Autodesk 2015 Annual Report Download - page 107

2015 Form 10-K 15
ITEM 1A. RISK FACTORS
We operate in a rapidly changing environment that involves significant risks, a number 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 our business, financial condition, and 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.
Global economic and political conditions may further impact our business, financial results, and financial condition.
As our business has expanded globally, we have increasingly become subject to risks arising from adverse changes in
global economic and political conditions. The past several years were characterized by weak global economic conditions,
volatile credit markets, relatively high unemployment, a low level of liquidity in many financial markets, increased government
deficit spending and debt levels, uncertainty about certain governments' abilities to repay such debt or to address certain fiscal
issues, and volatility in many financial instrument markets. If economic growth in countries where we do business slows, or if
such countries experience further economic recessions, customers may delay or reduce technology purchases. This could result
in reductions in sales of our products and services, longer sales cycles, and slower adoption of our technologies.
Over the past several years, many of our customers have experienced tighter credit, negative financial news, and weaker
financial performance of their businesses and have reduced their workforces, thereby reducing the number of licenses and the
number of maintenance contracts they purchase from us. In addition, a number of our customers rely, directly and indirectly, on
government spending. Current debt balances of many countries without proportionate increases in revenues have caused many
countries to reduce spending and in some cases have forced those countries to restructure their debt in an effort to avoid
defaulting under those obligations. This has not only impacted those countries but others that are holders of such debt and those
assisting in such restructuring.
These actions may impact, and over the past several years have negatively impacted, our business, financial results, and
financial condition. Moreover, our financial performance may be negatively impacted by:
• lack of credit available to and the insolvency of key channel partners, which may impair our distribution channels and
cash flows;
• counterparty failures negatively impacting our treasury functions, including timely access to our cash reserves and
third-party fulfillment of hedging transactions;
• counterparty failures negatively affecting our insured risks;
• inability of banks to honor our existing line of credit, which could increase our borrowing expenses or eliminate our
ability to obtain short-term financing; and
• decreased borrowing and spending by our end users on small and large projects in the industries we serve, thereby
reducing demand for our products.
Uncertainty about current and future economic and political conditions on us, our customers and partners, makes it
difficult for us to forecast operating results and to make decisions about future investments.
A slower economic recovery in industries important to our business may adversely affect our business, financial results,
and financial condition. If a macro-economic recovery does not occur as rapidly as anticipated, our ability to meet our long-
term financial targets may also be adversely affected.
If we fail to successfully manage our business model transition to cloud-based products and more flexible product licenses, our
results of operations could be negatively impacted.
To address the industry transition from personal computer to cloud, social, and mobile computing, we have accelerated
our move to the cloud and are offering more flexible product licenses. As part of this transition, we announced in fiscal 2014
that we are discontinuing upgrades after fiscal 2015 and, on February 4, 2015, we also announced that new commercial seats of
2015 Annual Report