Autodesk (ADSK) Q2 2025 earnings summary

Executive summary

• Revenue grew 12% year-over-year to $1.51 billion in Q2, with 13% growth at constant currency and strong performance in AEC and manufacturing, offset by softness in media and entertainment due to Hollywood strikes.

• Recurring revenue represented 97% of total, with net revenue retention rate between 100% and 110%.

• Strategic investments in cloud, platform, and AI, along with acquisitions like Payapps, PIX, and Aether Media, are expanding capabilities and driving competitive advantage.

• Business model evolution and go-to-market modernization, including the new transaction model, are enhancing customer relationships and operational efficiency.

• Internal investigation into free cash flow and non-GAAP margin practices has led to regulatory and legal proceedings.

Financial highlights

• Q2 FY25 total revenue reached $1.51B, up 12% year-over-year; billings increased 13% to $1.24B; free cash flow for the quarter was $203M.

• Non-GAAP operating margin for Q2 FY25 was 37%, up 1 point year-over-year; GAAP operating margin was 23%, up 4 points.

• Net income was $282M for the quarter, up from $222M year-over-year; diluted EPS was $1.30 (GAAP) and $2.15 (non-GAAP).

• Direct revenue increased 21%, now 40% of total revenue.

• Deferred revenue decreased 13% to $3.7B; RPO grew 12% to $5.9B.

Outlook and guidance

• FY25 revenue guidance raised to $6.08B–$6.13B (~11% growth); billings guidance increased to $5.88B–$5.98B (up 13–15%).

• FY25 GAAP EPS: $4.88–$5.01; non-GAAP EPS: $8.18–$8.31; free cash flow: $1.45B–$1.5B.

• FY25 non-GAAP operating margin expected at 35–36%; GAAP operating margin 21–22%.

• Q3 FY25 revenue guidance: $1.555–$1.570B; GAAP EPS: $1.21–$1.27; non-GAAP EPS: $2.08–$2.14.

• Fiscal 2026 free cash flow expected to reach ~$2.05B.