Autodesk (ADSK) 10-Q 4 Jun 10 2011 Q1 Quarterly report Financial data

Document and Entity Information

Document and Entity Information
	3 Months Ended Apr. 30, 2010	May. 28, 2010
Document Type	10-Q
Amendment Flag	false
Document Period End Date	2010-04-30
Document Fiscal Year Focus	2,011
Document Fiscal Period Focus	Q1
Trading Symbol	ADSK
Entity Registrant Name	AUTODESK INC
Entity Central Index Key	0000769397
Current Fiscal Year End Date	--01-31
Entity Filer Category	Large Accelerated Filer
Entity Common Stock, Shares Outstanding		229,463,291

CONDENSED CONSOLIDATED STATEMEN

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (USD $)
In Millions, except Per Share data	3 Months Ended Apr. 30, 2010	3 Months Ended Apr. 30, 2009
Net revenue:
License and other	279.8	243.6
Maintenance	194.8	182.2
Total net revenue	474.6	425.8
Cost of revenue:
Cost of license and other revenue	41.2	44.1
Cost of maintenance revenue	10.1	8.2
Total cost of revenue	51.3	52.3
Gross profit	423.3	373.5
Operating expenses:
Marketing and sales	186.5	183.9
Research and development	127.2	121.5
General and administrative	51.7	50
Impairment of goodwill		21
Restructuring charges	7.1	16.5
Total operating expenses	372.5	392.9
Income (loss) from operations	50.8	-19.4
Interest and other income (expense), net	-3.4
Income (loss) before income taxes	47.4	-19.4
Provision for income taxes	-10.5	-12.7
Net income (loss)	36.9	-32.1
Basic net income (loss) per share	0.16	-0.14
Diluted net income (loss) per share	0.16	-0.14
Shares used in computing basic net income (loss) per share	229	227.1
Shares used in computing diluted net income (loss) per share	234.6	227.1

CONDENSED CONSOLIDATED BALANCE

CONDENSED CONSOLIDATED BALANCE SHEETS (USD $)
In Millions	3 Months Ended Apr. 30, 2010	12 Months Ended Jan. 31, 2010
Current assets:
Cash and cash equivalents	938.1	838.7
Marketable securities	121.7	161.9
Accounts receivable, net	218.1	277.4
Deferred income taxes	43.8	44.2
Prepaid expenses and other current assets	72.3	57.4
Total current assets	1,394	1379.6
Marketable securities	179.5	125.6
Computer equipment, software, furniture and leasehold improvements, net	95.5	101.6
Purchased technologies, net	80.1	88
Goodwill	540.3	542.9
Deferred income taxes, net	112.4	101.9
Other assets	99.9	107.6
Assets, Total	2501.7	2447.2
Current liabilities:
Accounts payable	90.4	67.8
Accrued compensation	78.4	115.6
Accrued income taxes	15.3	8.4
Deferred revenue	470.6	444.6
Other accrued liabilities	56.3	67.6
Total current liabilities	711	704
Deferred revenue	73.1	71.9
Long term income taxes payable	131.1	127.2
Other liabilities	72.4	70.6
Commitments and contingencies
Stockholders' equity:
Preferred stock
Common stock and additional paid-in capital	1237.6	1204.3
Accumulated other comprehensive income (loss)	-1.1	-3.5
Retained earnings	277.6	272.7
Total stockholders' equity	1514.1	1473.5
Liabilities and Stockholders' Equity, Total	2501.7	2447.2

1_CONDENSED CONSOLIDATED STATEM

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (USD $)
In Millions	3 Months Ended Apr. 30, 2010	3 Months Ended Apr. 30, 2009
Operating Activities
Net income (loss)	36.9	-32.1
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization	26.7	27
Stock-based compensation expense	24.3	23
Restructuring charges, net	7.1	16.5
Impairment of goodwill		21
Loss on disposition of assets		1.1
Changes in operating assets and liabilities, net of business combinations	44.1	-29.3
Net cash provided by operating activities	139.1	27.2
Investing Activities
Purchases of marketable securities	-134.5	-26.6
Sales of marketable securities	29.7	11.7
Maturities of marketable securities	94.1
Capital expenditures	-5.8	-13.6
Purchase of equity investment		(10)
Net cash used in investing activities	-16.5	-38.5
Financing Activities
Proceeds from issuance of common stock, net of issuance costs	36.2	25.4
Repurchases of common stock	-58.8
Draws on line of credit		2.2
Repayments of line of credit		-52.2
Net cash used in financing activities	-22.6	-24.6
Effect of exchange rate changes on cash and cash equivalents	-0.6	-1.2
Net increase (decrease) in cash and cash equivalents	99.4	-37.1
Cash and cash equivalents at beginning of fiscal year	838.7	917.6
Cash and cash equivalents at end of period	938.1	880.5

