Autodesk (ADSK) 27 May 202021 Q1 Earnings call transcript

Ladies and gentlemen, thank you for standing by, and welcome to the Autodesk First Quarter Fiscal Year 2021 Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speaker presentation, there will be a question-and-answer session. [Operator Instructions] Please be advised that today’s conference is being recorded. [Operator Instructions] I would now like to hand the conference to your speaker today, Abhey Lamba, Vice President, Investor Relations. sir. ahead, go Please

good discuss you fiscal the results. first and conference year joining call quarter to results afternoon. operator, for Thank our XXXX Thanks, of our

Herren, Andrew broadcast being via webcast. CEO; On call live Anagnost, line Today’s conference is and the Scott our CFO. is our

In replay call of will autodesk.com/investor. available at addition, a the be

following You the release, press today’s earnings can this of Investor call. on commentary our slide opening find Relations presentation, website and transcript

and about we the reflect future refer filings our from our other differ important course on statements on including may the business of to and Actual make During could and operations and our pandemic our statements or Please factors. events our in risks based differ resulting for to SEC actual outlook, call, and results These may that impact assumptions developments our statements. conference factors, judgment related currently results, forward-looking known cause those materially. results forward-looking this COVID-XX in strategies. the best

statements as current call disclaims of are reviewed the today. being accurate presented call to contain Autodesk obligation made revise or or statements. update forward-looking made may after during information. this replayed or not is call any If during any Forward-looking the today, information the

call, slide today’s referenced as release website. presentation press such will reference numbers a reconciled numeric we During represents the and non-GAAP of the otherwise are Investor changes we in each noted, on quote comparison. in Relations discuss growth or performance, or number a unless our financial call year-on-year our the All

call the Now to over I turn like Andrew. to would

essential Thank to of are who not medical heroic. want allowing their efforts do. efforts pandemic communities. the but Their lives, other to themselves, the are world the are frontline. many truly for only you professionals open, everything families around their protect and you people confronting To and all thank Abhey. impacts I of you, on Their COVID-XX the the workers other Thank saving

appreciation remotely the teachers have to personal working in needs our with these the a skill work released, deeper the were are by safety Many for demands the pandemic. And developed we had mind learn been multiple Personally priorities play our thoughts customers, commitments world continued remain their thanks successfully of has a of well-being included to has during us, of operation with business role From in learn. times; how unprecedented lot of partners, for our had a a to many even societies. transition most and to adopting to communities. Our balanced are teacher’s It smooth. also our respect everyone cloud-based more to and am to do, the that more proud how it partners an become affected seek takes what and operating I significant suddenly family have infrastructure. and and support and a as roles professional lives complex, healthy the employees, of myself while I've our of youngest help and my home employees I young many juggle always lives I've standpoint, and our upgrades constrained. our patience product learn child, school

throughout surprise region. from surge home usage users remained February, the in our products levels started a end as of above of relatively of it's of slightly, weekly usage dropped our in we've reopening in the major work – rapidly no saw business closely quarter. the lot we products, cloud metrics collaboration And but the pre-COVID and as March and rebounded by of overall project the usage people One tracking China, the steady. is since started In been active products, pandemic dip our but

and revenue our AEC rates held product renewal target anchored of slowdown markets, subscription and of different the while economic is experienced in allows conditions business regions. and the we May, During resiliency geographic space. business adapt well, into our manufacturing -- diversity steady which our The the held quarter up to offerings, relatively locally a by evolve indirect model our as us in operate regions distribution geographic and model, our among

accelerate quarter, to the to helped their from During we the and home. transition our working ease customers cloud migration their

Without the provide like Scott to before actions. our through details the to terms support I'd matter. in investor of turn refer customers, Please wouldn't that, our liquidity resiliency We company, deck the relations business now partners rally also their details performance to insight communities our website over employees you in. on to concerns. incredibly offered the our they extended of take for how also guidance With to way our proud back not I but on drivers. to the they to our it rally each other growth only slide these payment in their I to our am of resiliency, more and strategic come the alleviate model support live into

Thanks Andrew.

comments lines. echo offer battling more I thanking want quarter, first the Before the details pandemic heroes, Andrew's our on I on to the front

proper has the and products, frontline be national from and other concern, the with our philanthropic biggest on communities. proud Availability month. organizations that played support the partnerships My help for combat I'm so pandemic, will need. manufacturing graduated hospitals Protective her or and sprouts quick in addressing PPE a many just own Equipment Our PPE local been the all and of Personal front to superheroes and of my has desk line daughter build particularly expertise and and global, next her has role degree the nursing

revenue in going strong quarter. by our obligations obligations on was business margin performance from Total remaining subscription COVID-XX guidance. by grown growing detail, million and We and Typically delivered by focus operating billion XX% expanding repurchase to remaining grew to more plan quarter impacts $X.X revenue in cash solution. current percentage XX XX% XX% today our go and points. total on the to with XX% the I'm of our and flow through grew free the offset continue shares $XXX but I'll by performance results to keyword performance Our

to in our You in QX what cloud relations do and private mention can make. to fit each we renamed two quickly almost the previously to have labels functionality. cost previously these additional products called I want find products The of what our is on our called enabled to compute design categories. change is website. investor we core that performance into we that cloud have details business no of all There the

slowed business the During quarter rate surprisingly not down the second half renewal steady, whereas QX. new in relatively held of

been our by geography or not uniform on However, the impact industry. business has

not businesses, but from well. and of our employees with products less XX and XX% are generate standpoint, XX% diverse to geographic is from have students. XX with less find businesses to only than small than those customers Many customers you a business our about revenues approximately exposure we Our of to asked our as diverse small

Our net is to rate retention revenue within XXX% the XXX% range.

