10-QPeriod: Q3 FY2021

Autodesk, Inc. Quarterly Report for Q3 Ended Oct 31, 2020

Filed December 4, 2020For Securities:ADSK

Summary

Autodesk, Inc. (ADSK) reported solid financial results for the third quarter and the first nine months of fiscal year 2021, ending October 31, 2020. The company demonstrated robust revenue growth, driven by a significant increase in subscription revenue, which now constitutes 97% of total net revenue. This transition to a subscription model continues to be a key strategic focus, with maintenance revenue declining as expected due to customer migration. Profitability also saw substantial improvement, with operating income and net income showing strong year-over-year increases. The company maintained a healthy recurring revenue stream and solid net revenue retention rates, indicating strong customer loyalty and the stickiness of its subscription offerings. Autodesk also reported strong operating cash flow, demonstrating its ability to generate cash from its core business operations.

Financial Highlights

51 data points
Beta

Revenue

$952.40M

91.2% Gross Margin

Net Income

$132.20M

13.9% Net Margin

EPS (Diluted)

$0.59

Total Assets

$5.94B

Cash & Equivalents

$1.54B

Free Cash Flow

$340.20M

Financial Statements
Beta
Revenue$952.40M
Cost of Revenue$83.70M
Gross Profit$868.70M
R&D Expenses$233.00M
Operating Expenses$700.70M
Operating Income$168.00M
Net Income$132.20M
EPS (Basic)$0.60
EPS (Diluted)$0.59
Shares Outstanding (Basic)219.60M
Shares Outstanding (Diluted)222.30M

Key Highlights

  • 1Total net revenue increased by 13% to $952.4 million for the three months ended October 31, 2020, and by 16% to $2.75 billion for the nine months ended October 31, 2020, compared to the prior year periods.
  • 2Subscription revenue grew by 24% for the three months and 28% for the nine months, indicating a successful ongoing shift to a subscription-based business model.
  • 3Recurring revenue represented 97% of total net revenue for both the three and nine-month periods, highlighting the stability and predictability of Autodesk's revenue.
  • 4Income from operations significantly increased by 52% to $168.0 million for the three months and by 112% to $444.7 million for the nine months, demonstrating improved profitability.
  • 5Diluted earnings per share (EPS) rose to $0.59 for the three months and $1.34 for the nine months, up from $0.30 and $0.37 respectively in the prior year periods.
  • 6Remaining Performance Obligations (RPO) stood at $3.58 billion as of October 31, 2020, showing a slight increase year-over-year, indicating a healthy future revenue pipeline.
  • 7Cash and cash equivalents and marketable securities totaled $1.62 billion at October 31, 2020, providing ample liquidity.

Frequently Asked Questions

Autodesk reported strong revenue growth, with total net revenue increasing by 13% to $952.4 million for the third quarter and by 16% to $2.75 billion for the first nine months of the fiscal year ending October 31, 2020. This growth was primarily driven by a substantial increase in subscription revenue, which now accounts for 97% of total net revenue, while maintenance revenue continued to decline as expected due to customer migration to subscriptions.

Profitability showed significant improvement. Income from operations surged by 52% to $168.0 million for the quarter and by 112% to $444.7 million for the nine months. Diluted net income per share also rose considerably, reaching $0.59 for the quarter and $1.34 for the nine months, indicating strong operational efficiency and effective cost management.

Autodesk maintains a strong liquidity position, with $1.62 billion in cash, cash equivalents, and marketable securities as of October 31, 2020. The company generated $779.6 million in net cash from operating activities for the first nine months, demonstrating healthy cash flow generation. Additionally, Remaining Performance Obligations (RPO) stood at $3.58 billion, signaling a robust future revenue pipeline.

The transition to a subscription model is a core strategic initiative. Subscription revenue has grown significantly, now representing 97% of total net revenue. This shift has led to a planned decrease in maintenance revenue, as customers migrate from older maintenance plans to newer subscription offerings. This strategy contributes to more predictable recurring revenue and strengthens customer relationships.