Raises Billings, Revenue and Subscriptions Outlook for Fiscal Year 2015
Thursday, August 14, 2014 4:01 pm EDT
Public Company Information:
"Strong demand on a global basis and expanding adoption of our suites solutions drove strong billings and record revenue results"
SAN RAFAEL, Calif.--(BUSINESS WIRE)--Autodesk, Inc. (NASDAQ:ADSK) today reported financial results for the second quarter of fiscal 2015.
Second Quarter Fiscal 2015
Total billings increased 27 percent, compared to the second quarter of fiscal 2014.
Total subscriptions increased by approximately 74,000, from the first quarter of fiscal 2015.
Revenue was a record $637 million, an increase of 13 percent, compared to the second quarter of fiscal 2014 as reported, and increased 13 percent on a constant currency basis. Revenue contribution from the recent acquisition of Delcam was approximately $11 million.
GAAP operating margin was 8 percent, compared to 15 percent in the second quarter of fiscal 2014.
Non-GAAP operating margin was 18 percent, compared with 24 percent in the second quarter of fiscal 2014. A reconciliation of GAAP to non-GAAP results is provided in the accompanying tables.
GAAP diluted earnings per share were $0.13, compared to $0.27 in the second quarter of fiscal 2014.
Non-GAAP diluted earnings per share were $0.35, compared to $0.45 in the second quarter of fiscal 2014.
Deferred revenue was a record $981 million, an increase of 22 percent, compared to the second quarter of fiscal 2014.
Cash flow from operating activities was $96 million, an increase of 47 percent, compared to the second quarter of fiscal 2014.
"Strong demand on a global basis and expanding adoption of our suites solutions drove strong billings and record revenue results," said Carl Bass, Autodesk president and CEO. "We also made meaningful progress in the transition to a more recurring, subscription-based business, adding approximately 74,000 maintenance, desktop (rental), and cloud subscriptions. As a result, we significantly increased deferred revenue, which is rapidly approaching $1 billion. Our strong results and positive view of the macroeconomic environment led us to raise our outlook for billings, revenue, and subscription additions for fiscal 2015."
Second Quarter Operational Overview
Revenue in the Americas increased 11 percent compared to the second quarter last year to $223 million. EMEA revenue was $244 million, an increase of 21 percent compared to the second quarter last year as reported, and 16 percent on a constant currency basis. Revenue in APAC was $170 million, an increase of 8 percent compared to the second quarter last year as reported, and 14 percent on a constant currency basis. Revenue from emerging economies was $98 million, an increase of 14 percent compared to the second quarter last year as reported, and 13 percent on a constant currency basis. Revenue from emerging economies represented 15 percent of total revenue in the second quarter.
Revenue from the Platform Solutions and Emerging Business (PSEB) segment was $208 million, an increase of 5 percent compared to the second quarter last year. Revenue from the Architecture, Engineering and Construction (AEC) business segment was $218 million, an increase of 23 percent compared to the second quarter last year. Revenue from the Manufacturing business segment was $168 million, an increase of 17 percent compared to the second quarter last year. Revenue from the Media and Entertainment business (M&E) segment was $44 million, flat compared to the second quarter last year.
Revenue from Flagship products was $307 million, an increase of 6 percent compared to the second quarter last year. Revenue from Suites was $232 million, an increase of 20 percent compared to the second quarter last year. Revenue from New and Adjacent products was $99 million, an increase of 24 percent compared to the second quarter last year.
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 third quarter and full year fiscal 2015 assumes, among other things, a continuation of the current economic environment and foreign exchange currency rate environment. A reconciliation between the GAAP and non-GAAP estimates for fiscal 2015 is provided in the tables following this press release.
