Autodesk (ADSK) 21 Nov 232024 Q3 Earnings call transcript

Thank you for standing by, and welcome to Autodesk's Third Quarter Fiscal Year 2024 Earnings Conference Call. [Operator Instructions]

I would now like to hand the call over to VP of Investor Relations, Simon Mays-Smith. Please go ahead.

Thanks, operator, and good afternoon. our Autodesk's to fiscal joining quarter the for of results 'XX. you conference discuss call third Thank

On the line CEO, and with me are Clifford, CFO. Andrew our Debbie Anagnost, our

is live being Today's conference via call webcast. broadcast

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

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

assumptions, statements that Please models and cause to we results make based known from SEC the outlook, our and differ filings, related our and press judgment forward-looking our future our business materially. those refer capabilities, filed differ These forward-looking about During statements. in X-K our products statements factors may with today's to risks on most product this factors. reflect or may XX-Q call, Form important release, best Actual strategies. and results results actual currently events recent Form for our including other and could

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

in Relations financials as or numeric on website. call changes release or available referenced will supplemental otherwise We several are Investor quote our press during we this reconciled other our Excel financial each reference today's growth All materials represents numbers comparison. our non-GAAP call such discuss in noted, Unless performance. and are a year-on-year

call over And to now Andrew. the I will turn

competitive geopolitical underpinned opportunity call. the macroeconomic Resilience, policy Autodesk's and Thank and headwinds. you, Simon, to continued everyone, strong and financial despite and again performance welcome, discipline

have consistent and remained new many business strong quarters. have rates been largely trends for Renewal

and and medium-sized that business model has Kingdom; from Canada customers. growth that in in media our in enterprise deteriorating construction accelerating balanced means softness enable customers and subscription It and entertainment; the decelerating diversification from growing United has and balanced that momentum momentum smaller growth has Our that. in customer product our strength balanced

indicators activity cautious with from quarter, leading growing remain BuildingConnected and channel record partners. with bid Our optimism last consistent usage, on

and of while having to the capital cycle benefits deployment investments the Autodesk of economic mitigating expensive enables realize Disciplined strategy catch-up to significant risk and execution through its later. make focused strategic the of

As in Steve said of a introduced new Autodesk the with weeks across Flex, gives more partners. couple its ago. began testing at a model customers direct channel Investor Australia relationship model a closely more Day, transaction new we and with transaction product suite which its We our integrates for

The X and a the model growth, a transaction with operating to margins and closely Fusion, profit results other an to backwards. from broadly Services a result transaction other transaction term, companies and to the the In The model in be seen our and to actual agency free its our fiscal that all Assuming math. have costs the consequential. will and things, the on customers' operating industry the the in directly a neutral transaction Autodesk customer. platform. indirect clouds proceeds among data-driven launch partners percent In Forma globally. will and to revenue Autodesk, understand Autodesk in able being model to customers products model important our you industry will clouds: revenue on enabled build and the or services our and new near step already of transaction our to while connected our more mechanically markets to valuable, Platform Many cash flow more intend tailwind shift is operating new adopting step in model, taking as and we integrate provide transaction partners models new is contra new expected, major new our but and by, between quote 'XX customers workflows, 'XX, business Flow. path and dollars, transition provide in happens

by to cash optimization flow long revenue, up will transition enabled and the after of a free our platform. income tailwind this operating provide dollars, cost the term, building Over setting even

alongside And a I automate developing analyze there finally, AI, for technology Design our where there will from world we've is augment on, XX,XXX was we Autodesk working investing deliver end-to-end that better we're announced technologies more make Design data how made actionable work noncreative at no and customers And is and and their customers, surface We of opportunity and all. attendees, last transformation showed and Make and next-generation our University help agile services digital Make But in automation, enable Autodesk bite-sized and designed Autodesk been open to capabilities, data the will the access blocks week, than Services without and partners why augmentation to our chunks building years. AI Model. that's also them Data and their critical data. and analysis investing platform customers Autodesk of creative, build Think the the work, graph more tools enable services. via for several more Model in, Data in the products and data-driven Platform new our customers data data at make impactful. and are provide that of And that Autodesk as project and knowledge to chunks. extensible of actionable. and the services our services data Autodesk connected the make but which data APIs. are the offers valuable, These design, granular, Services that Platform and gives core are insights most accessible, is The

again, has more billings durable and our to direct transformation more from files and future and With and purpose run annual generation. and license a and business; we diverse from longer trusted perpetual customers; are from and outcomes, to indirect vectors; relentlessly well-executed transformation, given cloud, motions, with to and subscription, forged built brighter even flow resilient of free growth to desire from from evolve partnerships propensity growth desktop optimism. innovate. Autodesk with a building broader focus, go-to-market an a and data maintenance remains upfront more to with new Time and rate to Autodesk curious and cash added

are and transformation, That committed ongoing an environment automation contributions from from verticals scarcity, water was to reflected to increase in Autodesk Autodesk's our commitment supply construction customers EBA success with and performance. deploying labor is headwinds also our EBA disruption. quarter material and to overall their largest-ever the Our and chain record in signed during shortages

update strategic our growth the the back for and performance initiatives. on I turn call will quarterly over year. Debbie you now our financial to then guidance come through to take you to I'll

conditions the Thanks, of market last the momentum quarters. remained and business Andrew. underlying the Overall similar few to

incremental cohorts EBA handful performance Our financial in was third from a strong, true-up particularly revenue from large upfront and quarter of customers drove the our where upside.

