Autodesk Inc. (ADSK) turned in a solid third-quarter performance Tuesday evening, the kind that gets analysts reaching for their calculators to update price targets. The design software company posted revenue of $1.85 billion for the quarter, marking an 18% jump from the same period last year and comfortably clearing Wall Street's $1.81 billion estimate.
The earnings picture looked even better. Autodesk reported adjusted earnings of $2.67 per share, sailing past the consensus estimate of $2.50 per share. Not a bad showing for a company trying to position itself at the center of the AI revolution in design and manufacturing.
CEO Andrew Anagnost didn't shy away from the AI hype, explaining that the company is "defining the AI revolution for design and make, empowering customers with new task, workflow and system automations." He highlighted Autodesk's strategy of capturing value through various business models that blend human creativity with machine capabilities, spanning subscription, consumption, and outcomes-based approaches.
The forward-looking statements suggest management feels confident about maintaining momentum. For the fourth quarter, Autodesk expects revenue between $1.90 billion and $1.92 billion, with adjusted earnings in the $2.59 to $2.67 per share range. More notably, the company bumped up its full-year adjusted earnings guidance from a prior range of $9.80 to $9.98 per share to a new range of $10.18 to $10.25 per share. That's a meaningful increase above the Street's $9.95 per share estimate. Full-year revenue guidance landed at $7.15 billion to $7.17 billion.
The market responded positively, with Autodesk shares climbing 1.6% to close at $294.43 on Tuesday.
Analysts wasted no time adjusting their outlook following the earnings beat. Deutsche Bank analyst Bhavin Shah upgraded the stock from Hold to Buy and raised his price target from $345 to $375. Meanwhile, Rosenblatt analyst Blair Abernethy maintained a Buy rating and also lifted the price target from $355 to $375.
The upgrades reflect growing confidence that Autodesk can execute on its AI-driven strategy while continuing to extract more value from its subscription base. With both analysts now seeing $375 as a realistic target, that implies roughly 27% upside from Tuesday's closing price.
