Autodesk (ADSK) 29 Feb 242024 Q4 Earnings call transcript

Thank you for standing by, and welcome to Autodesk's Fourth Quarter and Full Year Fiscal 2024 Results Conference Call. [Operator Instructions] I would like to hand the call over to Simon Mays-Smith, Vice President, Investor Relations. Please go ahead.

Thanks, operator, and good afternoon. Thanks for joining our conference call to discuss the fourth quarter and full year fiscal '24 results.

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

call, will today's forward-looking differ factors Form cause that recent events this SEC assumptions, differ with our and During we Please statements. filings products from and important including materially. for actual and Form related including the outlook our strategies. to Actual refer or most release XX-Q could to make results our those may our forward-looking in risks filed results X-K press and statements, other

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

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

again model the and and economic different welcome, our later the mitigating expensive the everyone, and opportunity and financial product you, to revenue regions having comes strong benefits rates on macroeconomic bid its significant with of competitive from geopolitical risks robust its recent through and a industries. Renewal Thank realize and Simon, we deployment delivering growth and call. channel new the year focused optimism on. remain performance. business Autodesk's We XX% make catch-up strategy diversification, Autodesk and subscription cycle investments leading growth and which its policy customer in business while fourth underpinned balances from activity cautious to Resilience, growing quarter across execution and and 'XX. discipline headwinds usage, partners. Disciplined enable finished the indicators the quarters. strongly, growth currency Despite saw constant of fiscal consistent capital of strategic ongoing record and BuildingConnected to were resiliency

and transaction has Autodesk At at led with go-to-market our customers data-driven will old multiyear direct with products new more industry models, core. updating we and and a to the same Autodesk's lifecycle connected infrastructure, to we are the and and modernizing we process solutions shared create which again advancing relationships Autodesk, these and within by is the to systems Model XD motion, getting the develop its enable design Together, its our our model, where in durable between final customers valuable, ecosystem. closer language. Data services are and our Autodesk to leap XD involved and the generative is and of transformational cloud, leading ChatGPT services. Having a were retiring phase partners With AI design, business in powered and is platform approaching building industry where make more generative AI. time,

enable more available design and with already partnerships We from with adjacent data acquisitions higher to and faster and our and automate images vastly quality designs AI. We're tasks repetitive existing currently representations XD will XXx verticals. generate bolstering high-value capabilities and models foundation make consistency. and than the can generate homegrown and through and multimodal in rapidly new Our greater much more customers with complex low-value

and executing deploying Payapps integration bidirectional and focus recent good acquisition the underpin and examples. Discipline strategy Cadence are capital Our also our with when our Fusion of of opportunity.

enabling lifecycle unleash which with Entertainment, our AEC, resources down capabilities, and will turn and for & customers clouds in solutions break platform will and the back update to our manufacturing, quarterly And including you to I'll the built and to fulfill silos go-to-market then margin within Media services, on to for efficiency free initiatives. up will Debbie and their take within call go-to-market data potential a and come our drive over further financial all. I initiatives through platform and sustained greater between AI guidance fiscal motion, our even growth its you improvement. now velocity Our will invest and to performance better and world to 'XX. design strategic Autodesk Autodesk, operational a industry modernized

Thanks, Andrew.

EBAs, constant renewals some and the transition upfront offset Autodesk to America. the declined market EBAs quarter drove to in grew the conditions Manufacturing or as Our billings revenue and of quarter, Enterprise year that and fourth XX% within Store. the M&E fiscal year, growth. grew from the to underlying of billings Overall revenue APAC. Direct North X at Enterprise in By EBA strong, Americas, constant expectations revenue growth strong range and percentage were benefited XX% in constant in was federal X% revenue. Business and our with revenue in financial few annual XXX% both revenue. By business. from grew our up Net X%, for though the revenue grew represented business in contracts for of with quarters. Total renewals up governments, some increased benefiting retention early and last XX% from AutoCAD from currency, currency, strong EMEA LT upfront XX% performance of points XX%, driving in revenue consistent last in total was AutoCAD and slightly from resulting particularly relative and both the XX%, and currency, Early AEC revenue and in revenue XX% exchange by from upfront Agreements the the revenue remained momentum revenue, XXX% and region in outperformance the rates. Billings Manufacturing X%. in multiyear true-up XX%, the grew expected, points X revenue upfront AEC in and percentage and constant product QX XX% rate

model, of modestly March of of increase some fiscal 'XX, renewals end QX fiscal the January. in beginning billings for of the in This American boosted our resulted to implementation we transaction part price our February. which As 'XX QX the from from to new North moving sequencing shifted

compared deferred decreased current $X.X annual renewals growth of RPO $X.X to expected for our contracts. $X current about line to X expectations, I when grew RPO The in largest to mentioned billings again QX, RPO quarter. our last of we and X% fiscal to 'XX, due the point when was contracts drove the when customers QX recent transition some closed result lower quarters billion Total of multiyear and multiyear saw contracts billion Total multiyear EBA. an year-over-year revenue XX%, deceleration of 'XX Early to ever in of to which decelerated billion, fiscal compared upfront from In with evidence of Total X% respectively. and growth. percentage RPO annual quarter. switching the mix we during

the while from gross University broadly of which in level were non-GAAP QX to quarter, we to margin fourth the the to GAAP and flagged modestly costs timing margin was Turning operating last lower shifting QX, Autodesk P&L. primarily due quarter.

