Autodesk trims billings forecast, citing a more cautious software customer

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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 slump in demand for long contracts.

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The forecast broadly reflects “lower demand for multi-year, up-front and annual contracts than we expected,” Chief Financial Officer Debbie Clifford said in a statement Tuesday.

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Autodesk ADSK,
— which makes design software for industries such as construction, manufacturing and entertainment — said it expects billings of $5.57 billion to $5.67 billion for its full fiscal year, which ends Jan. 31. billion and $5.8 billion.

Autodesk said it expects free cash flow for the year to be between $1.9 billion and $1.98 billion. This is lower than earlier expectations of between $2 billion and $2.08 billion.

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Executives said they expect adjusted earnings per share of between $6.56 and $6.62 for the full year. In August, he said he expected earnings per share of between $6.52 and $6.71. The company’s full-year sales forecast on Tuesday was in the range of $4.99 billion to $5 billion, which is slightly lower than the forecast given in August.

Shares were down 6.7% after hours on Tuesday.

For the third quarter, executives cited a “more challenging macroeconomic environment” but said the results were in line with internal expectations and noted that customers continued to renew subscriptions, even as recession concerns weighed on technical Threatened to cut spending.

The company reported net income of $198 million, or 91 cents per share, compared to $137 million, or 62 cents per share, in the same quarter last year. Revenue increased 14% to $1.28 billion compared to $1.13 billion in the prior-year quarter.

Adjusted for stock-based compensation, amortization and other charges, Autodesk earned $1.70 per share.

Analysts polled by FactSet expected Autodesk to report adjusted earnings of $1.70 per share on revenue of $1.281 billion.

Autodesk stock has lost 24% of its value year to date. During that time, the S&P 500 Index SPX,
17% has fallen.

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