other the is we is for of which subscription customer for renewals, a are renewals the all of metrics partial stickiness some, contract renewed. measure track seats not One in but

a well. steady remained AutoCAD rate In was LT relatively downturns, renewal indicator demand. leading prior as for partial Our

some slowdown, our mixed moved customers current purchases. up the optimize as their during apparently higher, LT chose to However, AutoCAD

environment. quarter, multi year the the deals in decrease forward customers modest even multi-year the a saw commitments, in we of end current with toward many although continued Lastly move to

we actively entertainment spend. evolving our shifting travel reducing of business expense, environment hiring result the events as rate, the monitoring Given are managing rationalizing spending, virtual COVID-XX, board, marketing the a and our and across our

a digitizing construction, critical to We such in invest as and pandemic. success future our R&D, out areas will from the come as to ensure continue company we

let us me our a subscription sheet economic Now backed the for robust navigate expectations to cloud year, the a model, strong by in and foundation a to gives challenges. our remainder of turn the investment balance products successfully business

will in year full due environment, range our have than economic ongoing uncertainty on impact to Our a new wider business. pronounced normal guidance the more it is

trends Regarding the the quarters we the second impacted to by pandemic. most year, business the new be during activity expect

business a Our in year our in swift about and rates. quarter fourth quarter strong third quarter the business The recovery into second we're new upper with new growing. is continued pipeline cautious But of improvement the assumes range end and third entering end new modeling impact slower the year, by second lastly. close the deeper new in on a quarter fall units At unit lower posting quarter a and are with of decline. the year-over-year full improvement the further growing volume range, recovery we sales, fourth modest the in full

our the abundance On is meaningful are we still hand, offers the second modeling quarter, of our us which out in rates renewal renewals an uncertain decline business rate, have other renewal experienced environment, the and resilience of in an not in in change we a caution. majority the of

the second later year. and high in and end the of pace extent the in differ of guidance in Our scenarios low drop the end the recovery quarter

flow expect the on large transactions below billing we Given net our decline some a year. more loaded for will rates, expectations. by more reduction the a to timing move move be remain which our end backend XXXX multi-year from modest range year the multi-year end reduce XXX% to the and next. flow steeper Fiscal of our anticipate will current XXX% impacted lower is The new free to significant based rate The of revenue decline. product the above the rest are this strong will of we decision demand, our in cash our retention free in upper guidance billings a XXX%, contracts, be renewal billings a whereas of the but cash impacting of and to fewer transactions, assumes year,

by We expect expand four approximately percentage year margin to our to two operating full points.

expect can double-digit down second Looking quarter billings, the at by our meaningfully which pandemic the percent. sequentially low impact forecast, to be we

sales, our being terms of which to backend in year. August, accelerating half Additionally, will could loaded end free the early second customers quarter breakeven a slightly to QX negative more extended up the up our offer decision before to impact for our through combined cash with payment flow,

being of fiscal impacted our our are fiscal XXXX confident $X.X target by flow billion. cash Although in free results COVID-XX, we XXXX year are

by once allow that it us fiscal exit current we to We like of And the multiple business Assuming the to to starts Andrew. resilient this end a pandemic. I'd year. back the now tailwinds, recovery on turn model capitalize build will

Scott. you, Thank

and resilient. way solutions back are are they cloud that the to and years to digitization take investing and all accelerated We we that beyond companies worked forced expect these sure not secular to are offer benefits in for accelerated they in have businesses been as they trends be to People experiencing more be work, all before will to have turn how subscription are going this go and necessary the change our pandemic. being to during steps

this during focus combined well-positioned in ongoing only investments to with cloud-based Our world be pandemic, offerings, over. advantage they our the also competitive with will few leave in but and on over that new is the when us our customers, help last years, working a not it

of and of some heavily biggest more lean to altering the are the fact, digitization. our mix our customers In into products cloud already

AEC well in continuing, down. Although has spending held sites job and seeing some customers project shut is are some delays, cases, cancellations, temporarily and up work

realities, these adoption have construction we continued despite However, seen our of offerings.

Media sites project easy for was to renewal. rapidly Their business contractor United office construction selected for solutions new [ph] with evolved and connectivity products BIM PlanGrid. comprehensive bidding. and vendor. Southeastern a for shut becoming PlanGrid their with competitive example, field in was their Many needed management solution like general to deal field, solution is a started field-focused They growing impacting include that included States, price Construction, the XXX of and ultimately, For for business construction The down over BuildingConnected and at temporarily, a a our concern current fast multiyear our time were implement. the

construction products BIM collaboration chain However, complete experienced like solid and value Design and our XXX the growth. span products Docs our

a extended try for customers experience no process customers adoption collaboration who We're are access period and the Our accelerate seeing value at of out of limited of the time. products cloud allows their timelines. in program to the cost

in BIM early test store. We surge over projects are has cumulative new also great seeing Since over grew and BIM through for commercial infrastructure, XXX seamlessly. XXX a which our digital been in Docs. Design our XXX% This product seats March, usage up has scaled XXX% in customers directly cloud purchase additional

the cloud the use you allows is with stored customers our in anywhere Design cloud. anytime, data tool product to As might XXX that recall, BIM Design our collaboration

working. efficiently customers work are solutions do to allow from think experienced revert that of Now we not will ways to anywhere, cloud-based they them that previous

for premier Americas reached AECOM One were essential rapidly of world's our largest customers, their to and AECOM, ensure of business. our adoption continuity absolutely increased usage. 'We're that the CIO, out increased us which is and remote commented, Felker, set David XXX to significantly support beforehand shifting infrastructure firm. to working, Construction, the is of up the to we BIM recently

long-term.' working look to so continue Autodesk home our Our to noted ever will successful without investments and of in forecast to well, businesses this Cloud XXX that and way strategic grow digitization use their automation believe the and have substantial pandemic has We BIM baseline dramatically our technology, while with lockdown there work an is need be told enabled support. platform able provide At more so remotely, our done in number of also will competitive forward. And on In seek working. with delivered segment their When customers side We They operations, is would short-term our customers XXX the continue their are digital all to partnership are every our upturn, will BIM to make successfully Design infrastructure. overnight, our went more platform, current governments BIM will the the only downturn, along of they of stimulus, the New industry, that using that as stay entire and become to subscriptions. our business new they accelerate will solutions products the new the of in not projects end doing AEC home also pivot for have going doubled helping historically in into in than the we Warren as from they businesses XXX business projects quickly. successfully helped and Architects to Mahoney been days. us their mobilized other this. process, One five We not work from resilient. Zealand and we

will positive the feedback private at better with Aurigo owners During we from from owners. we and Capital customers. are cities, serve and Transportation, quarter, enterprises this project counties of announced receiving alliance, benefit public an to Departments alliance and already

had we Their our state typical and Bentley's. data skyscrapers. a to largest and This for a choose digital and and clients China owned the quarter, top the them airports stadiums, international Autodesk's include service to compatibility infrastructure, teams of over and phase. one bring streamlined healthcare firm workloads design enterprises collaborate in down subsidiary allow projects construction architecture products domestic across