results third expected, As size. quarter uplift significant with in QX we the the our a in co-termed in renewed called out deal deal

APAC, still the in variances single Americas; high revenue in XX% in which year's the revenue revenue. currency: revenue and M&E currency. X%, in COVID and digits AutoCAD XX%; reflects of in and excluding X% Total percent constant was impact and By grew X%, X%; manufacturing excluding LT currency: down and XX% region grew By constant revenue in revenue XX% XX% up grew grew in China. last constant EMEA; upfront grew AEC in in digits revenue upfront product in revenue; lockdown AutoCAD and variances double

XX% and XX% from of EBAs increased points strong the revenue revenue, up last Direct growth from both total eStore. year, percentage represented X in benefiting and

in to and $X.X the from constant billings increased We to Net upfront both rates. range had current rate Total of XXX% annual RPO billings proceeding within is of fiscal impact full expected. contracts billion second declining grew at third remained revenue $X The exchange our broadly retention billion XX%. which resulted the transition Total to X% for multiyear quarter, billion. quarter XXX% $X.X RPO in deferred XX%. revenue as

ever fiscal to largest as Excluding in in due the contracts when decelerated to 'XX. to 'XX compared when mix RPO lower fiscal growth modestly expected, of tailwind QX, EBA, multiyear mostly total from QX, compared the our

increased, University third gross and last to by due non-GAAP the XX%. Turning note this shifted of timing to continued that driven the the level the Autodesk the have costs also discipline. quarter growth year quarter broadly revenue cost P&L. event. with year to Non-GAAP GAAP and operating I'd fourth remained at from associated margin margin

Free annual billings in to from was the earlier multiyear million for this $XX the by cash third and payment upfront flow transition quarter, of year. the primarily we contracts limited discussed taxes federal

Turning to capital allocation.

continue framework. actively capital within We manage our to

economic Our capital through cycle. We disciplined and deployment uncertainty. period during the remain vigilant of underpinned macroeconomic this strategy is by focused

price of to XXX,XXX them. $XXX acquisitions and As organically $XXX and capabilities share. We and for per platform heard our invest Andrew, approximately cloud from an and we in at million, average you shares services, services that underpin continue the purchased approximately through

accelerate compensation We opportunistically dilution makes when repurchases from it do will to program our continue sense offset to so. stock-based to

finish with Now guidance. let me

headwind is and and is headline This slightly end our our generally that expectations. revenue, slightly a of towards share expected. overall the markets earnings guidance have we to flow. better the share per of modeled this are has a flow keeping at more billings beginning backdrop, year. of income and we and business cash expansions range trending higher FX means at interest to cash our we been tailwind possible earnings of The of the outcomes slightly been of while free than the the revenue. the end Incrementally, competitive been co-terming raising guidance. per end of more And performance EBA tailwind a more our constant billings free Against to have are

year. summarize to the I'd like factors we've this so highlighted far key

proportionately eye previous again as still EBA impact of and margins embedded customers for lock and regarding enter third of the cash you'd customers obligations, We're the in would discount. the of unbilled quarter, fourth revenue, switch significant quarter. our billings, it upfront contracts, movements performance All if evidence Deferred the comments renewals annual of applicable. switch quarters reduce in as are our portion without total remain I've during contracts foreign free growth negatively RPO given else multiyear create some obligations for the would keeping price flow XXXX remaining multiyear to multiyear total more and the most drive on billings expect, remaining the to The rates. equal, the opportunities an Annual annual impact unchanged. performance exchange revenue, are made to current removal We annual upfront contracts. from saw and adoption fiscal customers cohort, switching broadly upsell we it us and

expect Putting together, billion. now be to that we revenue $X.XX and between all $X.XX billion fiscal 'XX

operating 'XX levels, margin improvement, We be to FX currency expect by margins offset to constant with non-GAAP similar headwinds. fiscal

and $X.XX the earnings $X.XX. to guidance, for revenue higher between flow reflect To increasing per cash free $X.XX expect non-GAAP be We share we're to be range billion. billion $X.X between and guidance

remains guidance given billings headwinds for in the EBA further the foreign exchange quarter. Our potential co-terming unchanged fourth incremental and

The assumptions 'XX. our slide year deck on modeling website for QX more fiscal on details full has and

using goal to captured in Rule continue Rule remain this hallmark free is We framework a XX margins balance the XX valuable XX% cash world, reaching business one and think of or time. them. of with of growth our flow We companies in a more to compounding framework the over and the intend strong between the of of manage most we

