Leases

9 Months Ended

Oct. 31, 2023

Autodesk has operating leases for real estate, vehicles, and certain equipment. Leases have remaining lease terms of less than 1 year to 66 years, some of which include options to extend the lease with renewal terms from 1 year to 9 years and some of which include options to terminate the leases from less than 1 year to 6 years. Options to extend or terminate the lease are considered in determining the lease term when it is reasonably certain that the option will be exercised. Payments under our lease arrangements are primarily fixed; however, certain lease agreements contain variable payments, which are expensed as incurred and not included in the operating lease assets and liabilities. These amounts include payments affected by the Consumer Price Index, payments for common area maintenance that are subject to annual reconciliation, and payments for maintenance and utilities. The Company’s leases do not contain residual value guarantees or material restrictive covenants. Short-term leases are recognized in the Condensed Consolidated Statements of Operations on a straight-line basis over the lease term. Short-term lease expense was not material for the periods presented. Changes in operating lease right-of-use assets and operating lease liabilities are presented net in the “Accounts payable and other liabilities” line in the Condensed Consolidated Statements of Cash Flows with the exception of “Lease-related asset impairments” which is presented in “Adjustments to reconcile net income to net cash provided by operating activities”.

The components of lease cost were as follows:


	Three Months Ended October 31, 2023
	Cost of subscription and maintenance revenue		Cost of other revenue		Marketing and sales		Research and development		General and administrative		Total
Operating lease cost	$	2	$	1	$	7	$	5	$	2	$	17
Variable lease cost	1		—		1		2		—		4

	Nine Months Ended October 31, 2023
	Cost of subscription and maintenance revenue		Cost of other revenue		Marketing and sales		Research and development		General and administrative		Total
Operating lease cost	$	5	$	2	$	22	$	17	$	7	$	53
Variable lease cost	1		—		5		4		2		12


	Three Months Ended October 31, 2022
	Cost of subscription and maintenance revenue		Cost of other revenue		Marketing and sales		Research and development		General and administrative		Total
Operating lease cost	$	2	$	1	$	9	$	7	$	2	$	21
Variable lease cost	—		—		2		1		1		4

	Nine Months Ended October 31, 2022
	Cost of subscription and maintenance revenue		Cost of other revenue		Marketing and sales		Research and development		General and administrative		Total
Operating lease cost	$	6	$	3	$	28	$	21	$	8	$	66
Variable lease cost	1		—		5		4		2		12

Supplemental operating cash flow information related to leases is as follows:


	Nine Months Ended October 31,
	2023		2022
Cash paid for operating leases included in operating cash flows (1)	$	81	$	84
Non-cash operating lease liabilities arising from obtaining operating lease right-of-use assets	44		49

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(1) Includes $12 million in variable lease payments for both the nine months ended October 31, 2023 and 2022, not included in “Operating lease liabilities” and “Long-term operating lease liabilities” on the Condensed Consolidated Balance Sheets.

The weighted average remaining lease term for operating leases is 6.1 and 6.5 years at October 31, 2023, and January 31, 2023, respectively. The weighted average discount rate was 2.77% and 2.60% at October 31, 2023, and January 31, 2023, respectively.

Maturities of operating lease liabilities were as follows:


Fiscal year ending
2024 (remainder)	$	19
2025	88
2026	75
2027	55
2028	46
Thereafter	114
	397
Less imputed interest	32
Present value of operating lease liabilities	$	365

Autodesk has subleased certain office space to a third party and has classified the sublease as an operating lease. The sublease has a remaining lease term of 8.3 years. Sublease income was $2 million and $6 million and for the three and nine months ended October 31, 2023, respectively. Sublease income was $2 million and $3 million for the three and nine months ended October 31, 2022, respectively. Sublease income is recorded as a reduction of lease expense in the Company’s Condensed Consolidated Statements of Operations.

Operating lease amounts in the table above do not include sublease income payments of $73 million. Autodesk expects to receive sublease income payments of approximately $35 million for remaining fiscal 2024 through fiscal 2028 and $38 million thereafter.

As of October 31, 2023, Autodesk had no material additional operating lease minimum lease payments for executed leases that have not yet commenced.