A：Autodesk delivered strong first quarter results with revenue and non GAAP earnings per share at the higher end of guidance ranges, exceeding expectations in terms of billings, non GAAP margins, and free cash flow.

A：Autodesk is focusing its growth investments on the Cloud Platform and AI, optimizing sales and marketing, and investing to enable future optimization that drives higher margins. Additionally, they are allocating more capital to share repurchases and refreshing the board with new directors to guide the next decade of growth.

A：The three sources of certainty for Autodesk are: 1) the new transaction model, which integrates the company with customers and increases automation while reducing duplicative workflows; 2) rebuilding their free cash flow stack to increase capacity for returning cash to shareholders through share repurchases; 3) the end of major business model transitions, which will simplify the company's analysis and understanding.

A：The new transaction model contributed $105 million to revenue and $15 million to billings in the first quarter. Total revenue grew by $15 million in constant currency, excluding the impact of the new transaction model.

A：GAAP operating margins decreased 13 basis points primarily due to restructuring charges and a noncash charge. Non GAAP operating margins were strong, increasing three percentage points due to operating leverage from cost discipline and timing benefits from restructuring, partly offset by the margin drag from the new transaction model.

A：The updated billings guidance range is $7.16 billion to $7.31 billion, the revenue guidance range is $6.925 billion to $6.995 billion, and the free cash flow guidance range is $2.1 billion to $2.2 billion.

A：Strategic initiatives and customer successes highlighted by Autodesk include partnerships and projects like the one with a leading infrastructure consulting firm that closed a significant EBA and plans to transition to BIM and use Autodesk Construction Cloud for a common data environment. Another example is Hitachi Energy expanding its use of Autodesk Construction Cloud and investing in digital twin solutions for renewable energy integration and digitization. Additionally, a general contractor chose Autodesk for an integrated solution to manage project complexity and drive efficiency.

A：Grain Handler faced growing inefficiencies from limited process integration in its design and manufacturing workflows, which prompted it to select Fusion to modernize its entire design and manufacturing process.

A：Fusion is driving strong ACV (Average Contract Value) growth and productivity gains by increasing extension attach rates, driving higher average sales prices, and by automating the task of defining sketch geometry through AI-powered auto constraints, which has led to over 580,000 constraints for Fusion users since launch.

A：Austin University is preparing future engineers by making the entire Autodesk product portfolio available to all students and is migrating diffusion for first-year modules in all engineering disciplines to foster collaboration and hands-on learning.

A：Autodesk helped a major engineering consulting company in Taiwan remove non-compliant software versions and ensure all employees had the latest and safest software. Also, it provided flexible consumption options for Joan's engineering to handle fluctuating project requirements.

A：The wildfires in Los Angeles burned over 57,000 acres, displaced over 200,000 residents, tragically took the lives of at least 30000 people, and caused economic damage estimated at over 250 billion. The community is working to rebuild more resiliently, and the Foothill Catalog Foundation is creating a pre-approved catalog of home designs to streamline reconstruction.

A：Autodesk supports community recovery from natural disasters by participating in initiatives like the Foothill Catalog Foundation and by enabling faster, more coordinated building processes through digital models and streamlined approvals, as demonstrated in Singapore's Corridor X initiative.

A：The evolving trade policy and macro environment are creating uncertainty for customers as they flag concerns about increased costs and uncertain bidding processes. Although customers express concern, they seem to focus more on the second half of the year and connect the issues to broader economic conditions.

A：The construction backlog has ticked up, there's an increase in monthly active users of Autodesk products, and growing bid activity. This suggests that despite uncertainty, customers are still engaged in business and experiencing an inflow of work.

A：The sales and marketing optimization plan is on track, and the team is building capabilities that will be needed next year as part of the ongoing sales and marketing evolution. A significant part of this roadmap includes further integrating Fusion with other tools like Revit to facilitate multidisciplinary collaboration.

A：Fusion is accelerating the roadmap around data management issues based on customer feedback, with a focus on better bond management and product data cloud management. They have reallocated funds to address these priorities and have made progress by releasing relevant features in Q1 with more to come throughout the year.

A：The go-to-market changes and channel consolidation are significant because they reflect deliberate efforts to streamline the partner ecosystem. This has led to a reduction in the number of named entities with whom Autodesk counts as partners, which may enhance focus and efficiency in the market.

A：The goal is to have fewer transactional channel partners and more solution-focused ones. This strategy includes larger partners focusing on their own intellectual property (IP) and acquiring smaller, more transactional partners.

A：In the first quarter, robust activity on the store led to growth, with an increased focus on price realization. This is attributed to capturing business from transactional partners that would have otherwise taken transactions away from the company.

A：The company is not experiencing the disruptions associated with the new transaction model that were seen in the previous year. The channel partners are adapting and onboarding their long tail of customers, which is expected to increase channel productivity throughout the year.

A：The first renewals under the new model in the Americas are expected in June, and in EMEA in September, due to when those regions went live on the new model last year.

A：The new transaction model is mainly responsible for the revenue growth being above the 100% to 110% range. Without this effect, growth would have been consistent with previous performance and within the script to ignite range.

A：Strength across the quarter in Q1 contributed to the revenue growth, with AEC being a driver, as well as upfront revenue from EAS and the Autodesk store. Additionally, friction from the new transactional model implementation eased.