Third Quarter Fiscal 2015
Q3 FY15 Guidance Metrics
Q3 FY15 (ending October 31, 2014)
Revenue (in millions)
$590 - $605
($0.05) - $0.01
EPS Non-GAAP (1)
$0.17 - $0.23
(1) Non-GAAP earnings per diluted share exclude $0.15 related to stock-based compensation expense and $0.07 for the amortization of acquisition related intangibles, net of tax.
Full Year Fiscal 2015
Autodesk is updating its guidance for full fiscal year 2015 as follows:
FY15 Guidance Metrics
FY15 (ending January 31, 2015)
10 - 12%
7 - 9%
GAAP operating margin
4 - 5%
Non-GAAP operating margin
15 - 16%
Net subscription additions
200,000 - 250,000
The third quarter and full year fiscal 2015 outlook assume a projected annual effective tax rate of 29 percent and 26 percent for GAAP and non-GAAP results, respectively. These rates do not include one-time GAAP discrete items or the federal R&D tax credit that expired on December 31, 2013.
Earnings Conference Call and Webcast
Autodesk will host its second quarter conference call today at 5:00 p.m. ET. The live broadcast can be accessed at http://www.autodesk.com/investors. 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 http://www.autodesk.com/investors. This replay will be maintained on Autodesk's website for at least 12 months.
Safe Harbor Statement
This press release contains forward-looking statements that involve risks and uncertainties, including statements in the paragraphs under “Business Outlook” above, statements regarding the impacts of our business model transition, and other statements regarding our strategies, market and products positions, performance, and results. There are a significant number of factors that could cause actual results to differ materially from statements made in this press release, including: general market, political, economic and business conditions; failure to maintain our revenue growth and profitability; failure to successfully manage transitions to new business models and markets, including the introduction of additional ratable revenue streams and our continuing efforts to attract customers to our cloud-based offerings and expenses related to the transition of our business model; failure to control our expenses; our performance in particular geographies, including emerging economies; the ability of governments around the world to meet their financial and debt obligations, and finance infrastructure projects; weak or negative growth in the industries we serve; slowing momentum in subscription billings or revenues; difficulty in predicting revenue from new businesses and the potential impact on our financial results from changes in our business models; difficulties encountered in integrating new or acquired businesses and technologies; the inability to identify and realize the anticipated benefits of acquisitions; the financial and business condition of our reseller and distribution channels; dependence on and the timing of large transactions; fluctuation in foreign currency exchange rates; the success of our foreign currency hedging program; failure to achieve sufficient sell-through in our channels for new or existing products; pricing pressure; unexpected fluctuations in our tax rate; the timing and degree of expected investments in growth and efficiency opportunities; changes in the timing of product releases and retirements; and any unanticipated accounting charges.
Further information on potential factors that could affect the financial results of Autodesk are included in Autodesk's Annual Report on Form 10-K for the year ended January 31, 2014 and Form 10-Q for the quarter ended April 30, 2014, which are on file with the U.S. Securities and Exchange Commission. Autodesk does not assume any obligation to update the forward-looking statements provided to reflect events that occur or circumstances that exist after the date on which they were made.
Autodesk helps people imagine, design and create a better world. Everyone--from design professionals, engineers and architects to digital artists, students and hobbyists--uses Autodesk software to unlock their creativity and solve important challenges. For more information visit autodesk.com or follow @autodesk.
Autodesk is a registered trademark of Autodesk, Inc., and/or its subsidiaries and/or affiliates in the USA and/or other countries. All other brand names, product names or trademarks belong to their respective holders. Autodesk reserves the right to alter product and services offerings, and specifications and pricing at any time without notice, and is not responsible for typographical or graphical errors that may appear in this document.
(1) Effective in second quarter of fiscal 2015, Autodesk elected to present amortization of purchased customer relationships, trade names, patents, and user lists as a separate line item within operating expenses. As a result, amortization previously reflected in “General and Administrative” expense was reclassified to “Amortization of Purchased Intangibles" within Operating Expenses. Prior period amounts have been revised to conform to the current period presentation.