Basis of Presentation

Basis of Presentation
	3 Months Ended Apr. 30, 2010
Basis of Presentation	1. Basis of Presentation The accompanying unaudited Condensed Consolidated Financial Statements of Autodesk, Inc. (Autodesk or the Company) as of April30, 2010, and for the three months ended April30, 2010, have been prepared in accordance with accounting principles generally accepted in the U.S. for interim financial information along with the instructions to Form 10-Q and Article 10 of Securities and Exchange Commission (SEC) Regulation S-X. Accordingly, they do not include all of the information and notes required by generally accepted accounting principles (GAAP) for annual financial statements. In managements opinion, Autodesk has made all adjustments (consisting of normal, recurring and non-recurring adjustments) during the quarter that were considered necessary for the fair presentation of the financial position and operating results of the Company. The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect reported amounts in the financial statements and accompanying notes. These estimates are based on information available as of the date of the unaudited Condensed Consolidated Financial Statements. Actual results could differ from those estimates. In addition, the results of operations for the three months ended April30, 2010 are not necessarily indicative of the results for the entire fiscal year ending January31, 2011, or for any other period. These unaudited Condensed Consolidated Financial Statements should be read in conjunction with the Consolidated Financial Statements and related notes, together with managements discussion and analysis of financial position and results of operations contained in Autodesks Annual Report on Form 10-K for the fiscal year ended January31, 2010 (the 2010 Form 10-K) filed on March19, 2010. Reclassifications During the quarter ended April30, 2010, Autodesk reclassified certain costs of revenue, which primarily included reclassifying shipping and fulfillment expenses from Cost of license and other revenue to Cost of maintenance revenue, due to a change in the Companys cost allocation methodology. These expenses have been reclassified in the statement of operations to conform to the current period presentation as follows: ThreeMonths Ended Increase (Decrease) to Expense April30,2009 Cost of license and other revenue (5.4 ) Cost of maintenance revenue 5.4

Recently Issued Accounting Stan

Recently Issued Accounting Standards
	3 Months Ended Apr. 30, 2010
Recently Issued Accounting Standards	2. Recently Issued Accounting Standards With the exception of those discussed below, there have been no recent accounting pronouncements or changes in accounting pronouncements during the three months ended April30, 2010, as compared to the accounting pronouncements described in Autodesks Annual Report on Form10-K for the fiscal year ended January31, 2010, that are of significance, or potential significance, to the Company. Accounting Standards Adopted in the Three Months Ended April30, 2010 In January 2010, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2010-06 regarding Accounting Standards Codification (ASC) Topic 820 Fair Value Measurements and Disclosures. This ASU requires additional disclosure regarding significant transfers in and out of Levels 1 and 2 fair value measurements and the reasons for the transfers. In addition, this ASU requires the Company to present separately information about purchases, sales, issuances, and settlements, (on a gross basis rather than as one net number), in the reconciliation for fair value measurements using significant unobservable inputs (Level 3). ASU 2010-06 clarifies existing disclosures regarding fair value measurement for each class of assets and liabilities and the valuation techniques and inputs used to measure fair value for recurring and nonrecurring fair value measurements that fall in either Level 2 or Level 3. This update also includes conforming amendments to the guidance on employers disclosures about postretirement benefit plan asset (Subtopic 715-20). The changes under ASU 2010-06 were effective for Autodesks fiscal year beginning February1, 2010, except for the disclosures about purchases, sales, issuances and settlements in the roll forward of activity in Level 3 fair value measurements, which are effective for Autodesks fiscal year beginning February1, 2011. The adoption of the portion of this ASU that was effective as of February1, 2010 did not have a material impact on Autodesks consolidated financial position, results of operations or cash flows. Autodesk believes that the adoption of the remaining portion of the ASU that is effective for Autodesks fiscal year beginning February1, 2011 will not have a material impact on its consolidated financial position, results of operations or cash flows. In June 2009, the FASB issued ASU 2009-16 and ASU 2009-17, amendments to ASC Topic 860 Transfers and Servicing and ASC 810 Consolidation, which update accounting for securitizations and special-purpose entities. ASU 2009-16 eliminates the concept of a qualifying special-purpose entity, changes the requirements for derecognizing financial assets and requires additional disclosures. ASU 2009-17 amends the evaluation criteria to identify the primary beneficiary of a variable interest entity and amends the consolidation guidance applicable to variable interest entities. Additionally, ASU 2009-17 requires ongoing reassessments of whether an enterprise is the primary beneficiary of the variable interest entity. These statements were effective for Autodesks fiscal year beginning February1, 2010. The adoption of ASU 2009-16 and ASU 2009-1

