Autodesk Reports Strong Revenue Growth but Slower Rise in Remaining Performance Obligations
Autodesk (NASDAQ:ADSK) reported a strong performance for its fiscal second quarter, with revenue rising 16% year-over-year to $2.046 billion and billings increasing by 10%. However, total remaining performance obligations (RPO), which indicate future revenue commitments, grew only modestly at 2%, raising concerns about long-term visibility. The company has been shifting its contract strategy by reducing discounts on multiyear agreements, including phasing out certain renewals. This change is expected to improve pricing over time but temporarily impacts unbilled deferred revenue and RPO growth, which fell 8% in the quarter. Management remains optimistic that better price realization will offset weaker long-term commitments. Autodesk also saw improved profitability with GAAP operating margin expanding four percentage points to 29%, while non-GAAP operating margin rose two points to 41%. Free cash flow increased by 24% to $561 million. However, the acquisition of MaintainX is expected to dilute margins in fiscal 2027 and add costs for at least one full year.
Tickers: $ADSK
Topics: operating_margin pricing_strategy remaining_performance_obligations revenue_growth