'XX last As think here the as put over and We've and we in behind fiscal we've to place them all I been linear. look into not to all all useful it's saying XX% of X about 'XX. particularly the the talked be path factors will one year, that quarters,

which new 'XX subscriber earlier, drag expect we the to in to EBA with revenue smaller the upfront headwinds renewal Slightly to less tailwind absence offsetting beyond. First, of revenue revenue that, payments on and a Andrew in new 'XX. are fiscal our true-up cohort growth, mix EBA model, discussed fiscal macroeconomic a be transaction and growth growth

revenue change or or growth about more. in we macroeconomic, at policy be other In more 'XX we'd fiscal words, Assuming environment, the expect least no around X% are material 'XX. or as in to fiscal same geopolitical the expecting growth now

built billings reduce free of upfront harder. came will will cash X make growth flow to free reported in QX means in not underlying $XXX that transition years recur multiyear fiscal about 'XX. and This million 'XX contracts fiscal cash flow from annual fiscal comparisons between in 'XX the second, that And the

growth largest faster 'XX multiyear If of fiscal free fiscal renewal an that as more cohort and fiscal flow the than cash 'XX. is fiscal free down cash free fiscal 'XX The stacking $XXX 'XX billings our free fiscal a the with cash flow mechanically to fiscal annual million basis, adjusted you make annually be progression will linear, it base will expected in from 'XX bit and converts flow generate although build comparable growth 'XX year. be to flow fiscal by 'XX more 'XX contracts adjust on significant cash underlying to in

As and fiscal pay attention quarterly you build we've each please said estimates, quarter during your to full fiscal 'XX year what 'XX.

new As the neutral Andrew operating tailwind flow growth and dollars speed likely to margin provide said, and a profit transaction to operating The be will a be of revenue each percent. be our on magnitude cash of to dependent headwind model free deployment. will broadly

transition than multiyear normal anticipate during trough transaction cash for in Excluding flow still will margin any are flow new be we planning in expect the half 'XX fiscal fiscal we model, fiscal annual first in fiscal cash for contracts. upfront be second half, to billings from we the And impact 'XX. improvement more free our 'XX 'XX. free from operating linearity Overall, to

we I 'XX when intend to Per guidance these comments usual, fiscal don't 'XX fiscal parse report before so we'll results, give then.

at and As number course, for supply compounded is harder tension, normal. and normal the visibility transition and fiscal contracts last environment March, certainty. customers. policy, source is our monetary extreme makes Investor of movements rates, possible uncertainty. for an in which our navigate flow the inflation, of as and, enviable policy, cash chains, geopolitical, events politics, operating Autodesk being geopolitical that uncertainty to annual factors weather of of climate and pandemic. this both our rebuilding thinking Day is of no policy, here control increased I generational multiyear outside new we exchange These the health there of to Autodesk by said range context, the Macroeconomic gives of the mechanical the billings free In outcomes, its I'm

time to said we've path will I to hope top you. the disciplined this the business XX% make this: meaningful goal be linear. it our to reiterate But why regardless consistently of between the growth or macroeconomic more feel and and me steps XX% Andrew, gives and toward balance you metric a driving managing to We're line cash backdrop. also flow delivering over right intend We better back understanding let that profit growth. the of this achieving strikes not

Debbie. you, Thank

you quarter. our Let the progress me finish by updating in third on

similar and cloud. momentum see to optimize previous in quarters. AEC, infrastructure fueled Market conditions We customers and solutions continue connect good in consolidating by particularly previously to transportation, our the water on to construction, workflows remain to siloed

generate strong sixth services WSP of EBA professional AEC one a millions testament WSP, customers. increased demanded dollars costs Leveraging impactful in reduced enduring QX, partnership. leading In delivered the clients, the and most importantly, and world's across efficiency, industries, breadth range with Autodesk, firms, services and our by results pipeline closed groundwork contracts capabilities, the our through to automation its manufacturing of comprehensive and its the bridge through of its for portfolio, has secured delivered of

infrastructure solutions supports industry production. TYPSA, easier Utilizing collaboration innovation, Collaborate responsible and clashes, thus a to consulting fewer Autodesk's harnessing sanitation, around coordinate Autodesk improve to all solutions clean is global and more effective water Autodesk BIM engineering to data infrastructure. bolster through to which Pro, of and of firm sustainable life types a development efficiently, manage, more goals design its and infrastructure, TYPSA plans quality exchange, are team and better contributing reviews. improved empowering execute and through TYPSA consumption projects

field and into MAUs construction design, XXX% Cloud customer over interest up seeing growing are again our end-to-end Autodesk preconstruction Construction execution in which encompass solutions, Encouragingly, operations. the and handover well in complete quarter. We to were

vision cost partnership, Cloud construction standout offerings needs Autodesk selected platform. an construction Autodesk over capabilities aligned preconstruction our In on serve evolving to the commitment With and differentiators, its and top has as our directly Elford, and of as the it XXX Ohio, marketplace. based QX, ENR contractor level in our competitive general our Inc., of solution Construction industry momentum the based the demonstrated chose ultimately in end-to-end

sustainability our transition Over majority increase a Again, cycle and managed data to risk. be enabling remain and to managing life all on have time, decreasing we through the industry focused across efficiency of people, these that stories common and project projects expect theme: this clouds. way, the processes we while

on invest and We Moving digital our and progress our make to Design their their to in and more to Customers resilient. transformations business made it continue on on Make platform to excellent initiatives. strategic consolidate grow manufacturing.