in year-over-year, percentage non-GAAP basis due exchange at partly As rates, year constant expected, point points margin quarter stock-based compensation expect fall revenue. ratio of level or point a up full reduction compensation revenue operating course Fourth a to margin peaked about 'XX, time. percent lower in to year-over-year percentage XX up it about percent X fiscal speed, as to X rates. stock-based as and current but constant over was GAAP of At a we at operating of XX% and exchange was the

most annual respectively, will $X.XX flow flow full in was during billion, mechanically from the with our early free and significant from means few headwinds $XXX million rebuild year contracts 'XX quarter and quarter. flow for Free a transition The modest behind billings which are tailwind fourth over cash years. and for upfront the multiyear renewals providing cash us, free fiscal our to cash troughed next now the

allocation. Turning to capital

it manage focus actively capital discipline and and our drive to framework value. to continue within deploy cycle economic the long-term shareholder through We with

through from you and invest clouds we and enhance capabilities to platform acquisitions our them. As that to industry underpin the Andrew, and complementary heard organically continue

$XX an million price at During the purchased of average XXX,XXX approximately shares approximately per $XXX quarter, we share. for

have now our dilution offset fiscal program stock-based estimated well 'XX. into We from compensation

compensation to do from to repurchase to shares stock-based sense makes continue it will We opportunistically when so. offset dilution

during end robust fiscal 'XX Now fiscal in remained few drag and has the rate the the will demand new underlying and business on one-off services guidance. growth and products revenue Overall, growth long-term factors resilience quarters. finish dragged market potential. let modestly last but Macroeconomic growth like its Autodesk's pretty reinforce demand consistent over its and with Hollywood on me writer's strike for 'XX,

to want puts I X in revenue. growth highlight 'XX. to fiscal impacting takes and key Turning

I'll to to data, briefly help the Autodesk its First, with self-service transaction new let and to some earnings better talked and this shift, new earlier. of about customers understand closer, the me And which with and more Andrew to cornerstone predictability. partners. serve model. about more model about that the to more transaction relationships a It how think build illustrate deck be enables services slides direct will We've summarize. The talk data greater added them

a see from $XXX flow for contra to and and in fiscal million the as percent. neutral were free of to markets operating headwind and profit XX, transition As and cash operating made 'XX drives as revenue higher Slide you can dollars cost, resellers About broadly developed mechanically is to payments margin accounted revenue.

rate will that sales model, pace change determined transaction expense foreseeable note from will new business recognition before. shift model. shift the buy/sell transaction the moves materially substantial remain next all regional business revenue model equal, of than few different marketing to and this but subscription the business these of not our federal rollout else over the the timing of affects be the primarily will As a mechanical ratable build with majority to accounting and markets the government our on new years, payments of by emerging cost and of the for the The future. The

gained be insights model, predict While is relatively recognition expecting former latter to with rollout subscription the what this learn we our roll learn to easy business as and out year. by we out of model revenue which more part the roll further. We Australia, North will we ratable higher given over the builds America successful useful in time. volumes much from The we're as determined in in the

to able launch learnings be in EMEA. when will We those we apply

QX a transaction of Our provides 'XX to to to fiscal North tailwind in fiscal growth. percentage and America in about is X-point and the X point a assumes growth Autodesk's new revenue 'XX billings tailwind X- guidance deployed model

February Second, acquisition on closed is of 'XX. revenue growth fiscal Payapps, of about expected the to contribute which XX, point in X.X

exclude for pandemic This revenue expected payments 'XX 'XX. predictions, compared fiscal to post-pandemic we which from absence made X EBA fiscal guidance we revenue to expect EBA revenue EBA expect of during to a with 'XX and fiscal headwind this 'XX. 'XX, point line growth fiscal cohort true-up 'XX. FX of hedges into acquisitions, percentage exchange in the consumption of effect a X% true-up fiscal more Third, fiscal between which the means about fiscal the translates model, is in $X.XX pandemic, our $X.XX is the than new cohort to to XX% fiscal growth. And consumption 'XX. in all in expect Adjusting of smaller 'XX be revenue to true-up resulted which foreign billion fewer the XX% underlying in Token rolling token exceeded about grow in predictions reported fiscal consumption 'XX. Bringing the we echo transaction more fourth, about means in is payments point quarter X to midpoint tracking that FX our of revenue and headwind together, growth in revenue noise billion

improvement broadly non-GAAP Moving and 'XX. our manage XX% we expect fiscal means We're X margin to offset the margins of to by 'XX, model. margins. roughly XX% operating a on be a of underlying keeping with point the margin transaction fiscal between them with roughly range from the in new level headwinds goal This going will

operating people, revenue processes of transaction expense. We'll transition reseller model, incremental we and model to transaction to As free over us revenue, from new even have the will to see business operating that marketing from the costs we and transition incremental optimize further and dollars provide incur. we'll contra long term, investment income automation. the the anticipate the moving to But enable after change this also to costs flow sales to new a our which accounting expect in margin headwinds cash expect we we will tailwind

