Autodesk 2015 Annual Report Download - page 114

2015 Form 10-K 22
Because we derive a substantial portion of our net revenue from a small number of products, including our AutoCAD-based
software products and suites, if these products are not successful, our revenue will be adversely affected.
We derive a substantial portion of our net revenue from sales of licenses of a limited number of our products, including
AutoCAD software, products based on AutoCAD, which include our suites that serve specific markets and products that are
interoperable with AutoCAD. Any factor adversely affecting sales of these products, including the product release cycle, market
acceptance, product competition, performance and reliability, reputation, price competition, economic and market conditions,
and the availability of third-party applications, would likely harm our financial results. During fiscal 2015 and 2014, combined
revenue from our AutoCAD and AutoCAD LT products, not including suites having AutoCAD or AutoCAD LT as a
component, represented 28% and 30% of our total net revenue, respectively.
A breach of security in our products, services or computer systems may compromise the integrity of our products or services,
harm our reputation, create additional liability and adversely impact our financial results.
We make significant efforts to maintain the security and integrity of our source code and computer systems. The risk of a
security breach or disruption, particularly through cyber attack or cyber intrusion, including by computer hackers, foreign
governments and cyber terrorists, has increased as the number, intensity, and sophistication of attempted attacks and intrusions
from around the world have increased. These threats include but are not limited to identity theft, unauthorized access, DNS
attacks, wireless network attacks, viruses and worms, advanced persistent threat (APT), application centric attacks, peer-to-peer
attacks, phishing, backdoor trojans, and distributed denial of service (DDoS) attacks. Any of the foregoing could attack our
products, services or computer systems. Despite significant efforts to create security barriers to such programs, it is virtually
impossible for us to entirely eliminate this risk. Like all software, our software is vulnerable to cyber attacks. In the past,
hackers have targeted our software, and they may do so in the future. The impact of cyber attacks could disrupt the proper
functioning of our software products or services, cause errors in the output of our customers' work, allow unauthorized access
to sensitive, proprietary or confidential information of ours or our customers, and other destructive outcomes. Moreover, as we
continue to invest in new lines of consumer products and services we are exposed to increased security risks and the potential
for unauthorized access to, or improper use of, the information of our consumer users. If any of the foregoing were to occur, our
reputation may suffer, customers may stop buying our products or services, we could face lawsuits and potential liability, and
our financial performance could be negatively impacted.
We rely on third parties to provide us with a number of operational services, including hosting and delivery and certain of our
customer services and other operations. Any interruption or delay in service from these third parties, breaches of security or
privacy, or failures in data collection could expose us to liability, harm our reputation, and adversely impact our financial
performance.
We rely on hosted computer services from third parties for services that we provide our customers and computer
operations for our internal use. As we gather customer data and host certain customer data in third-party facilities, a security
breach could compromise the integrity or availability or result in the theft of customer data. In addition, our operations could be
negatively affected in the event of a security breach, and we could be subject to the loss or theft of confidential or proprietary
information, including source code.
Unauthorized access to this data may be obtained through break-ins, breaches of our secure networks by unauthorized
parties, employee theft or misuse, or other misconduct. We rely on a number of third-party suppliers in the operation of our
business for the provision of various services and materials that we use in the operation of our business and production of our
products. Although we seek to diversify our third-party suppliers, we may from time to time rely on a single or limited number
of suppliers, or upon suppliers in a single country, for these services or materials. The inability of such third parties to satisfy
our requirements could disrupt our business operations or make it more difficult for us to implement our business strategy. If
any of these situations were to occur, our reputation could be harmed, we could be subject to third-party liability, including
under data protection and privacy laws in certain jurisdictions, and our financial performance could be negatively impacted.
If we are not able to adequately protect our proprietary rights, our business could be harmed.
We rely on a combination of patent, copyright and trademark laws, trade secret protections, confidentiality procedures,
and contractual provisions to protect our proprietary rights. Despite such efforts to protect our proprietary rights, unauthorized
parties from time to time have copied aspects of our software products or have obtained and used information that we regard as
proprietary. Policing unauthorized use of our software products is time-consuming and costly. We are unable to measure the
2015 Annual Report