and the time Autodesk legacy software. reduce a and manager company molding its its with partnering process solutions and within had global technology For Autodesk's adopting eliminate example, to its by already industrial streamline risks based more is data U.S. to from to rapidly standardized programming CAM in process in The their significantly on customer innovate modernize Fusion business. Upchain

and renewed to quality, process an use product Vault it and its management our plans focus continues ability exploring existing cloud management, and its which life to service design, with life easy Upchain, sustainability Fusion's During threat and Fusion. supplier EBA QX, cycle into and Fusion digital its provide on closed-loop of customers. It cycle new initiatives, insight. management Autodesk to ecosystem is broaden for on-ramp enhance

For from example, subscriptions for named leading industry tokens to is to manufacturer users a maximize those migrating for users. Flex complementing occasional with and licenses agriculture the and value network access

time. to design. it its toolpath digital its and flexibility automation for and As to sure use its products right its needs, Autodesk's like explore factories its to Flex scale with the right the have digitizes for Flex based advanced it generative most the making global provides users at CAM create facilities, access usage technology, Fusion, the twins will on customer

connect more and the workflows quarter sustainability to cloud in Fusion continues with grow strongly, drive to the resilience. efficiency, as ending more subscribers, XXX,XXX customers

manufacturer factories. than connected XX%. In EBA into we automotive, and QX, our grow a footprint and to design continue In more its automotive leading expanded the renewed beyond studio by manufacturing

modeling Tracking and its Autodesk's of is and usage Flow to with layouts the the of In and departments its project design, factory Production expand VRED improve accelerate integrated modeling an internal for replacing across use evaluation, In implement it enhance concept design customer to and addition lighting simulation. performance. and Alias tool existing optimize factory will operational collaboration future, for communication to

education, manufacturing are we and to In preparing innovation design, engineers drive analysis solutions. future next-generation through

For accessible and and and CAM, numerous in has design positive and from seamlessly Behrend, its the with curriculum. to class activities Penn design Harrisburg in projects its for them to PSU outside allows CAE Harrisburg the collaborated State into enabling transition integrate is a in spaceflight inspiring Fusion on CAD Penn partnership Berks, campuses. mechanical classes applications, engineering making and adopted platform across impact have State students a applications. NASA University recently to plans Park classroom already example, CAM/CNC core design to our with NASA. project Fusion's a generative make at difference They industrial it

we analysis noncompliant meet that of frequency actual we logs, client a usage traded requirements. And latest customers of to and finally, and sync ensure software our with compliance. available approach sought necessary company features usage has maintaining they most directly proactive publicly versions management processes and by subscriptions construction in the identified software. are continue Through instances leveraging while and in plan. using based our SSO, the appropriate premium needs sign-on, A of software of ensured compliance the single usage minimize the client to streamline to collaborative our Japan recommended their access secure and number risks on This an

workflows to with and real-time cloud; relentlessly enterprise-level trusted and connected been evolve We've experiences; services; trusted to models and the curious, shared years build and partnerships. in desire a and immersive innovate. business for and data, extensible propensity AI teams and industry foundation remains platform Autodesk innovative laying with

and We purpose are optimism. focus, building the future with

for would questions. we to now the open like up Operator, call

the Instructions] of first Saket question of Barclays. Kalia line [Operator comes from Our

Any with new Okay. about said add? of the can particularly you transaction question Great. for this the new Andrew, you model, be, consequential as Lots in you. here, talk model. color Maybe why there would your is guess, as right I prepared first maybe remarks? right, here

Yes, absolutely.

talk built as Saket, in these start, going resilient. about we saying, We're and on. we've and up talking When me resilience, that's is through round trying transaction well. model, and been Let I really think important showing we're with the it's back And is this business to new future. by up the about results super this journey the into customers this to continue to first, our in what do

cloud-based connect We than our are less way powered in design all a AI before. never do that no cycle and that life trying they've move had make solutions to to by their connected of processes customers

XX-year-old Now systems to do models. and that, you absolutely use business cannot

journey one you've actually from here step to with modernize them. seen we on billings. kind mean steps we're been company. we've journey is So customers matches the to annualized to to products in models, journey modernizing this to We I subscription after and the important the of the so developing moving company the started cloud-based that the of company. most delivering modernize the relationship kind This of next technology that have relentless our

So cloud, customer, through with they engagement to the a this, as we're in account. not only an our going to direct use products the engagements them have with through have as we're customers direct going

customers We're understand an level not account collection us transactions several model that's information it whole the a that entity, capabilities going information help and give understand just our solution one better. And partners and will about of them them give at business Because about our And more not us through important. passed package. will will really as our only and customers, tiers. in more as up and significantly the to to it wrap

solutions the them. our integrate in customers important this from going that to the front in transition is to has going of to deploy to And other on They network partner cloud. [ are helping be here and our really new to part consequential partners solution-focused The thing Design for make incredibly is and Make transaction-focused design (sic) partners. move lines ] be

it's of very it's for consequential. very been stream on working it yes, do think long modernizations of So we've part And significant. a parcel and a I while, is and

you comments for your my But parse of out some parse I out 'XX. No, we it. comments you 'XX parts? know very on Got maybe to those Debbie, given you. said sounds maybe follow-up for Sorry ask, for a but... kind could moving It bit just fiscal fiscal wouldn't of strategic. absolutely. the

