Autodesk, Inc. recently announced the financial results for its fourth fiscal quarter ended January 31, 2006. For the fourth quarter, Autodesk reported record net revenues of $417 million, a 17 percent increase over $356 million reported in the fourth quarter of the prior year.
Fourth quarter net income was $83 million, or $0.33 per diluted share on a GAAP basis and $91 million, or $0.37 per diluted share on a non-GAAP basis. Fourth quarter non-GAAP net income excludes $8 million in-process R&D expenses related to the acquisition of Alias and $1 million amortization of purchased intangibles. Net income in the fourth quarter of the prior year was $66 million, or $0.26 per diluted share on a GAAP basis, and $75 million, or $0.30 per diluted share on a non-GAAP basis.
Autodesk’s performance was driven by strong growth in new seats and subscriptions, increasing penetration of its vertical and 3D products and continued strong profitability. In addition, during the quarter the company completed the acquisition of Alias for $197 million.
Unlike trends at many major software companies, revenues from new seats and emerging businesses continued to be strong, representing approximately two-thirds of total revenues in the fourth quarter. Revenues from new commercial seats increased 16 percent over the fourth quarter of the prior year and 23 percent on a constant currency basis.
Subscription revenues increased 53 percent over the fourth quarter of last year and exceeded upgrade revenue for the quarter and the full year. Combined revenues from subscription and upgrades continue to represent approximately one-third of total revenues. Consistent with the growth in subscriptions and the company’s movement of the retirement of the AutAD 2002-based family of products to March 2006, upgrade revenues decreased compared to the fourth quarter of the prior year.
The company’s vertical and 3D products continue to increase their market penetration. In the fourth quarter of fiscal 2006, combined revenues from new commercial seats of the company’s 3D products increased 73 percent over the prior year.
During the quarter, Autodesk continued to show strong profitability. Operating margins increased to 23 percent on a GAAP basis compared to 22 percent in the prior year. Non-GAAP operating margins were flat compared to the prior year at 25 percent. The acquisition of Alias decreased fourth quarter non-GAAP operating margins by 1 percentage point.