Aug
13
Written by:
Steve Wolfe
8/13/2010 12:00 PM
Autodesk's total revenues rose 14 percent in the quarter ended July 31, 2010 when compared with the like quarter a year earlier. In contrast, PTC reported a 7 percent revenue increase, and Ansys’ sales rose 13 percent in the quarter ended June 30, 2010. Dassault Systèmes reported a 16 percent sales increase (in US dollars) in the second calendar quarter. But after adjusting for the acquisition of IBM’s PLM Software business, revenues appear flat.
Figure 1-Autodesk’s revenues remain well below the peaks set in 2008, but profits rebounded sharply in the most recent quarter.
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Parsing Autodesk’s sales growth by product lines, Autodesk’s Manufacturing Systems division bested all others by growing 19 percent. It was followed by the much larger Platform division, which grew 18 percent. (The Platform division sells plain AutoCAD; its low-priced cousin, AutoCAD LT; and a grab bag of software for mapping, freehand drawing, piping design, and other purposes.) Sales of Autodesk’s construction division rose 8 percent, and the Media and Entertainment division grew 6 percent. The big winner in Autodesk’s software portfolio is the 30-year-old AutoCAD, whose sales jumped 21 percent year-to-year. It accounts for 34 percent of Autodesk’s total revenues.
Figure 2-Autodesk’s manufacturing and entertainment divisions were the only ones to show sequential sales gains.
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Thanks to cost cutting in the previous quarters, Autodesk’s profits soared 4.7-fold to $59.9 million on the modest revenue increase. That’s just shy of the $62 million Dassault Systèmes earned in its most recent quarter.
What’s interesting about Autodesk’s success is that the company’s products consist almost entirely of single-user desktop tools that engineers use to do their jobs faster. Relatively little of Autodesk’s income comes from what its rivals call “product lifecycle management” (PLM) software that combines engineering applications with fiendishly complex enterprise-level software for managing engineering data.
Comparing Autodesk’s performance with that of comparable competitors, it appears that single-user applications are growing more briskly than PLM software. Dassault Systèmes’ SolidWorks unit grew a respectable 12 percent (in US dollars), while Ansys grew 13 percent. PLM companies are investing vast sums to develop complicated PLM software that only a few customers seem inclined to buy right now. Autodesk’s strategy of keeping its products relatively simple and relatively low-priced appears to be besting the competition as we crawl up from the worst recession since the 1930s.
Figure 3-Sales of the Manufacturing Systems division returned to their five-year trend line.
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Figure 4-With construction mired in a slump, growth slowed in Autodesk’s construction division, its second largest.
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Figure 5-Autodesk owned the annual Siggraph exposition this year, but its sales of tools for game and movie production are stuck in a downtrend.
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Figure 6-With a relatively small share of the Asian market, Autodesk would appear poised to grow in that region.