announced are is XXXX. as Revit, for to Beyond generating that, use optimized they have Design Generative our of design Design already available Revit schemes and Generative taken products advantage in excited in we recently

is enables our in space customers plan Generative to of work As do to effectively. the to safely, need Design they return help redesigning layouts buildings, one people and things this

chain to flexible disruption. has manufacturing to our products our evolving and will develop enabling future. shutdowns, impacted use conditions. Although, even Customers R&D operate factory by continues customers and production solutions to in when under the products be are been temporary experience Automation supply supply disruptions chains vital floors and new competitiveness

cloud. chains during cope work customers continue customers their help in their readiness work. products portfolios' with in supply multi-tenant gain demands among and Our this the of the distributed and leading PLM comprehensive reassessing customers to cloud environment and distributed as XXX remotely solution Fusion technology traction pandemic, CAD/CAM and divisions, the a are collaborate to is

board with to we April Currently, In fastest-growing the circuit electronics large by design integrated them a month the printed that price XXX their good expect company. example acquisition. they for a new Fusion at offered big in fact, the expand a A user with of we for our further functionality point. semiconductor attractive deal closed use this stand-alone was our Fusion is capabilities more products presence design work. to And due

quarter. of of to which plants. increased included design They cloud In a using as to Growth between their users and on-premise of strong, to the X,XXX XXX EBA teams, during offering. across forward in our equipment the portfolio. maintenance in look minimal efficiency to at Fusion by XXX remote one our addition, with supported the to chemical subscription report move Customers features manufacturing in world, of work, collaboration disruption their been relative our starting chemical solutions has Fusion remains competition improve the largest BASF, platform the producer several communication

signed flexible usage-based increase engagement for was most the fit them us. the in of enterprise During a in the adopt their solution quarter, a made downturn. competitive automobile to was catalyst ensure side for products. decision to to their the this with model customer with we who access substantially They COVID-XX on industry our to efficient good business an they of manufacturer The needs other portfolio expansive China. agreement our the first stay

In addition where products. the commercial rapidly in our are engineers maintain leadership space, to space, to we in growing adopting continue education our our future presence the

driven new-user over space, XX% acquisition April. went by education in Our up in Fusion XXX the

us, Moving onto non-compliant are area for another users. traction, monetizing we priority high still making

sales stopped. the this situations are In terms mean sensitive does are and often customer deferring to led of final initiatives, outreach, not we but being has progress

first win the after over deal BIM the compliance a are closed for have piloting Docs. impacted year compliance we Autodesk we In We months closing, Bentley pandemic, transaction is and for a beyond. on of all an America, been to and move us on stronger the while the and that by Central The pandemic. additional many next now the deal building we closed current prior was business license working in and reopen competitive customer XXX are license

but enabled the the we entire for going and three digitization start revenue more our paradigms needs new current with confident head make processes for manufacturing at the in so and and a collaboration, will a for BIM, XXXX to Day distributed model the that resilient is is not to complete This you as resilient of significantly our workflows continue company. companies key both customer more to few to And not in workflow the but and initiatives. capabilities questions. in to invest do going that fiscal industrial areas but than to our June us paradigms like Two, and network cloud strategic adopt will will more is the cloud-based virtually cloud over us to operator, of that. With have industry's construction in growth. to initiatives. accelerate One, years Xth our our computing are the up and and AEC invest We growth make over adaptable business three, industrial after solution have that site. in a have like only efficient in the we make evolution now cloud-based accelerate competition support call critical of years. future, -- by the more emerging and Investor time There also to the design with not allow history in targets open multi-tenant only only coming robust, seek We to cloud-based forward next address an many where will engaging eye to aggressively strategic that, look on share margin our to leading we we'd the

Our Capital. Barclays Thank comes Kalia Instructions] Saket you. with question [Operator first from

line now is Your open.

guys by customers a look thanks I you. to hiring. engineering want taking Thanks for on Andrew, see questions seeing with about Hey, maybe well. to at my area. it headcount and just great. lens, Okay, your talk and from everyone's if I start here. commentary you from you're can just the And different what maybe for doing hope

and is times? AEC to during your us But Now clearly, if high-level customers how going these you manufacturing your observations are customers. between differ about I'm your between could manufacturing situation give wondering, customers headcount some approaching that just –

seeing. were I we some well. well you what is reductions, Look, Yes. our If see headcount – customers our what that, tendency We're as I'll as what in there's indirect more partial measures of in do base. engaging in renews towards give you're Saket, opening a lot of we're I'll is commentary. not the hope mentioned all right, seeing a would we doing

talks partial team stable a employment environment. which in seeing to kind of So we're a base not renews and increase this stable

the top we is that notion users, of active to what's pay of whole while into something last We during thing weekly other active bit we of okay? The This use we didn't economic the That's our activity declined have weekly to able to real a headed on with downturn. the starting measure products. applications. happening little attention monitor active is this, That weren't weekly our is of it usage, stabilize. definitely happening desktop as

process us, our hanging in on So people that's in factors, and meet indicator multiple out team R&D, to that members. order the to well R&D people look, so they on products effectively keep early the stuff their that on We're working to come of the another people here as the this. tells project demand their need are development uses front of

we're what seeing that's Saket. So

for could on That's paid-up remarks, little wondering really more. free you bit And but my subscriptions? 'XX Scott, multiyear in little how a Can you in those that saw what maybe this I'm your it touched for you're about follow-up helpful. just the you, bit quarter fiscal prepared on cash talk if flush just you flow in the a about thinking out guide? talk about we just

And Saket. -- in that we see was at total balance you down half It too. quarter. Multiyear quarter, things a bizarre And was really then are The strong. multiyear the was did and you multiyear to affected QX. of we hope total long-term the in as as saw in Across revenue was It safe continues evenly, a is, we relatively What interesting look slow relationship bit in to different mid-March, the deferred in see Thanks, – strong. family opening commentary. second not deferred slowed bit And board, not strong demand balance. an such quite a of we little were And substantially. see Yes. the come What slowed rate. talked by right when you be but the about it strong. did continuation the your the down It's countries we It it staying beginning around was strong. quarter down. the time. a saw a of I

lot it see continue to the come our down, of customers buying value in multiyear. a while did So

selling value chase, are don't sales see we to value And course, up those of continue frees that partners we Our in it because renewals and that. get capacity. have to

So the good is on what I some second of see headwind the the of and for for good half that's expect us part influencing good transactions do multiyear triumvirate of partners, for customers, the our change some through free and half billings trend on second with multiyear down guidance year. second the year, the expectation as in flow cash that towards an in continues. the to through recovery of year, certainly the will quarter

Thanks That’s guys. very helpful.