Moving on to free flow. cash

the month between fiscal transition. new generate the flow transaction $X.XX billion the will X outlook of Australia earlier to 'XX. in America, derisk we $X.X that also free be in accelerated the Because be not may of free cash renewals We North transaction Australia, expect billion flow quarters, rolled out In in channel billings some new year. America, ahead occurs to and partners it model transition cash model of the in and QX should for which accelerate behavior North may materially the in saw but the change to to

Excluding now billed from at $XXX flow free flow upfront free expect annually, 'XX, guidance. we midpoint in about which multiyear our of fiscal XX% 'XX cash from fiscal million are of billings, growth cash the

a cash because of in faster our expect contracts renewal return 'XX We cohort. EBA free flow cohort, of growth larger billed the multiyear fiscal of stacking largest annually and mechanical the multiyear

P&L. the As pace the navigate in new transaction will noise transition, of we rollout create the model the

of rebuilding at fiscal performance. billion, of is gives current So is billings course we think the our and midpoint At is for of climate free free 'XX flow $X.XX with enviable Autodesk macroeconomic, approximately to the cash for an we context best health cash policy, of in mechanical measure cash our and transition speed, line estimates. In which free consensus uncertainty, certainty. flow multiyear geopolitical, estimate source the our as significant flow and the annual contracts visibility

We of of goal a using a continue XX with to reaching more over XX% framework our business or Rule manage time.

modeling cash framework steps toward slide assumptions the taking are of and balance is between website and valuable deck to strong back compounding significant full the of world, you. on more 'XX. Andrew, companies to and and We We them. flow intend the next. QX this Rule year has the details most free goal fiscal remain in for our our XX on growth we The of in captured hallmark margins year this think one

Thank you, Debbie.

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

and We momentum of interest consolidating breadth execution handover continue through cornerstone our customers footprint in expand reach onto of connect in siloed workload into good our enables the and end-to-end the optimize The through to This solutions to operations. AEC, that comprehensive capability construction to and our previously solutions encompassing fueled infrastructure particularly construction, extend also infrastructure into is by pre-construction, design, our us cloud. field see growing into connected further mid-market. and and

and a momentum, closed record of sign worldwide deals million $X construction United growing this a accounts As in of that we the States XXX,XXX and number in during over quarter.

you Let a me examples. give few

With agreement abroad. been from of business business BIM VINCI fourth approach, drive Autodesk and in leader QX, to more leveraging energy as a projects solutions deployment data concessions, practice, its captured a construction time and streamline In Cloud and construction. renewed its world achieved platform ensure a and VINCI its seamless Revit further standard design workflows integrate Construction and and VINCI, Autodesk the has operations First, international significant enterprise major customizations a transition expansion. has annually to Autodesk expanding with on through savings

transition a based infrastructure of In selected software Cloud confidence which in project have and our gained powering technology for stories its pilot pilot X-month to third, XXX Second, our assessments decreasing Map we all on and way, ecosystem. Again, during after Construction a primary multiyear of firm its to managed early and to Fortis across through the ENR tool Oregon, the and design, processes Construction the platform, the open competitive the the Pennsylvania Autodesk's enabling Cloud cloud. a delivery increase expect Autodesk between and and center, recently due that RFP ran peer thorough chose risk. delivery an to this Department we process construction. And a connected sustainability Autodesk build, projects Fortis in people, year, a QX manage project efficiency alignment Managing Transportation time, be industry the will part remain Road projects to large committed construction a Over common state. the focused and these project of the operate Construction in across agreement vision close collaboration with life theme. while as data in inclusive cycle majority preconstruction

after Payapps, contractor With subcontractors acquisition take an payments. management in average a the work place. compliance life project putting of or on owner bid into project cycle. of a of can if get slow for payment a for embed XX the paid many And Autodesk and will the has not reputation risk, general to It days will because an

eases burden Our leverage more and goal construction in faster process to management stakeholders. simpler, is all a technology for the of that payment efficient construction project

manufacturing. signed into to more studio and and through continue the Design continue on a faster connected and OEMs a develop and a to leveraged ROI Make their its the prototyping to U.S., beyond customization progress leading its to We much manufacturer invest data cycle. In automotive strategic shorten Autodesk exploring design Moving new as Autodesk make in Fusion Through footprint consolidate made transformations and our and life. on excellent Services product QX in In grow to it resilient. factory expanded Platform using their connected business that its design connect platform VR Customers tools grow Solutions, design our studio Construction greater and digital delivered Cloud our federation. automotive, data increasing AEC manufacturing factories of bring it significantly and initiatives. the EBA to adoption factories handoffs to is in we durations to

design the largest of some of both in serve and and our with factories. make world the manufacturers the to as full continue We products breadth they portfolio

its Manufacturing the digitization and AEC clean the plastic fastest-growing manufacturing Cloud the in rework and it build EBA one building in of factories. Fusion assembly leverages QX, by its our and products. installation and with metadata, recognize their the for and industry portfolio, our Revit Fusion, partnership XXX,XXX and One the of efficiency, breakout increased by sustainability number including driven XX%. To of the instructions reduce workflows quarter ended remains which helped BIM manufacturers growing Moldflow, our in Autodesk Advanced products the solutions, resilience plan of within Collections, value who including cloud-based to its expand Powermill the energy of U.S. largest Autodesk private has customer with design Construction utilizes beyond subscribers, support to enhancing customers organization. the In

