Autodesk, Inc. Q1 Fiscal 2026 Earnings Summary

Autodesk, Inc. (ADSK) announced strong first-quarter results for fiscal year 2026, surpassing revenue and non-GAAP earnings per share guidance. The company highlighted its strategic focus on cloud, AI, and industry convergence amidst an uncertain macroeconomic environment.

Financial Performance Highlights (Q1 FY26)

• Revenue: Grew 15% (16% in constant currency) to $1.2 billion, with $78 million contributed by the new transaction model. Excluding this, revenue grew 11% in constant currency.
• Billings: Increased 29% (30% in constant currency), primarily due to the shift to annual billings for most multi-year contracts and the new transaction model, which contributed $105 million. Excluding these impacts, billings grew 22% in constant currency.
• RPO (Remaining Performance Obligations): Total RPO reached $7.2 billion, up 21%, with current RPO at $4.6 billion, up 16%.
• Non-GAAP Operating Margin: Strong at 37%, a 3 percentage point increase year-over-year, driven by operational leverage, cost discipline, and timing benefits from restructuring, partially offset by the new transaction model's margin drag.
• GAAP Operating Margin: Decreased 7 percentage points to 14%, impacted by a $105 million restructuring charge and a $54 million one-time non-cash charge related to the employee stock purchase program.
• Free Cash Flow: $556 million.
• Capital Allocation: Repurchased approximately 1.3 million shares for $353 million at an average price of $269 per share.

Strategic Priorities and Market Dynamics

CEO Andrew Anagnost emphasized three key certainties for Autodesk in an uncertain world:

1. New Transaction Model: Proactively integrates the company closer with customers, drives business, and enhances automation while reducing channel partner redundancies, creating new growth and margin opportunities.
2. Free Cash Flow Rebuild: The transition to annual billings for multi-year contracts is rebuilding the free cash flow stack, increasing capacity for sustainable share repurchases.
3. Simplified Analysis: As business model transitions conclude, Autodesk will become easier for analysts and investors to understand.

Go-to-Market Optimization

The company's go-to-market optimization plan is on track, with new Chief Revenue Officer Andy Elder joining from Microsoft. Channel consolidation is a deliberate strategy, focusing on fewer, more solution-focused partners and driving customers toward direct engagement through the Autodesk store, which saw robust activity and increased price realization in Q1. Disruptions from the new transaction model implementation are easing.

Industry Convergence and AI

Autodesk is focused on the convergence of design and make in the cloud, enabled by its platform, industry clouds, and AI.

• AECO (Architecture, Engineering, Construction, and Operations): Continued strong performance. A leading infrastructure consulting firm closed its sixth EBA, the second largest deal in Autodesk history, to accelerate BIM adoption and standardize on Autodesk Construction Cloud for digital delivery. Hitachi Energy expanded adoption of ACC, Revit, and Fusion for renewable energy integration and digital twin solutions. A design-build general contractor adopted ACC for unified project data and collaboration. These demonstrate the trend of converging people, processes, and data for increased efficiency and sustainability.
• Manufacturing: Customers are consolidating on Autodesk's design and make platform for digital transformations. Waldner, an industrial group, transitioned from 2D to 3D with Product Design & Manufacturing Collection and Vault Professional. George P. Johnson adopted Fusion Manage and Operations for digital transformation across fabrication facilities. Grain Handler, a global leader in grain handling, selected Fusion to modernize its entire design and manufacturing workflow with integrated CAD-CAM.
• AI Integration: Autodesk is delivering meaningful productivity gains with AI. The AI-powered auto-constraint feature in Fusion has generated over 580,000 constraints for users since launch, with user acceptance rates exceeding 50%. The company plans to roll out more sophisticated AI tools that automate repetitive tasks, aiming to make Fusion the most AI-powered tool in mechanical design and accelerate market share gains. AI enhancements are also coming to Forma in AEC.
• Education: Austin University is making the entire Autodesk product portfolio available to students and migrating first-year engineering modules to Fusion, preparing future engineers with industry-relevant skills.
• Flexible Consumption: Enabled flexible consumption models for customers like Jones Engineering, allowing them to manage fluctuating project requirements and reduce administrative bottlenecks.

Outlook and Macroeconomic Considerations

• Underlying Momentum: The underlying business momentum in Q1 FY26 was consistent with recent quarters and continues into Q2.
• Guidance Adjustment: Increased billings, revenue, and free cash flow guidance ranges reflect foreign exchange movements (U.S. dollar depreciation) partially offset by increased caution due to greater macroeconomic uncertainty. The company has not yet seen this impact in its business but is factoring it in prudently.
• Billings Guidance: Raised to $7.16 billion to $7.31 billion.
• Revenue Guidance: Raised to $6.925 billion to $6.995 billion.
• Free Cash Flow Guidance: Raised to $2.1 billion to $2.2 billion.
• Margins: Raised the bottom end of non-GAAP guidance, reflecting operating leverage and cost discipline.
• Labor Constraints: The industry continues to face labor, material, and capital constraints, driving a need for digital efficiency. This is seen as a positive for Autodesk as it compels industries like AEC to adopt technology for productivity.

Autodesk remains confident in its ability to deliver sustainable shareholder value through long-term secular growth markets, a focused strategy, and resilient business operations.