Synopsys met analysts' expectations for first quarter revenues but has given shaky guidance for Q2 and the rest of the year.
Brad Henske, chief financial officer, said: "Orders were soft in the quarter as many customers tightened expenses in January after failing to see their business return in Q4."
Bookings were down mainly because the company saw a swathe of bookings a year ago when it switched users from time-based licences to subscription licences, he said.
Software revenues grew 19% on last year. But the consulting and training businesses continued to lag, said Henske. Service revenue for the quarter totalled $69m, down $12.9m sequentially and $17.9m on last year.
The company also saw a fall-off in maintenance renewal "as customers try to get by temporarily without support," Henske said.
He told analysts that few semiconductor executives claim much visibility today, and that has had an impact on Synopsys' ability to forecast adequately beyond the next quarter.
The company expects revenues of between $182m and $183m for Q2. Henske said: "Beyond that, visibility has not improved materially from last quarter, and we cannot give complete guidance for 2002."
He adds that Synopsys could see $10m less revenue in each of the remaining quarters of the year, but it plans to cut $35m to $40m out of its expense plan for the remainder of the year.
"We will continue to adjust expense and headcount levels to match market conditions in preparation for our acquisition of Avant," said Henske. The deal is expected to be completed between March and June this year.
John Barr, a financial analyst with Robertson Stephens, said: "Synopsys described a continuing difficult environment for its customers. It met its numbers but was cautious about the rest of the year."