Autodesk 2015 Annual Report Download - page 132

2015 Form 10-K 40
available at the time. As additional information becomes available, we reassess our potential liability and may revise our
estimates. Such revisions could have a material impact on future quarterly or annual results of operations.
Recently Issued Accounting Standards
See Part II, Item 8, Note 1, “Business and Summary of Significant Accounting Policies,” in the Notes to Consolidated
Financial Statements for a full description of recent accounting pronouncements, including the expected dates of adoption and
estimated effects on results of operations and financial condition.
Overview of Fiscal 2015
Fiscal Year
Ended January
31, 2015 As a % of Net Revenue
Fiscal Year
Ended January
31, 2014 As a % of Net Revenue
(in millions)
Net Revenue $ 2,512.2 100% $ 2,273.9 100%
Cost of revenue 342.1 14% 274.3 12%
Gross Profit 2,170.1 86% 1,999.6 88%
Operating expenses 2,049.4 82% 1,714.8 75%
Income from Operations $ 120.7 5% $ 284.8 13%
During fiscal 2015, as compared to the prior fiscal year, net revenue increased 10%, gross profit increased 9%, and
income from operations decreased 58%. Contributing to the year over year decrease in income from operations during fiscal
2015 was an increase in operating expenses, offset by increases in both subscription revenue and license and other revenue.
We continue to make progress on our business model transition announced in fiscal 2014 with more flexible licenses and
service offerings that have ratable revenue streams. As a result, our net revenue for fiscal 2015 excluded approximately $87
million that was deferred as a result of the transition. The $87 million related to flexible licensing arrangements with certain
enterprise customers and had a particular impact on license revenue in the Americas and EMEA geographies, as well as our
AEC and MFG business segments.
Our business experienced year over year growth in our AEC, MFG, and PSEB segments, many of our major products,
particularly our AEC suites, and all of our geographic areas, particularly EMEA. This growth contributed to the year over year
increase in both subscription and license and other revenue during fiscal 2015. We also experienced growth in our total
subscriptions and billings during fiscal 2015, as compared to fiscal 2014, primarily due to promotional activity driving upgrades
and maintenance renewals in advance of the end of upgrades after fiscal 2015.
Income from operations for fiscal 2015 was negatively impacted by increased spend as a result of the business model
transition, the incremental employee costs associated with acquisitions, investments in our move to the cloud, as well as
increased spending on other key initiatives.
The reasons for these changes are discussed below under the heading “Results from Operations.”
Revenue Analysis
Revenue from flagship products represented 48% and 51% of total net revenue during fiscal 2015 and fiscal 2014,
respectively. Revenue from flagship products increased by 2% as compared to the prior fiscal year. Revenue from suites
represented 36% and 34% of total net revenue for fiscal 2015 and fiscal 2014, respectively, and increased by 17% compared to
the prior fiscal year. Revenue from new and adjacent products represented 16% and 14% of total net revenue during fiscal
2015 and fiscal 2014, respectively. Revenue from new and adjacent products increased by 24% as compared to fiscal 2014.
We rely significantly upon major distributors and resellers in both the U.S. and international regions, including Tech Data
Corporation and its global affiliates (collectively, “Tech Data”). Tech Data accounted for 25% and 24% of our consolidated net
revenue during fiscal 2015 and 2014, respectively. We believe our business is not substantially dependent on Tech Data. Our
customers through Tech Data are the resellers and end users who purchase our software licenses and services. Should any of the
agreements between Tech Data and us be terminated for any reason, we believe the resellers and end users who currently
2015 Annual Report