Autodesk Fourth Quarter Driven by Strong Growth in Suites and Cash Flow

Company Reiterates Long-term Financial Targets

SAN RAFAEL, Calif. — (BUSINESS WIRE) — February 26, 2014Autodesk, Inc. (NASDAQ: ADSK) today reported financial results for the fourth quarter and full fiscal year ended January, 31, 2014. Revenue was $587 million. Normalized for the business model transition, revenue would have experienced approximately 2 percent growth year-over-year. GAAP diluted earnings per share were $0.23 and non-GAAP diluted earnings per share were $0.40.

Fourth quarter results exclude approximately $30 million of license revenue that was deferred as a result of the company's business model transition.

Fourth Quarter Fiscal 2014 Highlights

  • Revenue from Suites increased 15 percent to $216 million, compared to the fourth quarter last year.
  • Operating margin was 9 percent on a GAAP basis and 20 percent on a non-GAAP basis. A reconciliation of GAAP to non-GAAP results is provided in the accompanying tables.
  • Deferred revenue increased 8 percent to $901 million, compared to the fourth quarter of fiscal 2013. Normalized for the business model transition (noted above), deferred revenue would have experienced approximately 4 percent growth year-over-year.
  • Cash flow from operating activities increased 18 percent to $184 million, compared to the fourth quarter of fiscal 2013.

"We closed our fiscal year with momentum marked by strong growth in suites and demand for our Architecture, Engineering and Construction (AEC) solutions," said Carl Bass, Autodesk president and CEO. "Demand accelerated for our world leading portfolio of building information modeling (BIM) solutions. Our cloud-based BIM 360 tools had a terrific quarter as we continue to enable greater mobility and collaboration for our construction customers. Our cloud-based PLM 360 business also experienced continued momentum and had its best quarter to date."

Fourth Quarter Operational Overview

The business model transition (noted above) was related primarily to flexible license arrangements with certain enterprise customers. In the fourth quarter, the business model transition had particular impact on license revenue in the Americas and the AEC business segment.

Revenue in the Americas was $207 million. EMEA revenue was $229 million. Revenue in Asia Pacific was $150 million. Revenue from emerging economies was $88 million and represented 15 percent of total revenue in the fourth quarter.

Revenue from the Platform Solutions and Emerging Business (PSEB) segment was $196 million. Revenue from the AEC business segment was $196 million. Revenue from the Manufacturing business segment was $154 million. Revenue from the Media and Entertainment business (M&E) segment was $41 million.

Revenue from Flagship products was $288 million. Revenue from Suites was $216 million. Revenue from New and Adjacent products was $83 million.

"We were pleased with our fourth quarter performance, which included strong growth in cash flow from operations, solid growth in deferred revenue, and a significant sequential increase in backlog," said Mark Hawkins, Autodesk executive vice president and CFO. "We remain confident in our long-term model, which calls for a 12 percent billings compounded annual growth rate, 20 percent more annual value from our new and existing subscriptions, and a 50 percent increase in subscriptions by the end of our fiscal 2018. We believe we can accomplish this while getting to a 30 percent non-GAAP operating margin by the end of fiscal 2018."

“We are at the very beginning of a platform and model transition that will propel Autodesk to the future," Bass added. “We are focused on driving our subscription base, annual subscription value, and billings over the next four years and beyond. As anticipated, our transformation will start gradually and we expect will gain momentum as we go forward."

Business Outlook

The following are forward-looking statements based on current expectations and assumptions, and involve risks and uncertainties some of which are set forth below. Autodesk's business outlook for the first quarter and full year fiscal 2015 assumes, among other things, a continuation of the current economic environment and foreign exchange currency rate environment, and interest expense related to Autodesk's $750 million debt offering in December 2012.

First Quarter Fiscal 2015

First quarter EPS guidance includes the dilutive impact of the Delcam acquisition.

Q1 FY15 Guidance Metrics           Q1 FY15 (ending April 30, 2014)
Revenue (in millions)           $560-$575
EPS GAAP           $0.01-$0.04
EPS Non-GAAP (1)           $0.19-$0.22


(1) Non-GAAP earnings per diluted share exclude $0.11 related to stock-based compensation expense, $0.06 for the amortization of acquisition related intangibles, and $0.01 related to restructuring charges.

Full Year Fiscal 2015

FY15 Guidance Metrics           FY15 (ending January 31, 2015)
Net billings growth           5-8%
Revenue growth           3-5%
GAAP operating margin           5-8%
Non-GAAP operating margin           14-16%
Net new subscription additions           150,000-200,000

A reconciliation between the GAAP and non-GAAP estimates for fiscal 2015 is provided in the tables following this press release.

Both the first quarter and full year fiscal 2015 outlook assumes projected annual effective tax rates of approximately 25.5 percent for both GAAP and non-GAAP results. These rates do not include one-time discrete items or the federal R&D tax credit that expired on December 31, 2013.

Earnings Conference Call and Webcast

Autodesk will host its fourth quarter conference call today at 5:00 p.m. ET. The live broadcast can be accessed at Supplemental financial information and prepared remarks for the conference call will be posted to the investor relations section of Autodesk's website simultaneously with this press release.

NOTE: The prepared remarks will not be read on the conference call. The conference call will include only brief remarks followed by questions and answers.

A replay of the broadcast will be available at 7:00 pm ET at . This replay will be maintained on Autodesk's website for at least 12 months.

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