Autodesk 2009 Annual Report Download - page 93

ITEM 1A. RISK FACTORS
We operate in a rapidly changing environment that involves a number of risks, many of which are beyond
our control. In addition to the other information contained in this Form 10-K, the following discussion highlights
some of these risks and the possible impact of these factors on future results of operations. If any of the following
risks actually occur, our business, financial condition or results of operations may be adversely impacted, causing
the trading price of our common stock to decline. In addition, these risks and uncertainties may impact the
“forward-looking” statements described elsewhere in this Form 10-K and in the documents incorporated herein
by reference. They could affect our actual results of operations, causing them to differ materially from those
expressed in “forward-looking” statements.
The deteriorating global economic conditions may further affect our financial results, additionally harming
our business.
As our business has expanded globally, we have become increasingly subject to the risks arising from
adverse changes in domestic and global economic and political conditions. Global economic conditions have
deteriorated over the past several quarters, particularly during our most recent fiscal quarter that ended on
January 31, 2009. This has led to our customers deferring, reducing or cancelling purchases in response to tighter
credit and negative financial news. These factors have negatively impacted our business and our financial results.
If global economic conditions continue to deteriorate, or our customers continue to perceive uncertainty in
global economic conditions, many of our customers may further delay, reduce or cancel their technology
purchases. This could result in further reductions in sales of our products, longer sales cycles, slower adoption of
new technologies and increased price competition.
In addition, continued weakness in the end-user market could further negatively affect the cash flow of our
distributors and resellers who could, in turn, delay paying their obligations to us, which would increase our credit
risk exposure and cause delays in our recognition of revenue on future sales to these customers.
These actions have and may continue to negatively impact our business, financial results and financial condition.
In addition, the negative effect these factors have had on our cash flows has caused us to take an impairment charge on
some of our long-term assets, and may cause us to take additional impairment charges in the future.
The actions that we are taking in response to the global economic slowdown and our related business
slowdown may be costly and may not be as effective as anticipated.
We are taking actions to reduce our cost structure to more closely align our costs with our revenue levels. In
taking these actions, we are attempting to balance the cost of such initiatives against the longer term benefit of
such initiatives. In taking these actions, we will incur additional costs in the short term that may have the effect
of reducing our operating margins. If we do not achieve the proper balance of these cost reduction initiatives, we
may eliminate critical elements of our operations, the loss of which could negatively impact our ability to benefit
from an economic recovery. We cannot assure that our cost cutting efforts will achieve appropriate levels of
expenses and we may take additional actions in the future.
In addition, we are taking actions to stimulate demand through a number of programs. Although we are
attempting to balance the cost of these programs against the longer term benefits, it is possible that we will make
such investments without a corresponding increase in demand for our products. This would further reduce our
operating margins and have a negative impact on our financial results.
The recent global credit and banking crisis may further negatively affect our business, results of operations,
and financial condition.
The recent global financial crisis affecting the banking system and financial markets and the going concern
threats to investment banks and other financial institutions have resulted in a tightening in the credit markets, a
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