A deepening relationship with Nvidia is bolstering this chip design software maker’s stock

Synopsys, a maker of chip design software, is the latest tech company to see its stock rise thanks to an artificial intelligence partnership with Nvidia.

Shares of Synopsys ( SNPS ) jumped nearly 7% on Monday morning before paring some of their early gains after the company said it was deepening its ties with AI chip darling Nvidia ( NVDA ), which saw its shares rise about 1% in recent trading. (Read our daily markets coverage here.)

Nvidia is making a $2 billion investment in Synopsys as part of the deal, which the companies said will develop accelerated artificial intelligence tools for chip design and engineering.

“No two companies are better positioned to deliver comprehensive AI-powered system design solutions than Synopsys and NVIDIA,” said Sasin Ghazi, CEO of Synopsys. “Together we will re-engineer engineering and empower innovators everywhere to realize their innovations more efficiently.”

The Nvidia partnership gives Synopsys shares a welcome boost after a difficult 2025 so far. Despite Monday’s gains, the stock is still down about 10% for the year, after taking a big hit in the wake of a weaker-than-expected earnings report in September.

Synopsys cited declining demand for its performance IP design, with Ghazi describing the third quarter as a “transformational” period shaped by a “challenging geopolitical backdrop.” The company said at the time that it was “taking a more conservative view on the fourth quarter.”

Despite reporting quarterly earnings last month that beat analyst estimates, Nvidia shares have also been hurt recently amid concerns that the tech giants are overspending on AI infrastructure. Its shares have added about a third of their value in 2025 so far.