Autodesk, Inc. (ADSK) | The Buildout — AI Infrastructure
The Verdict
Autodesk makes subscription software for designing, building and operating physical things — buildings, infrastructure, machines and media. The tools sit inside the workflow of the firms that carry out that work, and of the owners who run the results. That makes Autodesk an applied-AI platform rather than an AI supplier: it ships no chips, servers, cooling or power, and monetizes AI by embedding features into products customers already buy. Management frames the strategy as converging design, make and operate so project data flows continuously across an asset's life cycle. Its construction software is used by contractors and owners on physical projects, including a U.K. building services contractor consolidating fragmented systems across data center and commercial projects.
| Market Cap | — |
| Revenue (TTM) | $7.8B |
| Revenue Growth | +17.9% |
| EBITDA Margin (TTM) | 30.1% |
| Net Cash | $450M |
| Earnings Beats | 7 of 7 |
| P/E (TTM) | — |
| EV/EBITDA (TTM) | — |
What We Like
- FY27 guidance was raised, with billings moving to $8.575–$8.65 billion and revenue to $8.295–$8.345 billion.
- Construction revenue is about $600 million on a trailing-12-month basis and growing north of 20%, which management attributes to low technology penetration rather than a construction cycle.
- Remaining performance obligations were $7.81 billion, with $5.38 billion — 69% — expected to convert to revenue within 12 months.
- Non-GAAP operating margin reached 41% in FY27 Q2, up about 2 points year over year, and management reaffirmed a 41% target for FY29.
- Revenue through distributor TD Synnex fell to 14% of FY26 net revenue from 39% in FY24, a sharp reduction in single-partner concentration.
What We’re Watching
- Q4 FY27 carries the year's largest EBA renewal cohort, against what management calls a tough year-on-year comparison.
- MaintainX integration is early, and management promised four quarters of separate MaintainX revenue disclosure to show whether the >50% growth rate holds inside Autodesk.
- Western Europe new-business productivity is normalizing more slowly than the Americas, APAC, Eastern Europe and the Middle East, with no end date given.
- Changes to multiyear discounting are temporarily weighing on unbilled deferred revenue and RPO growth, a trade-off management says benefits price realization over time.
The thesis reads as intact but no longer expanding. Subscription revenue, a construction line growing north of 20% on technology penetration rather than a construction cycle, and non-GAAP operating margin moving from 39% to 41% all held across the two quarters in the record. What is unresolved is the transition: the transaction-model tailwind was worth about 3.5 points of FY27 Q1 revenue growth and about 2 points in Q2, and it ends after FY27, so the reported growth rate converges down toward the underlying rate. The open question is the Q4 FY27 EBA renewal cohort, the year's largest, because it lands against the toughest comparison management has flagged and it sizes the FY28 revenue base.
Earnings Beat
Autodesk reported FY27 Q2 revenue of $2.05 billion, up 16% as reported and 14% in constant currency, with gross margin of 91.4%. Non-GAAP operating margin was 41%, up about 2 points year over year, and GAAP operating margin was 29%. Free cash flow was $561 million and billings grew 10% as reported. The company's reported earnings have come in ahead of analyst estimates in seven of seven tracked quarters.
| Metric | Q2 FY2027 | Q1 FY2027 | Q2 FY2026 | YoY |
|---|---|---|---|---|
| Revenue | $2.0B | $1.9B | $1.8B | +16.1% |
| Gross margin | 91.4% | 91.0% | 91.0% | +40bps |
| EBITDA | $649M | $592M | $497M | +30.6% |
| EPS | $2.32 | $2.32 | $1.46 | +59.4% |
| Billings growth (as reported) | +10% | +18% | n/a | — |
MaintainX does present a drag on operating margin in fiscal '27.— Janesh Moorjani, CFO, 2026-08-27
Management tone: Management was candid about the weak spots without being asked to quantify them: it said the acquired MaintainX business was not profitable, attributed the GAAP margin cut to acquisition accounting, itemized the free-cash-flow narrowing, and named Western Europe as the lagging region in both prepared remarks and Q&A. On hard questions it decomposed rather than deflected — the organic-versus-inorganic billings bridge was answered with numbers. On AI revenue disclosure, usage telemetry and FY28 dynamics it reframed into framework language instead of giving figures.
