Autodesk 2010 Annual Report Download - page 136

Cost of Revenue
Fiscal Year
Ended
January 31,
2010
Increase (decrease)
compared to prior
fiscal year
Fiscal Year
Ended
January 31,
2009
Increase (decrease)
compared to
prior fiscal year
Fiscal Year
Ended
January 31,
2008$ % $ %
(in millions)
Cost of revenue:
License and other ............. $179.9 $(30.3) -14% $210.2 $11.1 6% $199.1
Maintenance ................. 11.9 3.0 34% 8.9 0.3 3% 8.6
$191.8 $(27.3) -12% $219.1 $11.4 5% $207.7
As a percentage of net revenue ....... 11% 9% 10%
Cost of license and other revenue includes labor costs of fulfilling service contracts and order fulfillment,
including stock-based compensation expense for those employees, direct material and overhead charges,
amortization of purchased technology, professional services fees and royalties. Direct material and overhead
charges include the cost of hardware sold (mainly PC-based workstations for Advanced Systems in our M&E
segment), costs associated with transferring our software to electronic media, printing of user manuals and
packaging materials and shipping and handling costs.
Cost of license and other revenue decreased 14% during fiscal 2010, as compared to fiscal 2009 primarily
due to the 39% decrease in license and other revenue. Cost of license and other revenue did not decline as rapidly
as the associated net revenue in fiscal 2010 as compared to fiscal 2009 because of increased amortization of
purchased technology related to fiscal years 2010 and 2009 acquisitions, costs associated with redundant services
as we migrated a portion of our IT systems onto a new platform, and higher costs associated with the
implementation of our electronic fulfillment system. Cost of license and other revenue increased 6% during fiscal
2009, as compared to fiscal 2008 even though license and other revenue decreased by 1%. Cost of license and
other revenue increased in fiscal 2009 due to an increase in amortization of purchased technology due to the
number of acquisitions completed during fiscal years 2009 and 2008, slightly offset by decreases in employee-
related expenses. Since many of these costs are headcount-related expenses, they do not vary proportionally with
changes in revenue.
Cost of maintenance revenue includes labor costs of providing product support to our maintenance
customers, including stock-based compensation expense for these employees, rent and occupancy, and
professional services fees. Cost of maintenance revenue increased 34% during fiscal 2010 as compared to fiscal
2009 due to an increase in product support headcount due to the acquisition of Moldflow Corporation in the
second quarter of fiscal 2009. Costs of maintenance revenue remained relatively consistent in both relative
dollars and as a percentage of net revenue during fiscal 2009 as compared to fiscal 2008.
Cost of revenue, at least over the near term, is affected by the volume and mix of product sales, fluctuations
in consulting costs, amortization of purchased technology, new customer support offerings, royalty rates for
licensed technology embedded in our products, and employee stock-based compensation expense.
Marketing and Sales
Fiscal year
Ended
January 31,
2010
Decrease
compared to
prior fiscal year
Fiscal year
Ended
January 31,
2009
Increase
compared to
prior fiscal year
Fiscal year
Ended
January 31,
2008$ % $ %
(in millions)
Marketing and sales ................ $731.9 $(168.8) -19% $900.7 $53.0 6% $847.7
As a percentage of net revenue ....... 43% 39% 39%
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