Design software maker Autodesk (ADSK) is back again in the spotlight as it has rolled out a restructuring plan that will eliminate approximately 1,000 roles, or about 7% of its workforce, as management reallocates spending toward cloud platforms and artificial intelligence (AI). The reductions will largely affect customer-facing sales teams, aligning with Autodesk’s evolving operating model. Investors responded favorably to this news, pushing shares up 4.8% on Thursday, Jan. 22. The reaction came after a ...

Core Insights - The company is in the final phase of efforts to streamline customer engagement and enhance its sales channels [1] Group 1 - The company is known for its products like AutoCAD and other digital design software [1]

Autodesk, Inc. (ADSK) is a California-based multinational software company and a global leader in 3D design, engineering, construction, manufacturing, and media and entertainment technology solutions. Founded in 1982 and valued at $53.8 billion by market cap, Autodesk is best known for pioneering AutoCAD, one of the most widely used computer-aided design (CAD) applications worldwide. The global leader in software is expected to announce its fiscal fourth-quarter earnings for 2026 in the near term. Ahead ...

Core Viewpoint - Autodesk, Inc. (NASDAQ:ADSK) is recognized as one of the top new stocks to buy, with a Buy rating and a price target of $375 from Rothschild analysts, who believe the company will grow faster than its end markets [1] Group 1: Company Overview - Autodesk, Inc. is a world leader in design, engineering, and construction software, with a projected market value of $51 billion by fiscal 2029 [1] - The company's architecture, engineering, construction, and operations portfolio generates over half of its revenue and has been its strongest division over the past decade [2] - Autodesk provides technology across various sectors, including architectural, engineering, construction, product design, and manufacturing [4] Group 2: Market Position and Growth Drivers - Autodesk has established a strong presence in design software with products like AutoCAD and Revit, and is expected to further solidify its market dominance [3] - Key growth contributors include increased adoption of building information modeling regulations, monetization of AI features, and consistent global construction activity [3]

Core Insights - Figma and Autodesk are both design software providers but operate in different markets, with Figma focusing on collaborative digital product design and Autodesk on engineering and industrial design software [1] - Both companies are integrating AI into their platforms to enhance value creation, with Figma aiming to boost creative productivity and user adoption, while Autodesk focuses on engineering optimization and risk reduction [1] Figma Overview - Figma is heavily investing in AI features to enhance its product suite, including the integration of Gemini 3 Pro and Nano Banana Pro for AI image generation and editing [3] - The collaboration with OpenAI allows users to generate FigJam diagrams from ChatGPT conversations, enhancing user experience [4] - Figma's acquisition of Weavy enables users to access leading AI models and editing tools on a single platform, making it competitive in the image editing market [5] - As of September 30, 2025, Figma had 12,910 paid customers with over $10,000 in annual recurring revenues (ARR) and 1,262 customers with over $100,000 in ARR, achieving a net dollar retention rate of 131% for high-spending customers [6] - Despite growth, Figma's non-GAAP operating profit decreased by 28.9% year-over-year to $34.02 million, with the operating profit margin dropping from 24% to 12% due to cost pressures from new AI features [7] Autodesk Overview - Autodesk leverages decades of proprietary data to train its AI models, integrating generative design and predictive analytics to enhance productivity [9] - The company reports significant adoption of AI tools across its platforms, with over 2.6 million constraints delivered by its AI-based Sketch AutoConstrain feature [10] - Autodesk is positioned to benefit from AI monetization and subscription revenues, although it faces high costs related to cloud infrastructure and talent acquisition [11] - Research and development costs remain high as Autodesk seeks to maintain its competitive edge, alongside increasing sales and marketing expenditures [12] - Autodesk's fiscal 2026 earnings are projected to grow by 20.5% year-over-year, with recent estimates revised upward [13] Comparative Analysis - In the last three months, Figma shares have declined by 25.7%, while Autodesk shares have decreased by 5.4% [14] - Autodesk's larger scale and market capitalization provide it with a better position to absorb cost pressures and monetize investments, making it a comparatively safer investment during the current AI growth phase [15] - Figma trades at a forward 12-month price-to-sales (P/S) multiple of 12.51X, which is higher than Autodesk's 8.12X [16]

Core Insights - Autodesk Inc. has shown strong operating consistency and is expected to sustain low-teens growth, supported by solid demand visibility and improved margins [1][2] - The company reported third-quarter fiscal 2026 results with an 18% constant-currency revenue growth, reaching $1.85 billion, and an adjusted EPS of $2.67 [2][3] - For the fourth quarter, Autodesk is guiding for approximately 11% adjusted revenue growth and 18% adjusted billings growth [2][3] Financial Performance - The company increased its fiscal 2026 operating margin guidance by 50 basis points to 37.5%, indicating strengthened margin performance due to efficiency improvements [4] - The demand momentum remains intact, with expectations that billings growth will initially remain elevated before normalizing [3][4] Analyst Perspective - UBS analyst Taylor McGinnis raised the price target for Autodesk from $385 to $400 while maintaining a Buy rating, reflecting confidence in the company's growth potential [1] - The analyst's review of the third-quarter results suggests that Autodesk's operational performance is robust and well-positioned for future growth [3][4]