A：The company's revenue growth assumptions were updated due to the US dollar weakening, which has been factored into the forecast. There was no change in assumptions regarding the core underlying business when guidance was initially set.

A：The company plans to continue rolling out highly specific AI enhancements that drive productivity gains for customers, such as drawing automation and form enhancements in Fusion Land. These intelligent features are built on their own foundation models and will continue to remove repetitive tasks to allow customers to be more productive.

A：The company intends to make Fusion the most AI-powered tool in the mechanical design market to gain a competitive advantage. Additionally, they plan to accelerate market share gains with AI as one of the key tools.

A：Enhanced capabilities in the form of AI for the AEC sector will make it easier to penetrate the market with sophisticated offerings, ultimately making the total solution more powerful. This is expected to lead to price recovery in the future.

A：To date, the restructuring plans have had minimal disruption. The company expects to be more comfortable with these risks being behind us later in the year.

A：The company undertook a major restructure in the first quarter, which included mitigation plans and other measures to manage the disruption that ensued from this large action. They managed to factor in some disruption in advance.

A：The acting Chief Revenue Officer (CRO) is Elizabeth Zorin, who is bridging the new CRO into place.

A：The company acknowledges good momentum in the business in Q1 that has continued into Q2. They are being prudent given what they are hearing and seeing out there, despite not having seen any negative business impacts yet.

A：The industry is labor constrained, with not enough labor, materials, and capital to meet the rebuild needs. Digital efficiency is seen as crucial, and the current climate may exacerbate these constraints. Technology is seen as a solution, providing tools to digitize processes and increase productivity with existing resources.

A：The robust adoption of the company's expanded design and make portfolio is attributed to its ability to deliver productivity in a labor constrained market, demonstrating the importance of technology for industries to embrace for increased productivity and to address fundamental capacity constraints.

A：Andy, previously from Microsoft, has joined as the new Vice President of Revenue. He brings strong enterprise sales skills, a deep understanding of cloud technology, and expertise in selling cloud-enabled end-to-end solutions. His leadership is seen as rounding out the company's skill set for future growth.

A：The company is focused on targeting repeatable processes and customer workflows that can yield quick returns. Looking ahead, it is positioning itself to leverage future CAD uses, including disruptive technologies that could change workflows, through both organic development and external partnerships. They are working on powerful tools that will simplify the generation of different types of geometry.

A：The company is reinvesting a portion of the savings from restructuring in building capabilities for sales and marketing, particularly to integrate with partners and scale the self-serve motion. The overall spend plan for the year remains largely unchanged, with the strong performance in Q1 contributing to bottom-line outperformance. The company continues to expect year-over-year growth in spending in constant currency, and the savings are a source of the operating margin expansion laid out at the start of the year.

A：The company is on a multi-year journey to drive productivity enhancements in sales and marketing. They are working on systems and processes that aim for future and ongoing optimizations leading to productivity and margin growth. This is an ongoing effort, not a one-time event.

A：Generally, the company is seeing the kind of momentum expected across geographies. However, there was slightly more softness in Asia Pacific, which includes Japan, China, and Korea, due to various factors such as the new transaction model in Japan, macroeconomic turmoil, and trade discussions. These factors have impacted the growth in that region, but the softness is considered to be within expectations.

A：The CFO, Janae, is providing an update on early observations and the company's philosophy on growth and margin trade-offs. She highlights the company's approach to assessing the growth margin trade-off in various scenarios throughout the year, which includes a framework for investors.

A：The speaker views the company as being well-positioned to address a rich market opportunity and capture growth. The focus is on supporting future growth, driving strong operational focus, and expanding operational margins.

A：The speaker did not identify any meaningful trends to call out during the quarter, but noted that revenue was strong and consistent throughout February, March, and April, and this momentum has continued into May.

A：The company is investing in cross-sell and upsell automation that will not be tied to specific renewal cycles, allowing for dynamic adjustments throughout the customer lifecycle. This is part of the investments and systems upgrades to support these adjustments.

A：The company is continuing to build capabilities to enable future sales and marketing optimization and reduce duplicative costs. Specifics of ongoing sales and marketing optimization are not yet detailed, and more information will be provided at a later point.

A：The decrease in constant currency adjusted billings guidance is due to the exclusion of the impact of the new transaction model, which is now guiding to a growth of 6% to 8%. This reflects the additional macroeconomic uncertainty factored into the forecast, which was not done in February.

A：The new transaction model is providing a greater tailwind to the company's financials due to greater adoption, resulting in a one percentage point increase in the constant currency growth rate compared to the guidance in February.

A：The trend observed is that most multiyear deals are renewing as annual deals, which is not in line with the expectations of the company. There has been no specific mention of this in the prepared remarks, but it is suggested that the company is in the final stages of the Billings transition, rebuilding the annual billing stack from the transition.

A：The speaker indicates that discussions with other EBA customers regarding the timing of their upfront revenue are tracking and trending in line with the historical experience and expectations.

A：The company's pricing strategy for customers coming up for renewal from an annual price lock will eventually give price increases that are consistent with the value delivered. However, it is noted that the program providing 10 years of price visibility is not yet fully sunsetted.