Management Guidance
Management guides FY27 billings of $8.575–$8.65 billion, revenue of $8.295–$8.345 billion, GAAP operating margin of 25–27%, non-GAAP operating margin of about 39%, and free cash flow of $2.725–$2.75 billion. The billings and revenue raises reflect MaintainX's contribution plus an underlying improvement, partly offset by currency and transaction-model mix; the GAAP margin cut reflects MaintainX accounting effects. H2 FY27 includes about $60 million of MaintainX revenue and about $70 million of billings, weighted slightly toward Q4, plus roughly $45 million of transaction expenses. Management guides FY28 non-GAAP operating margin to improve modestly from 39% and reaffirms 41% for FY29.
Trajectory
Revenue growth stepped down from 18% as reported in FY27 Q1 to 16% in FY27 Q2, and billings growth from 18% to 10%. Part of that is mechanical: the shift to annual billings for most multiyear contracts added about 3.5 percentage points to Q1 revenue growth, about 2 points to Q2 and about 1.5 points for the full year, and does not recur in FY28. Margins moved the other way — non-GAAP operating margin went from 39% to 41% quarter over quarter, and gross margin was 91.4% in Q2. Stock-based compensation fell to about 9% of revenue in FY27 from about 11% in FY26.
The Model
The model's locked projections put FY+1 revenue at $8,370 million and EBITDA at $2,561 million, a 30.6% EBITDA margin. For FY+2 it projects revenue of $9,485 million and EBITDA of $3,021 million, a 31.85% margin. The near-term figure anchors on the company's raised FY27 guidance range and on MaintainX starting to contribute; FY+2 assumes the construction and Fusion growth vectors hold and the margin path to the 41% FY29 target stays on track.
| Metric | FY2026 | Next FY (E) | Following FY (E) |
|---|---|---|---|
| Revenue | $7.2B | $8.4B | $9.5B |
| YoY Growth | — | +16.2% | +13.3% |
| EBITDA | $2.0B | $2.6B | $3.0B |
| EBITDA Margin | 27.6% | 30.6% | 31.9% |
Projections are the median of 4 independent model runs. The model’s revenue sits 4.5% above analyst consensus.
Management guides FY27 billings of $8.575–$8.65 billion, revenue of $8.295–$8.345 billion, GAAP operating margin of 25–27%, non-GAAP operating margin of about 39%, and free cash flow of $2.725–$2.75 billion. The billings and revenue raises reflect MaintainX's contribution plus an underlying improvement, partly offset by currency and transaction-model mix; the GAAP margin cut reflects MaintainX accounting effects. H2 FY27 includes about $60 million of MaintainX revenue and about $70 million of billings, weighted slightly toward Q4, plus roughly $45 million of transaction expenses. Management guides FY28 non-GAAP operating margin to improve modestly from 39% and reaffirms 41% for FY29.
What Could Go Right — and Wrong
- MaintainX holds the >50% growth rate it carried into the acquisition, confirmed by the four quarters of separate MaintainX revenue disclosure.
- The Q4 FY27 EBA renewal cohort renews and expands, converting the year's largest uncertainty into the FY28 revenue base.
- Western Europe new-business productivity normalizes, completing the sales reorganization without a lingering drag on organic growth.
- Construction keeps compounding north of 20% on technology penetration, and the named common-data-environment and digital-twin deployments move from early stages to portfolio scale.
- Consumptive AI revenue appears through Flex and workflow-level automation, particularly in Fusion.
- MaintainX growth decelerates after the close, or the annualized cost absorbs more FY28 margin than the guided modest improvement allows.
- The Q4 FY27 EBA renewal cohort underperforms against a harder comparison, hitting billings and the closing RPO balance at the same time.
- RPO and unbilled deferred revenue growth stay below revenue growth, meaning the multiyear-discount trade-off does not produce the intended price realization.
- AI workload and cloud hosting costs compress gross margin faster than the FY29 41% target embeds.
- Procore or Bentley monetize AI into share gains in construction and AEC faster than Autodesk does.
Looking Ahead
Over the next 12 months the questions are mostly operational. Autodesk begins disclosing MaintainX revenue separately for four quarters and then reverts to commentary only. The largest EBA renewal cohort of the year lands in Q4 FY27 against the toughest comparison management has flagged. Western Europe new-business productivity is expected to normalize gradually through the back half. Management has also said it will keep charging for APIs and machine-based usage, with timelines adjusted for customer ramp-up, and points to consumptive AI revenue arriving through Flex and related models as time goes on.
