Autodesk Posts Upbeat Q1 Results, But Issues Weak Forecast

reported better-than-expected results for the first quarter, but the company lowered its outlook for the year. The San Rafael, California-based company posted quarterly net income of $19.1 million, or $0.08 per share, compared to $28.3 million, or $0.12 per share, in the year-ago period. Non-GAAP earnings fell to $0.30 per share from $0.32 per share. Its revenue rose 9 percent to $646.5 million from $592.5 million, while revenue on a constant currency basis jumped 13 percent. Analysts were expecting earnings of $0.28 per share on revenue of $636.56 million. The average estimate among 21 Estimize users was for earnings of $0.29 per share and revenue of $636.29 million. Total billings rose 3 percent year-over-year in the first quarter. The company added 95,000 subscriptions during the first quarter. Deferred revenue climbed 20 percent to $1.15 billion, from $964 million in the year-ago quarter. Revenue in the Americas rose 19 percent year-over-year to $244 million, while EMEA revenue gained 9 percent to $245 million in the quarter. Revenue in APAC slipped 3 percent to $157 million, while revenue from emerging economies climbed 17 percent to $93 million in the first quarter. Revenue from the Architecture, Engineering and Construction business segment gained 21 percent year-over-year to $237 million in the quarter, while revenue from the Platform Solutions and Emerging Business segment dropped 13 percent to $185 million. Revenue from the Manufacturing business segment climbed 25 percent to $185 million, while revenue from the Media and Entertainment business segment rose 6 percent to $40 million. Revenue from Flagship products came in flat at $299 million, while revenue from Suites jumped 14 percent to $240 million. Revenue from New and Adjacent products surged 30 percent year-over-year to $108 million in the first quarter. Non-GAAP operating margin shrank to 15 percent, from 17 percent in the year-ago quarter. "We had a solid start to the year with good progress on our business model transition," said Carl Bass, Autodesk president and CEO. "We added 95,000 subscriptions during the quarter, with approximately half coming from new subscription types. Over the course of the next two years we expect to transition the vast majority of our offerings to subscription, which provides our customers with greater flexibility and a better user experience." For the second quarter, Autodesk projects adjusted earnings of $0.14 to $0.19 per share, on revenue of $600 to $620 million. Analysts had expected earnings of $0.32 per share on revenue of $649.99 million. For fiscal 2016, the company now expects adjusted earnings of $0.95 to $1.10 per share, on revenue growth of 2 percent to 4 percent. The company had earlier expected earnings of $1.05 to $1.20 per share on revenue growth of 3 percent to 5 percent. Autodesk shares fell 1.63 percent to $56.58 in the after-hours trading session.