In the face of analyst questions about more cost cuts, CEO Carl Bass says the company has cut enough for now.
Although design software vendor Autodesk Inc. said business began to stabilize over the past three months, the company yesterday reported another difficult quarter, with sales, license revenue, and earnings all dipping sharply in the period ended Oct. 31.
Blaming the global recession and, in particular, persistent high unemployment rates, Autodesk reported third-quarter revenue of $416.9 million, 31.3% below that of the same period last year. License revenue dropped further, falling almost 44% to $236 million. Maintenance revenue, at $181 million, was down 2.7%. Autodesk’s net earnings were $29.5 million, down 72% from the prior-year period.
Autodesk CEO Carl Bass, in remarks to securities analysts, said employment cutbacks among the company’s customers have undermined Autodesk’s results, as many companies have reduced licenses and subscriptions in line with lower headcount.
“While there are several data points in our business that are encouraging and represent positive indicators for our business, the health of the global economic environment remains mixed, and the continued job losses in our core markets represent ongoing challenges to a swift recovery in our business,” Bass said in a prepared statement.
Still, Bass portrayed Autodesk’s third-quarter results as representing a stabilization of the company’s business. After four consecutive quarters of revenue declines, Autodesk’s third-quarter revenue was marginally better than the second-quarter tally. New seat licenses and revenue from Autodesk’s Americas and Europe regions also showed slight sequential improvements.
“We are now shifting gears to rekindle revenue growth,” Bass told analysts. Specifically, he said, Autodesk continues to invest in new on-demand services, suite products, and products for the Apple platform.
In the third quarter, revenue from manufacturing customers was $90 million, down 27% compared with the year-earlier period.
Revenue also fell across the company’s geographic areas. Revenue from the Americas region, at $164 million, was down 24%, while revenue from Europe, at $159 million, fell 38% year over year. In Asia, revenue was down 29% to $94 million.
Even Autodesk’s revenue from emerging economies, at $62 million, was down 2% sequentially and 46% against the like period a year ago.
At the same time, revenue from Autodesk’s newer 3D design software products fell. At $122 million, revenue from 3D products was down 25% from the year-earlier level. Revenue from Autodesk’s 2D products was $189 million, down 37%.