There a of moving parts, indeed are lot Saket.

thanks the the out know the of question details, I'll parse I everyone wants going but question. that I'm ask. things for to just called in that some we So not to commentary. the things of the new and growth the revenue, opening are things Those that . revenue headwinds are true-up year. non-recurrence on upfront growth. are subscriber drag macro the These all that's to next highlight all and EBA FX

about timing We to It on margin a on new details impact We'll long the we're move going and is to That's also a talked percent. success be depending per model. cash dollar the transaction will really for of and this a ourselves February revenue. margin the you this up the to flow is tailwind do neutral usual. remember, the set headwind what give over to term. in But be trying to all

of of comes line question Securities. Griffin the Vleeschhouwer Jay next Our from

you price of of growth? of and year, Based you of Saket's time? 'XX, at over combination fiscal terms growth various changed or Or on question, sources and Autodesk a in following sustainable XX% volume have mix for those thinking chart of Debbie, to you the that your up XX%. volume double-digit this of to meeting are growth on on the magnitude a showed So analyst adhering earlier sources of price plethora components, still depicting

to more. environment. is that really growth. we growth dealing points over growth, talked all It's as we're the last do do we've know on I what driving what revenue that that year growth the success we or as about of takes that puts sources of long term. really trying important market seen today X% assuming the next opening ourselves remember to quarters, well over based is those and the revenue And XX for we're what Really conditions set Jay, of to still of what's several up with targeting similar targeting is about are see XX And commentary. what in are to and those this parameters uncertain We

AUC and to of data for Andrew, up regard were and following AU particularly quite our the with number last useful week. on on you, on interesting There plans, maps road broadly more sessions product model. a and

So complex let you an me about ask question that. unavoidably

So call going quite ultimately you the detailed of the think Build that AC generally. or when the there's description those ACC of with or and gave packaging granular does composition and role of in you're about line that, what software? as And data, you affect presentations. no any of where you also But you implement consumption time

large of much So last are how you commercial making what in talked AU you the about about terms at technology a week GA of thinking particularly of AC? of very set new features, for

Yes.

Okay.

So first granular tackle thing that data. let around the with me the

path, together, Revit agency environment like currently usage And that is -- different, Fusion ultimately looks how white mainstream products. happen operates, much terms the So very in the those with they ultimately, X the is as you product what know, and than the you journey way products, in as all environment very exists down this interacts blend most of the Forma it an does it that the particular in become of our how do environment. what of

consume the for paradigm the So which leads use way actually a ultimately they a different and people product different data in to yes, that granular every engage products with day.

that's don't in. longer-term more given clear, you're your time presentation. I line in . Time exactly which the you are So presentation know questions, okay? line, suspect I

X- X-year show So to heard. a over the some lot frame up of you a with that of there is a the frame, in things saw to you lot X- to time of associated but was going time X-year stuff

earlier that I spectrum rather part were Now towards to think it's kind that of part spectrum. the of tell to of the which ones obvious later

combining solutions kind That Forma infrastructure and stuff, end. of these closer. with conceptual detailed probably can over have the the expectation more Getting of much and some probably them design road more solutions uniting some with our Turning into design, data infrastructure you towards of granular, those later and maps.

Our from line Borg of Stifel. of the next Adam question comes

yet smaller next we cohorts kind have for just curious take transition remind transition. still relative place overall are of billings are to could and you we that on kind just process those And are Or Awesome. to going some the where just if in if multiyear to us know for I that's and where do there just year. annual that expectations. Maybe the of process? that still to Debbie, of Maybe in is kind

Thanks. are much We're Customers well. as behaving are couple going Sure. in. a systems rollout we quarters of pretty partners expected. The The and is working.

line So performance the expectations. is overall, in our with

the journey. to is, a thing X-year remember, key the think at be we're beginning is kind this going This of I of journey.

we're going rebuild fiscal to 'XX. get also flow 'XX, next So we in free mechanical year, fiscal of cash have and a as into

So the are call some helping I headed the 'XX 'XX. cash comments into normalize made and that important, how you that about flow our is fiscal on to fiscal think of

we're in that that 'XX. in the the beginning million faster at So bigger 'XX, cohorts $XXX then that for in flow period. fiscal into we'll fiscal fact as 'XX have we of head fiscal moving drives cash free renewal And coming up broadly, growth which

interesting of and going to expect things flow see cash free from overall, rebuilding we're at are point we where well, this So mechanical here.

price how back AI Any question. to maybe Interesting Autodesk at AU from a think AI And any Got uplift commentary those announcements just second solutions. about with last on week. it.

