Synplicity Announces Record Revenue and Earnings for the Fourth Quarter 2004  

Highlights:

• Fourth quarter revenue and earnings per share exceeded guidance
• Fourth quarter record revenue of $15.1 million
• Fourth quarter record GAAP net income of $803,000, or $0.03 per diluted share
• Fourth quarter record pro forma net income of $1.1 million, or $0.04 per diluted share
• Total product bookings increased in the fourth quarter of 2004 both on a year over year and sequential basis

SUNNYVALE, Calif., February 1, 2005 — Synplicity, Inc. (Nasdaq: SYNP), a leading supplier of software for the design and verification of semiconductors, today announced financial results for the fiscal quarter and year ended December 31, 2004. Revenue for the quarter ended December 31, 2004 was $15.1 million, a 14 percent increase from revenue of $ 13.2 million for the quarter ended December 31, 2003 and a 7 percent sequential increase from revenue of $14.1 million for the quarter ended September 30, 2004.

On a generally accepted accounting principles (GAAP) basis, net income was $803,000, or $0.03 per diluted share, for the quarter ended December 31, 2004, which included amortization of intangible assets from acquisitions of $222,000 and stock-based compensation expense of $29,000. For the quarter ended December 31, 2003, GAAP net income was $445,000, or $0.02 per diluted share, which included amortization of intangible assets of $227,000 and stock-based compensation expense of $76,000. For the quarter ended September 30, 2004, GAAP net income was $646,000, or $0.02 per diluted share, which included amortization of intangible assets from acquisitions of $223,000 and stock-based compensation expense of $38,000.

Pro forma net income was $1.1 million, or $0.04 per diluted share, for the quarter ended December 31, 2004, compared to pro forma net income of $748,000, or $0.03 per diluted share, for the quarter ended December 31, 2003, and pro forma net income of $907,000, or $0.03 per diluted share, for the quarter ended September 30, 2004. Pro forma figures exclude the impact of amortization of intangible assets and stock-based compensation expense. A reconciliation of GAAP to pro forma net income is included with this press release.

For the year ended December 31, 2004, revenue was $57.0 million, a 15 percent increase from revenue of $49.6 million for the year ended December 31, 2003. For the year ended December 31, 2004, Synplicity had GAAP net income of $2.2 million, or $0.08 per diluted share, compared to a net loss of $377,000 or $0.01 per diluted share, for the year ended December 31, 2003. Pro forma net income was $3.3 million, or $0.12 per diluted share, for the year ended December 31, 2004, compared to pro forma net income of $957,000, or $0.04 per diluted share, for the year ended December 31, 2003.

Separately, Synplicity also announced that Gary Meyers, president and CEO, has replaced Bernie Aronson as a director on the board of the Company effective January 28, 2005.

“We had an excellent fourth quarter which capped a strong financial year, including the highest quarterly revenue and earnings since inception,” said Gary Meyers. “In fiscal 2004 we grew product bookings, revenues and earnings. As we look to 2005, we expect that the combination of our leadership position in FPGA synthesis and our strong positioning in the structured ASIC market will provide us with solid revenue and earnings growth,” Meyers concluded.

Business Outlook
The following statements are based on current expectations. We do not intend to update, confirm or change this guidance until our earnings conference call, although we may provide additional detail regarding our guidance on today’s scheduled call.

• Revenue for the first quarter of 2005 is expected to be approximately $14.3 million
• GAAP operating expenses for the first quarter of 2005 are expected to be flat with the fourth quarter of 2005
• GAAP and pro forma net income per fully diluted share for the first quarter of 2005 are expected to be approximately $0.00 and $0.01, respectively
• Revenue for 2005 is expected to be approximately $62 million
• GAAP operating expenses for 2005 are expected to increase by approximately nine percent from 2004
• GAAP and pro forma net income per fully diluted share for 2005 is expected to be approximately $0.13 and $0.16, respectively

Audio Webcast
Synplicity’s earnings call will be webcast today at 2:00 p.m. Pacific, and may be accessed at http://investor.synplicity.com or at http://www.firstcallevents.com. Synplicity will discuss its fourth quarter and year 2004 results, and 2005 business outlook. Following completion of the call, a rebroadcast of the webcast will be available at http://investor.synplicity.com through March 31, 2005. For those without access to the Internet, a replay of the call will be available from 5:00 p.m. Pacific on February 1, 2005 through February 8, 2005. To listen to a replay, call (719) 457-0820, access code 5735477.

