Core Insights - Autodesk's Q4 results and guidance for 2025 indicate strong alignment with its AI strategy, showcasing growth across both segments driven by AI advancements [1][4] - The company is entering an "optimization phase" aimed at enhancing operational efficiency and reallocating resources for cost savings and growth opportunities [3] Financial Performance - Q4 revenue grew by 11.6%, surpassing analysts' consensus by 60 basis points, with Design segment up 12% and Make segment up 28% year-over-year [4] - Subscriptions, a key indicator of recurring revenue, increased by 14% across all geographies [4] - GAAP and adjusted operating margins expanded by 100 basis points year-over-year in F2025, contributing to a 10% rise in adjusted earnings [6] Regional Performance - Autodesk experienced double-digit growth in its primary U.S. market and all regions except for the "Other Americas" segment, which contracted by 4% [5] Analyst Sentiment - Analysts maintain a Moderate Buy rating, with a consensus price target of $338.43, indicating a potential upside of 23.41% [6][7] - Despite some price target reductions, the overall sentiment remains bullish, with more price target increases than decreases [7] Balance Sheet and Financial Health - The F2025 balance sheet shows a 10% increase in total assets, reduced debt, and a nearly 10% increase in shareholder equity, indicating strong financial health [8] - The company maintains low debt leverage at 1.25x cash balance and 0.75x equity, positioning it in a strong financial condition [8] Market Reaction - Following the Q4 report, Autodesk's stock rose approximately 1.5% in premarket trading, suggesting bullish sentiment and potential for further upside [9]

Core Viewpoint - Autodesk reported strong financial results for the fourth quarter of fiscal 2025, with earnings and revenues exceeding expectations, but announced a significant workforce reduction as part of a restructuring plan. Financial Performance - Non-GAAP earnings per share for Q4 FY2025 were $2.29, beating the Zacks Consensus Estimate by 7.51% and improving 9.6% year over year [1] - Revenues reached $1.64 billion, surpassing the consensus mark by 0.50% and growing 11.6% year over year [2] - Billings increased by 23% year over year to $2.11 billion [6] Revenue Breakdown - Subscription revenues, which accounted for 92.9% of total revenues, rose 13.7% year over year to $1.52 billion [4] - Maintenance revenues declined 28.6% year over year to $10 million, while other revenues decreased 7.8% to $107 million [4] - Recurring revenues contributed 97% to total revenues, with a net revenue retention rate within the targeted range of 100-110% [5] Regional Performance - Revenues from the Americas increased 11.3% year over year to $730 million [5] - EMEA revenues climbed 14.1% to $623 million, while Asia-Pacific revenues rose 7.1% to $286 million [5] Product Performance - AEC revenues, which represent 48.7% of total revenues, increased 14.8% year over year to $799 million [7] - AutoCAD and AutoCAD LT revenues rose 8.5% to $409 million, while Manufacturing revenues increased 8.9% to $318 million [7] Operating Results - Non-GAAP operating income was $608 million, reflecting a 16.5% year-over-year increase, with an operating margin of 37.1%, up 160 basis points [8] Balance Sheet & Cash Flow - Cash and cash equivalents totaled $1.89 billion, up from $1.71 billion as of October 31, 2024 [9] - Free cash flow was $678 million, an increase of $251 million compared to the previous year [10] Future Guidance - For Q1 FY2026, Autodesk projects revenues between $1.60 billion and $1.61 billion, with non-GAAP earnings per share expected between $2.14 and $2.17 [11] - For fiscal 2026, revenues are anticipated to be between $6.895 billion and $6.965 billion, with billings estimated in the range of $7.06 billion to $7.21 billion [11][12] Restructuring Plan - Autodesk plans to reduce its workforce by approximately 9%, equating to about 1,350 employees, as part of a worldwide restructuring initiative [3]

