Autodesk Inc (NASDAQ:ADSK) shares fell more than 4% in pre-market trading on Friday after the design software company reported second-quarter results above analyst expectations but issued fiscal 2027 adjusted earnings guidance that came in slightly below consensus at the midpoint.
For the quarter ended July 31, Autodesk reported adjusted earnings per share of $3.30, exceeding the analyst consensus of $3.12 by $0.18.
Revenue increased 16% year over year to $2.05 billion, ahead of the $2.01 billion estimate. On a constant-currency basis, revenue grew 14%.
Subscription revenue grows 17%
Autodesk reported subscription growth of 17%, above the 14.5% estimate cited in the source material, supported by better-than-expected renewal rates and sales linearity.
Current remaining performance obligations growth slowed to 12% during the second quarter from year-over-year growth of between 18% and 20% in recent quarters.
The source material attributed the slowdown partly to the removal of discounts on multi-year agreements, which resulted in some customers moving to annual contracts. This effect is expected to continue for several more quarters.
Fiscal 2027 EPS outlook comes in below consensus at midpoint
For fiscal 2027, Autodesk forecast adjusted earnings per share of between $12.52 and $12.60.
The midpoint of $12.56 was below the analyst consensus estimate of $12.60 cited in the source material.
For the third quarter, Autodesk expects revenue of between $2.125 billion and $2.140 billion, alongside adjusted earnings per share of $3.04 to $3.09.
Bank of America analysts described the report as “mixed 2Q27 results with conservatism into 2H27 guide.”
“We reiterate our Buy rating and $300 PO, as renewals support durable underlying growth at or above current guidance targets,” they wrote.
The comments represent Bank of America’s assessment rather than company guidance.
Free cash flow rises 24%
Autodesk reported quarterly billings of $1.85 billion, an increase of 10% from the previous year.
Adjusted operating margin expanded by two percentage points to 41%, while free cash flow increased 24% to $561 million.
Design revenue rose 16% to $1.71 billion, while Make revenue increased 26% to $244 million.
Within its product portfolio, the AECO family generated revenue of $1.03 billion, up 17% year over year, while AutoCAD revenue increased 14% to $500 million.
Autodesk raises billings and revenue growth guidance
“We delivered strong second quarter results with consistent execution and momentum. Our sales reorganization is proceeding as expected,” said Janesh Moorjani, Autodesk CFO. “We have increased our fiscal 27 billings and revenue growth guidance to reflect higher underlying growth expectations, as well as the incremental contribution from MaintainX.”
For fiscal 2027, Autodesk expects billings of between $8.575 billion and $8.650 billion.
The company also forecasts full-year revenue of between $8.295 billion and $8.345 billion.