Autodesk 2014 Annual Report Download - page 123

2013 Annual Report
2014 Form 10-K 49
At January 31, 2014, we had net deferred tax assets of $187.9 million. We believe that we will generate sufficient future
taxable income in appropriate tax jurisdictions to realize these assets.
For additional information regarding our income tax provision and reconciliation of our effective rate to the federal
statutory rate of 35%, see Note 4, “Income Taxes,” in the Notes to Consolidated Financial Statements.
Other Financial Information
In addition to our results determined under U.S. generally accepted accounting principles (“GAAP”) discussed above, we
believe the following non-GAAP measures are useful to investors in evaluating our operating performance. For the fiscal years
ended January 31, 2014, 2013 and 2012, our gross profit, gross margin, income from operations, operating margin, net income
and diluted earnings per share on a GAAP and non-GAAP basis were as follows (in millions except for gross margin, operating
margin and per share data):
January 31, 2014 January 31, 2013 January 31, 2012
(Unaudited)
Gross profit $ 1,999.6 $ 2,073.7 $ 1,986.5
Non-GAAP gross profit $ 2,049.8 $ 2,118.6 $ 2,028.4
Gross margin 88% 90% 90%
Non-GAAP gross margin 90% 92% 92%
Income from operations $ 284.8 $ 305.9 $ 355.6
Non-GAAP income from operations $ 510.5 $ 587.9 $ 533.4
Operating margin 13% 13% 16%
Non-GAAP operating margin 22% 25% 24%
Net income $ 228.8 $ 247.4 $ 285.3
Non-GAAP net income (1) $ 385.6 $ 450.0 $ 405.1
Diluted earnings per share (2) $ 1.00 $ 1.07 $ 1.22
Non-GAAP diluted earnings per share (1) (2) $ 1.68 $ 1.94 $ 1.74
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(1) Effective in the second quarter of fiscal 2013, Autodesk began excluding gains and losses on strategic investments for purposes of its
non-GAAP financial measures. Prior period non-GAAP interest and other income (expense), net, net income and earnings per share
amounts have been revised to conform to the current period presentation.
(2) Earnings per share were computed independently for each of the periods presented; therefore the sum of the earnings per share amount
for the quarters may not equal the total for the year.
For our internal budgeting and resource allocation process and as a means to evaluate period-to-period comparisons, we use
non-GAAP measures to supplement our consolidated financial statements presented on a GAAP basis. These non-GAAP measures
do not include certain items that may have a material impact upon our reported financial results. We use non-GAAP measures in
making operating decisions because we believe those measures provide meaningful supplemental information regarding our earning
potential and performance for management by excluding certain expenses and charges that may not be indicative of our core
business operating results. For the reasons set forth below, we believe these non-GAAP financial measures are useful to investors
both because (1) they allow for greater transparency with respect to key metrics used by management in its financial and operational
decision-making and (2) they are used by our institutional investors and the analyst community to help them analyze the health
of our business. This allows investors and others to better understand and evaluate our operating results and future prospects in
the same manner as management, compare financial results across accounting periods and to those of peer companies and to better
understand the long-term performance of our core business. We also use some of these measures for purposes of determining
company-wide incentive compensation.
There are limitations in using non-GAAP financial measures because non-GAAP financial measures are not prepared in
accordance with GAAP and may be different from non-GAAP financial measures used by other companies. The non-GAAP
financial measures included above are limited in value because they exclude certain items that may have a material impact upon
our reported financial results. In addition, they are subject to inherent limitations as they reflect the exercise of judgments by
management about which charges are excluded from the non-GAAP financial measures. We compensate for these limitations by
analyzing current and future results on a GAAP basis as well as a non-GAAP basis and also by providing GAAP measures in our