) reported earnings of 21 cents per share, which declined 21.2%
from the year-ago quarter. However, earnings were on par with the
Zacks Consensus Estimate.
Revenues increased 4.0% year over year to $593.0 million, ahead
of management's guided range of $560.0 to $575.0 million, and beat
the Zacks Consensus Estimate of $569.0 million. Backlog was up by
about $30.0 million on a year-over-year basis.
The year-over-year rise in revenues was primarily attributed to
higher subscription revenues, which jumped 11.7% year over year to
$276.0 million. License revenues, on the other hand, declined 2.3%
from the year-ago quarter to $316.2 million. Total subscriptions
increased by over 89,000 from the prior quarter.
Segment-wise, revenues from the Platform Solutions and Emerging
Business (PSEB) declined 0.5% from the year-ago quarter to $212.0
million. AutoCAD and AutoCAD LT revenues remained flat on a
year-over-year basis at 32.0% of net revenue.
Revenues from the Architecture, Engineering and Construction
(AEC) business segment surged 14.0% from the year-ago quarter to
$196.0 million. Continued adoption of BIM in the building and
infrastructure industries drove growth in AEC suites and cloud
based BIM 360 offering.
Late in the first quarter, Autodesk launched AutoCAD LT as a
desktop subscription on a global basis and the initial response was
Manufacturing revenues increased 5.8% on a year-over-year basis
to $147.0 million. Autodesk continues to win new deals in
industrial machinery, consumer products and automotive.
Autodesk continues to make investments in its portfolio and
recently expanded its solution to include new functionalities like
composite analysis technology for its simulation offering. As a
result of these investments, the company is seeing greater
penetration in industries like aerospace and automotive.
Autodesk continues to make progress with its 100.0% cloud-based
PLM 360. The company closed the Delcam transaction earlier in the
first quarter. The company is optimistic about its acquisition of
cam technology provider, Delcam as it believes that it will help it
to further broaden its already strong manufacturing solutions.
Autodesk's Media and Entertainment segment recorded a revenue
decline of 19.1% year over year to $38.0 million. Media and
Entertainment segment suffered from lower end-market demand.
Although Autodesk reported a 19.0% jump in revenues from Suites
(35.0% of revenues), revenues from its flagship products were down
4.0% year over year. Revenues from new and adjacent products
increased 2.0% on a year-over-year basis.
Geographically, revenues in the Americas increased 2.0% on a
year-over-year basis to $206.0 million. EMEA revenue increased 4.0%
to $226.0 million compared with the first quarter last year.
Revenues in APAC increased 6.0% to $161.0 million compared with the
year-ago quarter. Revenues from emerging economies (13.0% of net
revenue) increased 5.0% to $79.0 million from first quarter last
Gross margin (including stock-based compensation) contracted 120
basis points (bps) from the year-ago quarter to 88.9% in the
reported quarter. The year-over-year decline was primarily due to
business model transition and higher cloud-based cost.
Operating expenses (including stock-based compensation)
increased 11.7% on a year over year basis to $458.4 million. The
year-over-year increase was primarily due to higher marketing &
sales (up 140 bps), research and development (up 240 bps) and
general and administrative expenses (up160 bps) in the quarter.
Operating margin (including stock-based compensation) contracted
660 bps from the year-ago quarter to 11.5%, primarily due to lower
gross margin base.
Net income (including stock-based compensation) was $48.7
million or 21 cents per share compared with $61.2 million or 27
cents per share in the year-ago quarter.
Autodesk exited the first quarter of fiscal 2015 with total cash
and cash equivalents (including marketable securities) of $2.12
billion compared with $2.27 billion in the previous quarter. Cash
flow from operating activities was $219.0 million compared with
$184.0 million in the previous quarter.
Deferred revenues increased 13.0% on a year-over-year basis to a
record $964.0 million at the end of the reported quarter.
For the second quarter of fiscal 2015, Autodesk expects revenues
in the range of $595.0-$610.0 million. Earnings (excluding
stock-based compensation expense, amortization of intangibles and
restructuring charges) are expected in the range of 25 to 30 cents
per share for the upcoming quarter. This is higher than the Zacks
Consensus Estimate of 17 cents.
Management expects Autodesk to shift a small amount from
licensed revenue to deferred revenue in the second quarter.
Management expects net billings to grow in the range of 7.0% to
9.0% for fiscal 2015. Net new subscription additions are expected
to be in the range of 150K to 200K for the full year. Revenues are
expected to increase 4.0% to 6.0%, while operating margin on a
non-GAAP basis is expected to be in the range of 14.0% to 16.0% for
Autodesk's first-quarter result reflects improving demand
environment in the AEC market. We believe that the company has
significant growth opportunities in the AEC and manufacturing
markets, going forward.
Autodesk believes that the momentum from the BIM product
portfolio will help it to penetrate the $7.0 trillion construction
market fast. We believe Autodesk's new cloud-based offerings are
gaining traction. Moreover, the business transition will boost the
company's profitability, going forward.
Moreover, the company's focus on expanding its mobile
applications for both
) iOS and
) Android platform will further drive market share, going
However, increasing competition from
) is a concern. Moreover, continued investments in new products are
expected to hurt margins in the near term.
Currently, Autodesk has a Zacks Rank #3 (Hold).
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