Autodesk raises annual forecast to $ 4.4 billion after 16% jump in second quarter revenue

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3D design software developer Autodesk (Nasdaq: ADSK) raised its revenue forecast for the remainder of the year after revenue grew 16% in the second quarter of 2022.

Autodesk’s revenue results, which are published unorthodox over all fiscal years, show it grossed $ 1.06 billion in the second quarter of 2022, up 16% from the 913 million dollars announced in the second quarter of 2021. As a result, the company increased its budget for fiscal year 2022. From a forecast of $ 4.345 billion to $ 4.385 billion, which, if realized, would constitute annual growth from 15 to 16%.

According to company president and CEO Andrew Anagnost, the rapid increase in revenue is the result of a “dissolving uncertainty” as the pandemic begins to dissipate, which in turn led to “high product use”. Autodesk’s impressive second quarter results allow it to build on what was already an encouraging start to the year, although this has not really inspired investors as its shares have fallen 10% since publication. of its results.

“Sustained and targeted innovation to enable digital transformation in the industries we serve is changing our relationship with customers, from software provider to strategic partner,” said Anagnost. “This allows us to create more value through end-to-end cloud-based solutions that connect data and workflows and fuel the evolution of the business model. “

“By helping our customers grow, we will also grow, which will give us confidence in our goals for fiscal 2023 and beyond. “

The increase in Autodesk’s revenue in the second quarter of 2022 is mainly due to an increase in its billing revenue. Photo via Wikimedia Commons.

Autodesk second quarter 2022 results

While Autodesk still publishes its financial data in its traditional subscription and maintenance plan segments, starting in fiscal 2021, it has also started to divide its revenues into “Design” and “Manufacturing” divisions. In the second quarter of 2022, the company’s Design arm, including its maintenance, product subscriptions and EBAs, as well as AutoCAD sales, generated $ 944 million.

That figure, which is a 15% improvement from the $ 821 million reported in the second quarter of 2021, is primarily the result of a 29% increase in the company’s billing over the period. Likewise, Autodesk’s subscription plan revenue jumped 21% between Q2 2021 and 2022 for similar reasons, grossing $ 1.017 billion, while revenue from its maintenance plan fell to $ 17 million, before plans to completely eliminate the division.

Interestingly, however, the company’s Make segment saw the fastest growth in the second quarter of 2022, earning $ 90 million, 27% more than in the second quarter of 2021. Speaking on the earnings call of the company, Anagnost attributed the increase to the “convergence of design and make”, which increasingly sees its large customers combine its Fusion 360 and Moldflow offerings, to correct parts problems before going into production.

Income ($) Q2 2021 Q2 2022 Difference (%) Q2 2020 Q2 2022 Difference (%)
Design 821m 944m +15 N / A 944m
Make 71m 90m +27 N / A 90m
Total income 913m 1.06 billion +16 797m 1.06 billion +33

Elsewhere, Autodesk sales data shows its architecture, engineering and construction or “AEC” offering was its largest source of revenue in the second quarter of 2022, generating $ 479 million. However, the company’s figures also show that revenues for its entire line grew between the second quarter of 2021 and 2022, with sales of its AutoCAD and Manufacturing lines jumping 12% and sales of its Media and Entertainment offering. by 10%.

Finally, in terms of geography, the company’s Americas business remained its main source of revenue in the second quarter of 2022, bringing in $ 423 million, or 14% more than last year. Despite this, Autodesk’s EMEA revenue grew faster over the same period, from $ 355 million to $ 410 million, while its APAC division experienced the fastest overall growth, rising to $ 227 million, an increase of 21% from the second quarter of 2021.

Regional income ($) Q2 2021 Q2 2022 Difference (%) Q2 2020 Q2 2022 Difference (%)
Americas 372m 423m +14 326m 423m +30
EMEA 355m 410m +15 316m 410m +30
APAC 187m 227m +21 155m 227m +46
Total 913m 1.06 billion +16 797m 1.06 billion +33

Autodesk expansion plan

Like many software companies, Autodesk’s revenue is highly dependent on the success of its subscription model, and it has seen high renewal rates of 100-110% in the second quarter of 2022. This is true. is also reflected in the adoption of the company’s popular Fusion 360 3D modeling platform. , which now has more than 165,000 paid subscribers, and its paid extensions continue to drive the value of every one of those users.

To achieve this, Autodesk reduced the price of its generative design extension by 80% in June 2021, reducing its annual cost from $ 8,000 to $ 1,600. In doing so, the company not only made its software more accessible to customers, but also raised the visibility of Fusion 360 extensions, which Anagnost says will become a “significant revenue driver” by 2023.

Already in the second quarter of 2022, the company saw an American manufacturer of wire mesh make Fusion 360 its primary design tool by investing in an extension, which allowed it to automate new parts of its workflow. Likewise, Autodesk reported that a growing number of German companies are using its software to train their apprentices, Energie Baden-Württemberg (EnBW) starting to do so in the quarter.

“A lot of the customers we’re talking about now are people who have deployed Fusion throughout the process,” added Anagnost. “One of the cool things here is that our billing growth is growing faster than that of our subscribers. This is the result of our new expansion strategy, which continually adds more advanced features, which people can purchase on a pay-as-you-go or subscription basis.

An engineer using Autodesk's Fusion 360 software.
Autodesk continues to invest in improving the functionality of its software portfolio. Photo via Autodesk.

Aim for double-digit growth

Looking ahead to H2 2022 during Autodesk’s earnings call, the company’s chief financial officer, Debbie Clifford, said she expects an “improvement in the economic environment”, resulting in a “strong new business growth ”. As a result, Clifford added that she “anticipates accelerating revenue growth” in the third quarter, while setting a non-GAAP operating margin outlook of 31%.

While the company expects its net revenue retention rate to remain between 100% and 110% for the remainder of the year, it now aims to grow in its core construction and construction markets. infrastructure, as part of its broader strategy to deepen its offerings and increase the value of each customer.

“Our long-term strategic growth drivers and flexible subscription business model give us confidence that we can achieve our goal of sustainable double-digit revenues beyond fiscal 2024,” Clifford concluded. “Overall, we believe we have many exciting opportunities to drive growth by further expanding our addressable market, as well as deepening the monetization of our user base. ”

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The image shown shows Autodesk’s California headquarters. Photo via Wikimedia Commons.

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