Autodesk (ADSK Quick QuoteADSK - Free Report) reported fourth-quarter fiscal 2022 non-GAAP earnings of $1.50 per share that beat the Zacks Consensus Estimate of $1.43 per share by 4.9%. The bottom line improved 27.1% year over year.

The company reported revenues of $1.21 billion, surpassing the consensus mark of $1.19 billion. The figure grew 17% year over year. At constant currency, revenues were up 15%. The upside was driven by new product subscriptions and higher renewal rates.

Top-Line Details

Autodesk’s subscription revenues (92.5% of total revenues) increased 18% year over year (up 16% on a constant currency basis) to $1.12 billion. However, maintenance revenues (1.9% of total revenues) slumped 25% year over year (down 28% on a constant currency basis) to $23 million. Other revenues (5.6% of total revenues) increased 14.8% to $67.4 million in the reported quarter.

Recurring revenues contributed 94% to Autodesk’s fourth-quarter fiscal 2022 revenues. Net revenue retention rate was within the 100-110% range.

Region-wise, revenues from the Americas (40.3% of revenues) increased 18% from the year-ago quarter’s levels to $488.7 million. Revenues from Europe, Middle East and Africa (EMEA), which accounted for 39.2% of revenues, increased 16% to $474.5 million. Revenues from Asia-Pacific (20.5% of revenues) rallied 16% to $248.4 million.

Billings of $1.66 billion increased 13% year over year in the reported quarter.

Products Top-Line Details

Autodesk offers primarily four product families — Architecture, Engineering and Construction (AEC), AutoCAD and AutoCAD LT, Manufacturing (MFG) and Media and Entertainment (M&E).

AEC (43.5% of revenues) revenues increased 17% year over year to $527.5 million. AutoCAD and AutoCAD LT (28.5% of revenues) revenues rose 20% to $345.1 million. MFG (20.3% of revenues) revenues increased 4% to $246 million.

M&E (6.8% of revenues) surged 38% to $82.4 million, while other revenues (0.9% of revenues) increased 39% to $10.6 million.

Operating Results

Autodesk reported a non-GAAP operating income of $422 million, up 34% year over year.

Non-GAAP operating margin expanded 500 bps from the year-ago quarter’s levels to 35%.

Balance Sheet & Cash Flow

As of Jan 31, 2022, Autodesk had cash and cash equivalents (including marketable securities) of $1.76 billion compared with $1.79 billion as of Oct 31, 2021.

Deferred revenues increased 13% to $3.79 billion. Unbilled deferred revenues at the end of the fiscal fourth quarter were $949.2 million, up 7.8% year over year.

Total remaining performance obligation (RPO) of $4.74 billion and current RPO of $3.14 billion increased 12% and 15%, respectively.

Cash flow from operating activities was $723 million, while free cash flow was $716 million in the reported quarter. During the full fiscal 2022, cash flow from operating activities was $1.53 billion, and free cash flow was $1.48 billion.

In the quarter under review, the company repurchased 2.3 million shares for $613 million at an average price of approximately $267 per share.

Full-Year Highlights   

For full-year 2022, Autodesk reported revenues of $4.39 billion, indicating a surge of 16% year over year (up 14% on a constant currency basis).

The company reported non-GAAP earnings of $5.07 per share, witnessing an increase of 25.2%.

Non-GAAP operating income was $1.4 billion compared with fiscal 2021’s $1.11 billion. Non-GAAP operating margin expanded 300 bps to 32%.

Billings of $4.82 billion increased 16% year over year in fiscal 2022.

Guidance

For the first quarter of fiscal 2023, Autodesk expects revenues between $1.145 billion and $1.160 billion. Non-GAAP earnings are anticipated to be $1.30-$1.36 per share.

For fiscal 2023, Autodesk expects revenues between $5.020 billion and $5.120 billion, indicating growth of 14-17% year over year. Non-GAAP earnings are expected between $6.46 and $6.83 per share.

Billings are estimated to be $5.875-$6.025 billion, suggesting an increase of 22-25% year over year.

The company expects a non-GAAP operating margin of approximately 37% in fiscal 2023. Free cash flow is projected to be $2.130-$2.210 billion.

Zacks Rank & Key Picks

Autodesk currently carries a Zacks Rank #3 (Hold).

Some better-ranked stocks from the broader computer and technology sector include the iPhone maker Apple (AAPL Quick QuoteAAPL - Free Report) and Axcelis Technologies (ACLS Quick QuoteACLS - Free Report) , both sporting a Zacks Rank #1 (Strong Buy), and Analog Devices (ADI Quick QuoteADI - Free Report) carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

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