Yes.

these I'll our features through take some will delivered products. and of one, that Adam. already Look, So are be existing

"Here's out now evolved models, quite where customers not I have in Obviously, the actual little talk to your However, do it's up individual exploring interesting be some as some highly But early we we'll there monetization. large the which are new with think a right offered these Microsoft to seeing market, are yet things too deployed of model. a, models are you're about capabilities. of with

it, future interesting going in custom really of data." train extend very train are models Those it you with to Now your it you look that like and explore and integrated several probably be possibilities of look last kind the end as products, and for it functionality as this for now, move forward. a to at we But with been existing has years. is the the going up lot we'll

Next of Vruwink of question Joe line comes from the Baird.

the strategy AI it need thinking new messaging last at the was Andrew, like I said, cloud Autodesk the But on maybe pointed automation customers Maybe this. just to how exact AI how little that and is just be think pertains a really gateway follow-up that and that more is data a as about capabilities Great. Autodesk. question. did you to and future not to

So feedback approach curious on to and my this or from question maybe any of customers levels buy-in. just resistance hear is

started the the aggregator customers being You've of to kind industry data hear just pertaining Autodesk pooling information. up of and ends their

Yes.

We're going to in ecosystem." also way in you trusted. do of is the make that you whole that the to it things to part take a with entire not we data, trust and to work view use going stance ecosystem that a "Look, you way a going become pursue high it's look, appropriately think to a of we better. the you preserve work we're And and that's important around, strong for We're point our intend to strong customers of your data. on it continue broad So you to with to that very and and ethical IP does have allows use that with

So of conversation benefits terms productivity customers. massive the I of with of some model many, this trade-off amounts automating obviously is in Most recognize between the creation many have there. a and

So maintain and participate sense that in them we're integrity make for to to that that they the do. looking ways actually and trust want

for that look to in So we this forward. as us exactly matter handle move

information. going as of shot But And at 'XX FY to question Great. best then my points well. take X I'm think clarification or maybe I Okay. additional

year the seasonality? numbers. you've normal of have removing about is having you currency B, a of lot on currency that will And the some does How sense comment? of modeling year. these we that with impacts Can just currency happened known I talked year. Part deferreds So what's normal A. cash a be X%-plus what provided? thinking then and imagine on then, rate that that you be kind reconcile probably of to Debbie, to next And because seasonality just the balance in sheet, on part into growth headwind next Should would good factor revenue given long-term about hit this free the flow you

Joe. Thanks, Sure.

So a it reasonable thinking first think you're on about I the way. question, in

been and really So expectations place. and think modeling more more 'XX take give will currency, should you it's fiscal And about on then have modeling as beyond. the it that reasonable out reasonable -- all a gosh, then you the $XXX over million

a it year. us next given could now, right would I think into think to that be right But really everybody volatility, is now head we What has it But been I for year. based headwind a is revenue seeing seeing we headwind that. next as it growth way. see either the go what on we're

of Citi. comes of next Tyler line from the Our Radke question

Okay. talked you're Cloud Could but within from areas record Autodesk elaborate what Great. customers are strongest you some construction the Construction think, the I side business, broadly, that? the within also of about you contribution of the Andrew, seeing EBAs.

softness Yes. seeing No. others may We're have construction What's the highlighted. that is. not in interesting

the other at lot are slowing we We that, And end some the down, going performance of on of business. you're top warehouse the seeing in have whereas you like things our In offsetting construction And business see seeing we're saw growth right incredibly things in a growth it. sectors office, things now. strong And internationally. fact, strong U.S. retail,

Again, the industrial, manufacturing, going health centers, construction on, up. of infrastructure, lots picking factory these care, all business, are of data Autodesk dynamicism things of

that we've highs look the activity that now. to are record our When board dynamics got the playing at at regards we of business right a have. with was look we lot business, indicators we construction Bid at So well again.

bid we activity So good a saw strong there.

University #X hire So that it's backlog at still declined can't And right? construction general hire was, all I the may thing have bit, enough." " contractors heard still high, Autodesk While I from can't enough. a

pace. at So they're slow a through be relatively that still to backlog working going

market interesting. I more ourselves more we're and them. And down interesting is really that's deals of seeing winning think competitive we're frankly, what's now, in some Also deals,

in we're deals I actually our slowing probably in think competitors that various activity. some But deal results markets. lot for of interesting more down a seeing

for ago ask dissect like trying does just That's that if quarters I a questions bridge a gave, have lot further. about when FY to your commentary. out doesn't going ago year helpful. based getting to to But I the 'XX. not appreciate of it think And macro to gave you seem few Relative you tailwinds you on that transactional that seems to it or Debbie. on to worsened has And from I'm follow-up the XX% X%, framework it you which a some like a relative changes. XX%

Just than help conservatism maybe us Is other or that mostly it are bridge. larger thinking currency understand we're or the some headwinds of about?

