve this problem. We’re going to use generative AI to do it. And Pat, I think it’s pretty cool.

Patrick Moorhead: Yeah, it’s a good breakdown there. And I was really struck, well, actually, let me just bracket it here. This tool is the first version from Synopsys. It helps designers and those doing validation. They’ve been doing this on the machine learning front and the UI was different, but what they have done is they haven’t just stuck an NLP front end, generative AI base front end to do the same things that they’re always doing. They’re hitting different data sets, they’re hitting new proprietary data sets to give answers more quickly and more accurately. I couldn’t help but to be struck as I went through the briefing and as I went through the demo with them and watched that video, it struck me very much as some of these tools like GitHub Copilot that are for software developers. And you might say, well, Pat Synopsys is software. It is, but it’s designing hardware. And the fluidity and how much I recognize that, even not being deep in the weed tech nerd I think is important.

And it even kind of pays off on what Microsoft had talked about, which is it’s a Copilot for everything. And the fact that these folks came out with that and aligned with Microsoft is a pretty big deal. And the way that I like to describe it is, hey, improving workflows in ways you couldn’t imagine before, but now that we’ve seen them, you’re like, oh, this makes absolute sense. Little kudos for Synopsys here is that Microsoft silicon team uses this tool or used this tool. The Microsoft team didn’t get a lot of announcements, but they seem to have a lot of kudos. Now, had their silicon stuff not come out, you’d be like, well, who cares what Microsoft says about silicon? Well, we should care now, as we just talked about, Microsoft has a relevant portfolio of CPUs and accelerators and some stuff they’ve done on the networking side.

Yeah, I’m expecting to see a lot more here. And by the way, there are clients who don’t want to use Azure, who might want AWS or Google, and I would expect that over time we see Synopsys light up capabilities from those two cloud providers. Unclear to me if you can even run this stuff on-prem. I do know a lot of their AI stuff you can run in a hybrid model, which is good. So congrats to Synopsys.

Daniel Newman: Yeah, I think you’re spot on by the way. This isn’t the last place Synopsys is going to put this, these EDA tools will need to exist in different clouds for sure. But you know what, Pat? I love the ingenuity. This is problem solving at its best. And so it’s a first iteration. That’s the other thing you said I really like, this is just the beginning, this isn’t the end of this kind of tool and there will be some work to be done before it’s going to maximize value, but I do like directional, especially the use of generative AI to solve problems where there are real labor shortages in the world. This is an area that just can’t pump out enough qualified people and it’s going to be so important because you know what silicon eats Pat for breakfast? Silicon eats the world. Silicon eats the world. All right-

Patrick Moorhead: I think I heard some smart analysts say that once.

Daniel Newman: Yeah, real analysts.

Patrick Moorhead: Right. Right.

Daniel Newman: Real analysts.

Patrick Moorhead: Exactly.

Patrick Moorhead
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Patrick founded the firm based on his real-world world technology experiences with the understanding of what he wasn’t getting from analysts and consultants. Ten years later, Patrick is ranked #1 among technology industry analysts in terms of “power” (ARInsights)  in “press citations” (Apollo Research). Moorhead is a contributor at Forbes and frequently appears on CNBC. He is a broad-based analyst covering a wide variety of topics including the cloud, enterprise SaaS, collaboration, client computing, and semiconductors. He has 30 years of experience including 15 years of executive experience at high tech companies (NCR, AT&T, Compaq, now HP, and AMD) leading strategy, product management, product marketing, and corporate marketing, including three industry board appointments.