Autodesk 2005 Annual Report Download - page 38

Maintenance revenues, consisting of revenues derived from the subscription program, were $176.7 million
for fiscal 2005 as compared to $114.9 million for fiscal 2004. As a percentage of total net revenues, maintenance
revenues were 14% and 12% for fiscal 2005 and fiscal 2004, respectively. Our subscription program, available to
most customers worldwide, continues to attract new and renewal customers providing them with a cost effective
and predictable budgetary option to obtain the productivity benefits of our newest releases and planned annual
product release cycle and enhancements, such as Web support direct from Autodesk and e-learning. We expect
maintenance revenues to continue to increase as a percentage of total net revenues.
Net revenues in the Americas increased 25% to $510.9 million in fiscal 2005 as compared to $409.6 million
in fiscal 2004, largely due to strong new seat, upgrade and subscription revenue. Most of the first half of fiscal
2004 was impacted by the difficult selling environment experienced in the industries we serve. However, the
later half of fiscal 2004 had strong upgrade and subscription revenues which carried into fiscal 2005.
Net revenues in the Europe, Middle East and Africa (“EMEA”) region increased 32% to $443.7 million in fiscal
2005 from $337.2 million in fiscal 2004 due primarily to strong new seat, upgrade and subscription sales, as well
as favorable exchange rates. Ignoring the effects of changes in foreign currencies during fiscal 2005, net revenues
for EMEA increased approximately 20% in fiscal 2005 as compared to fiscal 2004.
Net revenues in Asia/Pacific increased 36% to $279.2 million in fiscal 2005 from $204.8 million in fiscal 2004.
The increase in net revenues was due primarily to strong new seat, subscription and upgrade revenues as well
as favorable exchange rates. Revenues for fiscal 2004 were adversely affected by the impact on our sales
operations of concerns regarding severe acute respiratorysyndrome (“SARS”) primarily during the second quarter
of fiscal 2004. Ignoring the effects of changes in foreign currencies during fiscal 2005, net revenues for Asia/
Pacific increased approximately 31% as compared to fiscal 2004.
For fiscal 2005, net revenues for the Design Solutions Segment were $1,077.3 million as compared to $818.1
million in fiscal 2004. The increase in net revenues in fiscal 2005 for the Design Solutions Segment was due
primarily to strong new seat, upgrade and subscription revenues and favorable exchange rates. Revenue from
upgrades and subscriptions combined accounted for 38% of Design Solutions Segment revenues for fiscal 2005
and 41% of Design Solutions Segment revenue for fiscal 2004. Maintenance revenue accounted for 16% of Design
Solutions Segment revenue for fiscal 2005 and 14% of Design Solutions Segment Revenues for fiscal 2004.
Although we have been shifting our focus to more vertically-oriented product lines, sales of AutoCAD, AutoCAD
upgrades and AutoCAD LT continue to comprise a significant portion of our net revenues. Such sales, which are
reflected in the net revenues for the Platform Technology Division and Other, accounted for 45% of our
consolidated net revenues for both fiscal 2005 and 2004. Net revenues for our 3D products increased
approximately 69% for fiscal 2005 as compared to fiscal 2004. A critical component of our growth strategy is
to convert our 2D customer base, including customers of AutoCAD and related vertical industry products, to
our higher priced 3D products such as the Autodesk Inventor products, Autodesk Revit Building products and
Autodesk Civil 3D. However, should sales of 2D products decrease without a corresponding conversion of the
customer seats to 3D products, our results of operations will be adversely affected.
Net revenues for the Discreet Segment increased 16% to $154.1 million in fiscal 2005 from $133.1 million in
fiscal 2004 primarily due to growth in new seat and subscription revenues of our 3ds max animation software,
an entire product line refresh of our editing and effects systems during fiscal 2005 and favorable exchange rates.
Net revenues from our advanced systems products were $110.4 million as compared to $91.9 million in fiscal 2004.
International sales accounted for 65% of our net revenues in fiscal 2005 as compared to 63% in the prior
fiscal year. Ignoring the effects of changes in foreign currencies during fiscal 2005, international sales would have
remained consistent at 63% of net revenues. We believe that international sales will continue to comprise a
significant portion of net revenues. Economic weakness in any of the countries which contribute a significant
portion of our net revenues would have a material adverse effect on our business.
Fiscal 2004 Net Revenues Compared to Fiscal 2003 Net Revenues
Net revenues increased to $951.6 million in fiscal 2004 from $824.9 million in fiscal 2003. Net revenues
increased in all three geographic areas, due primarily to strong upgrade and subscription revenues coupled with
the positive effects of changes in foreign currencies.
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