3D design software firm posts big Q3 profit jump, targets $7 trillion construction market
Autodesk, Inc. on Thursday said third-quarter revenue for its AEC business segment grew 13 percent to $186 million, thanks to the “global adoption of building information modeling (BIM),” said Carl Bass, Autodesk CEO.
“I think we’ve been as clear as possible that we think [AEC demand is] being more led by C than by A,” Bass said during the third-quarter earnings call with analysts Thursday. “A lot of what we’re seeing is really construction customers retooling their technology base, and that the market for commercial construction has improved on a global basis. The anecdotal feedback we hear from our construction industry customers suggests it is the dawn of a new area in construction technology.”
The San Rafael, Calif.-based company, now focusing more on cloud- and mobile-based solutions, reported profit for the three months ended Oct. 31 nearly doubled to $57.6 million, or $0.25 per share, on sales of $555 million, a 1.3 percent increase.
Autodesk said it signed its largest BIM 360 enterprise deal worth over $1.5 million during the third quarter, Bass said, explaining the existing customer renewed its agreement for about 20 percent more in total billings in order to deploy the cloud-based BIM 360 software platform as part of a new strategic model.
“This is exactly the type of transaction that supports our long-term growth assumptions,” Bass said, according to Seeking Alpha’s earnings call transcript. “We’ve only scratched the surface of the construction industry, and we’re well-positioned to tap further into that $7 trillion market.”
Meanwhile, subscription revenue grew 8.4 percent to $257.7 million, while license and other revenue fell 4.1 percent to $297.5 million.
“With the recent introduction of more flexible license and service offerings, Autodesk will evolve to an even more recurring and ratable revenue business model,” said Bass.
Sales by business segment
- AEC – revenue grew 13 percent to $186 million
- Manufacturing – increased 8 percent to $142 million
- Platform Solutions and Emerging Business (PSEB) – fell 10 percent to $183 million
- Media and Entertainment (M&E) – dropped 9 percent to $44 million
- Americas – revenue fell 1 percent to $208 million
- EMEA – revenue increased 4 percent to $204 million
- Asia Pacific – revenue was flat at $143 million
- Emerging economies – revenue increased 6 percent to $84 million, representing 15 percent of total Q3 revenue
Autodesk is expecting fourth quarter adjusted earnings of $0.29-$0.36 per share, on revenue of $560 million-$580 million. That’s down from previous guidance issued in August of $0.36-$0.40 earnings per share, on revenue of $540 million-$555 million. The company said it also expects full-year adjusted per-share earnings of $1.55-$1.61 on revenue of $2.25 billion to $2.27 billion.