Shares of Autodesk Inc. fell after hours on Tuesday after the software maker’s third-quarter results failed to impress investors and the company trimmed its full-year billings outlook, citing a drop in demand for longer contracts.
Chief Financial Officer Debbie Clifford, in a statement on Tuesday, said the forecast largely reflects “less demand for multi-year, up-front and more demand for annual contracts than we expected.”
— which makes design software for industries like construction, manufacturing and entertainment — said it expected billings of $5.57 billion to $5.67 billion for its full fiscal year, which ends Jan. 31. That’s a bit lower than the forecast executives gave in August for between $5.7 billion and $5.8 billion.
Autodesk said it expected free cash flow of between $1.9 billion and $1.98 billion for the year. That’s down from prior expectations for a range between $2 billion and $2.08 billion.
Executives said they expected adjusted earnings per share of between $6.56 and $6.62 for the full year. In August, they said they expected earnings of between $6.52 and $6.71 a share. The company’s full-year sales forecast on Tuesday stood at a range of $4.99 billion to roughly $5 billion, a bit lower than the forecast given in August.
Shares slid 6.7% after hours on Tuesday.
For the third quarter, executives cited a “more challenging macroeconomic environment,” but said results were in line with internal expectations and said customers continued to renew subscriptions, even as recession concerns threaten to dampen tech spending.
The company reported net income of $198 million, or 91 cents a share, compared with $137 million, or 62 cents a share, in the same quarter last year. Revenue increased 14% to $1.28 billion, compared with $1.13 billion in the prior-year quarter.
Adjusted for stock-based compensation, amortization and other charges, Autodesk earned $1.70 a share.
Analysts polled by FactSet expected Autodesk to report adjusted earnings of $1.70 a share, on revenue of $1.281 billion.
Autodesk stock has lost 24% of its value year to date. Over that time, the S&P 500 Index
has fallen 17%.