Financial Data and Key Metrics Changes - Total revenue in Q4 grew 12% year-over-year, with broad-based growth across products and regions [18][19] - GAAP and non-GAAP operating margins for Q4 were 22% and 37%, reflecting year-over-year increases of 90 basis points and 160 basis points, respectively [21] - Free cash flow for fiscal 2025 was $1.57 billion, exceeding guidance [22] Business Line Data and Key Metrics Changes - By product in constant currency: AutoCAD and AutoCAD LT revenue grew 9%; AECO revenue grew 15%; manufacturing revenue grew 10%; and M&E revenue grew 10% [18] - Direct revenue increased 35% in constant currency, representing 47% of total revenue, up 8 percentage points from last year [19] - Contribution from the new transaction model to revenue was $46 million in Q4 and $71 million for the year [19] Market Data and Key Metrics Changes - Revenue grew 11% in the Americas, 13% in EMEA, and 11% in APAC in constant currency [19] - RPO (Remaining Performance Obligations) of $6.9 billion and current RPO of $4.5 billion grew 14% and 12%, respectively [20] Company Strategy and Development Direction - Autodesk is focusing on the convergence of design and make in the cloud, enabled by platform, industry clouds, and AI [11][36] - The company is initiating an optimization phase of its sales and marketing plan to enhance customer satisfaction and productivity [8][10] - Future focus includes tighter channel partner integration and broad deployment of self-service capabilities [10][34] Management's Comments on Operating Environment and Future Outlook - Management noted that economic uncertainty continues to impact customer willingness to invest, but they are optimistic about new product subscriptions and emerging businesses driving growth [58][60] - The company expects constant currency billings growth of 17% to 19% and revenue growth of 8% to 9% for fiscal 2026, excluding the impact of the new transaction model [28][29] - Management emphasized the importance of executing their go-to-market optimization plan to drive higher margins over time [65][100] Other Important Information - The company plans to buy back between $1.1 billion and $1.2 billion of shares in fiscal 2026, a 30% to 40% increase compared to fiscal 2025 [31] - Autodesk is committed to further margin expansion beyond fiscal 2026, aiming for GAAP margins among the best in the industry [100] Q&A Session Summary Question: What drives new business growth higher over time? - Management indicated that enhancing channel productivity and investing in emerging high-growth businesses will drive new business growth [58][60] Question: Can you provide more color on margin potential and restructuring? - Management expressed confidence in margin expansion due to strong fiscal discipline and the ongoing optimization of the go-to-market strategy [62][65] Question: How is macro uncertainty affecting customer sentiment? - Management noted that customers desire certainty and that uncertainty is fueling customer angst, but they believe Autodesk's diversified business can absorb policy changes [72][73] Question: What are the critical product or technology executables for the future? - Management highlighted investments in industry clouds and AI capabilities as key areas for future growth [81][82] Question: How does the revenue guide reflect potential disruption from restructuring? - Management acknowledged that the guidance considers potential risks associated with restructuring and the CRO transition [88] Question: What is the timeline for seeing benefits from sales and marketing adjustments? - Management indicated that significant benefits are expected in fiscal 2026, with ongoing investments to build capabilities for future optimization [106] Question: How does Autodesk view M&A in light of recent changes? - Management reaffirmed their commitment to being an acquisitive company, looking for opportunities that align with their strategy [108]

Market Performance - Market indexes are struggling despite positive Q4 earnings, with the Dow down -193 points (-0.45%), S&P 500 down -94 points (-1.59%), Nasdaq down -530 points (-2.78%), and Russell 2000 down -34 points (-1.59%) [2] - Over the last five trading days, all major indexes have declined, with the Nasdaq experiencing the largest drop at -6.8% [2] Housing Market - January Pending Home Sales decreased by -4.6%, significantly worse than the expected -1.0%, although it shows slight improvement from December's -5.5% [3] - High mortgage rates continue to hinder the housing market, alongside cold winter weather [3] Q4 Earnings Highlights - AutoDesk (ADSK) reported Q4 earnings of $2.29 per share, exceeding expectations of $2.13 and last year's $2.09, with revenues of $1.64 billion surpassing the $1.63 billion consensus [4] - SoundHound (SOUN) reduced its loss per share to -$0.05 from an estimated -$0.11, with revenues of $34.54 million reflecting +101% year-over-year growth [5] - Rocket Mortgage (RKT) beat earnings estimates by a penny at 4 cents per share, with revenues of $1.2 billion exceeding the $1.16 billion forecast [6] - Duolingo (DUOL) reported a +51% year-over-year increase in Daily Active Users (DAU) to 40.5 million, with revenues surpassing expectations, although shares fell -4% in late trading [7]

Core Insights - Autodesk reported better-than-expected earnings for fiscal Q4 2025, driven by a successful transition to a subscription model and strong global performance [1][2] Financial Performance - Non-GAAP EPS for fiscal Q4 2025 was $2.29, exceeding Wall Street's consensus by $0.15, while revenue reached $1.639 billion, closely aligning with the expected $1.631 billion [2][3] - Year-over-year revenue growth was 11.6%, up from $1.469 billion in fiscal Q4 2024, with subscription sales contributing significantly [3][6] - Free cash flow surged to $678 million, a 58.8% increase from the previous year [3][8] - Operating margin improved to 37%, compared to 36% in the prior year [3][8] Business Model and Strategy - Autodesk has transitioned from selling perpetual software licenses to a software as a service (SaaS) model, emphasizing cloud integration [4] - The subscription model allows for more predictable revenue and enhances competitiveness in the market [4] - The company invested $393 million in R&D during the fiscal quarter, focusing on AI and generative design [5] Market Performance - Subscription revenue grew 13.7% to $1.522 billion, making up 97% of total revenue [6] - Revenue growth was notable in the Americas (11%) and Europe/Middle East/Africa (14%), with the AECO segment increasing by 15% [7] Future Outlook - For fiscal 2026, Autodesk anticipates revenue between $6.895 billion and $6.965 billion, with non-GAAP EPS projected to range from $9.34 to $9.67, indicating confidence in growth [9] - Ongoing investments in R&D, particularly in AI and cloud technologies, are seen as crucial for future success [9]

