Autodesk 2012 Annual Report Download - page 105

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Cost of maintenance revenue includes labor costs of providing product support to our maintenance customers, including
stock-based compensation expense for these employees, rent and occupancy, shipping and handling costs and professional
services fees. Cost of maintenance revenue increased 22% during fiscal 2012 as compared to fiscal 2011 due to an increase in
maintenance support headcount and increased annual fulfillment costs related to supplying USB flash drives of our suites
products. Cost of maintenance revenue increased 74% during fiscal 2011 as compared to fiscal 2010 due to an increase in
maintenance support headcount. These increases were partially offset by savings on freight and materials costs as fewer
maintenance customers require physical shipments than in the past due to electronic fulfillment.
Cost of revenue, at least over the near term, is affected by the volume and mix of product sales, mix of physical versus
electronic fulfillment, fluctuations in consulting costs, amortization of purchased technology, new customer support offerings,
royalty rates for licensed technology embedded in our products, and employee stock-based compensation expense. We expect
cost of revenue to increase in absolute dollars, but to remain relatively consistent as a percentage of net revenue during fiscal
2013, as compared to fiscal 2012.
Marketing and Sales
Marketing and sales
As a percentage of net
revenue
Fiscal Year
Ended
January 31,
2012
(in millions)
$ 842.6
38%
Increase compared to
prior fiscal year
$
$ 66.6
%
9%
Fiscal Year
Ended
January 31,
2011
$ 776.0
40%
Increase compared to
prior fiscal year
$
$ 44.1
%
6%
Fiscal Year
Ended
January 31,
2010
$ 731.9
43%
Marketing and sales expenses include salaries, bonuses, benefits, and stock-based compensation expense for our
marketing and sales employees, and the expense of travel, entertainment and training for such personnel, and the costs of
programs aimed at increasing revenue, such as advertising, trade shows and expositions, and various sales and promotional
programs. Marketing and sales expenses also include labor costs of sales and order processing, sales and dealer commissions,
rent and occupancy, and the cost of supplies and equipment.
Marketing and sales expenses increased 9% during fiscal 2012, as compared to fiscal 2011, primarily due to higher
employee-related costs related to salaries and fringe benefits primarily associated with increased head count and the
reinstatement of merit increases in fiscal 2012. Marketing and sales expenses increased 6% during fiscal 2011, as compared to
fiscal 2010, primarily due to higher employee-related costs related to variable compensation, including commissions, bonuses
and related fringe benefits. Variable compensation expenses increased as a result of exceeding our fiscal 2011 target revenue
growth and operating margins growth targets more than we did in fiscal 2010. Our annual incentive plans are based on
forecasted revenue and operating margin, with current year targets set at the beginning of the fiscal year. These increases were
partially offset by the decrease in advertising and promotion spending and stock-based compensation expense.
We expect to balance our need to invest in the marketing and sales of our products with our desire to actively manage our
sales and marketing operating expenses. As a result, we expect marketing and sales expense to increase in absolute dollars, but
remain relatively consistent as a percentage of net revenue in fiscal 2013, as compared to fiscal 2012.
Research and Development
Research and
development
As a percentage of net
revenue
Fiscal Year
Ended
January 31,
2012
(in millions)
$ 566.5
26%
Increase compared to
prior fiscal year
$
$ 70.3
%
14%
Fiscal Year
Ended
January 31,
2011
$ 496.2
25%
Increase compared to
prior fiscal year
$
$ 38.7
%
8%
Fiscal Year
Ended
January 31,
2010
$ 457.5
27%
Research and development expenses, which are expensed as incurred, consist primarily of salaries, bonuses, benefits and
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2012 Annual Report