Autodesk 2014 Annual Report Download - page 101

2013 Annual Report
2014 Form 10-K 27
Our business strategy has historically depended in part on our relationships with third-party developers who provide
products that expand the functionality of our design software. Some developers may elect to support other products or may
experience disruption in product development and delivery cycles or financial pressure during periods of economic downturn.
In particular markets, such disruptions have in the past, and would likely in the future, negatively impact these third-party
developers and end users, which could harm our business.
Additionally, technology created by outsourced product development, whether outsourced to third parties or developed
externally and transferred to us through business or technology acquisitions, have certain additional risks such as effective
integration into existing products, adequate transfer of technology know-how and ownership and protection of transferred
intellectual property.
As a result of our strategy of partnering with other companies for product development, our product delivery schedules could
be adversely affected if we experience difficulties with our product development partners.
We partner with certain independent firms and contractors to perform some of our product development activities. We
believe our partnering strategy allows us to, among other things, achieve efficiencies in developing new products and
maintaining and enhancing existing product offerings. Our partnering strategy creates a dependency on such independent
developers. Independent developers, including those who currently develop products for us in the U.S. and throughout the
world, may not be able or willing to provide development support to us in the future. In addition, use of development resources
through consulting relationships, particularly in non-U.S. jurisdictions with developing legal systems, may be adversely
impacted by, and expose us to risks relating to, evolving employment, export and intellectual property laws. These risks could,
among other things, expose our intellectual property to misappropriation and result in disruptions to product delivery schedules.
We regularly invest resources to update and improve our internal information technology systems. Should our investments not
succeed, or if delays or other issues with new or existing internal technology systems disrupt our operations, our business could
be harmed.
We rely on our network and data center infrastructure, internal technology systems and our websites for our development,
marketing, operational, support, sales, accounting and financial reporting activities. We are continually investing resources to
update and improve these systems and environments in order to meet the growing requirements of our business and customers.
Such improvements are often complex, costly and time consuming. In addition, such improvements can be challenging to
integrate with our existing technology systems, or uncover problems with our existing technology systems. Unsuccessful
implementation of hardware or software updates and improvements could result in disruption in our business operations, loss of
revenue, errors in our accounting and financial reporting or damage to our reputation.
Our business may be significantly disrupted upon the occurrence of a catastrophic event.
Our business is highly automated and relies extensively on the availability of our network and data center infrastructure,
our internal technology systems and our websites. We also rely on hosted computer services from third parties for services that
we provide to our customers and computer operations for our internal use. The failure of our systems or hosted computer
services due to a catastrophic event, such as an earthquake, fire, flood, tsunami, weather event, telecommunications failure,
power failure, cyber attack or war, could adversely impact our business, financial results and financial condition. We have
developed disaster recovery plans and maintain backup systems in order to reduce the potential impact of a catastrophic event,
however there can be no assurance that these plans and systems would enable us to return to normal business operations. In
addition, any such event could negatively impact a country or region in which we sell our products. This could in turn decrease
that country's or region's demand for our products, thereby negatively impacting our financial results.
We issued $750.0 million aggregate principal amount of senior unsecured notes in a debt offering in December 2012 and have
an existing $400.0 million revolving credit facility, and may incur other debt in the future, which may adversely affect our
financial condition and future financial results.
In December 2012, we issued 1.95% notes due December 15, 2017 in an aggregate principal amount of $400.0 million
and 3.6% notes due December 15, 2022 in an aggregate principal amount of $350.0 million. As the December 2017 and
December 2022 debt matures, we will have to expend significant resources to either repay or refinance these notes. If we decide
to refinance the notes, we may be required to do so on different or less favorable terms or we may be unable to refinance the
notes at all, both of which may adversely affect our financial condition.