Autodesk 2006 Annual Report Download - page 81

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During the first part of fiscal 2004, customers in the industries we serve, particularly manufacturing,
commercial construction and media and entertainment, were impacted by economic pressures in their own
businesses, resulting in a difficult customer purchasing environment. However, by the end of fiscal 2004 and
through fiscal 2005, we saw a lessening of these economic pressures.
The increase in license and other revenues for fiscal 2005, as compared to fiscal 2004, was due primarily
to increased new seat and upgrade revenues across all major products as a result of our new product releases
and the announced retirement of the AutoCAD 2000i-based product series for early calendar 2005. In addition,
changes in foreign currencies had a positive impact on revenue. Revenue from the sales of our services, training
and support are immaterial for all periods presented.
Maintenance revenues, consisting of revenues derived from the subscription program, increased during
fiscal 2005, as compared to fiscal 2004, as our subscription program continued to attract new and renewal
customers. As a percentage of total net revenues, maintenance revenues were 14% and 12% for fiscal 2005 and
fiscal 2004, respectively.
Net revenues in the Americas increased during fiscal 2005, as compared to 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 EMEA region increased during fiscal 2005, as compared to 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 the year, net revenues for EMEA increased approximately 20% as compared
to fiscal 2004.
The increase in Asia/Pacific region net revenues during fiscal 2005, as compared to fiscal 2004, 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
respiratory syndrome (“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.
The increase in net revenues for the Design Solutions Segment during fiscal 2005, as compared to fiscal
2004, 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. During fiscal 2005 and 2004, 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 44% of our consolidated net revenues for fiscal 2005 and
45% for fiscal 2004. Net revenues for our 3D products increased approximately 69% for fiscal 2005 as compared
to fiscal 2004.
Net revenues for the Media and Entertainment Segment increased during fiscal 2005 as compared to 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.
2006 Annual Report
35