Autodesk 2006 Annual Report Download - page 6

Autodesk Architectural Desktop continues to
provide AutoCAD-based design and documenta-
tion productivity with 3D visualization capabilities
for architects. Customers find that the move to
Architectural Desktop is a natural step on the path
to adopting full building information modeling. In
addition, our collaborative project management
solution, Autodesk Buzzsaw, continues to gain
traction in both the building and infrastructure
industries.
Our Media and Entertainment Division (M&E)
grew revenues 8% in fiscal 2006 to $172 million,
while continuing to improve profitability. M&E
delivered $33 million in operating income, and
increased its operating margin by 2 percentage
points to 19%. Our M&E solutions are designed
for digital media creation, management, and
delivery across all disciplines from animation, game
development and design visualization to film and
television editing, color grading and visual effects.
In fiscal 2006 we released powerful new versions
of every product in our M&E lineup.
Demand for our animation products was robust in
fiscal 2006 as a result of significant trends develop-
ing in the industry. Film studios are incorporating
more feature length animation projects into their
pipelines to meet box office demand. Game stu-
dios are using more animation and design tools in
the development of new offerings, to meet demand
for increasingly realistic and complex experiences.
Revenues from Autodesk 3ds Max increased 25%
over fiscal 2005. Through our acquisition of Alias,
we added important new capabilities to our future
offering with Alias Maya.
Revenues from our advanced systems products
were approximately flat with fiscal 2005. Our
systems business is in a planned transition. Film
studios are moving away from proprietary, high-end
solutions and adopting Linux-based workflows. In
fact, revenues from our Linux-based effects and
editing solutions—Discreet Flint and Discreet
Smoke more than 125% over fiscal 2005. Clearly,
these products continue to appeal to a growing
number of cost-conscious customers, as well as
new channel partners interested in selling finishing
and effects solutions at affordable prices.
Designing a future of opportunity
The most exciting thing about Autodesk is that
our prospects seem even brighter than our past.
Despite our very significant results and achieve-
ments over the past few years, the world continues
to move in our direction, and the opportunities
ahead are even more compelling. With mass
customization and the proliferation of design,
globalization, outsourcing, and off-shoring, our
customers must look for better tools or risk being
marginalized. Such tools enable them to more
effectively create, manage, and share their digital
assets. Autodesk is providing those tools and
we believe the opportunity for future growth is
substantial.
As we begin fiscal 2007, our products have never
been better aligned with our customers’ needs. In
March, we launched the strongest product portfo-
lio in the history of our company. These products
once again demonstrate our commitment to
offering the strongest suite of desktop design tools
to provide our customers competitive advantage in
an increasingly global marketplace. Our acquisition
of Alias provides exciting new products—includ-
ing Autodesk Maya, Autodesk Alias Studio and
Autodesk Showcase—which further increase the
breadth and depth of our portfolio across indus-
tries.
Adoption of our model-based 3D products con-
tinues to increase. The move to 3D represents a
significant opportunity for revenue growth with
considerably higher average selling prices. In fact,
our 3D products have penetrated less than 10% of
our total user base, which supplies us with future
growth opportunities for years to come as custom-
ers migrate to our 3D solutions.