Autodesk (NASDAQ: ADSK) shares declined approximately 4% on Friday, as investors weighed the company's fiscal second-quarter earnings beat against a softer-than-expected outlook for the third quarter and full year. The software maker's guidance for the upcoming periods came in below consensus estimates, overshadowing its better-than-anticipated quarterly results.
Q2 earnings and revenue top estimates
For the fiscal second quarter, Autodesk reported adjusted earnings of $3.30 per share, surpassing the $3.12 average analyst estimate. Revenue climbed 16% year over year to $2.05 billion, also exceeding the $2.01 billion consensus. Billings rose 10% to $1.85 billion, while current remaining performance obligations (cRPO) grew 12% to $5.2 billion, indicating sustained demand for the company's design and engineering software.
CEO Andrew Anagnost emphasized Autodesk's position in the artificial intelligence landscape, stating, "The future of AI for the built world will belong to the trusted platform that combines the richest context with the right models to deliver the best outcomes for customers."
Guidance disappoints, but analysts stay positive
Despite the quarterly beat, Autodesk's outlook weighed on the stock. For the third quarter, the company guided earnings of $3.04 to $3.09 per share and revenue of $2.125 billion to $2.140 billion. Analysts had projected earnings of $3.14 per share, though their revenue estimate of $2.08 billion was below Autodesk's range.
For the full fiscal year, Autodesk forecast earnings of $12.52 to $12.60 per share and revenue of $8.295 billion to $8.345 billion. Wall Street expected earnings of $12.58 per share and revenue of $8.21 billion. The company also raised its organic fiscal 2027 revenue-growth outlook by about one percentage point after adjusting for foreign exchange.
Several analysts reiterated bullish stances. BTIG's Nick Altmann maintained a Buy rating with a $300 price target, citing stronger-than-expected revenue growth, resilient renewals, and improving expansion activity. He noted that revenue increased 14% on a constant-currency basis, ahead of BTIG's 12% estimate. Stifel kept its Buy rating and $285 target, while DA Davidson reaffirmed a Buy with a $325 target, pointing to the improved organic growth outlook.
Margins remain a key concern
Profitability continues to be a focal point as Autodesk integrates MaintainX, a maintenance management software provider. The company reported a 41% operating margin, above BTIG's 39% estimate and roughly 200 basis points higher than a year earlier. GAAP operating margin reached 29%, compared with BTIG's 26% estimate.
However, Altmann identified the margin outlook as the primary concern. Autodesk maintained its fiscal 2027 operating-margin framework at around 39% but lowered its GAAP margin outlook by about one percentage point as MaintainX adds costs. MaintainX is expected to contribute approximately $60 million in fiscal 2027 revenue and roughly $70 million in billings.
Stifel noted that the midpoint of Autodesk's free cash flow guidance declined 1% as the company absorbs MaintainX expenses. The firm also said Autodesk continues to see traction with its ACC and Fusion products, while broader macroeconomic and demand conditions remain unchanged.
Investors may also be monitoring broader software trends, as seen in recent moves by other tech names like Marvell's stock dip despite a record quarter and Adobe's golden cross formation. These developments highlight the market's sensitivity to guidance and valuation in the current environment.
This article is for informational purposes only and does not constitute financial advice.