Saket. Thanks

Thank you.

Our next comes Winslow Phil question from Wells with Fargo.

now is line open. Your

taking Scott. question. where terms saying kind that what you in basis? on of planning, one is, the the of I'm Andrew, etcetera. call glad for then Hi, extends your AEC it obviously fact there. thanks they well to backlog seem have into hopefully talking to guide your to are starting do have side, team you phases were are side, follow-up to think you year, the that you Question you cycle reopening, different hear and When you talked and for go-forward especially customers, sort your about Then a that of of a coming follow-up you're to projects think architecture different about of backlog when restarting And sort Scott. impact, of construction the life the construction and for my for you members. families your of you and Andrew, the just that first considering you products how to sort

Yes.

backlog forms. X comes So in the

is into just that hold about hear put the and on is were backlog lot customers about a first The to pipe, not that of lot our projects look, that category just projects. from are we a from kind hold, were bunch away. of of where would that them a going put products people know are projects pullback Those at. until on the any they're were in None go represent

what yes, how and side, construction The the and the thing stopped construction. were put side that was at there design this downstream on saw definitely hold. side, on in queue end of actually some front kind interesting municipalities, is of projects in the the you So people engineering

construction on Now fewer was up output is sites well. on in on are that's same, our out seeing construction push And back on still all starting the right are they're we're their our And games, games, more TV need in that digitally are anticipation their back never sites so going They they as The working all they listing none customers. development what various base site them. their as from side actually construction to in are their there, manufacturing. goes new stopping. will up open you're So more people more what films, people up. same they problem in hearing our shut the never making the and all right? down. product Frankly, people stand just digital their that an working those restrictions site, places, so of Their that is customers – sites. That's and shifts, the the they but things going they They're couldn't the now. are units coming because saw tools of back coming and construction not – slowdown. that what is when fate stopped, doesn't sets that the to is with to requirements construction from struggling manage a segment on customer the what still never one obviously, the of is know film. The there's pickup on what – biggest and with you're these people seeing tools distancing, these some Manufacturing,

waiting the people production is business film the when still but to are going restart. the – So in for

I you that are us significant conversion to sort in year saw year of Okay. relative about That was in could weren't super to maintenance. with how into paying helpful. and a you And then tell subscribers just subscription just on came or number Scott, active Obviously, of terms if the thinking just you users to we the follow-up. that trend year? last those this of of QX wonder

transaction, well. quarter It we XXXX. Yes. is – that during of pursue there. out to situations, enormous continued final us, the the continue outcome economy beyond I productivity fourth about of Phil, those license many call and more we science data trend of opportunity we'll and headcount the those improves, we're even toward better face it's pursue And our We've as the led one the while that will the teams an half cases. to those, the as compliance difficult on the transactions, in That's What into as identifying on quarter. more of very do difficult is, many higher-quality customers at gotten tell at quarter have got you, this be of what for second passing investing to talked to half continue productivity improving. a leads. fiscal as a quarter we'll first shutdown we're we and forcing final continues did seen the the not That

So that continues to pipeline build.

that to still build in of ahead of the second continue us up, and work We that the half and an year. that's opportunity that's

thanks Great, safe. and guys stay

Phil. You too,

Phil. you, Thank

Thank you.

question Our comes from Heather Goldman Sachs. next Bellini with

Your line is now open.

questions. you are Thank the Autodesk question much, glad for and I doing employees have to hear and well. families your you taking very just two gentlemen the and

business April? month a your month maybe a Asia, is of I you have – First, aside mentioned little while the tracking any then follow-up trends deal also be a had compliance that any commentary license for the And quarter closed. the commentary given Andrew, after are And you parts one, this one follow-up -- ask, on in wanted how guess, economies open overall how where of reach, that you from would global of for that. I versus there seeing the But to Wuhan been just longer? first I in

Yes.

Okay, great.

like a to asked QX Korea a than give your we full question with roar. that our is you year then We broader entered fiscal celebrate of what just said, kind little can success me you so little China follow had Heather, let of start a week from And you hit, suit. a context. you happened decline, Scott I'll saw context. March to kind a saw XXXX. set you So, answer

a started U.S. decline that, after of decline, then Europe saw the online kind general You and to APAC, came then in

a and -- weekly, monthly was entire all are out. in in now Korea China both active And is the what stable. business tracking. of pre-COVID Korea Here's what rebounded, up. as going starting we that China Europe. Monthly highs usage a from country. right, to returned kind things we're surprisingly happening cascade in through is usage the saw, we played steady perspective above that -- became weekly and and same Japan is from crisis, the seeing the from right? though, active collections of are numbers now business usage kind active Europe weekly see We're

in in a starting not New stayed upward And the business up. constant in another that. yet, it's that rates. usage cascading our new was and seeing We're business -- relatively any saw U.S., numbers. a stayed go you're of it And trajectory active we all numbers. we're our is seeing stabilization but to thing steady seeing kind weekly that like And renewal

we we Now, a that during told What declined slightly we that than rates expected. always downturn. renewal was happened decline you less anticipated renewal actually would rates

fairly BIM this geographies on through well. added was downturn, the all going at all all the held our what did and they've of times of already right? in those make wavering. crisis. for even entire make BIM March, the monthly downturn. this, heat Design understand XX,XXX up through We Fusion -- hasn't sudden stayed products Like, and well during our a instance, in been all products kind cloud this, products It's at of actually right, all Docs, I the during of month, of one you the been in The you well XXX and and users incredibly did across was some want in like consistent rate. about during There very consistent some heat active to they've dip XXX whole incredibly that told thing, thing the So, in rates renewal sure

That's great. response for at this quick one just total you the mentioned question, I'm But deferred about, year Scott, this And think, of level XX% balance. most deferreds. wondering reasonable. I you talked then to you one might know think is someone's I as Thank much had long-term that in for be revenue point, about that you. just a and as at follow-up you there maybe would being set more up those recently,

right Heather. that's think I the range, No, Yes.

