As the industry progresses towards realizing a commercial supersonic aircraft, the push to reduce noise from sonic boom has intensified. This emphasizes the need to better understand and accurately model the underlying physics and seek ways to reduce modeling gaps in the calculation of sonic boom noise metrics. To answer this need, sonic boom prediction capability of the atmospheric propagation tool sBOOM is enhanced to include three-dimensional Earth effects during propagation. The discrete adjoint capability under three-dimensional effects is also enhanced to be helpful in design optimization. The differences in ground signatures, noise metrics, and carpet widths are compared against results obtained using flat Earth approximation and discussed. Finally, the developed capability is used in CFD based shape optimization to demonstrate the differences in aircraft outer mold line when ellipsoidal Earth effects during shape optimization for sonic boom mitigation.