Autodesk, Inc. |
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Reconciliation of GAAP financial measures to non-GAAP financial measures | |||||||
(In millions, except per share data) |
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To supplement our condensed consolidated financial statements presented on a GAAP basis, we provide investors with certain non-GAAP measures including non-GAAP operating margin, non-GAAP income from operations, non-GAAP diluted net income per share, and free cash flow. For our internal budgeting and resource allocation process and as a means to evaluate period-to-period comparisons, we use non-GAAP measures to supplement our condensed consolidated financial statements presented on a GAAP basis. These non-GAAP measures do not include certain items that may have a material impact upon our future reported financial results. We use non-GAAP measures in making operating decisions because we believe those measures provide meaningful supplemental information regarding our earning potential and performance for management by excluding certain expenses and charges that may not be indicative of our core business operating results. For the reasons set forth below, we believe these non-GAAP financial measures are useful to investors both because (1) they allow for greater transparency with respect to key metrics used by management in its financial and operational decision-making and (2) they are used by our institutional investors and the analyst community to help them analyze the health of our business. This allows investors and others to better understand and evaluate our operating results and future prospects in the same manner as management, compare financial results across accounting periods and to those of peer companies and to better understand the long-term performance of our core business. We also use some of these measures for purposes of determining company-wide incentive compensation. | |||||||
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There are limitations in using non-GAAP financial measures because non-GAAP financial measures are not prepared in accordance with GAAP and may be different from non-GAAP financial measures used by other companies. The non-GAAP financial measures are limited in value because they exclude certain items that may have a material impact upon our reported financial results. In addition, they are subject to inherent limitations as they reflect the exercise of judgments by management about which charges are excluded from the non-GAAP financial measures. We compensate for these limitations by analyzing current and future results on a GAAP basis as well as a non-GAAP basis and also by providing GAAP measures in our public disclosures. The presentation of non-GAAP financial information is meant to be considered in addition to, not as a substitute for or in isolation from, the directly comparable financial measures prepared in accordance with GAAP. We urge investors to review the reconciliation of our non-GAAP financial measures to the comparable GAAP financial measures included in this presentation, and not to rely on any single financial measure to evaluate our business. | |||||||
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The following table shows Autodesk's GAAP results reconciled to non-GAAP results included in this release. | |||||||
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| Three Months Ended October 31, |
| Nine Months Ended October 31, | ||||
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| 2023 |
| 2022 |
| 2023 |
| 2022 |
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| (Unaudited) |
| (Unaudited) | ||||
GAAP operating margin | 24 % |
| 20 % |
| 20 % |
| 19 % |
Stock-based compensation expense | 13 % |
| 13 % |
| 13 % |
| 13 % |
Amortization of developed technologies | 1 % |
| 1 % |
| 1 % |
| 1 % |
Amortization of purchased intangibles | 1 % |
| 1 % |
| 1 % |
| 1 % |
Acquisition-related costs | 1 % |
| — % |
| — % |
| — % |
| Lease-related asset impairments and other charges | — % |
| 1 % |
| — % |
| 1 % |
| Non-GAAP operating margin (1) | 39 % |
| 36 % |
| 36 % |
| 35 % |
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| GAAP income from operations | $ 334 |
| $ 256 |
| $ 813 |
| $ 712 |
| Stock-based compensation expense | 181 |
| 172 |
| 543 |
| 496 |
| Amortization of developed technologies | 11 |
| 14 |
| 31 |
| 41 |
| Amortization of purchased intangibles | 10 |
| 10 |
| 30 |
| 30 |
| Acquisition-related costs | 11 |
| 1 |
| 16 |
| 7 |
| Lease-related asset impairments and other charges | — |
| 12 |
| 7 |
| 20 |
| Non-GAAP income from operations | $ 547 |
| $ 465 |
| $ 1,440 |
| $ 1,306 |
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| GAAP diluted net income per share | $ 1.12 |
| $ 0.91 |
| $ 2.89 |
| $ 2.43 |
| Stock-based compensation expense | 0.84 |
| 0.79 |
| 2.52 |
| 2.28 |
| Amortization of developed technologies | 0.05 |
| 0.06 |
| 0.14 |
| 0.19 |
| Amortization of purchased intangibles | 0.05 |
| 0.05 |
| 0.14 |
| 0.14 |
| Acquisition-related costs | 0.05 |
| — |
| 0.07 |
| 0.03 |
| Lease-related asset impairments and other charges | — |
| 0.06 |
| 0.03 |
| 0.09 |
| Loss (gain) on strategic investments and dispositions, net | 0.05 |
| (0.03) |
| 0.12 |
| (0.04) |
| Discrete GAAP tax items | 0.03 |
| 0.01 |
| (0.08) |
| (0.02) |
| Income tax effect of non-GAAP adjustments | (0.12) |
| (0.15) |
| (0.32) |
| (0.32) |
| Non-GAAP diluted net income per share | $ 2.07 |
| $ 1.70 |
| $ 5.51 |
| $ 4.78 |
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| Net cash provided by operating activities | $ 18 |
| $ 469 |
| $ 876 |
| $ 1,160 |
| Capital expenditures | (5) |
| (9) |
| (21) |
| (32) |
| Free cash flow | $ 13 |
| $ 460 |
| $ 855 |
| $ 1,128 |
| ____________________ |
| (1) Totals may not sum due to rounding. |
