Autodesk (ADSK) 10-K risk factor changes: FY2017 vs FY2016

The past several years were characterized by [removed: weak] [added: mixed] global economic conditions, volatile credit markets, volatile exchange rates, relatively high unemployment, increased government deficit spending and debt levels, uncertainty about certain governments' abilities to repay such debt or to address certain fiscal issues, and volatility in many financial instrument markets.

| • | lack of credit available [removed: to] [added: to,] and the insolvency [removed: of] [added: of,] key channel partners, which may impair our distribution channels and cash flows; |

To support our transition, we discontinued [removed: licensing upgrades effective March 6, 2015, discontinued] selling new perpetual licenses of most individual software products effective February 1, 2016, and [removed: plan to discontinue] [added: discontinued] selling new perpetual licenses of suites effective [added: August 1, 2016.]

[removed: ][added: ]

During our transition, revenue, billings, gross margin, operating margin, net income (loss), earnings (loss) per share, deferred revenue, and cash flow from operations will be impacted as more revenue is recognized ratably rather than [removed: up front] [added: upfront] and as new offerings bring a wider variety of price points.

Whether our business model transition will prove successful and will accomplish our business and financial objectives is subject to numerous [added: risks and] uncertainties, including but not limited to: customer demand, attach and renewal rates, channel acceptance, our ability to further develop and scale infrastructure, our ability to include functionality and usability in such offerings that address customer requirements, tax and accounting implications, pricing, and our costs.

[removed: If we are not able to meet customer requirements, either with respect to our software or] hardware products or the manner in which we provide such products, or if we are not able to adapt our business model to meet our customers' requirements, our business, financial condition or results of operations may be adversely impacted.

At times, sales of licenses of our AutoCAD and AutoCAD LT or individual Autodesk flagship products have decreased without a corresponding increase in [removed: suites product] [added: industry collections] or cloud-based services revenue or without purchases of customer seats to our [removed: suites.][added: industry collections.]

Also, adoption of our cloud and mobile computing offerings and changes in the delivery of our software and services to our customers, such as desktop subscription [removed: (formally] [added: (formerly] referred to as rental) offerings, will change the way in which we recognize revenue relating to our software and services, with a potential negative impact on our financial performance.

[added: Although we have articulated a strategy that we] believe will fulfill these challenges, if we fail to execute properly on that strategy or adapt that strategy as market conditions evolve, we may fail to meet our customers' expectations, fail to compete with our competitors' products and technology, and lose the confidence of our channel partners and employees.

The manufacturing and 3D printing markets are highly competitive and some of our competitors have [removed: superior] experience and resources [added: superior] to [removed: us.][added: ours.]

The discontinuance of our perpetual licenses for most individual software products on February 1, 2016 and for perpetual suites on August 1, 2016 [added: has and] will [added: continue to] result in the loss of future [removed: up-front] [added: upfront] licensing revenue.

This also [removed: will freeze] [added: has frozen the] growth of our maintenance subscription revenue because there will be no further opportunities to attach maintenance [removed: licensing once we cease the sale of suites licenses.][added: licensing.]

Customer renewal rates may decline or fluctuate due to a number of factors, including offering pricing, competitive offerings, customer satisfaction, and reductions in customer spending levels or customer activity due [added: to] economic downturns or financial markets uncertainty.

Through the restructuring, we [removed: seek] [added: sought] to reduce expenses, streamline the organization, and reallocate resources to align more closely with the Company’s needs going forward.

As a result of these actions, we have incurred and [removed: will] [added: may] incur additional costs in the short term that have the effect of reducing our operating margins.

International net revenue represented [removed: 68%] [added: 63%] and [removed: 71%] [added: 68%] of our net revenue in fiscal [removed: 2016] [added: 2017] and [removed: 2015,] [added: 2016,] respectively.