- Next four quartersMaintainX revenue disclosure — Four quarters of separate MaintainX revenue, then commentary only.
- H2 FY27Western Europe normalization — New-business productivity lagging other regions; no end date given.
- Q4 FY27Largest EBA renewal cohort — Year's largest cohort, concentrated in the quarter; tough comparison.
- FY28FY28 margin vs MaintainX costs — Guided modest improvement from 39% despite MaintainX annualizing.
- FY2941% non-GAAP margin target — Reaffirmed twice; embeds AI workload gross-margin compression.
Financials
Annual Summary
| Metric | FY2025 | FY2026 | TTM | YoY |
|---|---|---|---|---|
| Revenue | $6.1B | $7.2B | $7.8B | +17.5% |
| Gross Margin | 90.5% | 91.0% | 91.3% | +40bps |
| EBITDA | $1.5B | $2.0B | $2.3B | +28.4% |
| EBITDA Margin | 25.3% | 27.6% | 30.1% | +234bps |
| Net Income | $1.1B | $1.1B | $1.6B | +1.1% |
| Free Cash Flow | $1.5B | $2.4B | $2.8B | — |
| Net Cash | — | — | — | — |
Key Ratios (Trailing)
- P/E TTM—
- EV/EBITDA TTM—
- EV/Revenue TTM—
- Price/FCF TTM—
- Gross Margin (TTM)91.3%
- EBITDA Margin (TTM)30.1%
- Net Margin (TTM)21.1%
- ROIC57.8%
- FCF Conversion120.7%
- SBC / Revenue9.1%
The Company
Autodesk sells subscription software for 3D design, engineering and entertainment. Its product families are AECO (architecture, engineering, construction and operations), MFG (product development and manufacturing), and M&E (media and entertainment). Customers use tools including AutoCAD, Revit, Fusion, Inventor and Maya to design buildings, infrastructure, machines and filmed content. The FY2026 10-K describes the company as a global leader in 3D design, engineering and entertainment technology, with products sold globally through a combination of indirect and direct channels.
This is a software business with no disclosed factories or owned plants; the only facility named in the 10-K is leased headquarters space in San Francisco. Cloud products run on a combination of co-located hosting facilities and increasingly on Amazon Web Services. The 10-K names primary competitors including Adobe, Bentley Systems, Dassault Systèmes, Intergraph, MSC Software, Nemetschek, Oracle, Procore, PTC, 3D Systems, Siemens PLM and Trimble. Revenue is subscription-based, and the shift to annual billings for most multiyear contracts is described as largely concluded.
Business Segments
Competitive Landscape
Autodesk describes itself as a global leader in 3D design, engineering and entertainment technology and names a set of primary competitors in its FY2026 10-K spanning design, construction, PLM and infrastructure software. The competitive dynamic the record shows is consolidation: customers are described as choosing to consolidate fragmented legacy systems onto the Autodesk platform, and the notable wins are framed as displacement wins over competing solutions. At the same time, named competitors are moving on explicit AI monetization. Procore plans most of its sales force selling Procore AI by Q3 with capacity-based licensing, Bentley has shipped a STAAD MCP server and is discussing token-based API pricing, and PTC reports AI-driven displacement wins — while Autodesk's consumptive AI revenue has no date.
- Named in the 10-K as a primary competitor. Revenue was $359M, up 15.7% y/y; construction environment described as stable; data centers front and center; plans most of its sales force selling Procore AI by Q3 with capacity/consumption-based licensing; launched a European common data environment.
- Bentley SystemsNamed in the 10-K. Constant-currency ARR +11.5% to $1.495B; commercial facilities relatively flat; released a STAAD MCP server; discussing API consumption and token-based pricing; calls EMEA its fastest-growing region.
- PTCNamed in the 10-K. Constant-currency ARR +8.5% to $2.388B; Onshape strength in robotics and physical AI; reports AI-driven displacement wins; says AI monetization is not overly material in FY27.
- OracleNamed in the 10-K for Primavera project management, and an AI-infrastructure builder reporting more than $30 billion of additional AI contracts and 850 megawatts of AI capacity delivered.
- Dassault SystèmesNamed in filings alongside its SolidWorks subsidiary; not discussed.
Supply Chain
Autodesk sits downstream of cloud hosting and upstream of the firms that build physical things. Its largest disclosed supply relationship is cloud hosting: the FY2026 10-K says cloud products run on co-located facilities and increasingly on Amazon Web Services.
More on ADSK: Earnings recap