Sure. Yes.

got could year. talking is just year. that FX, finally, what we growth subscriber to a the right the as growth. assuming for all remember, factor have revenue about And true-up this nonrecurrence new been the with implication be So an been We're it has and to mentioned, revenue remember, we're headwind year about talking EBA you we've now. new be all given a about I the then next of recognition model upfront thinking that we have, macro than growth on subscriber for year more of And that today. drag seeing revenue revenue ratable growth revenue

the factors estimate So as head those more or next of X factors into are biggest our we X% year. driving

KeyBanc Celino line the Jason Capital Our of from next of Markets. question comes

the on one Maybe EBAs. Great.

expansions. Overall, better maybe but what these in So overarching some you're still pretty than true-ups, expanding than that renewals Is had the like it seeing cohort QX, timing any earlier some you the also maybe takeaway see anticipated? expected? sounds is big of did you happen

Jason. Thanks,

of these we usage. uncertain overall demand today, Fast the really their monitor the cohort That's contracts. That assumptions And are pandemic. usage has year, continuing great. to that in And forward at that height renewed performing environment been they through this customers last was on usage is all EBA late projects. the conservative as back manage then, at XXXX. So mentioned about we've for which has cohort been made Remember, the time. because higher a led to to the high do of well before, more a

top insight had we've as of be continued today. we upside got outlook, into which estimates, strong. the on We into signs cohort. as EBA year the at our the each and is EBA look has our renewals line to We've of that progressed. We've the and quarter factored potential update that's all remainder And of upgrade eye So our the latest this true-ups. this QX. we the what And communicated the large drove to continue

Okay. this year? this opportunity to you then like additional sounds next Great. then seeing is And seeing? this a you're an quarter, but water few asked funding strength flow, some Are that infrastructure be this I it time. might see intended this, the your of too? competitors for could the last starting pun to be of question already start Or maybe And

several starts DOTs and we've modernization of the that process was relationships with $XX that that's we was of where heard it million you things Department from only have but modernization bill modernization, competitors one about that significant also that evaluating the Jason, have the really, Transportation not is directed some on their in of Yes. these of and actually engaged that money was with displaced at that it may targeting of DOTs infrastructure and it's deeply.

shows exciting So pretty projects. to to money that's That starting flow the stuff.

this Washington, again, going of floodgates move us money But takes from time get And momentum it kind this comment. of for As forward. up said, floodgates that's takes of of I've the time release to oxymoron there. build kind -- into to help it always rest -- and the places the is of that an the Washington to projects money

So started, say would continues in getting more it I be there's but an opportunity. more hope for to projects. emerging future Projects the are even

of question comes of Bank next the Michael Our from of line Funk America.

could. I if Two, Yes.

of So first for last relationships with changes number you, Andrew. partner A year.

mentioned new the You model. transaction

commission front-end versus earlier more think you I also changed structure back to the end loaded.

these you're expect curious hearing your changes reaction that of to you impact partners So kind and how from relationship. what

Yes.

doesn't our bringing mean these going It on So to along a this. are with all obviously, we be happy invest in changes. partners partners lot

clear with very an happy that the to just It's we're them. for looking growth is outcome Okay? because many is these that what be partners are about But going been not path for we've is or likely. changes to

showed things kind led a these partners. incremental way. them we've them of really kind to taken that, approach Beyond with We the of along, our

it. You we with out might and network it model ago recall, new close about partner we rolled transaction experience everybody got years with X.X to Australia, to Flex broad-based the started the then in

Australia. in testing we're Now

making customers deliberate businesses work it's where for partners about and, really in what frankly, ultimately there's over business. and we bringing consequential support that. them them some in their closer trust. discussion with has this terms where this infrastructure of with and the will these to take to that the their make we lot and of there's the our along by partners Make significant a in an Design business on their partners services the our going and Again, consequential And their ways. in frankly, needs journeys And a discussions to the partners, means environment of take happen have lot very with created of time credibility more larger And more

check And one on you, just to the accounting Debbie. for Wanted math. of the

EBA in mentioned revenue, nonrecurrence You 'XX a fiscal few times.

X So pieces.

upsizing First, EBA, I the true-ups accounting. of over that the thought in with contract. was ratably the thought term I that recognized

year us on Just the items trying the then if second, 'XX, impact might 'XX just to those and number. over 'XX year And pull so how we actual you to carry from can think remind me, fiscal fiscal I'm that that that correcting accounting. can of out benefit

Sure.

recognize accounting we So upfront. the standpoint, true-ups from an

periods, And signs x future we of next of term, number differential tokens. they for unless tokens, in contract build again. X-year recognize doesn't contract them the up we utilize for more of allotted x exceed their number that as when an they tokens it than think the it in and So over upfront revenue customer the enterprise recur and

same sort is could nonetheless one-off, a that's in why recur that that we for contracts good something situation. but from ourselves if one-off years So it's found of only the one-off, a X these a now

the today benefit by about about guidance terms this upgrade the the into 'XX, the gotten driven then numbers. that we're being enterprise you overall largely from in we that haven't we And is business But seeing talked think of fiscal strength year. can exact to sizing

of Matt Hedberg next from RBC. line Our question comes the of

thinking this once growth pro curious forma you. help more the the maybe I'm the migrated sort from Maybe to term, has for What to either longer of the of so impact model? -- business you like revenue guess could revenue. us is with move if Flex I contra

