Nemetschek’s view: AEC is doing OK, thank you very much

Feb 9, 2024 | Hot Topics

Remember how the VAR results I wrote about yesterday showed some weakness in AEC? Like many things, that may be the case, but not for everyone.

The Nemetschek Group just announced preliminary results for 2023 that beat the revenue and margin forecasts set just last October.

Full-year 2023 revenue was up 6% as reported and up 8% in constant currencies (cc) to €852 million, a new high for the company and at the top end of the 6% to 8% cc target the company set in October. And in this era where revenue tells only part of the story, Nemetschek also said that annual recurring revenue (ARR) rose by 24% (27% in cc) to €719 million, adding that “the ARR growth was therefore well above the revenue growth, which indicates a significant growth potential in the coming twelve months.”

By subtraction, Q4 revenue was also ahead of plan, at around €218 million, which would be 1% above the forecast. 

We won’t know for sure until the final report, but it’s possible that the revenue beat was in license revenue since the smaller Euro amount/sub would mean big volume with so little left in the year but plenty of time for larger deals in perpetual sales. If correct, that would mean the beat occurred in the Design segment, where a good chunk of the business is still perpetuals. It’s a guess — Nemetschek will tell us for sure on March 23.

So, in general, it would appear that AECish signals are mixed, though we have yet to hear from Bentley, Trimble, and Autodesk itself. Clearly, stay tiuned.

If you want more about Nemetsheck, go here: https://ir.nemetschek.com/websites/nemetschek/English/0/investor-relations.html