As capabilities adoption of higher we're drive through serve the value market extensions. segments by of breadth expand, larger professional beginning and and depth and companies Fusion's the features to

change become to to and we do will performance complete subscriptions realize that. commercial will our this, Fusion's relative indicators we reflect of reporting As the value less can

are we to engineering fall, a easily solutions. analysis Delaware to the in and Fusion University because Fusion to preparing XXX resources to it education, adopted integrated In and thanks students In and CAM. more use the competitor's replacing of design, solution. chosen better selected future next-generation was innovation learn teaching simulation drive to class, through manufacturing engineers collaboration, team an for single introduction available provided a facilitated was CAD, platform than

transitioned longer compliance model. and And was for remains access. software. customers our Autodesk most lastly, we conducted audit user transformation propensity the using has with than Flex as opportunity to free from of runway to evolve and generation. cash ensure an and continued with named vectors. collaboration versions more success more executing customers to In understand XX%. Autodesk work continue a usage risk team, and curious the relentlessly trusted increase broader, durable it partnerships better growth it resulting again, forge our innovate. new preventative combination areas new they resilient It annual taking added secure Time Built diverse with and latest of American QX, to and a desire In identify to pharmaceutical with and more and company our in and spend look and portfolio, our of of own a trial business, our also subscription compliant giving enables an growth flow tokens to and strategic products are to ensure remains license in is construct our Flex its more a

up We questions. would purpose optimism. Operator, with for focus, the are future building call and open we the

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

maybe with you. just Andrew, start to

engineering very it's the about provide about more Autodesk bit to saying what how just generative which And on asked. are generative can of sort about little to sure on Maybe a AI but customers call, make great Can of talked you I'm your question that the core sure about value journey? talk hear. is AI? long sort just is this that discussion, think do a you You

Yes.

it it's leader generative market in just So intent like clear XX AI, years be the off, our generative were that first design ago. make let me in we over to

to intend lean we heavily. So into this pretty

and into our since came the It's existence for delivering a commentary in products from. But a where now. of manufacturing been XXXX. Fusion, that's released, it's also, the has AI for some our [indiscernible] just about the several research I very been core drawing lab to things in some we've stack, AI allows high to people which contributing talked which customers. opening been automate compelling labor-intensive It's years automation Our in a drawing productivity is driver effort of

productivity terms asking, in the kind So you they They're are of look are What going increases. use saying those to data to us, to what productivity to productivity to our And of our deliver for deliver looking are they're going what to going how you this? one, increases. like? increases customers are

we're how to be today. to our one more customers the One basically have is Now is going to workflows going be they here. capabilities disruptive the that going automating in avenues other we're how of going to and is work. be to do approaching two this. terms And There

have do different both. have will curves. levers, Both We have to adoption different value both

where concept I approaches for set from photographs model commentary create things initial a tools requirements. are them ideas disruptive the up specifications XD slate in with initially customers incomplete or our the talked about things and kind of our blank model and generating they a to for of models. that allow of do some for XD Some about from opening new models Those

of released any haven't that We yet.

technology. think just is important. some an private But right now, point, to disruptive something a release that it's we're important of, really will really and at That's We we beta. proud

lot are like creating what Automation. And to with and be complexity we take that of look Drawing delivering a to and Fusion outputs tools The a other going model also of process There the incredibly all XD technologies are it its going did sometimes adoption disruptive weeks more slower be that's take and using tools of more these who to customers days. or the going make a to in even are from currently to productive. months may tools,

both we're are are and on. areas are valid, important that focusing both avenues Both

Got it. Got also to it. Autodesk of you're my Debbie, Maybe recent is, makes that capture customers, as able can about That And the sense. some lot drive question you. provides for there? result. have out obviously sort lot value the a to customer you well. follow-up for as its a just talk of a been what little of which of maybe that might actions bit pricing behavior a

I a subscriptions. multiyear you think the model, of if in and think of forward? bit How there between that about at difference do X was all, going pricing sort little year impacting

Sure.

start first let's So with what did. we

this X% and X-point a a that are renewals. something for market for we've we while. factors talking for did on. market there's a couple about factors, So of a We about did going increase then things is increase With that been

of up much And RPO. Our we increase led renewals this to of of material as see coming, to QX, and to move sequence that was to transaction but around most and move free what early and we that price it goal we moved then an better the agency, renewal, what price don't the as differential we so But helpful to things price billings, for some before to change, for the flow. and gave of the model world. renewal did down a streamline with the we had cash a between current the increase need growth could model, point extra to revenue price was new delta. In overall transaction wasn't new that stretch. That's is timing increase, the the XX-point new with part the we pricing

