Summary
Autodesk started fiscal 2012 with double-digit growth. Revenue for the quarter ended April 30, 2011 was $528.3 million, up 11.3% from the prior-year quarter. Gross profit rose 11.9% to $473.7 million. Operating income climbed 54.7% to $78.6 million. Net income jumped 87.8% to $69.3 million. Diluted EPS was $0.29, up 81.2%. Gross margin was 89.7%, up 0.5 percentage points. Operating margin was 14.9%, up 4.2 percentage points. The margin expansion came as revenue grew faster than costs, according to management. On a non-GAAP basis, gross profit was $482.7 million, income from operations was $119.1 million, net income was $93.7 million, and diluted EPS was $0.40. Non-GAAP operating margin was 23%, compared with 20% in the prior-year quarter. Non-GAAP gross margin was 91%.
Operational metrics point to steady demand. Subscription enrollment was about 3.0 million users at April 30, 2011, up from 2.9 million at January 31, 2011. Backlog rose to $647.4 million from $615.4 million at January 31, 2011. Deferred revenue increased 10.3% to $518.9 million. The company repurchased 1.7 million shares for $68.6 million during the quarter, and 22.7 million shares remained available for repurchase at April 30, 2011. Days sales outstanding improved to 47 days at April 30, 2011 from 55 days at January 31, 2011. The company entered a new $400 million unsecured revolving credit facility in May 2011, with an option to increase the facility by $100 million. In connection with the new credit agreement, Autodesk and Citibank terminated the $250 million U.S. line of credit facility. The new credit facility expires in May 2016. The notional amount of foreign exchange contracts was $452.4 million at April 30, 2011 and $401.6 million at January 31, 2011. The company's primary commercial banking relationship is with Citibank, which is also a lead lender in the new $400 million credit facility.
Product mix continued to shift toward suites. Suites represented 23% of total revenue, flagship products 61%, and new and adjacent products 15%. Emerging economies accounted for 15% of net revenue, and Japan represented 11%. The company released new design and creation suites in April 2011, including English language versions of Autodesk Design Suite, Autodesk Factory Design Suite, Autodesk Product Design Suite, Autodesk Building Design Suite, and Autodesk Entertainment Creation Suite, plus a Japanese language version of Autodesk Entertainment Creation Suite. Management believes expanding adoption of suites presents a meaningful growth opportunity.
Management's guidance for the second quarter of fiscal 2012 calls for cost of revenue, marketing and sales, research and development, and general and administrative expense to increase in absolute dollars but remain relatively consistent as a percentage of net revenue compared with the second quarter of fiscal 2011. For the remainder of fiscal 2012, the stated goals are to grow revenue and improve operating margin percentage. Management also plans to continue acquisitions, though it notes that acquisitions can bring cost and integration challenges and may negatively impact operating margins. The company anticipates the pace of acquisitions will increase compared to fiscal 2011.
Risks remain. The company operates in emerging markets where it faces economic volatility, geopolitical risk, local competition, weak intellectual property protection, poorly developed business infrastructure, scarce talent, and software piracy. Japan represented approximately 11% of net revenue, and the March 2011 earthquakes and tsunami created uncertainty for future results. Foreign exchange can significantly affect revenue and spending, and Autodesk uses hedging contracts to reduce but not eliminate that exposure. Tech Data accounted for 17% of consolidated net revenue, a concentration risk. The effective tax rate was 18% in the quarter, down from 22% in the prior-year quarter, and future tax rates could be affected by changes in tax law or the mix of foreign earnings. The effective tax rate decreased 4 percentage points from the prior-year quarter. Operating cash flow was $128.4 million, down 7.7% from the prior-year quarter, while capital expenditures rose 303.4% to $23.4 million.
