Autodesk 2014 Annual Report Download - page 107

2013 Annual Report
2014 Form 10-K 33
ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS
The discussion in our MD&A and elsewhere in this Form 10-K contains trend analyses and other forward-looking
statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of
1934. Forward-looking statements are any statements that look to future events and consist of, among other things, our
business strategies, including those discussed in “Strategy” and "Business Outlook" below; anticipated future net revenue;
future GAAP and non-GAAP earnings per share; future operating margin and other future financial results (by product type
and geography) and operating expenses; the effectiveness of our efforts to successfully manage transitions to new business
models and markets; the effectiveness of efforts to reduce our operating expenses; expected market trends, including the growth
of cloud, mobile and social computing; the effect of unemployment and availability of credit; the effects of the U.S. credit
downgrade and weak global economic conditions; the effects of revenue recognition; our backlog; expected trends in certain
financial metrics; the impact of acquisitions and investment activities; the effect of fluctuations in exchange rates and our
hedging activities on our financial results; our abilities to successfully expand adoption of our products; our ability to gain
market acceptance of new businesses and sales initiatives; our ability to successfully increase sales of product suites as part of
our overall sales strategy; the impact of economic volatility and geopolitical activities in certain countries, particularly
emerging economy countries, and the resulting effect on our financial results; and the impact of our restructuring activities. In
addition, forward-looking statements also consist of statements involving expectations regarding product acceptance,
continuation of our stock repurchase program, statements regarding our liquidity and short-term and long-term cash
requirements, as well as statements involving trend analyses and statements including such words as “may,” “believe,”
“could,” “anticipate,” “would,” “might,” “plan,” “expect,” and similar expressions or the negative of these terms or other
comparable terminology. These forward-looking statements speak only as of the date of this Annual Report on Form 10-K and
are subject to business and economic risks. As such, our actual results could differ materially from those set forth in the
forward-looking statements as a result of the factors set forth above in Item 1A, “Risk Factors,” and in our other reports filed
with the U.S. Securities and Exchange Commission. We assume no obligation to update the forward-looking statements to
reflect events that occur or circumstances that exist after the date on which they were made, except as required by law..
Strategy
Autodesk’s vision is to help people imagine, design and create a better world. We do this by developing software and
services for the world’s designers, architects, engineers, and digital artists, professionals and non-professionals alike—the
people who create the world's products, buildings, infrastructure, films, and games. Autodesk serves professional customers in
three primary markets: architecture, engineering and construction; manufacturing; and digital media and entertainment.
Our goal is to provide our customers with the world’s most innovative, and engaging design software and services. Our
product and services portfolio allows our customers to digitally visualize, simulate, and analyze their projects, helping them to
better understand the consequences of their design decisions; save time, money, and resources; and become more innovative.
Autodesk was founded during the platform transition from mainframes and engineering workstations to personal
computers. We developed and sustained a compelling value proposition based upon desktop software for the personal computer.
Just as the transition from mainframes to personal computers transformed the industry thirty years ago, we believe our industry
is undergoing a similar transition from the personal computer to cloud, social, and mobile computing. To address this transition
we have accelerated our move to the cloud and are offering more flexible licenses.
Our strategy is to lead our customers and the industries they serve to the new cloud and mobile platforms. This entails
both a technological shift and a business model shift. During the early part of fiscal 2014, we announced more flexible term-
based license offerings for certain products. These offerings are designed to give our customers even more flexibility with how
they use our products and service offerings and address new types of customers such as project-based users and small
businesses. Over the next four years, we expect to significantly increase our subscription base and the annual value of our
subscriptions, which we believe will help drive billings growth. During this transition, revenue, deferred revenue, operating
margin and EPS will be impacted as more revenue is recognized ratably rather than up front and as new offerings bring a wider
variety of price points.
Our strategy is predicated upon our major business initiatives to grow, transform and expand our business:
 Grow. We believe opportunity remains in our desktop software business, and we intend to continue to grow this
business. In particular we are offering product suites with improved interoperability and usability to enhance our
customers' productivity and effectiveness. We are continuing to develop new ways to deliver capability and value to