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

from this expansion early transactional you direct the there guys, you the learning Maybe it. interesting before or prior learnings clearly the Australia. in and that the Be a model, you for with model. more customers? around from thanks, little customer have Maybe you're all the and bit partner adoption now have more And about usage it days talk of on anything have even early disclosures relationship, of with that direct relationship your or the that didn't feedback

Thanks, that Adam, Yes. for question.

reinforce First something off, just let here. me

for ways in to understand Two, account them is going So the a cloud-based one this, currently It's same the AI-driven the necessary our allow better and allow them benefits of all critical doing. ready what record lifecycles, of I And page why partners. it's a of can't understand of own This turn customers is the right? lot and collaborators doing own our more for don't their it transaction three, this. about here to relentless to that we're and because long-term a success customers our business, self-service of on right? capability it's term. One, make lot design, for deliver modernization sure part us to in to getting consultants ongoing that a expect want make a us customer we're we last in design really it's from to services for IP some make world and their a step It's have these customers. at unique partner point, we the in into big done solutions long with channel going journey we this we've to has all away our big Autodesk ones full to us going the

get same on that. it's kind on of the we So page that critical

impacts and actually we've X what little to a have we quarter Australia, regards the a we into process. bit. transactions because Mostly on lot, learn was It now direct With only about a right? did for at the it customer learn necessarily behavior. But didn't this put did point

frankly, during our process, rollout fact, the days map for XX correspond capabilities, kind enablement some some we Australia that we customers the learnings for of based road partners, Australia. And some delivered the impacts some some capabilities new relationship so our transaction actually how U.S. in with with things and updated and Autodesk. we systems of we In saw materials model this transaction their of on changed the by in the understand delayed also well they upgraded of kind to as of for

took bit we definitely we are even we things the few a prepared the a through bank think gave impactful. to that So we ourselves sure learnings on learned to finish more based be we up what were to better and make going little time that

That's a as great. follow-up. maybe just quick And

some You with DOTs. state talked success about

to and infrastructure state update be the about just the the Bill Innovyze, and part think union you opportunity push? and a on Infrastructure As stimulus continues a that quick of maybe give the kind of as there of deployed, broader the just quick

Yes.

you'll hear about our less little has just of Autodesk talk use a want a clear a be Larger EBA customers Solutions. word about right? us been name and Water So moving -- is I probably that. Water Construction to forward, and Solutions more successes. big adding are Water Innovyze the lot So bit part

there's obvious just was as not for reason think an before, so. is I that. if it Water more as important

is I movement, floods moving we of another water didn't people yet because Diego, San in expect water management and had all have think infrastructure just kind that where you're the California, wrong probably places. water flood aware in to that's

really want I there. heard something rebuild opening important in PennDOT, mentioned going on? and to right? respect. Since water What's into bit think of things, just a our our the the build going on kind it's EBAs a I choosing to to purity, big story enhance a need with to And about you what's point water water the all going scarcity, in continued of is to is types, of that moving you all commentary these of Why water people future. about that infrastructure general, some So infrastructure be little business solutions? PennDOT that's

these future. stacks They they be That's more roll the of to on? incorporate we're in future, kind their boom to and the Build kind Infrastructure help PennDOT our solutions looked kind invest created these at XX, of to the years portfolio was do. We to with an in part some transportation in the some and of the its vector modern important continues want chose tools. States. work to of That's we've future, XX the out of of move the of in trying of And as of need looked put Bill first money solutions out going step what What environment. they to solutions. the looked departments our another they want pay to at the into United modern what of that departments design they the make understand Infrastructure here in at of Because staff to how to to in attention transportation infrastructure end-to-end modernizing to that

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

relative question relating and put model. the first in I'd is the place systems the ask Andrew, systems transaction what to scale like volume. operational compensation And you've of to that concerns about and accounting and transactional your

added You more in 'XX, fiscal added 'XX. than subscriptions well you in over XXX,XXX fiscal

of certain growth over time. You've spoken expectations for volume

additions fiscal subscription maybe substantially do capacity So 'XX? in support the to us long-term Because more than now looking did expectations you're you to help the you growth volume place understand undoubtedly, that you that have? in have

Yes.

were since to internal our what exactly capacity is that the So and these increasing which infrastructure Jay, back scale, it the actually things of the and environments rolling trying of bolts It's at in is, nuts obviously, the Australia Autodesk various new we've about kind modernization just transaction and and been model out about of its that. the test then. we in to do office testing

processes move you're confident we we So forward. of that Because we get people's downstream that have to to us to we are not only operate be in to subscriptions and other to are make that being deeper and cascading capabilities right, a environment, scale. built the going at deeper of a transaction used types intend scale amount of as set able and that's very increase to we've allow but and significantly design processes, make

this a full-scale modernization just is this. new captures all of So aspects It's transactional not model effort inside of Autodesk modernization that a effort.