Core Insights - Autodesk reported $1.85 billion in revenue for the quarter ended October 2025, marking an 18% year-over-year increase and an EPS of $2.67 compared to $2.17 a year ago, exceeding both revenue and EPS estimates [1] - The revenue surprise was +2.67% over the Zacks Consensus Estimate of $1.8 billion, while the EPS surprise was +7.23% over the consensus estimate of $2.49 [1] Financial Performance Metrics - Billings reached $1.86 billion, surpassing the average estimate of $1.84 billion [4] - Net Revenue from Maintenance was $8 million, below the average estimate of $8.95 million, reflecting an 11.1% year-over-year decline [4] - Net Revenue from Other sources was $111 million, exceeding the estimated $103.57 million, with a 6.7% year-over-year increase [4] - Net Revenue from Subscription services was $1.73 billion, above the estimated $1.69 billion, showing a 19% year-over-year growth [4] - Total Subscription and Maintenance Revenue was $1.74 billion, exceeding the average estimate of $1.7 billion, representing an 18.8% year-over-year increase [4] Product Family Performance - Net Revenue from Media and Entertainment (M&E) was $86 million, below the average estimate of $102.45 million, with a 3.6% year-over-year increase [4] - Net Revenue from Other product families was $33 million, below the average estimate of $40.6 million, reflecting a 6.5% year-over-year increase [4] - Net Revenue from Architecture, Engineering, Construction and Operations (AECO) was $921 million, exceeding the average estimate of $877.99 million, with a 22.6% year-over-year increase [4] - Net Revenue from Manufacturing (MFG) was $355 million, slightly above the average estimate of $348.82 million, showing a 15.6% year-over-year increase [4] - Net Revenue from AutoCAD and AutoCAD LT was $458 million, surpassing the average estimate of $425.22 million, with a 15.1% year-over-year increase [4]

Financial Data and Key Metrics Changes - Total revenue in Q3 grew 18% as reported and in constant currency, with a contribution from the new transaction model of approximately $124 million [9][10] - Billings increased 21% as reported and 20% in constant currency, with a contribution from the new transaction model of approximately $135 million [10] - Third quarter GAAP and non-GAAP operating margins were 25% and 38% respectively, reflecting year-over-year increases of approximately 330 and 120 basis points [11][12] - Free cash flow for Q3 was $430 million, benefiting from earlier timing of billings and lower cash tax payments [11] Business Line Data and Key Metrics Changes - Strength was observed in AECO (architecture, engineering, construction, and operations), driven by sustained investment in data centers, infrastructure, and industrial buildings [9] - The Autodesk Store and billing linearity during the quarter were stronger than expected, contributing to overall revenue growth [9] Market Data and Key Metrics Changes - RPO (Remaining Performance Obligations) of $7.4 billion and current RPO of $4.8 billion both grew 20%, benefiting from the new transaction model [10] - The macroeconomic environment appears broadly stable, but uncertainty remains elevated [13] Company Strategy and Development Direction - The company is focused on the convergence of design and make in the cloud, leveraging AI and platform capabilities to enhance customer value [17][18] - Autodesk is building a vibrant third-party ecosystem to enhance its solutions and create new monetization opportunities [7][19] - The strategy includes redefining business models and go-to-market approaches to capture shared value through subscription and consumption-based models [7][24] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the long-term value being created for customers and shareholders, despite geopolitical and macroeconomic uncertainties [5][6] - The company raised its full-year guidance for billings and revenue, reflecting strong underlying business momentum [14][15] Other Important Information - The company plans to buy back approximately $1.3 billion of stock, a 50% increase compared to fiscal 2025 [15] - The transition to annual billing for most multi-year contracts is expected to significantly diminish tailwinds next year [11][14] Q&A Session Summary Question: Insights on seats versus consumption AI monetization - Management highlighted a capacity challenge in industries served and the balance between human engagement and machine execution in future projects [28][30] Question: Fiscal 2027 outlook - Management indicated that while the business is performing well, there are risks of disruption and macroeconomic uncertainty that will be considered in future guidance [32] Question: Autodesk Construction Cloud penetration - Management noted that there is still room for increased penetration within existing accounts and emphasized the unique value proposition of the Autodesk Construction Cloud [36][39] Question: PLM market opportunities - Management stated that many mid-market customers lack strong data management solutions and Autodesk aims to provide them with modern, cloud-based platforms [41][42] Question: Customer migration and packaging - Management discussed efforts to ensure customers are not left behind during transitions and emphasized the importance of seamless integration between existing and new products [47][48] Question: AI capabilities and retention - Management confirmed that AI-driven capabilities like auto-constraints are enhancing customer retention and creating opportunities for incremental monetization [68][70] Question: Margin expansion drivers - Management identified go-to-market optimization and operating leverage as key levers for achieving margin targets [72][73]

This presentation contains forward looking statements about revenue, billings, free cash flow, operating margin, EPS, products, future performance, financial and otherwise, and strategy, including statements regarding our progress on our key priorities, business models, guidance for the fourth fiscal quarter and full fiscal year 2026, our business momentum, the macroeconomic environment, and our long-term financial objectives. There are a significant number of factors that could cause actual results to diff ...

Core Insights - The company, known for AutoCAD and other digital design software, has successfully leveraged the surge in investment within the data center sector [1] Company Summary - The company has capitalized on increased funding in data centers, indicating a strategic alignment with industry trends [1]