-- go will the be growth to on it's going accelerates accelerate. which going how we it rollout. about Matt, is at revenue determined And to be based pace the

revenue we that launched as learning mentioned, we As Australia. next Australia ahead we as global right then intend on now. working launched year. to last from look just We We're to And we're year, in go Flex now. We make we But Australia will -- this. we're when it to to an set growth. be transition, we execute we sure closely. accelerator we aspects with finally is are which need up watching that why this for But all success, of on

conversions. Got quarter you it. mentioned -- pretty that. any And then some this don't that out? you last or noncompliant good I I think there quarter know about Was you recall saw called you talking

perform continue to noncompliant well We with conversions. our

heard think you've talk couple So I us a about things. of

conversion. deals I types think was earnings of smaller we've terms talking recall, stuff some we've quarter's historically volume product is deal and we larger still in more but last the that call, Andrew that's about as But closed, on I of deals driving for That's have happening. talked a Autodesk. are scale the doing in sizes, of on driving those that of significant been some about

driving compliance users, noncompliant a of continues be it time, means to revenue us time. continue steady from going contributor more growth and flex see over over to different So you're to drumbeat to our

Deutsche of Bank. of next Our line Shah comes question Bhavin from the

Great.

of kind [ of see kind looking Just ] the that kind more learnings following disruption model. of that about and what Australia on from rolling partner any kind to on think perspective? you new broadly from the of of kind up transaction app we before should last one Like are

the doing we're that so new we to do make after things pipeline enter see directly, make way deals up into with the partners they system going system. of and enter that able how their the them up that their sure they're to them get sure line into the the lined things trying one is Well, of they're because

these used of distributors mean, by be over I bars, taken Some partners. of by to our for some services

issues make point experience, sure this pretty well the we sure but make the know to going at systems. a things pilot. we that function. but into Flex works. things all We're that confidence want Flex volumes up, them the confident line lot in those We we -- and want We're offerings, go work, for we're up with that the Australia because large of mechanics to to sure there's deal, with work that of or we because there's want all be things particular no stress try when the testing dates just right, the It's with works test renewal all entering a those not make sure going the the it things. of to issues things, for partner the it product Again, to all make those We things. to have these to that people true or that are actually having of hiccups want

price the That's kind know your behind extensions. XXX, following on And and you kind helpful up extension down this road? next What's year, you price Is this about the adoption the this Fusion kind out of inform views as like? of into just are guys but XXX. list going rationale and the making the adjustments think some on And further rolling there. of kind on on of pricing this? the of the Forma to Fusion I raising kind rationalizing kind how does lowering drive to of

Yes.

customers us of We're directly a price doing we're have Fusion. value Fusion increase sure appropriately to some the are the So treated there we're connected the Bhavin, is long who in for and time with been fairly. what is delivering making

those to in But price Fusion looking should customer the a is to continue has attention to high is carefully. level increased to that increase. all The at to just the be paying value we're value dynamics. base we saw we things what So that more going

we extensions adoption the and And bit. of base the saw some base would the a the contracted that in is shifted little better of extensions of the to what value -- was some offering probably were see the price

of ownership do of it's types the kind this So particular customers. balancing all for time overall appropriate And to of cost it's it.

question JPMorgan. next Tusa the line of Our Steve from comes of

to to are flat? flat? we What about? that kind several of think -- macro type subscriber the of this growth. we you do macro on go then What what rate it the mentioned talking kind like And impact low go in take What to take you it the year? like of Is that would times. Just mid-single-digit talking range? would Are for

cash secondarily, just side. on And flow free then the

I put just number the cash that longer-term we on a 'XX. for insinuated from think grow at had kind set cash there the level Investor through that still chart view to track 'XX the Are still outlook? Day, in would in of on you that us longer-term

Yes.

What So want I Steve, let answer specific to little incredibly take me won't I our resilient. question business the the is first is a bit. say question.

have really differences resilience. that. pay attention We're of here. puts highlight to for I and the some to You built takes And in to want

small media businesses offset and And grew offset some and the entertainment mid-market. For from AEC instance, and the the U.S. and writers' you XX% the headwinds probably noticed offset actors' in to quarter. Market strikes that that Regionally, EBAs of the and Canada due U.K. segment-wise, strikes. India

think business this have You of the to framework. resilient through for built

And I your to Debbie lens on so little want part I'll a and of the then comment bit, let shift your second question.

is long addition make drive to our for on a the growth greater pretty Yes, of call. to this What for to on the greater go-to-market, new transaction comments and and flow going think trying 'XX to cash really in business term free is 'XX our the model, long the fiscal the and I term. up changed, and I going look, transform decisions we're to nothing revenue track But say, we're parse fiscal set I'm over outside over ourselves is not really shareholders. has this for do about beneficial success our for big smart to to but goals. would achieving decision company. It's us

for That Q&A the conference back all would to to time the for is Mays-Smith turn remarks. have I today. we now like Simon closing

us. Handing you. the Wishing and joining who Thanksgiving to for on and celebrate back weeks those Happy forward at catching over Latif. quarter's with much, it Thanks to next coming so you the earnings. everyone, a looking up road Thanks,

you today's Thank Thank participating. This you. conference concludes for call.

may disconnect. You now