mid-XXs. up been slightly I think that. higher It had the than in ends it

upfront quarter to through that to the third free the was cash quarter problem subs paid going was product a and You year. remember I multiyear actually, on on there -- was the call, quarter hot fourth run for going fourth concern and think create flow this

because In multiyear my I thought on watch year opposed to to bit. a offering was going that list, stability this fact, the that we of tamp offer down of And pandemic. unstable was to to it running actually to couldn't hot our as have we level, a maintain be kind I a if that a wanted year I changes of percent, make the an it to so got impression

this put the saw to it We expectation At for year it's of down that my modestly. that for that point, need second haven't we pay don't mid-XX% half and offer. discount; to. upfront; total the think the same, XX% We I years long-term It's been. any the get That's of changes in will made always three year range. the come deferred in a

gentlemen. great. you much safe. so Okay, Thank Stay

too. Thanks. You

Heather. too You

Thank you.

question Vleeschhouwer Griffin comes next Our with Jay from Securities.

line is now Your open.

Thank I'll questions both ask evening, at and Andrew you. Scott. Good once.

forth, accelerated by named sales with current been for working coverage, So that of any, and accounts, planned of and the sales number channel. of are implications sales, or direct you distribution inside the You've the for if a that, What first, and store hiring your requirements are trends model? noted situation. hiring Andrew, and a the so lot of course, doing being

you've able progress? your rebuild or as else in Inventor affecting of you past some plasma. So rewire perhaps road to at number about terms new or you be terms be layer, secondly, and to data milestones AU, map, for and this business, prudent any could things. applications you'd that collaboration, major another advantage current of valley all that Revit there that multi-core platform, would platform multi-threading the the in its of such good at those implications are or in your looking think What to new over course, anything occasions brands And of often the then And orchestration, are overlaying maybe take way to that longer-term next talk any internally spoken, years there? the looking of about communicate

So a sales question and question. a technology

Okay.

with sales start the So question. let me

at as to headed the So noticed, invest. continued looked we've this year, as and we've into you've

continue While inside continuing areas There not that we're going we're expansion for this invest originally year, infrastructure. trouble home. efforts solutions in inside we right, are to and down customers the and probably and things spend Fusion bit R&D go-to-market when to as hire invest to on your we we inside with international like touch related when our sales supporting to slowed are to in, that in having don't we future sales construction you're sales business. teams, they're some you teams when things want you're But, much core think a to did getting our as anticipated working little from

we was down those efforts, in of some no So slowed go-to-market activity. there slowdown but our across-the-board

they most we invested think you, we're And in In and there. make important were of prioritized sense to those we there. we thought all terms is, what doing fact, what did things I that would

continue going the terms internationally see growth, In around think invest solutions. go-to-market and to of us longer-term cloud construction our you're in to I

question, to centers some to which be you're that plasma AU going locations are regard our solutions, service continue in we by some way. to in the data time see invest with I frame. of okay, you'll international think cloud us call servers of our second with those going Now get around right? name, later, to customers in probably anymore, our view and a all demand, It's it your different don't because

you in what to cloud all be right? platform, cloud, make lot about A that yet our has a going But look, there. to lot been I off, lot sure understand. exposed. I a been our I'm that about So want lot hasn't talk careful in first exposed, There's a

those probably you're that simultaneous a that but you're University. of multidisciplinary with, based model updates in collaboration, to Autodesk lot more architects access and the hear or Some around going maintains coming talking about about the disciplines, control to say, months things engineers, the common on allowing a different

model. I got on, informed this So thunder that. the a the What that by clients with I'm way. And in lot will there relatively what backend a robust believe and not very is, mean point we And steal a at sized we're we've believers going the say that are to to big going from I got we is really in cloud future. modestly app big

will infrastructure it very, – a data will very time. And So, thinner for instance, multitenant over the thinner hidden get it. but Fusion has get has very, Fusion's behind fine-grained client cloud a cloud – big client.

with of evolution very made You we little longer. going an deliberately, Revit see that had in pure applications. that. could to And experience That's a similar because lots also choice browser-based Jay, take we've that's to

well web, given a that month, it's It's an the aware is all is tool. users has for way thinner, Tinkercad, our us Right K-XX right, than on and thinner Not all solution, years clients which XX pure actually early right. solutions desktop users. drawings standard collaboration there. those Both as amazing out this be current browser-based think day, but clients, are model. browser-based million clients, as might Tinkercad. you as We of a taught totally XX,XXX edit long with thicker instance, For AutoCAD called drawings. on that experience does use It's now, any app multitenant of people way which tools. an It has the facto Tinkercad monthly like creation XD in learned from of these active modeling de XX,XXX but better, our

that you us why Fusion. that's with So see doing

cloud has You'll winning underneath AEC same robust people to that helps over it. it's time. database structure see the because it multitenant but And space in the sitting cloud, us get similar do it something

you. Thank well. hope do I you

Jay. too, You

Thanks, Jay.

Thank you.

Hedberg question comes next Capital Markets. with Our RBC Matt from

line Your is now open.

part that investments disruptive the are And in that made know, do business? the that a more made the called this manufacturing. out we've all happen are talk want a of in always offering. good guys, There's lot call you Fusion but hear thanks I'm bit of a there little of a We we Andrew, many you to And relative business? Hey, well. taking are questions. construction on the the really to XXX. need on I momentum your improvements about more you in momentum Where things about there, it being glad still and for in construction, questions perspective guys to on my particular product real

the part. In the manufacturing part or construction

– question… the I You make I to answer sure want

manufacturing the side. Yeah,

– Because all right. good. Okay,

a users it the you glad I'm that building the is I on right. it. added XX,XXX in I revenue the momentum of education, to users. save right, active and space. flow say, to it's activity. very doubt it in it no said, question. as on asked the application fire. early Suffice a up. in stages with going subscriber base So generation the Investor it's Day by definitely Tinkercad. large, commercial over March, all XXX,XXX Fusion coming for about And has monthly total seeing reveal monthly am active way, far we're a all I In by connectivity said There's the leader. Like significant. the There's It's today,

a more in becoming Fusion's and over of taking rapidly Tinkercad with up locked that K-XX got more we've space. education So post-secondary and force and