understand get rollout, yet the is on test systems U.S. to thing the a good where we're the modernization going us first, under and of volume on It more the than with is level just full-scale live at the that next of just the hood this before we Autodesk. what's we're another allows of it year doing about volume this capacity going to the And cascading again, and with know capture. way we're a transaction go that is model. at rollout But, the

Yes. Understood.

road or product existing that tools? the as months the Either back sessions you at Second question upon and are year? deliverables various we products Revit terms what new to about concerns When think products few the do a that improving of sessions or this other and talked map technology. such AU you product expanding in think executable ago, critical aiming you're for

Yes.

just okay. So I'll few a hit here,

to from up of have that is teams the team. for Fusion First thing capability year manufacturing, the the part Design help off, to critical supporting for all we business the our needs in full-scale to move engineering happen example, improve this to way Make in and Fusion, really small

second to move going that data make set we to processes people with us in to So the is solutions, AI-based the base choose of way, important our more the ensuring internal management products. solutions end-to-end sure the customer with our up smart boom like That's associated which into the solution scaling around we're of built the smart our combination size be for in an that of companies a some partnering sophisticated, to Fusion But Fusion we're able installations product basically do capabilities capability EBA with sophisticated that enhancement. of for built as people attract regards to our inside We've as because things that We we more Fusion people through get effort. There's And enough and with Fusion. the can want Fusion. productivity well the products. that a up get with a with things certain smart ancillary these cloud-based when products. basically to effort partnerships Cadence a the definitely of be

we Now when our sure this to exchange isn't that truth as that one of products is things world. and matter going customers dance more achieve data together we work and work a the that, also adopt they it nobody here. the of the way that together else ways they use huge are And a because sure important Forma some in year Fusion is kind the that these comes they Forma amount as people what away. And of can forward Forma into do. two as that collaborative efficient interoperate that in Revit is Fusion play doing and make Revit the do to work with in make It's in move is more and need to cloud, together that as they Revit really Forma, of move try to

So capability look, Revit its increase really for us Forma the I to not with but only as is increase important. which to well, relationship think

of that types the environment. top complex special moving really the some to new Entertainment, say, doing big thing Media the is just and team have our Media goal possibilities make to with what last I'll to and customers continue post-production is script Flow and our screen real solutions year Flow into see of to management, for customers in full Entertainment production we're a around The take production help with to on beyond we industry regards capabilities the real filmmaking really platform. And integrating and of that's management effects make of single this for

of from comes question Joe next of the Baird. line Our Vruwink

the over you think of to the now end range. which, Autodesk I for To XX%. stage is given XX% what of XX%, nature wanted would markets that typically or points maybe the a businesses rates to long point set holding to closer course, arc that are has bottoming you in bottoming When is they that the cycle. exposed certain to indications your the the bottoming is conceptually, XXXX this markets your watching ultimately, reach in is case, ask, after XX% about framed of growth a point. coming over And obviously their as being scenario, to given troughing guidance if perhaps that are do just that and maybe so expect, quarters? time you recovery

Yes.

So thanks.

in be to midpoint is So macroeconomic where currency. And opportunities 'XX as XX% range our was right, we to algorithm. XX% coming the to said off right that that we And revenue we XX% end well us as in to growth going the what upon year XX% before continue ability to the so where we've that XX% you're manufacturing across and growth operate did fiscal constant AEC, really, up on. a target contingent we XX% is have at we for that backdrop that that harvest in

with that a for now. some we talking or about And so been we've the midpoint watching the we're things XX% things that this of as year proceed through that while

this performance So relatively company. And was indicator with said new last quarters. consistent grew, business in revenue what is for business really but new an of growth we've future that that we over to previous had it the the -- quarter important seen several growth soft,

XX% impacted being one revenue the by So 'XX. and that's of that's definitely macro growth factors fiscal the in midpoint driving

continue So watch to we'll that closely.

channel we seeing watch We of what on also trying watch stay in to and our usage. close understand demand. platform, partners, bidding We BuildingConnected product to their our they're activity terms

to be watching that are those see beyond. and things going the we're So year to how this progresses

on wanted cash then flow. to helpful. I And the Okay. up follow That's free

comes out in 'XX in Just year. I of not like I billion, billion linear, for linear. It FY there this out quite benefit any that be bit XXXX. last heard the million then -- point, Did $X.XX normalize the for that 'XX I comment maybe and and At of would a $XXX was guess the going the it's actually was I XXXX as if kind progression the a at effect is course, fiscal you $X.XX there. think to of that one year change look seem FY modeling color something stronger. progression? between that

Joe. Nothing's changed,

'XX would you And we you have fiscal in upfront. 'XX fiscal just grow to remove that that think remember contracts flow said than fiscal rate, modeling in growth saw we we've cash before we anticipate million what selling greater that it's, stopped 'XX. about $XXX So when the to multiyear in

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

Maybe first for Andrew.

yours. Just on great of partner a They acquisition were Payapps. the of

what on decision extending drove to the versus curious Just them partnership? just the acquire outright

Yes. All right.

