Autodesk 2006 Annual Report Download - page 79

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Results of Operations
Net Revenues
Increase
compared to
prior
fiscal year
Increase
compared to
prior
fiscal year
Fiscal 2006 $ percent Fiscal 2005 $ percent Fiscal 2004
(in millions)
Net Revenues:
License and Other ................... $1,246.7 $ 189.6 18% $ 1,057.1 $220.4 26% $ 836.7
Maintenance ........................ 276.5 99.8 56% 176.7 61.8 54% 114.9
$ 1,523.2 $289.4 23% $1,233.8 $ 282.2 30% $ 951.6
Net Revenues by Geographic Area:
Americas ........................... $ 609.2 $ 98.3 19% $ 510.9 $ 101.3 25% $409.6
Europe, Middle East and Africa ....... 558.2 114.5 26% 443.7 106.5 32% 337.2
Asia Pacific ......................... 355.8 76.6 27% 279.2 74.4 36% 204.8
$ 1,523.2 $289.4 23% $1,233.8 $ 282.2 30% $ 951.6
Net Revenues by Operating Segment:
Design Solutions .................... $1,344.5 $273.2 26% $1,071.3 $259.6 32% $ 811.7
Media and Entertainment ............ 172.3 12.3 8% 160.0 20.4 15% 139.6
Other .............................. 6.4 3.9 156% 2.5 2.2 *% 0.3
$ 1,523.2 $289.4 23% $1,233.8 $ 282.2 30% $ 951.6
Net Design Solutions Revenues:
Platform Technology Division
and Other ........................ $ 731.6 $ 132.1 22% $ 599.5 $ 128.4 27% $ 471.1
Manufacturing Solutions Division ..... 256.9 57.2 29% 199.7 58.3 41% 141.4
Building Solutions Division ........... 177.6 53.3 43% 124.3 43.1 53% 81.2
Infrastructure Solutions Division ...... 178.4 30.6 21% 147.8 29.8 25% 118.0
$1,344.5 $ 273.2 26% $1,071.3 $ 259.6 32% $ 811.7
* Percentage is not meaningful
Fiscal 2006 Net Revenues Compared to Fiscal 2005 Net Revenues
The increase in net revenues during fiscal 2006 was due primarily to strong subscription and new seat
revenues, continued growth in AutoCAD and AutoCAD LT revenues, along with a favorable product mix shift
towards higher priced 3D products. In addition, we experienced strong growth in all three of our geographic
regions and we experienced especially strong growth rates in our emerging economies of China, Eastern Europe,
and India.
Growth in license and other revenues during fiscal 2006, as compared to fiscal 2005, was primarily due to
increased new seat revenues from most major products and, to a lesser extent, to a modest increase in upgrade
revenues. New seat revenue increases were driven by volume growth in AutoCAD, AutoCAD LT, and most major
products, and growing sales of our higher priced 3D products. Upgrade revenue increased in fiscal 2006, but
at a lower rate than in fiscal 2005 as customers increasingly migrate to our subscription program and as we moved
the retirement date of the AutoCAD 2002-based products to the first quarter of fiscal 2007. We have now
synchronized our major product retirements and new release launches to occur in the first quarter of each fiscal
year. We currently anticipate that AutoCAD 2004-based productswill be retired in the first quarter of fiscal 2008.
The installed base of the AutoCAD 2004-based products not on subscription at the beginning of fiscal 2007 is
smaller than the installed base of AutoCAD 2002-based products not on subscription at the beginning of
fiscal 2006. As a result, and with the success of our subscription program, we expect subscription revenue to
exceed upgrade revenue in fiscal 2007 and we expect upgrade revenues to decline. This shift away from upgrade
revenues toward a more predictable and sustainable subscription revenue stream is consistent with our long-term
growth strategy.
2006 Annual Report
33