Autodesk Reports Second Quarter Results

Announces Restructuring to Accelerate Transition to Cloud and Mobile Computing

SAN RAFAEL, Calif. — (BUSINESS WIRE) — August 23, 2012Autodesk, Inc. (NASDAQ: ADSK) today reported financial results for the second quarter of fiscal year 2013.

Second Quarter Fiscal 2013

  • Revenue was $569 million, an increase of 4 percent compared to the second quarter of fiscal 2012.
  • GAAP operating margin was 16 percent, compared to 17 percent in the second quarter of fiscal 2012.
  • Non-GAAP operating margin was 25 percent, consistent with the second quarter of fiscal 2012. A reconciliation of GAAP to non-GAAP results is provided in the accompanying tables.
  • GAAP diluted earnings per share were $0.28, compared to $0.30 in the second quarter of fiscal 2012.
  • Non-GAAP diluted earnings per share were $0.48, compared to $0.44 in the second quarter of fiscal 2012.
  • Cash flow from operating activities was $107 million, compared to $132 million in the second quarter of fiscal 2012.

"Our own execution challenges, combined with an uneven global economy, resulted in disappointing revenue results for the quarter,” said Carl Bass, Autodesk president and CEO. “Organizational changes we made within the company earlier this year slowed us down during the quarter. Despite our second quarter results, the changes better position Autodesk to meet the needs of our customers. We are focused on working through our internal challenges as rapidly as possible."

"Given the uneven macroeconomic environment and the company's desire to deliver operating margin improvement, we have taken a prudent approach to spending in fiscal 2013," continued Bass. "Our ongoing cost management measures contributed to the delivery of non-GAAP EPS within our guidance range for the second quarter."

Second Quarter Operational Overview

EMEA revenue was $210 million, a decrease of 1 percent compared to the second quarter last year as reported and an increase of 1 percent on a constant currency basis. Revenue in the Americas was $199 million, an increase of 4 percent compared to the second quarter last year. Revenue in Asia Pacific was a record $161 million, an increase of 12 percent compared to the second quarter last year as reported and 10 percent on a constant currency basis. Revenue from emerging economies was $88 million, flat compared to the second quarter last year as reported and an increase of 2 percent on a constant currency basis. Revenue from emerging economies represented 15 percent of total revenue in the second quarter.

Revenue from the Platform Solutions and Emerging Business segment was $218 million, an increase of 10 percent compared to the second quarter last year. Revenue from the AEC business segment was $161 million, an increase of 2 percent compared to the second quarter last year. Revenue from the Manufacturing business segment was $141 million, an increase of 4 percent compared to the second quarter last year. Revenue from the Media and Entertainment business segment was $49 million, a decrease of 10 percent compared to the second quarter last year.

Revenue from Flagship products was $318 million, an increase of 3 percent compared to the second quarter last year. Revenue from Suites was $166 million, an increase of 5 percent compared to the second quarter last year. Revenue from New and Adjacent products was $85 million, an increase of 5 percent compared to the second quarter last year.

Deferred revenue at the end of the second quarter was a record high of $752 million, an increase of 17 percent compared to the second quarter last year.

Restructuring

As part of today's announcement, Autodesk shared plans for a restructuring related to executing on the company's strategy including its continuing shift to cloud and mobile computing. While Autodesk is reducing its overall staffing levels in the near-term, the company will continue to invest in key development areas. In addition, the company intends to consolidate certain leased facilities.

The company anticipates taking a pre-tax charge in the range of $50 million to $60 million in connection with the restructuring. Approximately $40 million to $45 million of the pre-tax charges will be taken in the third quarter of fiscal 2013. Most of the remaining charge will be taken in the fourth quarter of fiscal 2013.

“This restructuring is squarely focused on our continued transformation and shift to more cloud and mobile computing," continued Bass. "This action allows us to continue to invest in recruiting and hiring people who can bring Autodesk the skills and experience that are critical for achieving our mid and long-term goals. As part of the ongoing platform shift, it's clear to us that design and engineering software will move to cloud and mobile platforms. Cloud and mobile has been a major investment area for Autodesk over the past couple of years and this restructuring will accelerate our progress as we intend to further invest in employees with expertise and skill sets essential to this transition. Additionally, this restructuring helps us reduce costs and streamline the organization as a continuation of the activities we began earlier this year."

Separately, in response to the company's second quarter performance, the uneven economic environment, and outlook for the rest of the year, Autodesk is implementing further spend management measures, such as reducing non-sales related travel and the number of its contractors.

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