Concentration of Credit Risks a

Concentration of Credit Risks and Significant Customers
	3 Months Ended Apr. 30, 2010
Concentration of Credit Risks and Significant Customers	3. Concentration of Credit Risks and Significant Customers It is Autodesks policy that its cash, cash equivalents and marketable securities are held with, and in the custody of, financial institutions with high credit standing. Autodesks cash and cash equivalents are held by diversified institutions globally. Autodesks primary commercial banking relationship is with Citibank and its global affiliates (Citibank). In addition, Citicorp USA, Inc., an affiliate of Citibank, is the lead lender and agent in the syndicate of the Companys $250.0 million U.S. line of credit. It is Autodesks policy to limit the amounts invested with any one institution by type of security and issuer. Total sales to the distributors Tech Data Corporation and its global affiliates (Tech Data) accounted for 17% and 14% of Autodesks consolidated net revenue for the three months ended April30, 2010 and 2009, respectively. The majority of the net revenue from sales to Tech Data relates to Autodesks Platform Solutions and Emerging Business segment and comes from outside the U.S. In addition, Tech Data accounted for 19% and 15% of gross accounts receivable at April30, 2010 and January31, 2010, respectively.

Financial Instruments and Hedgi

Financial Instruments and Hedging Activities
	3 Months Ended Apr. 30, 2010
Financial Instruments and Hedging Activities	4. Financial Instruments and Hedging Activities Financial Instruments Market values were determined for each individual security in the investment portfolio. The cost and fair value of Autodesks financial instruments were as follows: April30, 2010 January31, 2010 AmortizedCost FairValue AmortizedCost FairValue Cash and cash equivalents $ 938.1 $ 938.1 $ 838.7 $ 838.7 Marketable securities - short-term 121.9 121.7 164.8 161.9 Marketable securities - long-term 178.2 179.5 124.4 125.6 Foreign currency forward and option contracts 2.6 8.6 2.3 3.9 Autodesk classifies its marketable securities as either short-term or long-term based on each instruments underlying contractual maturity date. Marketable securities with maturities of less than 12 months are classified as short-term and marketable securities with maturities greater than 12 months are classified as long-term. Autodesk may sell certain of its marketable securities prior to their stated maturities for strategic purposes and in anticipation of credit deterioration. Autodesk has marketable securities that are classified as either available-for-sale securities or trading securities. At April30, 2010 and January31, 2010, Autodesks short-term investment portfolio included $29.5 million and $26.3 million, respectively, of trading securities invested in a defined set of mutual funds as directed by the participants in the Companys Deferred Compensation Plan. At April30, 2010, these securities had net unrealized losses of $0.3 million and a cost basis of $29.8 million, (see Note 9, Deferred Compensation). Marketable securities classified as available-for-sale securities include the following securities at April30, 2010 and January31, 2010: April30, 2010 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated FairValue Short-term available-for-sale securities: Commercial paper and corporate securities $ 64.2 $ 0.1 $ $ 64.3 Money market funds 10.0 10.0 U.S. government agency securities 6.8 6.8 Municipal securities 6.0 6.0 Certificates of deposit and time deposits 4.7 4.7 Other 0.4 0.4 $ 92.1 $ 0.1 $ $ 92.2 Long-term available-for-sale securities: Commercial paper and corporate securities $ 140.6 $ 1.0 $ (0.1 ) $ 141.7 U.S. government agency securities 13.5 0.1 13.6 U.S. treasury securities 10.2 10.2 Taxable auction-rate securities 7.6 7.6 Municipal securities 6.3 0.1 6.4 $ 178.2 $ 1.2 $ (0.1 ) $ 179.5 January31, 2010 Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Estimated FairValue Short-term available-for-sale securities:

