Autodesk Media & Entertainment Revenue Declines 11 Percent in Q2 FY 2014

Posted by Joe Zaller
Aug 22 2013

Autodesk reported that its Q2 FY 2014 revenue from its Media and Entertainment (M&E) segment was $43m, a decline of 11% versus the same period a year ago, and down 9% compared to the previous quarter.

M&E gross margins for the second quarter of fiscal 2014 were $34m (79%), down from 80% for the same period a year ago, and flat compared to the previous quarter.

Autodesk’s M&E revenue has been in decline for the past several quarters — something the company has said for the past year that it expects to continue as it incorporates greater functionality into its design suites.

The company also plans to introduce new revenue models for M&E customers, including cloud-based rental.

 

Business Outlook

Autodesk says it now expects its revenue in the third quarter of fiscal 2014 to be in the range of $540m – $555m, and adjusted earnings in the range of $0.36 to $0.40 cents per share.

According to Reuters, analysts on average were expecting earnings of 50 cents per share on revenue of $580.9 million.  The disappointing results sent the company’s shares down as much as 5.6% in after-hours trading.

Autodesk is not providing full year fiscal 2014 guidance at this time.

“The challenging dynamics within some of the end-markets that we serve has led us to adjust our growth assumptions,” said Mark Hawkins, Autodesk executive vice president and CFO. “While the near-term revenue target is lower, we remain diligent about managing our spend while making essential investments to drive growth. With the recent introduction of more flexible license and service offerings that have ratable revenue streams, such as cloud-based and rental license offerings, Autodesk’s business model is evolving. We are currently refining our plans around the pace and time frame for this business model transition. As we evolve our business model, we remain committed to long-term operating margin expansion.”

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Related Content:

Press Release: Autodesk Reports Second Quarter FY 2014 Results

Reuters: Autodesk forecasts disappointing third-quarter, shares fall

Previous Quarter: Autodesk Media & Entertainment Revenue Drops 8% in Q1 FY 2014, Readies Cloud-Based Launch

Previous Year: Autodesk Says Media & Entertainment Revenue Fell 10 Percent in Q2 FY 2013, Will Restructure Overall Business Strategy

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