Post Earnings Coverage as Autodesk Tops Market Expectation as Annualized Recurring Revenue Grows 10 Percent

LONDON, UK / ACCESSWIRE / August 31, 2016 / Active Wall St. announces its post-earnings coverage on Autodesk, Inc. (NASDAQ: ADSK). The company reported second quarter fiscal 2017 financial results on 25th August, 2016. The pioneering maker of computer-aided design software delivered a surprise profit with analysts had been expecting a loss, and the company also provided better-than-expected outlook for the current quarter. Register with us now for your free membership at: http://www.activewallst.com/register/.

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Earnings Numbers

For the three months ended on July 31, 2016, Autodesk reported net loss of $98.2 million, or $(0.44) per share, compared with a loss of $268.6 million, or $(1.18) per share in the corresponding year earlier quarter. Excluding stock-based compensation and other items, Autodesk reported earnings of $0.5 per share, down from $0.19 per share a year earlier. Revenue declined 10% to $551 million in Q2 FY17, or 6% when adjusted for currency fluctuations. Analysts projected a loss of $0.13 per share on revenue of $512 million. The decline in revenues was attributed to a 21.3% y-o-y decline in License revenues to $228.7 million from $290.5 million in Q2 FY16.

Autodesk’s total subscriptions rose by 109,000 from Q1 FY17 to 2.82 million. The company expects to add 475,000 to 525,000 subscriptions for the year. Autodesk also noted that total annualized recurring revenue (ARR) was $1.47 billion, an increase of 10% compared to Q2 FY16 and 14% on a constant currency basis. The company stated that new model ARR surged 82% on y-o-y basis to 371 million. The San Rafael, California headquartered company had earlier warned investors that sales would be impacted in the short-term due to its shift to ARR model from the traditional perpetual license model. Gross profit margin narrowed to 84.5% from 84.7% in the year ago period, while operating expenses rose 3%.

“We posted terrific second quarter results driven by growth in new model subscriptions, the end of perpetual license sales, and diligent cost control,” said Carl Bass, Autodesk’s president and CEO, “We’ve now seen several quarters of strong growth from our new model subscriptions, as our customers and partners embrace a model that has greater flexibility and a better user experience. Finally, we continued to extend our leadership in the cloud during a quarter that delivered our largest-ever increase in cloud subscriptions led by BIM 360 and Fusion 360.”

Segment wise

During Q2 FY17, revenues from Autodesk’s Architecture, Engineering and Construction business segment rose 8% to $253 million from the year earlier quarter. Manufacturing revenues grew 3% on y-o-y basis to $177 million. However the company’s Platform Solutions and Emerging Business segment sales plunged 47% to $86 million from the year ago period. Revenue from Autodesk’s Media and Entertainment segment slumped 16% on a y-o-y basis to $34 million.

On Geographical basis, revenues in Q2 FY17 from Autodesk’s Americas region fell 2% on y-o-y basis to $230 million. EMEA revenues declined 2% to $221 million, while sales in the APAC region tumbled 32% to $100 million.

Balance Sheet

As of July 31, 2016, Autodesk had cash and cash equivalents of $1.47 billion compared with $1.35 billion as on January 31, 2016. The company’s deferred revenue increased 23% to $1.52 billion compared to $1.24 billion in the second quarter last year.

Outlook

For Q3 FY17, Autodesk is projecting an adjusted loss of $0.22 per share to $0.27 per share with revenues in the range of $470 million to $485 million, compared to analysts’ estimate of a loss of $0.28 per share on revenue of $468.5 million.

For FY 2017, the company is projecting revenue of $2 billion to $2.05 billion, up from the previous forecast of $1.95 billion to $2.05 billion, and above analysts’ estimate of $1.99 billion. Autodesk is expecting net loss in the range of $0.55 per share to $0.70 per share, better than the prior forecast of net loss of $0.70 to $0.95 per share and market estimate of $0.82 per share.

Stock Performance

On August 30, 2016, Autodesk’s shares declined marginally by 0.42% to close the trading session at $ 68.03. A total volume of 2.4 million shares were traded during the session, which was above the 3 months average volume of 1.65 million. The company’s stock price has gained 13.88% in the past one month and has advanced 45.52% in the past 12 months.

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