EPS of $1.46 increased by 12.2% from previous year
Gross margin of 91.0%
Net income of 313.00M
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Autodesk Inc (0HJF.L) QQ2 2026 Results Analysis — Solid revenue growth, strong profitability and disciplined capital allocation in a leadership software franchise
Executive Summary
Autodesk delivered a robust QQ2 2026 quarter, underscoring durable demand for its subscription‑based 3D design, engineering and entertainment software. Revenue of USD 1.763 billion rose 17.1% year over year and 8.5% quarter over quarter, supported by a high‑quality mix that produced a gross margin of approximately 91% and an operating margin of about 25.2%. Net income reached USD 313 million, translating to a 17.8% net margin and an EPS (GAAP) of USD 1.47. The company generated USD 460 million of operating cash flow and USD 458 million of free cash flow, while returning substantial capital to shareholders via stock repurchases of USD 358 million and meaningful debt reduction. The balance sheet remains liquidity‑rich, with USD 2.0 billion of cash and 2.1+ billion of cash + near‑cash equivalents, and a net debt position of about USD 0.731 billion after considering total debt of USD 2.734 billion. Deferred revenue sits at USD 3.555 billion, signaling strong revenue visibility and a healthy revenue backlog backdrop. Management commentary on the call (not included in the provided transcript data) would typically emphasize ARR expansion, continued cloud/MIS adoption, and product leadership as drivers of durable growth.
Key Performance Indicators
Revenue
1.76B
QoQ: 8.49% | YoY:17.14%
Gross Profit
1.60B
90.98% margin
QoQ: 19.61% | YoY:17.51%
Operating Income
444.00M
QoQ: 98.21% | YoY:29.45%
Net Income
313.00M
QoQ: 105.92% | YoY:10.99%
EPS
1.47
QoQ: 107.04% | YoY:12.21%
Revenue Trend
Margin Analysis
Key Insights
Revenue: USD 1.763 billion in QQ2 2026, up 17.1% year over year (YoY) and 8.5% quarter over quarter (QoQ).
Gross Profit: USD 1.604 billion with a gross margin of 0.910 (91.1%), reflecting a high‑margin software model and favorable mix toward recurring revenue.
Net Income and Margin: USD 313 million net income; net margin ≈ 17.8%.
Financial Highlights
Revenue and Margin Trends
- Revenue: USD 1.763 billion in QQ2 2026, up 17.1% year over year (YoY) and 8.5% quarter over quarter (QoQ).
- Gross Profit: USD 1.604 billion with a gross margin of 0.910 (91.1%), reflecting a high‑margin software model and favorable mix toward recurring revenue.
- EBITDA: USD 456 million; EBITDA margin ≈ 25.9%.
- Operating Income: USD 444 million; operating margin ≈ 25.2%.
- Net Income and Margin: USD 313 million net income; net margin ≈ 17.8%.
- EPS: USD 1.47 (GAAP) and USD 1.46 (diluted), with YoY EPS up ~12.2% and QoQ up ~107% in the headline numbers provided.
Cash Flow and Capital Allocation
- Operating cash flow: USD 460 million; free cash flow: USD 458 million.
- Working capital: working capital movements contributed to free cash flow dynamics (change in working capital − USD 249 million; receivables − USD 39 million; payables + USD 128 million; other working capital − USD 338 million).
- Investing/Financing: purchases of property, plant and equipment minimal (capex ~ USD 2 million); investments in securities/outflows in long‑term investing; stock repurchases: USD −358 million; debt repayments: USD −199 million; net financing outflow: USD −219 million; overall net change in cash: USD +187 million.
- Liquidity: cash and cash equivalents USD 2.003 billion; cash + short‑term investments USD 2.236 billion; total cash position supports ongoing buybacks and optional debt management.
Balance Sheet and Leverage
- Total assets: USD 10.856 billion; total liabilities: USD 8.141 billion; total stockholders’ equity: USD 2.715 billion.
- Cash and equivalents: USD 2.003 billion; total debt: USD 2.734 billion; net debt: USD 0.731 billion.
- Deferred revenue: USD 3.555 billion, indicating substantial future revenue recognition and strong visibility.
- Key leverage metrics indicate a mid‑single to low‑mid balance between debt and equity, with debt to capitalization around 0.502 and total debt to capitalization around 0.502 as per the provided ratios. Interest coverage appears to modestly understated in the dataset, but operating income supports solid coverage given the absence or variability of reported interest expense in the period.
Income Statement
Metric
Value
YoY Change
QoQ Change
Revenue
1.76B
17.14%
8.49%
Gross Profit
1.60B
17.51%
19.61%
Operating Income
444.00M
29.45%
98.21%
Net Income
313.00M
10.99%
105.92%
EPS
1.47
12.21%
107.04%
Key Financial Ratios
currentRatio
0.76
grossProfitMargin
91%
operatingProfitMargin
25.2%
netProfitMargin
17.8%
returnOnAssets
2.88%
returnOnEquity
11.5%
debtEquityRatio
1.01
operatingCashFlowPerShare
$2.16
freeCashFlowPerShare
$2.15
priceToBookRatio
23.78
priceEarningsRatio
51.57
Net Income vs. Revenue
Expense Breakdown
Management Commentary
Transcript Notes: The provided data does not include an earnings call transcript. Consequently, there are no management quotes or theme breakdowns to quote or summarize by strategy, operations, or market conditions. When a transcript is available, the highlights would typically cover ARR growth, cloud strategy (including Autodesk Forge and related TM initiatives), product roadmap with Fusion 360 updates, enterprise sales execution, and geographic mix. Investors should expect management to discuss renewal rates, customer adoption of cloud services, and backlog/deferred revenue visibility as primary indicators of sustainability.