Fair Value Measurements

Fair Value Measurements
	3 Months Ended Apr. 30, 2010
Fair Value Measurements	5. Fair Value Measurements Fair value is an exit price, representing the amount that would be received upon the sale of an asset, or the amount paid to transfer a liability in an orderly transaction between market participants.As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability.As a basis for considering such assumptions, Autodesk uses a three-tier value hierarchy, which prioritizes the inputs used in measuring fair value as follows: (Level 1) observable inputs such as quoted prices in active markets; (Level 2) inputs other than the quoted prices in active markets that are observable either directly or indirectly in active markets; and (Level 3) unobservable inputs in which there is little or no market data, which requires Autodesk to develop its own assumptions. Whenever possible, Autodesk uses observable market data, and relies on unobservable inputs only when observable market data is not available, when determining fair value. On a recurring basis, Autodesk measures at fair value certain financial assets and liabilities, which consist of cash equivalents, marketable securities and foreign currency contracts. The Companys investment held in the International Fund is designated as a Level 3 security. The Company conducted its fair value assessment of the International Fund using Level 2 and Level 3 inputs. Management has reviewed the International Funds underlying securities portfolio, which is substantially comprised of term deposits, money market funds, U.S. treasury bills and commercial paper. These securities are issued by highly-rated institutions.Normally, the Company would classify such investments within Level 2 of the fair value hierarchy. Management evaluated the fair value of its unit interest in the International Fund, considering risk of collection, timing and other factors. These assumptions are inherently subjective and involve significant management judgment. As a result, the Company has classified its holdings in the International Fund within Level 3 of the fair value hierarchy. Autodesks investments in auction rate securities are classified within Level3 because they are valued using a discounted cash flow model, and some of the inputs to this model are unobservable in the market. There has been no change in the valuation input assumptions since January31, 2010. Assets and Liabilities Measured at Fair Value on a Recurring Basis The following table summarizes Autodesks investments and financial instruments measured at fair value on a recurring basis as of April30, 2010: Fair Value Measurements at April30, 2010 Using QuotedPrices in Active Markets for IdenticalAssets Significant Other Observable Inputs Significant Unobservable Inputs (Level 1) (Level 2) (Level 3) Total Assets Cash equivalents (1): Certificates of deposit and time deposits $ 62.6 $ 185.5 $ $ 248.1 Commercial paper 166.5 166.5 Money market funds 118.9 47.9 166.8 Municipal securi

Stock-Based Compensation

Stock-Based Compensation
	3 Months Ended Apr. 30, 2010
Stock-Based Compensation	6. Stock-Based Compensation Stock Plans As of April30, 2010, Autodesk maintained two active stock plans for the purpose of granting stock awards to employees and to non-employee members of Autodesks Board of Directors: the 2008 Employee Stock Plan (2008 Plan), which is available only to employees, and the 2010 Outside Directors Option Plan, as amended (2010 Plan), which is available only to non-employee directors. Additionally, there are seven expired or terminated plans with options outstanding. The exercise price of all stock options granted under these plans was equal to the fair market value of the stock on the grant date. The 2008 Plan was approved by Autodesks stockholders in November 2007. Under this plan, 16.5million shares of Autodesk common stock, in addition to 0.5million shares that remained available for issuance under the 2006 Employee Stock Plan upon its expiration in March 2008, were reserved for issuance. The 2008 Plan permits the grant of stock options, restricted stock awards and restricted stock units; however, no more than 2.5million of the shares reserved for issuance under the 2008 Plan may be issued pursuant to awards of restricted stock and restricted stock units. Options and restricted stock units granted under the 2008 Plan vest over periods ranging from immediately upon grant to over a four year period and expire within four to seven years from the date of grant. At April30, 2010, 0.7million shares were available for future issuance under the 2008 Plan. The 2008 Plan will expire in March 2011. In April 2010, Autodesk requested the stockholders to approve amendments to the 2008 Plan to increase the number of shares reserved for issuance under the plan by 15.5million shares and extend the term of the plan to June 2013. If the stockholders approve the amendments to the 2008 Plan at the stockholder meeting in June 2010, the number of shares reserved for issuance under the plan will be 15.5million shares plus that number of shares remaining under the existing 2008 Plan, not to exceed 500,000 shares. The 2010 Plan, which was approved by the stockholders and replaced the 2000 Directors Option Plan (2000 Plan) in June 2009, became effective March16, 2010. The 2010 Plan allows for an automatic annual grant of options to non-employee members of Autodesks Board of Directors. Options and awards granted under the 2010 Plan vest over periods ranging from one year to over a four year period and expire within seven years from the date of grant. At April30, 2010, 3.0million shares were available for future issuance. The 2010 Plan reserved 2.5million shares of Autodesk common stock, plus 0.5million shares that remained available for issuance under the 2000 Plan. The 2010 Plan permits the grant of stock options and restricted stock awards to non-employee members of Autodesks Board of Directors. The 2010 Plan will expire in March 2020. The following sections, Stock Options and Restricted Stock, summarize activity under Autodesks stock plans. Stock Options: A summary of stock option activity for the three months ended April30, 2010 was as follows: Number of Shares Weighted AveragePri

