Disrupting itself by switching to a software-as-a-service (SaaS) model and by providing mobile applications, leading to higher revenues and enhanced profit margins
- Autodesk¹ is a leader in professional 3D-design software and consumer applications for architecture in the engineering, construction, manufacturing, media and entertainment industries.
- Founded in 1982, Autodesk is headquartered in San Rafael, California. It generates over $2.5 billion in revenues ($269 million EBITDA) and has over 8,823 employees.
- Autodesk’s best-known product line is AutoCAD, a 2D and 3D computer-aided design (CAD) software application allowing architects and other users to create virtual 3D models.
- Autodesk has 10 million users and is aiming to generate 70% of their revenues from SaaS by 2018.
- From 1990 onwards, Autodesk has increasingly diversified its products into adjacent industry segments.
- As of 2014, 45% of Autodesk’s revenues are generated from 1.9 million customers using the company’s SaaS solutions.
- In FY15 operating margin was recently estimated at 14%-16%; equity analysts expect Autodesk to further enhance margins to more than 30% by 2018.
- Autodesk are poised to benefit from the upcoming 3D-printing trend where SaaS is an increasingly significant component.
- In 2011 Autodesk realized the need to shift their business based on a perpetual licensing model with diminishing profits towards an internet software as a service (SaaS) subscription model.
- Autodesk designed SaaS-platform products that are easily deployable and well suited to attacking incumbents in the industry.
- Customers are being motivated to make the switch to the cloud through increased product features and ubiquitous availability of the tools across several devices and operating systems.
Sources: Marketwatch; Seekingalpha; Autodesk; WEF/Accenture Analysis
Autodesk is one of more than 100 case studies identified as part of the World Economic Forum’s Digital Transformation of Industries initiative. An overview of the DTI program can be found here.