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Forward Guidance
Forward-Looking View: The dataset contains no formal forward guidance from Autodesk for QQ3 2026 or beyond. The strong QQ2 2026 results—high gross margins, solid operating margin, and robust FCF generation—suggest a favorable runway provided demand remains resilient in key markets (AEC, manufacturing, media & entertainment) and subscription renewals stay robust. In our assessment, achievability of continued growth hinges on:
- ARR expansion through renewals, cross‑sell of Industry Collections, and broad adoption of cloud services and platforms (e.g., BIM/Construction Cloud ecosystems).
- Stabilization of gross margins and expense discipline to maintain mid‑to‑high teens net income growth and steady EPS progression.
- Capital allocation balance between buybacks, selective acquisitions, and investment in R&D to sustain product leadership.
- Monitoring deferred revenue backlog and renewal velocity as leading indicators of revenue visibility.
Key factors investors should monitor include: (1) ARR growth rate and net retention, (2) annualized recurring revenue contribution, (3) renewal rates by major customer segments, (4) changes in deferred revenue mix, and (5) any changes in geographies driving demand (e.g., North America vs. non‑NA).
Competitive Position
Company
Gross Margin
Operating Margin
Return on Equity
P/E Ratio
0HJF.L Focus
90.98%
25.20%
11.50%
51.57%
0HW4.L
40.30%
24.40%
9.56%
8.63%
0HLQ.L
1.00%
40.70%
2.86%
9.85%
0HAV.L
53.50%
18.00%
3.50%
35.66%
0HJI.L
49.90%
25.70%
19.00%
30.93%
Gross Profit Margin
Operating Profit Margin
Return on Equity
P/E Ratio Comparison
Investment Outlook
Baseline thesis: Autodesk remains a cash‑generating software platform with a high‑quality, recurring revenue base and strong product leadership. The QQ2 2026 results reinforce the resilience of the subscription model and the ability to convert revenue growth into meaningful free cash flow. With a USD 2.0B cash position and a net debt of USD 0.731B, the company has ample flexibility for buybacks and selective M&A, which could support shareholder value if execution remains consistent. The elevated valuation metrics suggest limited downside protection from multiple compression but imply growth optionality priced in; any sustained acceleration in ARR growth, higher renewal rates, or accelerated cloud migration could justify current premium multiples.
Catalysts to watch: (1) incremental ARR growth and renewal velocity; (2) progress in cloud platform adoption and cross‑sell into existing customer bases; (3) backlog depletion and conversion of deferred revenue into cash; (4) discipline in operating expenses sustaining margin expansion; (5) potential strategic acquisitions or partnerships that extend product capabilities and market reach. Downside risks include softer demand, longer sales cycles, and competition eroding share gains. Investors should monitor quarterly guidance updates and commentary on ARR/retention trends for confirmation of the growth trajectory.
Key Investment Factors
Growth Potential
Long‑duration growth powered by subscription renewals, cloud platform adoption, and product expansions in high‑growth segments (AEC, digital factory, and media/entertainment). The strong gross margin (~91%) and expanding EBITDA contribution support ongoing high‑quality earnings growth. The USD 3.555B deferred revenue base signals substantial revenue visibility and potential upside as renewals convert to cash.
Profitability Risk
Key risks include macro headwinds affecting enterprise IT and design software spending, potential slower renewal cycles, competitive pressure from peers and adjacent software ecosystems, currency fluctuations given a global customer base, and the risk of revenue mix shift if new product introductions underperform or delays occur in cloud migration initiatives. High valuation multiples could compress if growth or visibility deteriorates.
Financial Position
Balance sheet remains liquid with USD 2.0B of cash and equivalents and a modest net debt position (~USD 0.731B). Deferred revenue provides revenue visibility, supporting earnings quality. Cash flow generation is robust (CFO USD 460M; FCF USD 458M) enabling buybacks (USD 358M) and selective debt management.
SWOT Analysis
Strengths
Industry-leading position in 3D design, CAD/CAE, and BIM software with diversified product portfolio (AutoCAD, Revit, Fusion 360, Maya/3ds Max, Vault, ShotGrid, BIM 360).
High gross margin (~91%) and strong EBITDA generation due to a durable recurring software model and sizable deferred revenue backlog.
Solid cash flow generation and strong liquidity position (cash and equivalents ~USD 2.0B) enabling capital returns and deleveraging.
Weaknesses
Valuation multiples are elevated (P/E and P/FCF in the higher end of software peers), which heightens sensitivity to any growth disappointment.
Relatively high deferred revenue reliance implies exposure to renewal cycles; any deterioration in enterprise demand could pressure visibility and revenue recognition timing.
Opportunities
Cloud adoption and platform integration (Forge ecosystem) can expand ARR and cross‑sell opportunities across AEC, manufacturing, and media/entertainment verticals.
Continued product leadership and acquisitions could broaden addressable markets (e.g., simulation, manufacturing, or collaboration tools).
Geographic diversification and expanding enterprise customer base could sustain multi‑year growth.
Threats
Macro uncertainty impacting large enterprise software budgets and project pipelines.
Intense competition from other CAD/PLM players and potential ecosystem shifts toward open platforms.
Currency volatility and abrupt changes in IT spend cycles could impact short‑term results.