Forecast
Reported figures
GAAP, from SEC filings| Metric | Q1 FY2012 | Q4 FY2011 | QoQ | Q1 FY2011 | YoY |
|---|---|---|---|---|---|
| Revenue | $528.3M | $527.7M | +0.1% | $474.6M | +11.3% |
| Gross profit | $473.7M | $479.3M | -1.2% | $423.3M | +11.9% |
| Gross margin | 89.7% | 90.8% | -1.2 pp | 89.2% | +0.5 pp |
| Research & development | $136.6M | $126.9M | +7.6% | $127.2M | +7.4% |
| Sales & marketing | $201.9M | $226.9M | -11.0% | $186.5M | +8.3% |
| General & administrative | $56.6M | $52.1M | +8.6% | $51.7M | +9.5% |
| Total operating expenses | $395.1M | $407.7M | -3.1% | $372.5M | +6.1% |
| Operating income (loss) | $78.6M | $71.6M | +9.8% | $50.8M | +54.7% |
| Operating margin | 14.9% | 13.6% | +1.3 pp | 10.7% | +4.2 pp |
| Net income (loss) | $69.3M | $61.6M | +12.5% | $36.9M | +87.8% |
| Net margin | 13.1% | 11.7% | +1.4 pp | 7.8% | +5.3 pp |
| Diluted EPS | $0.29 | $0.26 | +$0.03 | $0.16 | +$0.13 |
Risks
Any deceleration or reversal of the current global economic recovery may cause customers to defer, reduce or cancel purchases, and the filing notes past years led to restructuring and impairment charges. MD&A also warns that economic conditions in countries contributing significant net revenue may adversely affect overall financial performance.
A significant portion of revenue is maintenance revenue, and customers have no obligation to attach or renew maintenance after the typical one-year term. MD&A reported maintenance revenue increased 5% in the quarter ended April 30, 2011, but any decline in attach or renewal rates or new license sales would negatively impact future revenue.
Revenue depends on a small number of products; combined revenue from AutoCAD and AutoCAD LT represented 37% of consolidated net revenue for the three months ended April 30, 2011. Any factor adversely affecting sales of these products would likely harm financial results.
Approximately 86% of revenue for the three months ended April 30, 2011 was derived from indirect channel sales, and Tech Data accounted for 17% of consolidated net revenue in both the current and prior-year quarters. Distributor insolvency or loss of a major distributor could force write-offs or delay revenue recognition.
International net revenue represented 73% of net revenue for both the three months ended April 30, 2011 and 2010, exposing Autodesk to regulatory, economic, currency, tax and political risks. Japan alone was $60.7 million, or about 11% of net revenue, and the March 2011 earthquake and tsunami created uncertainty.
A critical growth strategy is migrating AutoCAD and AutoCAD LT customers to suites; suites revenue increased 17% and represented 23% of revenue in the quarter ended April 30, 2011. If standalone product sales decrease without a corresponding increase in suites revenue or seat purchases, results of operations would be adversely affected.
Autodesk regularly acquires or invests in businesses and technologies, and MD&A states the pace of such investments is expected to increase compared to fiscal 2011. Integration challenges, inherited liabilities and failure to realize anticipated revenue or cost projections could negatively impact results.
MD&A notes revenue benefited from foreign exchange rate changes in the quarter ended April 30, 2011, and total spend increased 6% as reported but 4% on a constant currency basis. Changes in the U.S. dollar may significantly affect future net revenue, total spend and income from operations.
The risk factors specifically cite the March 2011 earthquakes and tsunami in Japan, and MD&A notes Japan was about 11% of net revenue. Although the company believes the impact on future financial results will be immaterial, the events created uncertainty.
SaaS KPIs
All quarters →Non-GAAP Operating Margin
Aggregate backlog
Non-GAAP Gross Margin
Total Subscription Program Enrollment
Summary, forecast, risks and KPIs are extracted from Autodesk, Inc.'s SEC filings for Q1 FY2012 (10-Q / 10-K and the 8-K earnings release); GAAP figures in the summary are checked against the reported XBRL data. They can contain errors; the filings are authoritative. Processed Oct 15, 2026.