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FULL YEAR FISCAL 2019 |
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FY19 Guidance Metrics |
FY19 under ASC 606
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Billings (in millions) |
$2,580 - $2,640 (2)
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Revenue (in millions) |
$2,485 - $2,505 (3)
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GAAP spend growth (cost of revenue plus operating expenses) |
(2.5)% - (1.5)% |
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Non-GAAP spend growth (cost of revenue plus operating expenses) (4) |
1 - 2% |
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EPS GAAP |
$(0.59) - $(0.51) |
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EPS non-GAAP (5) |
$0.87 - $0.95 |
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Net subscription additions |
500k - 550k |
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Total ARR growth |
28% - 30% |
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_______________ |
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(1) |
The move to the new revenue standard results in an immaterial change to revenue and ARR and a $0.03 reduction to EPS, compared to what would have been recognized under ASC 605. |
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(2) |
Billings guidance reflects the initial impact of approximately $160 million for the adoption of ASC 606. This adjustment does not impact cash flow. |
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(3) |
Excluding the impact of foreign currency exchange rates and hedge gains/losses, revenue guidance would be $2,450 - $2,470 million. |
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(4) |
Non-GAAP spend excludes $231 million related to stock-based compensation expense, $44 million related to restructuring and other facility exit costs, $30 million for the amortization of acquisition-related intangibles, and $6M for acquisition related costs. |
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(5) |
Non-GAAP earnings per diluted share excludes $1.05 related to stock-based compensation expense, $0.17 related to restructuring charges & other exit costs, $0.14 for the amortization of acquisition-related intangibles, $0.10 of GAAP-only tax charges, $0.03 for acquisition related costs and, ($0.03) related to gains on strategic investments and dispositions. |
The third quarter and full year fiscal 2019 outlook assume a projected annual effective tax rate of (117) percent and 19 percent for GAAP and non-GAAP results, respectively. Assumptions for the annual effective tax rate are regularly evaluated and may change based on the projected geographic mix of earnings. At this stage of the business model transition, small shifts in geographic profitability significantly impact the annual effective tax rate.
Earnings Conference Call and Webcast
Autodesk will host its second quarter conference call today at 5:00 p.m. ET. The live broadcast can be accessed at http://www.autodesk.com/investor. Supplemental financial information and prepared remarks for the conference call will be posted to the investor relations section of Autodesk's website simultaneously with this press release.
A replay of the broadcast will be available at 7:00 p.m. ET at http://www.autodesk.com/investor. This replay will be maintained on Autodesk's website for at least 12 months.
Glossary of Terms
Annualized Recurring Revenue (ARR): Represents the annualized value of our average monthly recurring revenue for the preceding three months. "Maintenance plan ARR" captures ARR relating to traditional maintenance attached to perpetual licenses. "Subscription plan ARR" captures ARR relating to subscription offerings. Refer to the definition of recurring revenue below for more details on what is included within ARR. Recurring revenue acquired with the acquisition of a business is captured when total subscriptions are captured in our systems and may cause variability in the comparison of this calculation.
ARR is currently one of our key performance metrics to assess the health and trajectory of our business. ARR should be viewed independently of revenue and deferred revenue as ARR is a performance metric and is not intended to be combined with any of these items.
Annualized Revenue Per Subscription (ARPS): Is calculated by dividing our annualized recurring revenue by the total number of subscriptions.
Billings: Total revenue plus the net change in deferred revenue from the beginning to the end of the period.
Cloud Service Offerings: Represents individual term-based offerings deployed through web browser technologies or in a hybrid software and cloud configuration. Cloud service offerings that are bundled with other product offerings are not captured as a separate cloud service offering.
Constant Currency (CC) Growth Rates: We attempt to represent the changes in the underlying business operations by eliminating fluctuations caused by changes in foreign currency exchange rates as well as eliminating hedge gains or losses recorded within the current and comparative periods. We calculate constant currency growth rates by (i) applying the applicable prior period exchange rates to current period results and (ii) excluding any gains or losses from foreign currency hedge contracts that are reported in the current and comparative periods.
Enterprise Business Agreements (EBAs): These represent programs providing enterprise customers with token-based access or a fixed maximum number of seats to a broad pool of Autodesk products over a defined contract term.
Free Cash Flow: Cash flow from operating activities minus capital expenditures.
Maintenance Plan: Our maintenance plans provide our customers with a cost effective and predictable budgetary option to obtain the productivity benefits of our new releases and enhancements when and if released during the term of their contracts. Under our maintenance plans, customers are eligible to receive unspecified upgrades when and if available, and technical support. We recognize maintenance revenue over the term of the agreements, generally between one and three years.
Other Revenue: Consists of revenue from consulting, training and other services, and is recognized over time as the services are performed. Other revenue also includes software license revenue from the sale of our discontinued perpetual licenses.
Product Subscription: Provides customers the most flexible, cost-effective way to access and manage 3D design, engineering, and entertainment software tools. Our product subscriptions currently represent a hybrid of desktop and SaaS functionality, which provides a device-independent, collaborative design workflow for designers and their stakeholders.
