Revenue Recognition

3 Months Ended

Apr. 30, 2023

Revenue from Contract with Customer [Abstract]

Revenue Recognition

Revenue Recognition

Revenue Disaggregation

Autodesk recognizes revenue from the sale of (1) product subscriptions, cloud service offerings, and enterprise business agreements (“EBAs”), (2) renewal fees for existing maintenance plan agreements that were initially purchased with a perpetual software license, and (3) consulting, training, and other products and services. The three categories are presented as line items on Autodesk's Condensed Consolidated Statements of Operations.

Information regarding the components of Autodesk's net revenue from contracts with customers by product family, geographic location, sales channel, and product type is as follows: 

	Three Months Ended April 30,
	2023		2022
Net revenue by product family:
Architecture, Engineering and Construction (1)	$	582	$	537
AutoCAD and AutoCAD LT (1)	349		327
Manufacturing	246		225
Media and Entertainment	71		68
Other	21		13
Total net revenue	$	1,269	$	1,170
Net revenue by geographic area:
Americas
U.S.	$	456	$	398
Other Americas	97		86
Total Americas	553		484
Europe, Middle East and Africa	474		449
Asia Pacific	242		237
Total net revenue	$	1,269	$	1,170
Net revenue by sales channel:
Indirect	$	820	$	769
Direct	449		401
Total net revenue	$	1,269	$	1,170
Net revenue by product type:
Design	$	1,086	$	1,004
Make	121		103
Other	62		63
Total net revenue	$	1,269	$	1,170

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(1) During fiscal 2023, we corrected an immaterial classification error and reclassified certain revenue amounts between Architecture, Engineering and Construction and AutoCAD and AutoCAD LT. The results for the fiscal quarter ended April 30, 2022, have been adjusted to conform to the current period presentation. These reclassifications did not impact total net revenue.

Payments for product subscriptions, industry collections, cloud subscriptions, and maintenance subscriptions are typically due up front with payment terms of 30 to 45 days. Payments on EBAs are typically due in annual installments over the contract term, with payment terms of 30 to 60 days. Effective in fiscal 2024, payments on multi-year subscriptions are typically due in annual installments over the contract term, with payment terms of 30 to 60 days. Autodesk does not have any material variable consideration, such as obligations for returns, refunds, warranties, or amounts due to customers for which significant estimation or judgment is required as of the reporting date.

Remaining performance obligations consist of total short-term, long-term, and unbilled deferred revenue. As of April 30, 2023, Autodesk had remaining performance obligations of $5.39 billion, which represents the total contract price allocated to remaining performance obligations, which are generally recognized over the next three years. We expect to recognize $3.51 billion or 65% of our remaining performance obligations as revenue during the next 12 months. We expect to recognize the remaining $1.88 billion or 35% of our remaining performance obligations as revenue thereafter.

The amount of remaining performance obligations may be impacted by the specific timing, duration, and size of customer subscription and support agreements, the specific timing of customer renewals, and foreign currency fluctuations.

Contract Balances

We receive payments from customers based on a billing schedule as established in our contracts. Contract assets relate to performance completed in advance of scheduled billings. Contract assets were not material as of April 30, 2023. Deferred revenue relates to billings in advance of performance under the contract. The primary changes in our contract assets and deferred revenues are due to our performance under the contracts and billings.

Revenue recognized during the three months ended April 30, 2023 and 2022, that was included in the deferred revenue balances at January 31, 2023 and 2022, was $1.06 billion and $987 million, respectively. The satisfaction of performance obligations typically lags behind payments received under revenue contracts from customers.

Cloud Computing Arrangements Autodesk enters into certain cloud-based software hosting arrangements that are accounted for as service contracts. Costs incurred for these arrangements are capitalized for application development activities, if material, and immediately expensed for preliminary project activities and post-implementation activities. Autodesk amortizes the capitalized development costs straight-line over the fixed, non-cancellable term of the associated hosting arrangement plus any reasonably certain renewal periods. The capitalized costs are included in “Prepaid expenses and other current assets” and “Long-term other assets” on our Condensed Consolidated Balance Sheets. Capitalized costs were $203 million and $190 million at April 30, 2023, and January 31, 2023, respectively. Accumulated amortization was $50 million and $41 million at April 30, 2023, and January 31, 2023, respectively. Amortization expense for the three months ended April 30, 2023 and 2022 was $9 million and $4 million, respectively.