01—Abstract
Summary
Summary of the 10-Q filed June 1, 2023. Cited figures are marked; the original filing is the authoritative source.
Autodesk, Inc. (ADSK) reported solid financial results for the first quarter of fiscal year 2024, ending April 30, 2023.
The company demonstrated year-over-year revenue growth of 8%, reaching $1,269 milliona, driven primarily by a 10% increase in subscription revenue. This highlights the continued success of Autodesk's transition to a subscription-based model, with recurring revenue constituting 98% of total net revenue. While gross profit increased to $1,142 million, operating expenses also saw an increase, resulting in a slight dip in operating margin.
However, strong operational cash flow generation of $723 millionb indicates robust business health. The company actively managed its capital through significant share repurchases totaling $534 million. Investors should note the slight decrease in deferred revenue and remaining performance obligations compared to the previous quarter, which warrants monitoring, though the company remains optimistic about future growth prospects in its key market segments.
02—Key points
Key Highlights
- Total net revenue increased by 8% to $1,269 million compared to the prior year, driven by a 10% rise in subscription revenue.
- Recurring revenue represented 98% of total net revenue, underscoring the company's successful subscription transition.
- Gross profit increased by 8.4% to $1,142 million, demonstrating strong cost management of revenue-generating activities.
- Operating cash flow significantly improved, rising to $723 million for the quarter, up from $434 million in the prior year.
- The company repurchased $534 million of its common stock, signaling confidence in its financial position and commitment to returning capital to shareholders.
- Deferred revenue decreased slightly by 2% to $4.48 billion and Remaining Performance Obligations (RPO) decreased by 4% to $5.39 billion compared to the previous quarter, indicating potential shifts in billing cycles or contract terms.
- Net revenue retention rate (NR3) remained strong, within the range of 100% and 110% on a constant currency basis.
03—One dollar
Follow one dollar
Of each $1.00 of revenue in Q1 FY2024, Autodesk kept $0.13.
- Revenue$1.27B100.0%
- Cost of revenue−$127.0M10.0%
- Gross profit$1.14B90.0%
- Operating costs−$925.0M72.9%
- Operating income$217.0M17.1%
- Interest, other & tax−$56.0M4.4%
- Net income$161.0M12.7%
04—Financials
Financial Highlights
Figures from 10-QQ1 FY2024filed June 1, 2023Financial Statements
Q1 FY2024 against Q1 FY2023
| Line item | Q1 FY2024Q1 FY2023 | Change |
|---|---|---|
| Revenue | $1.27B$1.17B | +8.5% |
| Cost of Revenue | $127.00M$117.00M | +8.5% |
| Gross Profit | $1.14B$1.05B | +8.5% |
| R&D Expenses | $327.00M$289.00M | +13.1% |
| Operating Expenses | $925.00M$839.00M | +10.3% |
| Operating Income | $217.00M$214.00M | +1.4% |
| Net Income | $161.00M$146.00M | +10.3% |
| EPS (Basic) | $0.75$0.67 | +11.9% |
| EPS (Diluted) | $0.75$0.67 | +11.9% |
| Shares Outstanding (Basic) | 215.00M217.00M | −0.9% |
| Shares Outstanding (Diluted) | 216.00M219.00M | −1.4% |
05—Questions
Frequently Asked Questions
What was the primary driver of Autodesk's revenue growth in this quarter?
The primary driver of Autodesk's revenue growth was the increase in subscription revenue, which rose by 10% year-over-year. This is a testament to the company's successful transition to a subscription-based business model.
How did Autodesk manage its cash during the quarter?
Autodesk generated a strong $723 million in cash from operating activities. Additionally, the company actively managed its capital by repurchasing $534 million of its common stock, indicating a healthy cash position and a commitment to shareholder returns.
What are the key financial trends to watch for Autodesk moving forward?
Investors should monitor the slight quarter-over-quarter decrease in deferred revenue and remaining performance obligations. While the company's overall financial health appears strong, these trends could indicate shifts in customer contract terms or billing cycles and warrant further observation.
How did Autodesk perform across its product families?
All major product families showed growth. Architecture, Engineering and Construction (AEC) revenue increased by 8%, AutoCAD and AutoCAD LT by 7%, Manufacturing by 9%, and Media and Entertainment by 4%. This broad-based growth across segments is a positive sign.
06—Continue