Release Date: November 26, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Autodesk Inc (ADSK, Financial) reported a strong 12% revenue growth in constant currency for the third quarter.
- The company successfully implemented a new transaction model in Western Europe, contributing positively to revenue and billing.
- Autodesk Inc (ADSK) increased its share repurchase authorization by $5 billion, indicating confidence in its financial health.
- The company is seeing strong momentum in its construction business, with net new customers doubling year over year.
- Autodesk Inc (ADSK) raised its full-year guidance for revenue, billing, and free cash flow, reflecting sustained business momentum.
Negative Points
- The transition to the new transaction model has created noise in billing and the P&L, complicating financial analysis.
- Macroeconomic challenges and geopolitical issues continue to pose headwinds to new business growth.
- The absence of enterprise business agreement true-ups from the previous year negatively impacted revenue.
- There is a headwind from the declining contribution of billed and unbilled deferred revenue from large multi-year contracts.
- The company faces challenges in maintaining growth momentum due to factors like macroeconomic conditions and geopolitical uncertainties.
Q & A Highlights
Q: Can you tell us more about Janesh, the new CFO, and what he brings to Autodesk?
A: Andrew Anagnost, President, Chief Executive Officer, Director: Janesh brings a wealth of experience, having served as CFO and COO at Elastic for seven years, where he drove significant changes. He also has experience from VMware and Cisco, which have been valuable sources of talent for Autodesk. His primary focus will be on driving optimization and scale within Autodesk, ensuring that every dollar invested yields maximum return for the business and its investors.
Q: With the new CFO in place, when might Autodesk hold its next investor day?
A: Andrew Anagnost, President, Chief Executive Officer, Director: Janesh will join in December, and we want to give him time to settle in and prepare for the next fiscal year. Therefore, it's unlikely that we will hold an investor day in the spring, but we will update you once Janesh is ready.
Q: How sustainable is the current RPO growth, and what factors might influence it?
A: Elizabeth Rafael, Interim Chief Financial Officer, Board Director: The current RPO growth is consistent with previous quarters, with early renewals and the new transaction model providing a tailwind. However, there is a headwind from the declining contribution of billed and unbilled deferred revenue from large multi-year agreements coming up for renewal in fiscal '26.
Q: Are there any learnings from the new transaction model regarding customer adoption and upsell opportunities?
A: Andrew Anagnost, President, Chief Executive Officer, Director: It's still early to draw conclusions, but we have seen some shifts to direct channels for customers previously served transactionally. Our experience with enterprise business agreements shows that understanding customer usage patterns can enhance cross-sell and upsell opportunities.
Q: How is the macroeconomic environment affecting Autodesk's business, and are there any changes in customer sentiment?
A: Andrew Anagnost, President, Chief Executive Officer, Director: The issues that matter to our customers, such as infrastructure build-out and domestic manufacturing, are bipartisan and remain a focus regardless of the administration. Therefore, we expect these areas to continue being important to our customers.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