that thick to you're that the use for think client start hiding as the next things underneath the I exciting especially we data the with are Fusion a going we see over layers application. year, reveal lot to of

to So But using solve day, Fusion a off bit until will XX,XXX Day. problems Investor any little today. to I I tell are you, hold in want given real-world people

for think I potential the future. has application. really significant it’s an It So exciting

cloud our are in We functionality, in not way only power. but low of competition, ahead

to So get bit next teaser into a it's Day a you of Matt. Investor the week,

I that. looking were great Difficulty].... this the for ask Scott, Yeah, And quarter, know a wanted renewals then forward about hear. stable [Technical maybe to call we’re quick which to to is I

up is voice your breaking Matt, badly. pretty

your You started question guessing fine was is. then and what off I

of Sorry joys about from working home. that. The

look about your guide? some in your your how the for expectations at customers VSB – guidance, on what you renewals are fiscal today? question 'XX are Just you talked 'XX when But renewal. doing And is expectations

that, second sort seeing of between enterprise. because high segment above I VSB, somewhere had into between up move a typically mind, at of constantly great would this end as that the to a see modestly of for renewal that seeing segment single am from end. the though And drives segment us seats or site But that, we XX call would Small not that then XX% I we're difference less. one are we think the we an in guidance and to end there, in that question the in rate running not I quarter. renewal the difference a imagine point. XX as of employees built our it we but And during back you there's or an and of be guide. That's impact less XX% which expectation we're a segment, versus but Yes. even generalize do modeling could think Very expectation range the with the cautious, and just yet, that bear those sales. to Business of But have the have the It's I've expected low is seeing right frankly. multiple that, a bigger not surprising, scenarios bit And the rate We're of that things rates our scenarios through on seen where that they recovery that that into down is those. are

lot. a Thanks

Thanks Matt.

Thank you.

Our next Steve from question comes Koenig Wedbush Securities. with

is line Your open. now

my put two Hi gentlemen, quick them ask thanks I'll out ones. for both I'll taking question. just there.

horizontal of is it, impact? call any First really from stimulus construction? what stimulus you any we'll the one terms do Or positive doing. tailwinds the spending. -- spending there is, -- government are It's guys expect in you the the anti-recession are you seeing Is

your recall very and number guys. pretty low steep. around kind 'XX if period, Autodesk your assumptions Question relative model give mid us assumptions guidance maybe wondering my of any question correctly, And XX%. business, on we're Thanks you to new your I licenses It I'm back color at can any down looking of like that's how number color two, much behind just you're -- So making? from was the high-end range, one?

Okay. Great. right. All

horizontal take and question. off I'll So start construction the

stacks born you Obviously, we've partnership, with most really a infrastructure infrastructure investing an and saw moving make was that, stimulus Origo in I transportation projects, parts. What solution the Right we've and really on our between in commentary. forward technology, design been strong with the So through construction these strong in but do rail. is been and us products and time in to entirely for Between particular, these regard recently early really cloud this engagements. the part some of and partnership now they're very rapidly it's we've engage for really, of now, in Origo, old complementary. an core for planning stack road cloud. in anticipating building in Aurigo we're the terms capital to company, investment in that a solutions, the whereas There's opening fairly the mentioned and stacks design to the overlap of types our their in basically types the designed departments bring and been in functionality of various cloud. old of is they're very, the in our is stack is portfolio our

we with various infrastructure of tailwinds So quite We absolutely returns departments for put of these from transportation. engagements for We're terms the of ready. some in believe we're thing. kind seeing we've some time. preparing right believe partnerships been those in partnerships are already place around We

we've to it. preparing So we yes, tailwind coming been anticipate and do related a from infrastructure, for stimulus

of it's same to the We to traffic are, to on a I but company question slide guys avoid I'll expectations also to second try had, know the what our the other the and a are website to moved and try point reporting you the – busy you actually you bit. companies other load deck we you time. same today I'll on Steve, I'll to a the to And time. you night, there point at tell that lot lighten at posted

the for and our we is core an there, in end we there new that that looks the full volume customers. such recovery, an volume such year, the Andrew the are. the the – full expect the most new the the reduction less end, for says, And on rate slower rate getting there's for new impact what between is high and monitoring, the business range but a a the I low each that our our by of we of expect full renewal low tell the the like our quarter like up I of recovery At in expect depth markets decline then all the the what and cases, don't have impacted came that had our our I'll means expect that strong, we range, the products end a the workforce. slight of business new really So rate XX, expectations well, said, unit of renewal And partial if second understanding from in in impact both Things in be and the in usage actually grows At in end I second year, the that slide XX a end for you high a staying QX, renewed as have recovery, guidance in year, a reopened divergence bottom quarter. to we're low by of in the slightly informed markets usage for year. active swifter weekly of modestly. such by what seeing as that's QX,

high base, end. So the of our on new I like think renewal is what the from strength the looks volume differentiates what the the plus – end low expectation

One sure in there's make to the that. saw of close during the just we're financial clear new levels seeing not too declines business we to okay, crisis, more point, on great

Thanks lot, Cool. it. a Got guys.

Thank you.

from Our Sterling JPMorgan. with next Auty comes question

is Your open. now line

transportation Yes, industries hospitality, in of cetera, viewed users, thanks. et not hardest like Hi, design transportation, as exposure to but guys. I sense know hotels, maybe any that that some your of group? the heavy are

and tend Those like facilities things LTE of to layout. versus be facilities Yes. segments users planning

– be while they facilities to usage users companies, play applications. they’re a So us. they're It's generally big downmarket tend of our for

the exposure services. business line don't hospitality, and have those hard industries transportation in to hit of So we from a very of main food in our lot

a estate how number And business maybe we'll the in not enough. think you all impact landscape other terms back your post real moving in change might maybe bringing talked from thoughts what forward? already the of I've in thoughts commercial see fair workers COVID-XX, companies one permanently. of and a of the just terms impact then Any that Any about, question. That's

