Autodesk, Inc. (NASDAQ:ADSK) Q3 2023 Earnings Call Transcript

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Debbie Clifford: Thanks Matt. So, we are not guiding on the call today. We are trying to provide some insight into how to think about it. And that range is in the realm of possibility, and there are a couple of factors that we want to continue to emphasize that are going to impact that. And that is the rate at which our customers transition to annual billings and the overall macroeconomic environment. But as I have said, we will provide specifics on the next earnings call.

Matt Hedberg: Got it. Thanks. And then maybe just one on the expense side, I appreciate the currency headwinds next year and sort of the reiteration of kind of the long-term margin framework. Are there things that you guys are doing right now from a spend perspective, whether it’s hiring or just sort of like general cost consciousness as we get into more economic uncertainty?

Debbie Clifford: Thanks. So, first, I want to say that we have been focused on ensuring that we don’t spend ahead of top line growth. We have delivered considerable operating margin expansion over the last couple of years. We have exhibited a spend discipline that we now benefit from as the market conditions continue to evolve. If we focus on the near-term, we have delivered on our margin goals for the year-to-date. We are on track to do so through the end of the year. You can see that from no change in our operating margin guidance. Our hiring plans at the beginning of the year reflected really what is a solid balance between proactive investment and the discipline required to achieve our margin targets. As we look ahead to next year, we are in the planning process right now, but we are focused on ensuring that we continue this pattern of disciplined spend.

We are looking to ensure that we can invest in the right areas to drive the strategy. So, things like purposeful and strategic rather than broad-based investing in areas like our industry clouds and shared services, but all against a backdrop of delivering a healthy margin. And I also want to say that we want to ensure that we are not too short-term in our thinking. We have a strong balance sheet. We want to make sure that we strike that right balance as we navigate these macro waters. We want to capitalize on the downturn to continue to invest, but all while keeping that watchful eye on operating margin. And as we said before, we are committed to achieving a margin target in the 38% to 40% range in that fiscal €˜23 to €˜26 window.

Matt Hedberg: Alright. Thanks.

Operator: Thank you. Our next question comes from the line of Tyler Radke of Citi. Your line is open.

Tyler Radke: Thanks for taking my question. Andrew, so at AU, you obviously announced the product announcements on Forma and Flow. I am curious how, if you could talk a little bit about the plans to accelerate the engineering velocity, specifically, is this is going to require more hiring, or is it just kind of re-prioritization of your engineers? And then just kind of comparing it to the timeline that you saw Fusion play out in that monetization cycle, just help us understand how you are expecting kind of the product to roll out and the monetization trend over time? Thanks.

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