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Autodesk Annual Report (Amendment), Year Ended Jan 31, 1998

Filing Date
Filed February 4, 1999
Period End
January 31, 1998
Security
ADSK
In the record · 2016–202610-K1110-Q328-K113

ADSK filed 11 annual reports (10-K), 32 quarterly reports (10-Q) and 113 current reports (8-K) between 2016 and 2026.

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  4. Leadership change8-K · Jun ’25Jun ’25

01—Abstract

Summary

Summary of the 10-K/A filed February 4, 1999. Cited figures are marked; the original filing is the authoritative source.

Autodesk reported fiscal 1998 (year ended January 31, 1998) net revenues of $617.1 milliona, up 24.2% from $496.7 million, driven mainly by AutoCAD Release 14 and the Softdesk acquisition.

AutoCAD and its upgrades still generated about 70% of revenue, and roughly 244,000 new AutoCAD licenses were added worldwide. Foreign revenue was about 58% of the total, and a stronger U.S. dollar reduced international revenue by an estimated $30 millionb. The filing includes a material restatement.

Following SEC guidance on in-process R&D, Autodesk cut its Softdesk IPR&D charge by $35.9 millionc and capitalized that amount as goodwill and intangibles. Restated net income is $45.2 million ($0.91 diluted EPS), versus $15.4 million ($0.31) as originally reported. Investors should note that the restated figures depend on amortization of a larger intangible base, and that management acknowledged Softdesk in-process products have run well below original revenue projections.

The balance sheet remained solid, with $301.3 milliond in cash and marketable securities, $158.6 million in operating cash flow, and stockholders' equity of $332.9 million. The company repurchased $174.9 million of its stock during the year. Risks disclosed include a nonpublic FTC investigation, a Vermont Microsystems judgment (reduced on appeal to $7.8 million but not yet reflected in the financials), Asia Pacific economic instability, and Year 2000 remediation costs of $5 to $6 million in fiscal 1999.

02—Key points

Key Highlights

  1. Net revenues rose 24.2% to $617.1 million, with growth in the Americas (up 54%) and Europe (up 10%), while Asia Pacific was flat.
  2. Restated net income is $45.2 million ($0.91 diluted EPS), up from the $15.4 million ($0.31) originally reported, after a $35.9 million reduction in Softdesk IPR&D expense.
  3. AutoCAD and its upgrades were about 70% of revenue, with 244,000 new licenses added and AutoCAD upgrade revenue of $108 million, up from $45 million.
  4. Operating cash flow was $158.6 million, and cash plus marketable securities totaled $301.3 million at year end.
  5. Autodesk repurchased $174.9 million of common stock, under both its Systematic and Supplemental plans, while paying $11.3 million in dividends.
  6. Stockholders' equity was $332.9 million (book value $7.32 per share), and the current ratio fell to 1.5 from 2.0.
  7. Risks include a nonpublic FTC investigation, unresolved VMI litigation with a $7.8 million judgment still under appeal, and Softdesk in-process products that have underperformed projections.

03—Questions

Frequently Asked Questions

  1. Why did Autodesk restate its fiscal 1998 results, and how big was the change?

    After the SEC's September 1998 letter on in-process R&D, Autodesk re-evaluated the $55.1 million IPR&D charge tied to its March 1997 Softdesk acquisition. It reduced the charge by $35.9 million and capitalized that amount as goodwill and other intangibles. Restated operating income rose to $75.2 million from $45.4 million, and net income rose to $45.2 million from $15.4 million.

  2. How dependent is Autodesk on AutoCAD?

    Highly dependent. AutoCAD and AutoCAD updates accounted for about 70% of fiscal 1998 revenue, down from about 80% in fiscal 1996. The filing says any factor hurting AutoCAD sales, including product life cycle, performance, pricing, or third-party application availability, could materially harm results.

  3. What are the main risks to future growth?

    Key risks include intensifying competition in a low-barrier industry, FX headwinds (the stronger dollar against the yen and mark), Asia Pacific economic instability, reliance on value-added resellers, and product defects like those in AutoCAD Release 13. Softdesk in-process technologies have also fallen short of projected revenues, which could lead to impairment of acquired intangibles.

  4. Are there material legal or regulatory exposures?

    The company disclosed a nonpublic FTC investigation into possible unfair competition, with no charges filed. It also has a Vermont Microsystems trade secret case, where the judgment was reduced on appeal to $7.8 million, but the reduction is not yet reflected in the financials because post-judgment motions and appeals are pending. About $18.0 million of long-term securities is restricted as collateral for this case. Management does not expect material adverse effects from these matters.

04—Continue

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