For the quarter ended January 2025, Autodesk (ADSK) reported revenue of $1.64 billion, up 11.6% over the same period last year. EPS came in at $2.29, compared to $2.09 in the year-ago quarter.The reported revenue compares to the Zacks Consensus Estimate of $1.63 billion, representing a surprise of +0.50%. The company delivered an EPS surprise of +7.51%, with the consensus EPS estimate being $2.13.While investors scrutinize revenue and earnings changes year-over-year and how they compare with Wall Street exp ...

Autodesk (ADSK) came out with quarterly earnings of $2.29 per share, beating the Zacks Consensus Estimate of $2.13 per share. This compares to earnings of $2.09 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of 7.51%. A quarter ago, it was expected that this design software company would post earnings of $2.11 per share when it actually produced earnings of $2.17, delivering a surprise of 2.84%.Over the last four quarters, the c ...

This presentation contains forward-looking statements that involve risks and uncertainties, including quotations from management, statements in the paragraphs under "Business Outlook" above, statements regarding reallocating internal resources, our new transaction model and sales and marketing optimization, statements about our short-term and long-term goals, statements regarding our strategies, market and product positions, performance and results, statements regarding our share repurchase programs, and al ...

Design software maker Autodesk said Thursday that it will lay off 1,350 employees, which works out to 9% of its workforce.The job cuts follow a series of large headcount reductions across the tech industry. In January, Meta said it would let go of 5% of its workers, and earlier this month Workday, which sells human resources and finance software, announced an 8.5% decrease. In November, chipmaker AMD said it would let go of 4% of its staff members. Google this week also announced cuts to its human relations ...

Financial Performance - Total revenue for Q4 FY25 increased 12% to $1.64 billion, with recurring revenue representing 97% of total revenue[4] - Total net revenue for the three months ended January 31, 2025, was $1,639 million, a 11.6% increase from $1,469 million in the same period of 2024[44] - Subscription revenue reached $1,522 million for the three months ended January 31, 2025, up 13.6% from $1,339 million in the prior year[44] - Net income for the fiscal year ended January 31, 2025, was $1,112 million, representing a 22.7% increase compared to $906 million in 2024[44] - Autodesk's net income for the fiscal year ended January 31, 2025, was $1,112 million, an increase of 23% compared to $906 million in 2024[46] - The company reported net cash provided by operating activities of $1,607 million for the fiscal year 2025, up from $1,313 million in 2024, representing a 22% increase[46] - Free cash flow for the fiscal year 2025 was $1,567 million, compared to $1,282 million in 2024, marking a 22% increase[50] Revenue Growth - Total billings rose 23% to $2.11 billion, indicating strong demand for Autodesk's offerings[6] - Design revenue reached $1.36 billion, a 12% increase, while Make revenue grew 28% to $176 million[6] - Total subscriptions increased by approximately 516,000 to 7.79 million, reflecting robust customer acquisition[10] - Remaining performance obligations (RPO) indicate a strong future revenue stream, with the current amount expected to be recognized in the next twelve months[33] Operating Margins - GAAP operating margin improved to 22%, up from 21% in the previous year, while non-GAAP operating margin increased to 37% from 36%[4] - Non-GAAP operating margin for the fiscal year 2025 was 36%, compared to 36% in 2024, indicating stable operational efficiency[49] - The company anticipates a GAAP operating margin of 21% to 22% for FY26, with a non-GAAP operating margin forecasted at 36% to 37%[52] Cash Flow and Assets - Cash flow from operating activities for Q4 FY25 was $692 million, an increase of $255 million compared to the previous year[6] - The company’s cash and cash equivalents decreased to $1,599 million as of January 31, 2025, down from $1,892 million a year earlier[45] - Total assets increased to $10,833 million as of January 31, 2025, compared to $9,912 million in the previous year, indicating growth in the company's financial position[45] Workforce and Restructuring - The company announced a restructuring plan resulting in a 9% workforce reduction, affecting approximately 1,350 employees, with anticipated pre-tax charges of $135 million to $150 million[4] - The company incurred $683 million in stock-based compensation expense for the fiscal year 2025, slightly down from $703 million in 2024[46] Future Projections - For FY26, Autodesk projects total billings between $7,060 million and $7,210 million, and revenue between $6,895 million and $6,965 million[17] - The first quarter FY26 revenue guidance is set between $1,600 million and $1,610 million, with GAAP EPS expected to be between $0.76 and $0.90[16] - For Q1 FY26, Autodesk expects GAAP EPS to be in the range of $0.76 to $0.90, with non-GAAP EPS projected between $2.14 and $2.17[52]