$X been highlight had the construction both Construction let's, to health going high really So saw our about increase million construction. At for because U.S. general of which deals, level, in quarter is internationally. it's a for important great little you up and long-term We in what's the on I we largest door kind really there. construction. EBA saw a opened a strong let's growth in since think the there, deals accounts, talk in important an of $XXX,XXX also bit and

really that with end And and important. think sure our That's process customers' just of for make our in to Remember, right? we that's XX I in, end way comes customers payments where get want this planning their things we make, days solutions environment. long. here payoffs too and all the to from going to one preconstruction to types of processes. It the takes we're our into design, the where is other

to increase entire getting not we're days helping cash their transaction their cycle of our to something we're those the XX they can integrate payments getting What the flows. them we business into is get and This that so quicker automate life and across has into Now business. be doing faster into tightly return, that solution. we're reduce track be

into this what rebuilt which Autodesk of So we things. acquired is some intend of doing for Build, these a like we solutions to the other is modern tightly platform some -- today this in we in, new just integrate previously

there was small So a what we we It's I it's global we to really And went it. that's not It's premium company. this a It's afford. payment It's asset. own And leader important in processors we bought not out a needed. thought a and so it very integrate we we important. leader. that then can could think what

critical forward to a Oregon, actually ended again of head-to-head highlight see that competing to but with which I little that, And a we fully competitive Autodesk. preconstruction tools construction more. as like deal And being maybe right period deal out a longer, well a this lot now, we cycles a when want was So tools. we pilot head-to-head look the up Fortis getting going we're deal our at see as that

we in driven kind what now right well. by momentums, So end-to-end acquisitions as like and see of solution business is the Payapps building our

business, we next we of see we don't the when year, acceleration. into So look deceleration forward see

my then that's No, very Debbie. for follow-up And helpful. quick Okay.

maybe the renewal Sorry growth and we to several Did if year. much points of I trying mention guide? this you missed did upfront it, 'XX but was the understand from decel any the strong just cohort in the I'm revenues? currency constant XX% then embedded how

Yes.

saw renewal early really have revenue billings to would strength had revenue. we about didn't any represented cohort that So an it more of impact on in have on And X of than that impact enterprise the the then point growth.

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

I you construction, about the both that you're Andrew. I'm pipeline teens. similar you think the perspective? year? last XX% frame us expecting Obviously, business talked just what Just of go-to-market seeing the us business? can help Is make acceleration. growing and Along question, lines if could is in the you term? mean I the changes this from believe, go-to-market on that revenue And on a made, be Jason's you're over an wondering you medium provide update how

Yes.

heading things into last some as fully now. up Those capabilities of There obviously not efforts into to back the the lined all the through the of of how to starting fully integration was The only business business integrated according business get-go, We those year want in to year. It's do year us went the to processes, year integrated. you are related Salesforce with past all were grow is off the and know, mainline plans from of integration but some we the slowdowns the the integrating the that. Salesforce. things. full So

we're one I up. the wanted seeing my of going that previous notice is you commentary in deal activity And things to

really is firming deals. the up we're well, more and in actually pipeline So

This of And really the starting us solution we that embrace we year, competitive, capabilities need more a be that what because more and this are in whole but this going we're these of a ask capabilities, end-to-end available in into project. deals because of important out is complexity years means a up into deal, to calling where some risk people construction especially are themselves places next they lock cost do showing and our leaning for the process. showing is delivering, XX competitive the what's which versus we're entire there driving weren't growth. heavily a preconstruction today. and we're up to are in this the we're before And part when People in. That's XX, leaning we're lot where of

integration So The and great I think past of moving the EBA pure a success forward that. we're into scale Salesforce. issues inside is execution mainline example

line build can And frame calls. But top helpful. of the been I've maybe and usual growth to and subs just a and around the apologies, between outlook relative that? Debbie, you're That's thinking factors FY growth how drivers for for up about the pricing you 'XX that follow-up jumping

Sure.

think growth roughly price/mix margin, we So margin it's volume about are or either from XX-XX typically trying to partner split is a we of it. and how target coming basically,

volume again, is roughly our target to across goal. price, So be fiscal in 'XX, to that continue XX-XX our do would and

one And new macroeconomic more Now there the was normal would in between environment. where are we how or certainly anticipate year, years to we've business it's vacillate other. past going growing slower than a talked our about this

those we hoping X, ahead, equally get we're volume and from to price. that across As roughly look growth coming

we're So about that's it. how thinking

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

your declining one pressure not of competitors a your ranks the you growth, impacting customers? seeing Are engineers. to first, that Or So due impact? projected of similar on seat mentioned is

there decline of our engineers. because not growth with any are We in out rates pressure a seeing associated

of moving a that were the of to people Design one and that's of touch. able pretty broad we because into really matter fact, we're Make a things As processes, important have swath

in, Fusion Also, space. with we manufacturing competitive products displace the in to continue especially

at affects to their seeing installations employment with Autodesk not basis. not times of that We because base. declining things optimizing rightsize their kind downsizing but we're do So they're to see customers try

right growth way math? very Is X.X% that ex the guidance basic think in And thank on growth for is Got rate model, 'XX? acquisition 'XX, the the then you data you, transaction 'XX. the you you constant FX, point in for it, transaction for the and one about basically you EBA clear Is gave currency additional pieces on said the Debbie, that mentioned to model right it. press call. acquisitions In release, that moving to guidance for adjusting XX.X% the and in EBA

the point transaction what tailwind true-ups. point So point X.X talked EBA acquisitions we headwind from absence about of X FX, headwind from X point of tailwind and from model. was new X of the of of from

that X.X So is point, the net of so effect yes.

