Autodesk Inc. (ADSK) reports third-quarter earnings on Tuesday, and the setup is pretty straightforward: results should land comfortably within the company's guidance range, even if they come in a hair below what analysts were hoping for.
According to Rosenblatt Securities analyst Blair Abernethy, who maintains a Buy rating and $355 price target on the stock, the design software giant is on track to post quarterly revenue of about $1.804 billion. That's just shy of the $1.806 billion consensus estimate, but well within the company's own $1.80 billion to $1.81 billion guidance range.
The real story is where that 15% year-over-year revenue growth is coming from. Abernethy expects the AEC (architecture, engineering, and construction) segment to power forward with 20% growth, while AutoCAD should deliver a respectable 9% increase. Those are solid numbers that show Autodesk's core franchises remain healthy.
On the earnings side, look for non-GAAP earnings per share of $2.49, slightly below the $2.50 consensus but again within guidance of $2.48 to $2.51 per share.
The softer spots? Mechanical design products like Inventor and general design tools are feeling some pressure. "In mechanical (Inventor) and general design (AutoCAD/LT), we expect an in-line Q3 and likely a tempered outlook as seen by competitors, in part due to tariff-related macro turmoil in Europe causing customer caution and somewhat longer buying cycles," Abernethy noted.
Translation: European customers are hitting pause while they figure out the tariff situation, which means sales cycles are stretching out. Not catastrophic, just slower.
Autodesk shares closed down 0.14% at $290.39 on Monday. With a market cap of $62.13 billion and a P/E ratio north of 60, investors are clearly betting on continued growth despite the near-term choppiness. The stock has ranged between $232.67 and $329.09 over the past year, and it's currently trading much closer to the high end of that range—a sign that market confidence in Autodesk's long-term prospects remains strong, even without a dividend yield to sweeten the deal.
