Business Outlook
The following are forward-looking statements based on current expectations and assumptions, and involve risks and uncertainties some of which are set forth below under "Safe Harbor Statement." Autodesk's business outlook for the second quarter and full year fiscal 2018 assumes, among other things, a continuation of the current economic environment and foreign exchange currency rate environment. A reconciliation between the fiscal 2018 GAAP and non-GAAP estimates is provided below or in the tables following this press release.
Second Quarter Fiscal 2018
|
Q2 FY18 Guidance Metrics |
Q2 FY18 (ending July 31, 2017) |
|
Revenue (in millions) |
$488 - $500 |
|
EPS GAAP |
($0.66) - ($0.60) |
|
EPS non-GAAP (1) |
($0.18) - ($0.14) |
|
_____________ |
|
(1) Non-GAAP earnings per diluted share excludes $0.28 related to stock-based compensation expense, between $0.15 and $0.13 related to GAAP-only tax charges, $0.04 for the amortization of acquisition-related intangibles, and $0.01 related to CEO transition costs. |
Full Year Fiscal 2018
|
FY18 Guidance Metrics |
FY18 (ending January 31, 2018) |
|
Revenue (in millions) (1) |
$2,000 - $2,050 |
|
GAAP spend growth (cost of revenue plus operating expenses) |
Approx. (2%) |
|
Non-GAAP spend growth (cost of revenue plus operating expenses) (2) |
Approx. flat |
|
EPS GAAP |
($2.61) - ($2.35) |
|
EPS non-GAAP (3) |
($0.73) - ($0.56) |
|
Net subscription additions |
600,000 - 650,000 |
|
Total ARR |
24% - 26% |
|
_______________ |
|
(1) Excluding the impact of foreign currency exchange rates and hedge gains/losses, revenue guidance would be $2.005 - 2.055 billion. |
|
(2) Non-GAAP spend excludes $244 million related to stock-based compensation expense, $39 million for the amortization of acquisition-related intangibles, and $12 million related to CEO transition costs. |
|
(3) Non-GAAP earnings per diluted share excludes $1.12 related to stock-based compensation expense, between $0.55 and $0.46 of GAAP-only tax charges, $0.18 for the amortization of acquisition-related intangibles, $0.06 related to CEO transition costs, and ($0.03) related to gains on strategic investments and dispositions. |
The second quarter and full year fiscal 2018 outlook assume a projected annual effective tax rate of (13) percent and 26 percent for GAAP and non-GAAP results, respectively. Assumptions for the annual effective tax rate are regularly evaluated and may change based on the projected geographic mix of earnings. At this stage of the business model transition, small shifts in geographic profitability significantly impact the annual effective tax rate.
Earnings Conference Call and Webcast
Autodesk will host its first quarter conference call today at 5:00 p.m. ET. The live broadcast can be accessed at http://www.autodesk.com/investor. 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.
A replay of the broadcast will be available at 7:00 p.m. ET at
http://www.autodesk.com/investor. This replay will be maintained on Autodesk's website for at least 12 months.
Glossary of Terms
Annualized Recurring Revenue (ARR): Represents the annualized value of our average monthly recurring revenue for the preceding three months. "Maintenance plan ARR" captures ARR relating to traditional maintenance attached to perpetual licenses. "Subscription plan ARR" captures ARR relating to term-based product subscriptions, cloud service offerings, and flexible enterprise business arrangements. Refer to the definition of recurring revenue below for more details on what is included within ARR. Recurring revenue acquired with the acquisition of a business may cause variability in the comparison of this calculation.
ARR is currently one of our key performance metrics to assess the health and trajectory of our business. ARR should be viewed independently of revenue and deferred revenue as ARR is a performance metric and is not intended to be combined with any of these items.
Constant Currency (CC) Growth Rates: We calculate constant currency growth rates by (i) applying the applicable prior period exchange rates to current period results and (ii) excluding any gains or losses from foreign currency hedge contracts that are reported in the current and comparative periods.
Flexible Enterprise Business Agreements (EBA): These represent programs providing enterprise customers with token-based access or a fixed maximum number of seats to a broad pool of Autodesk products over a defined contract term.
License and Other Revenue: Represents (1) perpetual license revenue and (2) other revenue. Perpetual license revenue includes software license revenue from the sale of perpetual licenses, and Creative Finishing. Other revenue includes revenue such as standalone consulting and training, and is recognized over time as the services are performed.
Maintenance Plan: Our maintenance plans provide our customers with a cost effective and predictable budgetary option to obtain the productivity benefits of our new releases and enhancements when and if released during the term of their contracts. Under our maintenance plan, customers are eligible to receive unspecified upgrades when and if available, and technical support. We recognize maintenance revenue over the term of the agreements, generally between one and three years.
Recurring Revenue: Consists of the revenue for the period from our traditional maintenance plans and revenue from our subscription plan offerings. It excludes subscription revenue related to consumer product offerings, select Creative Finishing product offerings, education offerings, and third party products. Recurring revenue acquired with the acquisition of a business is captured when total subscriptions are captured in our systems and may cause variability in the comparison of this calculation.
Subscription Plan Offerings (formerly titled New Model): Comprises our term-based product subscriptions, cloud service offerings, and flexible enterprise business agreements.
Subscription Revenue: Includes subscription fees from term-based product subscriptions, flexible enterprise business arrangements and all other services as part of a bundled subscription agreement accounted for as a single unit of accounting. (i.e. cloud services, maintenance, and consulting).