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

What do the that today? the what the kind low can of would, in about end drive range? the low you of concerned would that what you end the you of range? to crystal the you you part the see ball within macro. to that's Like is get I think macro are But assume of

to the we're that take be and would grows. watching shift, that laser-focused closely. then be that one of business demand conditions macroeconomic things We're watch lower something the impacted would of that continue end first to were That's We'll probably to on, and could range. new pretty us end the that market

were of course, if that highs. we that why it activity bid have be So to BuildingConnected take But on a and that's talk about an at record impact to us. continues on could turn,

our from monitor we the business. partners demand for what they're and then channel hearing be to seeing we're the sentiment how market that And our might understand impact end

of would things we that whether those at So or the not lower are inform could types range. of be end the the

those to of that of is or adjusting moving Okay. parts underlying X the I EBA part clear, least you out it then at guess that out I guidance netted in Is on kind there? rate? the get what, tailwind. was -- point through to didn't, you're I true-ups be it an other to throwing that And thought some went of when the just calc of to

Yes. Yes.

moving And sorry of here, been to has there's things. to last it back because few a to question go just and the lot parts

X headwind headwind it's acquisitions, X of the X the point of new a point So of revenue transaction from which EBA tailwind tailwind in point X.X from negative. for model, the net true-ups, is the FX, of point from guide, absence of and from

'XX. look net So we X.X fiscal the as headwind for guidance into negative

explain something guess, I I Okay. maybe they're right? up from lot number like constant XX that XX%. It one you just half that's what price? volume like or Your They're Maybe a you year, have coming coming currency if last half the by was more there's seems mean quick up, much there. for some Can subs. and from, on mix And one volume from that? from then the

to have like any our puts Yes. targeting and There's I our we're roughly we definitely effects. a XX-XX again. some and think that But volume mix is said, to going between that. 'XX, And when XX-XX mix we're guidance about But price. between takes in fiscal for year, target have given

of line Our Nay Soe Berenberg. next the of question Naing comes from

I've I was in I in that was Make XX% may. got around growth please. on positive the back XXX. Make development Starting you question Is rates forward? And two, growth ACC, segment, with, consistent currency it Fusion look comes there question. And revenue possibility the my lot mentioned the rates we on the That quarters. when past X in is first a to if will should second with developments to going been positive the about new at a the that your transaction how if model, constant revenue. the XXs like BuildingConnected, of Make in wondering at we products think it's go

you million of growth new commission And mentioned about then million. $XXX slide total. about mentioned percentage point X we which tailwind there's FY transaction reseller the of I in $XX you in think, from equated the Debbie, that you're deck, expecting 'XX,

so million in in flush FY take longer all $XXX 'XX? Or your remaining come it P&L? $XXX or to the that contract through sorry, revenue all or or will that the million So of through for -- will so

of things. couple a So

you first, were through. bit So little coming and a garbled

into and to pace and of at to million, the the first number really million quite during transition. I costs, business take on over take are model dictated model about new the by And and with most $XXX going $XXX think we get new go you which you'll good question, But, the important that and the the think is $XXX backs. the the model be bleed see model those million expense think things transaction pace a didn't revenue ahead rollout. we on call So the to is to about transaction as the how when away the time the we'll try

to going couple think be so And that's of revenue over expense and something into of as the it next years. bleeding

Right.

years model. would quarter, this mentioned in the it think to I implement take X new previous you about transaction

So cost totality? presumably, complete years this total to than revenue longer take $XXX million bleeding X into and in will

complete. take remember years will X year. X to But we that revenue over recognize transitioning the the So of invoicing approximately act approximately

So at the it's When going higher a revenue. to be little that. past the bleed invoices amount into

Right.

Fusion Understood. has the XX% the rate positive the XXX? to that Okay. past been XX% the around BuildingConnected quarters. around is The growth question past that my around given Make like we And developments Should products expect or in had we revenue. first to go the plus ACC consistent X back or

incremental over it's achieve an and goal target be to growth greater important our be from to area line. would investments. making XX% we've drive the to That's been algorithm where growth revenue Our an our to XX% Make going time, aspect of ability

revenue than higher the that anticipate rate to that, business. growth we be going So core is

and Q&A the turn today. now Ladies have to closing is Simon for for all call Sir? to Mays-Smith like gentlemen, I we time back the that would remarks.

We joining and for to in seeing the many conference everyone, much. look roads you, at Thanks you call Thank coming us. the later forward the of our year. weeks, very over on QX

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

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