Schnitger Corporation

Autodesk restructures to better deal with economic climate

Autodesk announced today that it would lay off 750 people (10% of staff) and spin out its
location-based services businesses (always an unusual fit) to save $130 million in annual
operating expenses. These measures are in addition to the cost-reduction initiatives
announced last November: a hiring freeze, business travel restrictions, and other
reductions in its operating expenses.

The company also offered updated guidance for the current quarter (recall that Autodesk’s
fourth quarter ends January 31) that show a lot of red ink depending on how you look at the
accounting. Net revenue for Q4 is now expected to be in the range of $475 million to $500
million, leading to a GAAP-basis loss per diluted share of between $0.12 and $0.05.
Excluding charges related to the cost-cutting measures, stock-based compensation and
other one-time charges, the company expects non-GAAP earnings per diluted share to be
in the range of $0.18 and $0.24. Note that whether one-time charges are included can be
the difference between a net loss and a net profit.

CEO Carl Bass gave the following statement in the press release: "Global economic
conditions continue to impact our end-user demand. Given the current uncertainty of the
economic environment, the cost savings initiatives we are implementing are prudent.
Autodesk has a strong cash position and leadership across multiple product sectors and
geographies. The company has experienced several economic downturns during its
26-year history, and like before, we fully expect to emerge from the downturn stronger,
more efficient, and more competitive."

Autodesk will announce final results on February 26, 2009.

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