Autodesk net income up 170% in first quarter

Revenue might have been higher if not for the late-quarter introduction of 2012 suites. Autodesk makes sweeping changes in how it reports product sales.

Autodesk (NASDAQ: ADSK) today reported that revenue was up 11% in the first quarter of fiscal 2012, compared to the same quarter a year earlier, and net income was up 170% from a year earlier. While product demand was good in all segments, the final totals might have been higher if not for the late-quarter release of the company’s new line-up of suites.

Revenue was $528 million for 1Q12 (ended April 30, 2011), up 11% from last year’s first quarter. Sequentially, revenue was down 6%, a reflection of business as usual since the first quarter of the year is generally much lower than Autodesk’s fourth quarter.

Net income was $99.7 million, up 170% from $36.9 million a year ago. This is Autodesk’s highest quarterly net income since 2Q09 (October 2008) when it was $104 million.

Revenue in the first quarter last year included a one-time benefit of approximately $15 million related to a promotion, that affects the comparison with this year’s results.

By geographic regions:

  • EMEA revenue was $215 million, up 8% from 1Q11 and up 10% on a constant currencies basis
  • Americas revenue was $181 million, up 13% from a year earlier
  • Asia Pacific revenue was $132 million, up 15% from 1Q11 and up 11% on a constant currency basis.

Revenue from emerging economies was $77 million, up 13% from 1Q11 and up 13% on a constant currency basis. Revenue from emerging economies represented 15 percent of total revenue in the first quarter.

“Constant currency” calculations are provided by Autodesk, and are designed to remove the impact of foreign currency fluctuations and any gains or losses recorded to revenue within the current period as a result of Autodesk’s hedging program.

Revenue by category:

  • License and other revenue was $323 million, up 15% from a year earlier; sales of new commercial licenses increased 23% from a year ago
  • Maintenance revenue set a record at $205 million, up 5% compared to the first quarter last year. Autodesk says maintenance renewal and attach rates improved both year-over-year and sequentially and are now at or above pre-recession levels.

Revenue by product groups:

  • Revenue from the Platform Solutions and Emerging Business segment was $211 million, up 15% from 1Q11
  • Revenue from the Architecture, Engineering and Construction business segment was $141 million, up 3% compared to a year earlier
  • Revenue from the Manufacturing business segment was $123 million, up 14% compared to 1Q11.
  • Revenue from the Media and Entertainment business segment was $53 million, up 15% compared to the first quarter last year.

Cash per share on April 30, 2011 was $6.62, up from $5.60 three months ago; the rise continues a trend that started five quarters ago.

Autodesk reclassifies product categories

Autodesk has made changes to how it reports product sales, saying the update more accurately describes revenue results from its evolving product portfolio, especially its new suites. Going forward, Autodesk will provide revenue results in the following product type categories: “Flagship,” “Suites,” and “New and Adjacent” products. The products in each group are listed below the revenue results in the next paragraph.

Using the new classifications on this quarter:

  • Revenue from Flagship products was $325 million, 61% of total revenue, and up 10% compared to the first quarter last year
  • Revenue from Suites was $124 million, 23% of total revenue, up 17% compared to 1Q11. Autodesk’s new family of design and creation suites was launched very late in the first quarter, so this quarter’s results are primarily from pre-existing suite families, such as Inventor and Revit suites
  • Revenue from New and Adjacent products was $79 million, 15% of total revenue, up 9% from last year.

The following represents Autodesk’s current view of product categories; the company says it will periodically make changes to this list.

Flagship” includes the following products:

  • 3ds Max
  • AutoCAD
  • AutoCAD LT
  • AutoCAD vertical products such as AutoCAD Mechanical and AutoCAD Architecture
  • Civil 3D
  • Inventor products (standalone)
  • Maya
  • Plant 3D
  • Revit products (standalone)

“Suites” include the following products classes:

  • Autodesk Design Suites
  • Building Design Suites
  • Educational/academic suites
  • Entertainment Creation Suites
  • Factory Design Suites
  • Inventor family suites
  • Plant Design Suites
  • Product Design Suites
  • Revit family suites

“New and Adjacent” includes the following products and services:

  • Algor products
  • Alias Design products
  • Autodesk Consulting
  • Buzzsaw
  • Constructware
  • Consumer products
  • Creative Finishing products
  • Moldflow products
  • Navisworks
  • Vault products
  • All other products

What do we think?

Autodesk had a good quarter, as was to be expected. The change in reporting makes it all to obvious just how important AutoCAD remains to the company’s fortunes. There remains a huge market for 2D CAD, and Autodesk will continue to support and defend it. To put Autodesk 2D sales in perspective, AutoCAD LT outsells Adobe Photoshop.

Seven of our custom charts follow.

Contributing Analyst L. Stephen Wolfe, P.E. provided research for this report.