Use of Non-GAAP Financial Measures
This press release includes financial measures for net income and net income per share that exclude certain non-cash charges and that have not been calculated in accordance with GAAP. These measures differ from GAAP in that they exclude the amortization of intangible assets from acquisitions and stock-based compensation expense for stock options granted prior to Synplicity’s initial public offering. Synplicity has previously provided these measurements in addition to GAAP financial results because it believes they provide a consistent basis for comparison between quarters that is not influenced by certain non-cash expenses and therefore are helpful to understanding Synplicity’s underlying operational results. Further, these non-GAAP measures are some of the primary measures Synplicity’s management uses for planning and forecasting. These measures should not be considered an alternative to GAAP, and these non-GAAP measures may not be comparable to information provided by other companies.

About Synplicity
Synplicity® Inc. (Nasdaq: SYNP) is a leading supplier of innovative synthesis, verification and physical implementation software solutions that enable the rapid and effective design and verification of semiconductors. Synplicity's high-quality, high-performance tools significantly reduce costs and time-to-market for FPGA, structured/platform ASIC and cell-based/COT ASIC designers. The company's underlying Behavior Extracting Synthesis Technology® (BEST™), which is embedded in its logical, physical and verification tools, and has led to Synplicity's top position in FPGA synthesis, now provides the same fast runtimes and quality of results to ASIC and COT customers. The company's fast, easy-to-use products support industry standard design languages (VHDL and Verilog) and run on popular platforms. Synplicity employs over 280 people in its 20 facilities worldwide. Synplicity is headquartered in Sunnyvale, California. For more information, visit http://www.synplicity.com.

Forward-Looking Statements
This press release contains forward-looking statements including, but not limited to, statements regarding Synplicity’s business outlook for revenue, operating expenses, net income and net income per share. These statements relate to future events and involve known and unknown risks, uncertainties and other factors that may cause Synplicity's actual financial results, levels of activity, performance or achievements to differ materially from those expressed or implied by the forward-looking statements. In some cases, you will be able to identify forward-looking statements by terminology such as “may,” “will,” “should,” “expects,” “plans,” “anticipates,” “believes,” “estimates,” “predicts,” “potential,” “continue” or the negative of these terms or other comparable terminology. Forward-looking statements are only predictions and actual events or results may differ materially. Synplicity cannot provide any assurance that its future results will meet expectations. Synplicity's operating results could differ materially due to a number of factors, including the performance and quality of both its FPGA and ASIC software products relative to its competitors’ products, the market acceptance of structured ASICs and the growth of its ASIC synthesis business. For additional information and considerations regarding the risks faced by Synplicity, see its annual report on Form 10-K for the year ended December 31, 2003 as filed with the Securities and Exchange Commission, as well as other periodic reports filed with the SEC from time to time including its quarterly reports on Form 10-Q. Although Synplicity believes that the expectations reflected in the forward-looking statements are reasonable, Synplicity cannot guarantee future results, levels of activity, performance or achievements. In addition, neither Synplicity nor any other person assumes responsibility for the accuracy or completeness of these forward-looking statements. Synplicity disclaims any obligation to update information contained in any forward-looking statement.

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Synplicity and Behavior Extracting Synthesis Technology are registered trademarks of Synplicity, Inc. BEST is a trademark of Synplicity Inc. All other names mentioned herein are the trademarks or registered trademarks of their owners.

Investor Relations :
Doug Miller
Synplicity, Inc.
(408) 215-6000
ir@synplicity.com

Public Relations :
Steve Gabriel
Porter Novelli
(408) 369-1500
steve.gabriel@porternovelli.com

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