Yes. It's of way. an kind think important that about careful in to question

space, office buildings of First part and commercial a commercial commercial huge our off, business. business building, the not

going to about personally, is this However, I you need living mean, be couple -- this a so There's trends, more aware speak work-from-home I to on when type environments, the some move we office as we're think with One, to of of. can working. other less actually people well, space. knowledge side dense probably that this will have to how I and have they're

for us are in of the getting require current terms back in us space. office So, some to offices instance, significantly requirements our of de-densify to going our

going lot And reconfigure going we in office, ways. high-rise an where That's still talking on this that do a people going, come needs clear talking spaces. spreading not space we're they're the out okay? kind We've them just on are future It's that still living be it, have they into have less will then that people of that to been urbanization, months, how about to XX centers more need but very office are of unique are of less bigger coming where they're design certainly, fewer So, dense with where widely a a offices you're customers growth. always from -- hub-and-spoke where general So, much them have helping away be the to into flow. may We're offices But infrastructure a XX to but people by office going workers. and to kind change. are require tools. short-term, over and might suburbanization, to be in And be are population be to urban requires there's into okay, about There's centers the we distributed next those that also to office suburban space, going out spaces going. to spread around seeing and dense. to of they're have not connected a we're urbanization to to that, going standpoint, and going population these have some in trend our still

in our less. be So, plays projections out there's change. build they ways this may a future, more, going of this, view on our the it people not are that but and lot building in to Where

Thank you.

you. Thank

comes question next Our from Weiss Morgan Keith with Stanley.

is Your line now open.

couple Most just quick ones. this Hamza my of answered, of have Hi, been in a questions for but is Keith.

is the that -- year-on-year? there sees so -- adds? new any actually new overall that end growth mentioned of you subscription we net decline. implying low the Scott, a unit you, instance just subscriptions Or see volume decline For slight is maybe sub guidance where basically Is could

Yes.

and your strength of the renewal With I our name got -- least rate, right at time. this Hamza

With size and base, of I our no, renewal the the rate don't see our of coming renewal overall strength overall subs down.

some see see could pressure, we're and that of volume unit new seeing the QX, I in think half no. the I second but coming don't the aggregate down,

has the high versus historical mid us on give you the of to sort it's pretty rate, how you And renewal trended that sort as of color think I Any of sort Got stable. like XX%. to can mentioned been range, it.

same in Yes, steady, it's really quarter. range. throughout the Hamza, stayed the It stayed

new Even -- business the about difference QX slowed as second first half the down I talked of of the and the half QX. between

as Even the stayed down across steady and steady timeframe, renewal stayed slowed during board. the pretty new business that rates the pretty

Okay. Thank you very much.

Welcome.

Thank you.

question Our comes Borg with from Stifel. Adam next

now is line open. Your

hear and I'm question. Hey taking thanks everyone's to glad the guys for safe.

M&A Just one on a quick philosophy.

and the most talked on to focus AEC side for being M&A on manufacturing. we've past, large the in -- the done So, about shifting potential part,

dislocations, a follow-up. love I market And latest thoughts. have potential would your current the given to I Just hear

Yes.

that side. we being we all that was are on the right? we construction the biggest side, on to pieces all talked our M&A needed very I I've large look done specifically, going specific So, markets. Certainly, like construction continue felt to got the we at about

will With supply our manufacturing, the manufacturing rethinking be five with accelerated think, the supply likely shakeup with next in chains their on focus that won't years with over opportunities growth all I numerous likely AEC for and that, things associated will could months organic themselves sorts look next continue. present of The inorganic people as at and opportunities activity. opportunistically in don't But XX that think we well.

position got act appropriate sheet. nice recurring in good We're year revenue a something we've could balance this on Fortunately, good us. be strong a think for to a We've got model. that we

in So future. immediately our we don't see anything

a know And just that Got Thanks. it. multiuser it. Got back till follow-up, as then licensing, quick pushed I got August.

Just curious great. feedback how Thanks and conversations there would color are going or any with so be much. customers,

because to need It I tell story. before I'm came to get you for just multiuser not There and preparing we're today. desperate customer in to two-factor a they rid while their to a use of that specifics. licenses, a move after going single-user attack. was got -- licenses a was malware

people, to that distributing really of over us needs. not us their you much So that they working the nice in you're and a your work-from-home to all faster are workers matter download it saw to it's coming log And bad to when a we've responding thing, can had place, trying works. right? on all named just and realizing the software users from an move office fact, As now customers

to people realize a was lot started multiuser multiuser. initially, So some it this things. of the in And, problems starting to them are was A exposed they die were getting has the cases, they for it panacea fact, were we And thought not other about that noise in down. crisis, that of to before lot having.

now, a could been of know what right for and head Times an people out will us does that excellent opportunity what benefits. seeing you And some if this. So to really right we're I as we it's named discussion the don't change, of now. that understand gets user But, have continue. to and for about are

there's only conversions around very done some few this So it's interesting We've days. point, a early but this. still conversations multiuser at

again. Thanks, Great.

welcome. You're

Adam. Thanks

Thanks Adam. safe. Stay

Thank you.

Our Brad comes from Zelnick next Credit question with Suisse.

Your line is now open.

BIM how it It's thinking usage echo of of the conversion? I temporary, working How the home? see longer me is much page around. to free given Docs. how this of so usage much fitting all XXX And from you given you And as mean, good term? for in. trial, you everyone My about sustainable Thanks are Great. see do guys. strong all I'll Design and well for question wishes the extended

Yes.

didn't do as help know, home. to we only -- access to paid the So you work program extended the drive did convergence, from people we it

do the project are they're going out customers work definitive -- fluidity them the a don't need any system they that. pretty are foresee they of our to way very didn't us how feel pull unless their happening. Remember, they they However, old up what can We really project once and working. that unlikely of remotely, and their of like, being that in I not to can that the back found started these to environments of with most go of

the commentary was we of with one is opening fact, very moving to us in said things In distributed a are more I that, explicit the that AECOM model.

we’re you were. we With be that to these things, we told And ready Autodesk? them, course, our definitively Are increasing going of usage.

some while way may customer’s So, back revert their to old working. of

do them We exposed significant they that come of It's previously. weren't expect to something really number of them changed. to out could aware they a this

in Andrew. in to Thanks, Autodesk a economic recovery? an expectations. And the tight supply, is talent maybe labor forcing relative follow-up much strength anticipation of regarding subscriptions retention due on the to and to hold just How a firms

what Brad, though – case. that’s them the hang use. to I drivers I’m to really it’s going Yeah. I on It's think to don’t are, have put say, people to a hard if the don’t even

are less more the you upstream that's where wake And shelter-in-place in and on had site more the shutdown impact the in and of – think lot process, more coronavirus. least a today used process. from manufacturing less I place taken think products job the the it's the -- floor that's largely and on design about the on our and if in at the

we -- at held one the XX renewed compelling only So a I well. of at, renews weekly not don't had significant active headcount nine, look is as partial statistics most in that we're sensing and I seats steady change We users. look has think,

or that up there's picking we're that work a underneath in workforce -- change changing to not the I'm products. so needs the not be And done the