Income Taxes

Income Taxes
	3 Months Ended Apr. 30, 2010
Income Taxes	7. Income Taxes Autodesks effective tax rate was 22% and negative 65% during the three months ended April30, 2010 and 2009, respectively. Autodesks effective tax rate during the quarter ended April30, 2010 differs from the effective tax rate during the same period of the prior fiscal year primarily due to a $20.9 million discrete non-cash tax charge as a result of a change in expected future tax rates and establishment of a valuation allowance against certain California deferred tax assets that was recorded during the first quarter of fiscal 2010 partially offset by a discrete tax benefit of $7.7 million associated with the impairment of goodwill that was recorded during the first quarter of fiscal 2010. During the first quarter of fiscal 2010, the State of California enacted legislation significantly altering California tax law. As a result of the legislation, we expect that in fiscal years 2012 and beyond, income subject to tax in California will be less than under prior tax law and accordingly, deferred tax assets are less likely to be realized. Excluding the impact of discrete tax items, the effective tax rate for the first quarter of fiscal 2011 was lower than the Federal statutory tax rate of 35% primarily due to foreign income taxed at lower rates partially offset by the impact of stock-based compensation expense. As of April30, 2010, the Company had $180.5 million of gross unrecognized tax benefits, excluding interest, of which approximately $167.4 million represents the amount of unrecognized tax benefits that would impact the effective tax rate, if recognized. The remaining $13.1 million relates to items that would result in balance sheet reclassification with no impact to income tax expense. It is possible that the amount of unrecognized tax benefits will change in the next twelve months; however an estimate of the range of the possible change cannot be made at this time. At April30, 2010, Autodesk had net deferred tax assets of $156.2 million. The Company believes that it will generate sufficient future taxable income in appropriate tax jurisdictions to realize these assets.

Restructuring Reserve

Restructuring Reserve
	3 Months Ended Apr. 30, 2010
Restructuring Reserve	8. Restructuring Reserve In addition to previously announced restructuring plans in fiscal 2009 and 2010, in the first quarter of fiscal 2011, Autodesk initiated a restructuring plan in order to further reduce operating costs. The restructuring plan is expected to result in costs relating to targeted staff reductions of approximately 210 to 230 positions. In connection with this restructuring plan, Autodesk expects to record restructuring charges of approximately $10.0 million to $12.0 million during fiscal 2011. No leased facilities were consolidated as part of this restructuring (Fiscal 2011 Plan). In connection with the Fiscal 2011 Plan, during the quarter ended April30, 2010 Autodesk reduced the number of employees by approximately 120 positions and recorded restructuring charges of $7.1 million, which related to one-time employee termination benefits. The remainder of the termination benefits will be substantially paid during fiscal 2011. The following table summarizes the restructuring activity recorded in the Condensed Consolidated Balance Sheets during the three months ended April30, 2010: Balance at January31,2010 Additions Payments Adjustments(1) Balance at April30,2010 Fiscal 2011 Plan Employee Termination Costs $ $ 7.1 $ (4.7 ) $ $ 2.4 Fiscal 2010 Plan Employee Termination Costs 0.8 (0.8 ) Lease Termination and Asset Costs 6.1 (1.0 ) 5.1 Fiscal 2009 Plan Employee Termination Costs 1.0 (0.2 ) 0.8 Lease Termination and Asset Costs 8.2 0.2 (1.6 ) 6.8 Other Employee Termination Costs 0.4 (0.3 ) 0.1 Lease Termination and Asset Costs 2.9 (0.4 ) 2.5 $ 19.4 $ 7.3 $ (9.0 ) $ $ 17.7 Current portion(2) $ 11.4 $ 10.3 Non-current portion(2) 8.0 7.4 $ 19.4 $ 17.7 (1) Adjustments include the impact of foreign currency translation. (2) The current and non-current portion of the reserve is recorded in the Condensed Consolidated Balance Sheet under Other accrued liabilities and Other liabilities, respectively.

