Autodesk last week reported final figures for the quarter and year ended January 31, 2009
that were in line with its preannouncement.The company has always said that its
diversified approach (serving so many end-user industries around the world) would help to
insulate it from economic upheavals, but this one just appears to be too big to avoid.

To recap, Autodesk’s Q4 revenues were $489.8 million, down 18% from a year ago,
leading to a net loss of $105.3 million. For fiscal 2009, Autodesk reported revenue of
$2.315 billion, up 7% over fiscal 2008, hitting an all-time high.

But that was it for good news as CEO Carl Bass painted a gloomy picture of the current
business environment. "All aspects of our business are being impacted by this slowdown,"
said Bass. Revenue declines were spread across all business units and geographie.
When asked for more geographic detail on the analyst conference call, Bass provided the
only light moment of the afternoon by saying "that Antarctica and maybe Greenland were
unaffected but perhaps not Iceland as we have seen." More seriously he noted that,
"Maybe China or India…but I haven’t seen an unscathed territory out there." The company
did say that it still sees emerging economies as a key growth area for Autodesk – but not
right now as revenue from emerging countries declined 31% and represented 16% of total
revenue for the quarter.

Autodesk now expects Q1 revenue to continue trend down, guiding analysts to a range of
$400 million to $440 million, which would be a decrease of around 17% from Q1 2008
revenue of $508 million. Autodesk did not provide guidance for the remainder of the year.

Rather than repeating the endless financial data available in lots of places, here are a few
items of interest to a PLMish audience:

– The direct business held up better than that of the channel – not surprising since the
direct sales force deals with the largest accounts which are stressed, but not as badly as
the smaller companies served by resellers. Bass’ prepared remarks included a
recommitment by the company to its channel partners, as the company "work[s] closely
with [its] partners in a collaborative effort to fight through these economic headwinds." No
details were given.

– Bass said that he did not know what an appropriate expense level would be for
Autodesk, given current revenue projections, and said that he would monitor it carefully
during fiscal 2010. When an analyst on the call said that perhaps the company should
return to levels seen in 2002, Bass said "We need to size this business considerably
smaller and are already taking steps to do that — I think as we go throughout the year we
will figure out what that size eventually is." How small remains to be seen.

– Revenue from 3D modeling software products (Inventor, Revit, Civil 3D and NavisWorks)
was $144 million, down 1% from last Q4. The company reports shipping 30,000 seats of
3D, down from 44,500 in Q4 2007; seats of Inventor declined from 17,000 last Q4 to 6,100
in Q4 2008. That’s a massive slide in Inventor seats; I’m trying to get more detail. [Aside:
The company said it will no longer provide these metrics – partly because of the downward
trend, one assumes, but also because rebundling efforts will make future totals much
harder to compare to past data. It’s unfortunate because this is important data to help
gauge price stability and buyers’ sensitivity to prices.]

– Revenue from EMEA was down 16%, Asia Pacific, down 25%; Americas, down 17%
and, as discussed above, revenue from emerging economies was down 31% in Q4. For
the year, revenue was up 15% in Europe and up 7% in Asia but down 3% in the Americas.

– All business units saw revenue declines in Q4 but AEC and MSD ended the year up over
last due to strong sales for the first six months of fiscal 2009. The AEC business unit
reported a 14% decline for the quarter but an increase of 9% for the year; Manufacturing
Solutions’ revenue declined 7% Q/Q but rose 17% for the year.

It’s hard to believe the brick wall Autodesk hit in the second half of the year, leading to H2
revenue declines that are far more significant than any of its PLM competitors. It’s likely a
combination of addressing the needs of smaller companies (hit hardest in this economy
and with fewer cash reserves) and serving a broad base in which no industry is immune.
But Autodesk’s diversification strategy should serve it well as US and other nations’
stimiulus packages gear up public works projects — much of that road design work will be
done in CAD, and a lot of that in an Autodesk-branded product.