Thanks. Great.

of pandemic. were usage thing The the trend -- starting places hit by to some that remember, first only weekly is active up the in

as we're this. people to starting come So opposite more of seeing actually side where their use are they the to

you. Thank

question, the Brad. for Thanks

Thank you.

from Our KeyBanc. Jason question Celino next with comes

Your line open. now is

to fitting in one One hear for guys. me it's everyone. Scott. and Hey from quick you Thank nice for

about coming it of low toggling growth. the mid spend the might – do? think the guidance, about spend spend to of maybe high guide think How to mid single-digit the down As for you to we the different about some ranges for end side, do you looks like on high the its

and our to the are last more some quickly suit, being of customers or we've and digitize the it high workforce making plays all, hope low that time. given keeping result our the been distributed The five the of a forced a in that I strange lead invest We'll plays you're It's between vary into got of end to over four end as Jason, as range. of R&D our first continue R&D, -- strong to well so the longer-term fact as don't investments spend well. The of the years. areas such right investment we've right

So to off foot now We're the also to going the is in take to investments. not invest construction. the on time gas R&D continue

to market think underpenetrated technology. by dramatically proven is a that that's be I

in invest there can your we value-add no digitizing to there. continue some the provide own areas. we'll secular to our in comp will that space. be And in continue of to We'll that growth to focus invest the And so customers. core change There's provide

to We expect, are be there about are and spend continuing management, diligent savings. you'd as

spend that it our ever and it there's think range way, shown a it's that face-to-face or months back the our last I obviously to it's levels stream get built be into have sales conduct into And don't across you by returns someone savings going away. had If don't historically. You spending with P&E us are business, to the a a table the of brainstorming the the X whether have based to sitting session. can anything, on transaction guidance been the sense, that's

events We've don't some to of through rationalization I to moved gotten our savings come So many expect of our We've that spend. online. fully back. marketing

I think online. many those of will stay

into think in. continue invest areas some to to in, that are and many of in So we're those continue will built core that the term. position. there's we're we're going I savings But -- And there investing privileged longer a

guidance. that in growth level our be through double-digit of is revenue the happening to high the disruption of with to show market able and marketplace expansion even So end

the So good I we're that in. feel about decision

growing in time that category. revenue a same puts factoring, elite and are us That's Yes. we fairly

the want to supports Given expect R&D getting the the of infrastructure in going this, we're that us we the from time is acceleration of that customers. digitization And what be the you other do. investing this to to side R&D and that's

the great. I appreciate thanks Okay, color again. Thank you. and

question, Thanks for the Jason.

Research. from Our next Zane Chrane Bernstein with comes question

Your line is now open.

at XXX% I impressed for Hey I with and renewal XXX% renewal the dollar guys, filling rate thanks net the it. there me range. was rate, to appreciate staying in

future? impressive flat trying some and PPP is from with little loans when the I a was do holding I'm have I'm employee retention from secondly, any just renewals tick what had you layoffs portion the the customer if once So current looking of study, to of could deadline loans? for RPO, year. have up passes you wondering bookings, then point in with for customers PPP maybe regarding churn And at roughly the more the the growth full base your you bit partial the that reconcile especially at pretty the idea maybe benefiting wondering billings those

tend is pipeline, you of there way before a could Or deals or you wondering, that? the weakening the is time many you. closing? take X if it if to pipeline in what So the I'm Thank average quarters know show the X, up, have be part quarters? X, the And to that in do how entry pipeline does to any

cover and I'll Zane. the a right. That's handle question. sales the first lot All pipeline Andrew one, there, take let cycle I'll to

as or XX% less define way sales. benefit On the -- is us no the XX% but it businesses first typically the that of you And to less, that and those stats segment program, seats single-site, XX business at of or I'll for earlier small has XX total one gave I smaller know, we driven there's and think our businesses. one, of employees that that of that targeting was course, small to look

monitor So been call smaller think board, of strong avoidance said are all request, of earlier, shelter by you then our to do sign them a have product. this course, have out I come piece the the that’s of Steve it's as revenue and Andrew though talked of active loan and as globe many It's back, of shown also inside short-term programs a into recession. is, hard and of we active rolled kind we them that What seeing -- dip went and overall of users users the or weekly we it course earlier not we whether how stream. our the saw another across stimulus benefited countries know see the have them stimulus about we also good but the and And that across renewals stayed time. had from

its answer, indicators seeing its direct because So not to we're but you do. give that. We know, we’ll to certainly, that a hard hard

terms up, regards a So of Asia in -- is all from of on new cascading, seen – we've to going things to question, right. are is general so starting with in turn business the what terms right in already pipeline pipeline, all how

already in APAC. grow we’re So pipeline seeing the

signs of starting Europe. We in that are see to

see further watching potential for in is yet seen around start given but get signs the only presages the which, positive and trends, you of the user that active which the we feel pretty our haven't weekly basis, each sign not by of year. the pipeline, from as country-by-country we've the from away We and new we a the by pipeline business seen way, the it trends, the U.S. the it's region but cadence terms we where we’re way do strength the going. in the a why pandemic, we And business further think for think of pipeline about building I

Yes.

billings our guide, at you it pace in down, I the first built And quarter. on a think low had the to out when been where of look guide. the seen that to couple a an bit I've that half there a we've second effect is the that. create modestly it color the what headwind come We've billings it change does scenarios is points continues other I'd the year. of throughout the from on multiyear of or And clearly in slow modeled that add that is having into bit

strong wishing Got have I it. rapid much. very recovery. very you and helpful. Thanks guys a That's Well,

Thank you.

you. Thank

at Lamba time now I the to like over for the the would remarks. call. end call back turn closing to We now for of are the Abhey

you you thanks, and Thanks look everybody, joining any please meantime, seeing joining for many Analyst us at Yes. out of have Day week the reach Thanks, Joelle, forward questions. In today. if on next for us X. to We our today. June

Thank you.

and this concludes you today's participating. Ladies for Thank gentlemen, call. conference

You disconnect. may now