Deferred Compensation

Deferred Compensation
	3 Months Ended Apr. 30, 2010
Deferred Compensation	9. Deferred Compensation At April30, 2010, Autodesk had marketable securities totaling $301.2 million, of which $29.5 million related to investments in debt and equity securities that are held in a rabbi trust under non-qualified deferred compensation plans. The total related deferred compensation liability was $29.5 million at April30, 2010, of which $1.3 million was classified as current and $28.2 million was classified as non-current liabilities. The value of debt and equity securities held in the rabbi trust at January31, 2010 was $26.3 million. The total related deferred compensation liability at January31, 2010 was $26.3 million, of which $1.1 million was classified as current and $25.2 million was classified as non-current liabilities. The current and non-current portions of the liability are recorded in the Condensed Consolidated Balance Sheets under Accrued compensation and Other liabilities, respectively.

Computer Equipment, Software, F

Computer Equipment, Software, Furniture and Leasehold Improvements, Net
	3 Months Ended Apr. 30, 2010
Computer Equipment, Software, Furniture and Leasehold Improvements, Net	10. Computer Equipment, Software, Furniture and Leasehold Improvements, Net Computer software and hardware, leasehold improvements, furniture and equipment and the related accumulated depreciation were as follows: April30, 2010 January31, 2010 Computer software, at cost $ 129.3 $ 127.3 Computer hardware, at cost 110.5 108.5 Leasehold improvements, land and buildings, at cost 113.6 113.7 Furniture and equipment, at cost 42.7 42.9 396.1 392.4 Less: Accumulated depreciation (300.6 ) (290.8 ) Computer software, hardware, leasehold improvements, furniture and equipment, net $ 95.5 $ 101.6

Purchased Technologies, Custome

Purchased Technologies, Customer Relationships and Trade Names, Net
	3 Months Ended Apr. 30, 2010
Purchased Technologies, Customer Relationships and Trade Names, Net	11. Purchased Technologies, Customer Relationships and Trade Names, Net Purchased technologies, customer relationships, trade names and the related accumulated amortization were as follows: April30, 2010 January31, 2010 Purchased technologies $ 311.5 $ 311.5 Customer relationships and trade names (1) 175.5 176.5 Less: Accumulated amortization (328.8 ) (314.9 ) Purchased technologies, customer relationships and trade names, net $ 158.2 $ 173.1 (1) Customer relationships and trade names are included in Other Assets in the Condensed Consolidated Balance Sheets.

Goodwill

Goodwill
	3 Months Ended Apr. 30, 2010
Goodwill	12. Goodwill The changes in the carrying amount of goodwill during the three months ended April30, 2010 were as follows: Platform Solutions and Emerging Business Architecture, Engineeringand Construction Manufacturing Media and Entertainment Total Balance as of January31, 2010 $ 40.2 $ 224.8 $ 277.9 $ $ 542.9 Effect of foreign currency translation, purchase accounting adjustments and other (1.9 ) (0.7 ) (2.6 ) Balance as of April30, 2010 $ 40.2 $ 222.9 $ 277.2 $ $ 540.3 Autodesk assesses goodwill annually for impairment in the fourth quarter of each fiscal year or sooner should events or changes in circumstances indicate potential impairment. When assessing goodwill for impairment, Autodesk uses discounted cash flow models that include assumptions regarding projected cash flows (Income Approach) and corroborates it with the estimated consideration that the Company would receive if there were to be a sale of the reporting segment (Market Approach). Variances in these assumptions could have a significant impact on Autodesks conclusion as to whether goodwill is impaired, or the amount of any impairment charge. Impairment charges, if any, result from instances where the fair values of net assets associated with goodwill are less than their carrying values. The process of evaluating the potential impairment of goodwill is subjective and requires significant judgment at many points during the analysis. The value of Autodesks goodwill could also be impacted by future adverse changes such as: (i)declines in Autodesks actual operating results, (ii)a sustained decline in Autodesks market capitalization, (iii)significant slowdown in the worldwide economy or the industries Autodesk serves, or (iv)changes in Autodesks business strategy or internal operating results forecasts. As of April30, 2010, a hypothetical 10% decrease in the fair value of Autodesks reporting units would not have an impact on the carrying value of goodwill nor result in additional impairment of goodwill.

