AutoDesk (ADSK -4%) shares fell today, despite surpassing earnings expectations and achieving steady revenue growth in Q4. The 3D CAD software developer, widely used in the construction industry, also provided Q1 and FY26 forecasts mostly above consensus. Recently, ADSK announced a 9% workforce reduction to reallocate savings toward strategic priorities such as cloud, platform, and AI enhancements.

These investments align with ADSK's updated long-term strategy. CFO Janesh Moorjani stated that the company is poised to exceed its steady growth rate of +10-15%. Although FY26 revenue guidance of $6.895-6.965 billion surpassed analyst expectations, it still indicated growth within the +10-15% range. Moorjani anticipates more robust growth and higher margins in the long term, though specifics were not disclosed.

• ADSK has transitioned from a licensing, multi-year billings model to an annual, subscription-based model, boosting revenue growth. In Q4, billings rose 23% year-over-year to $2.11 billion, exceeding company guidance.
• Management observed that the economic environment and business momentum in Q4 mirrored previous quarters, supporting strong renewal rates but hindering new business growth. Economic uncertainty can deter new contracts, but ADSK is enhancing sales team productivity to focus on new business growth.
• Despite economic volatility, ADSK forecasts Q1 adjusted EPS of $2.14-2.17, slightly up from Q4's $2.14, and revenue of $1.60-1.61 billion, slightly down from Q4's $1.64 billion. For the year, ADSK expects adjusted EPS of $9.34-9.67 and revenue of $6.895-6.965 billion. Billings are projected at $7.06-7.21 billion, a 19% increase year-over-year at the midpoint. The company warned of potential disruptions due to headcount reduction and tariff impacts, which are accounted for in its guidance.

Despite a solid Q4, ADSK shares are under pressure due to concerns about potential disruptions. While ADSK has factored these into its forecasts, uncertainties around tariffs and workforce reductions create investor unease. Until further clarity emerges, ADSK shares may remain subdued in the near term.