Borrowing Arrangements

Borrowing Arrangements
	3 Months Ended Apr. 30, 2010
Borrowing Arrangements	13. Borrowing Arrangements Autodesks U.S. line of credit facility permits unsecured short-term borrowings of up to $250.0 million and is available for working capital or other business needs. The credit agreement contains customary covenants, which could restrict liens, certain types of additional debt and dispositions of assets if Autodesk fails to maintain its financial covenants. The line of credit is syndicated with various financial institutions, including Citicorp USA, Inc., a Citibank affiliate, which is the lead lender and agent. Autodesk had no outstanding borrowings on this line at April30, 2010. This facility expires in August 2012. Autodesks China line of credit facility permits unsecured short-term borrowings of up to $5.0 million and is available for working capital needs. At April30, 2010, Autodesk had no outstanding borrowings on this line of credit, which contains customary covenants. This facility has no contractual expiration.

Commitments and Contingencies

Commitments and Contingencies
	3 Months Ended Apr. 30, 2010
Commitments and Contingencies	14. Commitments and Contingencies Guarantees and Indemnifications In the normal course of business, Autodesk provides indemnifications of varying scopes, including limited product warranties and indemnification of customers against claims of intellectual property infringement made by third parties arising from the use of Autodesks products or services. Autodesk accrues for known indemnification issues if a loss is probable and can be reasonably estimated. Historically, costs related to these indemnifications have not been significant, but because potential future costs are highly variable, Autodesk is unable to estimate the maximum potential effect of these indemnifications on its future results of operations. In connection with the purchase, sale or license transactions of assets or businesses with third parties, Autodesk has received or assumed customary indemnification agreements related to the assets or businesses purchased, sold or licensed. Historically, costs related to indemnifications or guarantees assumed have not been significant, but because potential future costs are highly variable, Autodesk is unable to estimate the maximum potential effect of these indemnifications on its future results of operations. As permitted under Delaware law, Autodesk has agreements whereby it indemnifies its officers and directors for certain events or occurrences while the officer or director is, or was, serving at Autodesks request in such capacity. The maximum potential amount of future payments Autodesk could be required to make under these indemnification agreements is unlimited; however, Autodesk has Directors and Officers Liability insurance coverage that is intended to reduce its financial exposure and may enable Autodesk to recover a portion of any future amounts paid. Autodesk believes the estimated fair value of these indemnification agreements in excess of applicable insurance coverage is not significant. Legal Proceedings Autodesk is involved in legal proceedings from time to time arising from the normal course of business activities including claims of alleged infringement of intellectual property rights, commercial, employment, piracy prosecution and other matters. In the Companys opinion, resolution of pending matters is not expected to have a material adverse impact on its consolidated results of operations, cash flows or its financial position. However, it is possible that an unfavorable resolution of one or more such proceedings could in the future materially affect its future results of operations, cash flows or financial position in a particular period.

Common Stock Repurchase Program

Common Stock Repurchase Program
	3 Months Ended Apr. 30, 2010
Common Stock Repurchase Program	15. Common Stock Repurchase Program Autodesk has a stock repurchase program that helps offset the dilution to net income per share caused by the issuance of stock under the Companys employee stock plans and returns excess cash generated from its business to stockholders. During the quarter ended April30, 2010, Autodesk repurchased 2.0million shares of its common stock on the open market at an average repurchase price of $29.38 per share and subsequently retired those shares. Common stock and additional paid-in capital and retained earnings were reduced by $26.9 million and $31.9 million, respectively, during the quarter ended April30, 2010, as a result of the stock repurchases. As of April30, 2010, 11.5million shares remained available for repurchase under this program. The number of shares acquired and the timing of the purchases are based on several factors, including general market conditions, the volume of employee stock option exercises and the issuance of shares through our ESP Plan, the pool of existing outstanding options and the grant of new options, the trading price of Autodesk common stock, cash on hand and available in the United States, and company defined trading windows.

Comprehensive Income

Comprehensive Income (Loss)
	3 Months Ended Apr. 30, 2010
Comprehensive Income (Loss)	16. Comprehensive Income (Loss) The components of other comprehensive income (loss), net of taxes, were as follows: ThreeMonthsEnded April30, 2010 2009 Net income (loss) $ 36.9 $ (32.1 ) Other comprehensive income (loss) Net gain (loss) on derivative instruments, net of taxes 7.1 3.2 Change in net unrealized gain (loss) on available-for-sale securities, net of tax (0.3 ) Net change in cumulative foreign currency translation gain (loss) (4.4 ) (1.7 ) Total other comprehensive income (loss) 2.4 1.5 Total comprehensive income (loss) $ 39.3 $ (30.6 ) Accumulated other comprehensive income (loss), net of taxes, was comprised of the following at April30: April30, 2010 2009 Net gain (loss) on derivative instruments $ 9.4 $ 3.0 Net unrealized gain (loss) on available-for-sale securities 1.2 Unfunded portion of pension plans (5.9 ) Foreign currency translation adjustments (5.8 ) (12.7 ) $ (1.1 ) $ (9.7 )

Net Income

Net Income (Loss) Per Share
	3 Months Ended Apr. 30, 2010
Net Income (Loss) Per Share	17. Net Income (Loss) Per Share Basic net income (loss) per share is computed using the weighted average number of shares of common stock outstanding for the period, including restricted stock awards and excluding unvested stock options and restricted stock units. Diluted net income (loss) per share is based upon the weighted average shares of common stock outstanding for the period and potentially dilutive common shares, including the effect of stock options and restricted stock units under the treasury stock method. The following table sets forth the computation of the numerators and denominators used in the basic and diluted net income per share amounts: ThreeMonthsEnded April30, 2010 2009 Numerator: Net income (loss) $ 36.9 $ (32.1 ) Denominator: Denominator for basic net income per shareweighted average shares 229.0 227.1 Effect of dilutive securities 5.6 Denominator for dilutive net income per share 234.6 227.1 Basic net income (loss) per share $ 0.16 $ (0.14 ) Diluted net income (loss) per share $ 0.16 $ (0.14 ) The computation of diluted net income (loss) per share does not include shares that are anti-dilutive under the treasury stock method because their exercise prices are higher than the average market value of Autodesks stock during the period. For the three months ended April30, 2010 and 2009, 19.4million and 31.2million potentially anti-dilutive weighted shares, respectively, were excluded from the computation of diluted net income (loss) per share.

Segments

Segments
	3 Months Ended Apr. 30, 2010
Segments	18. Segments Autodesk reports segment information based on the management approach. The management approach designates the internal reporting used by management for making decisions and assessing performance as the source of the Companys reportable segments. Autodesk has four reportable segments: Platform Solutions and Emerging Business (PSEB), Architecture, Engineering and Construction (AEC), Manufacturing (MFG) and Media and Entertainment (ME). Autodesk has no material inter-segment revenue. The PSEB, AEC and MFG segments derive revenue from the sale of licenses for software products and services to customers who design, build, manage or own building, manufacturing and infrastructure projects. The ME segment derives revenue from the sale of products to creative professionals, post-production facilities, and broadcasters for a variety of applications, including feature films, television programs, commercials, music and corporate videos, interactive game production, web design and interactive web streaming. PSEB includes Autodesks horizontal design product, its AutoCAD product. Autodesks AutoCAD product is a platform product that underpins the Companys vertical design product offerings for the industries it serves. For example, AEC and MFG offer tailored versions of AutoCAD software for the industries they serve. Autodesks AutoCAD product also provides a platform for Autodesks developer partners to build custom solutions for a range of diverse design-oriented markets. PSEBs revenue primarily includes revenue from sales of licenses of Autodesks horizontal design products, AutoCAD and AutoCAD LT, as well as many of Autodesks vertical design products. AEC software products help to improve the way building, civil infrastructure, process plant and construction projects are designed, built and managed. A broad portfolio of solutions enables greater efficiency, accuracy and sustainability across the entire project lifecycle. Autodesk AEC solutions include advanced technology for building information modeling (BIM), AutoCAD-based design and documentation productivity software, and sustainable design analysis applications, and collaborative project management solutions. BIM, an integrated process for building and infrastructure design, analysis, documentation and construction, uses consistent, coordination information to improve communication and collaboration between the extended project team. AEC provides a comprehensive portfolio of BIM solutions that help customers deliver projects faster and more economically, while minimizing environmental impact. AECs revenue primarily includes revenue from the sales of licenses of Autodesk Revit, AutoCAD Civil 3D, AutoCAD Architecture and AutoCAD Map 3D products. MFG provides the manufacturers in automotive and transportation, industrial machinery, consumer products and building products with comprehensive digital prototyping solutions that brings together design data from all phases of the product development process to develop a single digital model created in Autodesk Inventor software. Autodesks solutions for digital prototyping enable a broad group of manufacturers to realize benefit