We anticipate that our international operations will continue to account for a significant portion of our net revenue, and, as we expand our international development, sales and marketing expertise, will provide significant support to our overall efforts in countries outside of the U.S. [removed: Risks inherent in our international operations include:]

| • | increasing enforcement by the U.S. under the Foreign Corrupt Practices Act, [added: and] adoption of stricter anti-corruption laws in certain countries, including the United Kingdom; |

These exposures may change over time as business practices evolve and economic conditions [removed: change, and they could have a material adverse impact on our financial results and cash flows.][added: change.]

[added: Despite significant efforts to create] security barriers to such programs, it is virtually impossible for us to entirely eliminate this risk.

Additionally, the Federal Trade Commission has used its authority under Section 5 of the Federal Trade Commission Act to bring actions against companies for failing to maintain adequate security for personal information collected from consumers over the Internet and for failing to comply with [removed: privacy-related] [added: privacy- related] representations made to Internet users.

[removed: Additionally, some federal, state, or foreign governmental bodies have] established laws that seek to censor the transmission of certain types of content over the Internet or require that individuals be provided with the ability to permanently delete all electronic personal information, such as the German Multimedia Law of 1997 and the California “Eraser law” for minors.

Increased enforcement of existing laws and regulations, as well as any laws, regulations or changes that may be adopted or implemented in the future, could limit the growth of the use of public cloud applications or communications generally, result in a decline in the use of the Internet and the viability of Internet-based applications, and require us to implement [removed: of] additional technological safeguards.

In February [removed: of] 2016, [removed: The] [added: the] European Commission and the United States agreed on a new framework for transatlantic data flows: the [removed: EU-US] [added: EU-U.S.] Privacy Shield.

We [added: increasingly] rely on hosted computer services from third parties for services that we provide our customers and computer operations for our internal use.

For fiscal [removed: 2016] [added: 2017] and fiscal [removed: 2015,] [added: 2016,] approximately [removed: 79%] [added: 72%] and [removed: 83%] [added: 79%, respectively,] of our revenue was derived from indirect channel sales through distributors and resellers and we expect that the majority of our revenue will continue to be derived from indirect channel sales in the future.

Tech Data accounted for [added: 30% and] 25% of our total net revenue for [removed: both] fiscal [removed: 2016] [added: 2017] and [removed: 2015,] [added: 2016,] respectively.

[added: In particular, if one or more of such] distributors or resellers were unable to meet their obligations with respect to accounts payable to us, we could be forced to write off such accounts and may be required to delay the recognition of revenue on future sales to these customers.

A significant portion of our revenue is generated through maintenance revenue; [added: if] decreases in maintenance [removed: renewal rates would negatively impact] [added: revenue are not offset by increases in new model subscription revenue,] our future revenue and financial [removed: results.][added: results will be negatively impacted.]

Our maintenance customers have no obligation to [removed: attach maintenance to their initial license or] renew their maintenance [removed: contract] [added: contracts] after the expiration of their [removed: initial] maintenance period, which is typically one year.

The discontinuance of our perpetual licenses for most individual software products on February 1, 2016 and for perpetual suites on August 1, 2016 [removed: will result] [added: resulted] in the loss of future maintenance attach [removed: opportunities and freeze maintenance growth.][added: opportunities.]

[removed: Once we discontinue new perpetual suites we] [added: We] expect [removed: customers'] [added: customer] renewal rates will decline or fluctuate over time as a result of a number of factors, including the overall global economy, the health of their businesses, [removed: and] the perceived value of the maintenance [removed: program.][added: program and planned maintenance pricing increases.]

| • | failure to achieve anticipated levels of customer acceptance [removed: to] [added: of] our business model transition, including the impact of the end of upgrades and perpetual licenses; |

| • | the success of new business or sales [removed: initiatives and increasing our portfolio of product suites;] [added: initiatives;] |

In particular, our financial results in Europe during our third quarter are usually affected by a slower summer period, and our [removed: Asia Pacific] [added: APAC] operations typically experience seasonal slowing in our third and fourth quarters.

| • | [removed: significant] [added: significantly] higher than anticipated transaction or integration-related costs; |

Because we derive a substantial portion of our net revenue from a small number of products, including our AutoCAD-based software products and [removed: suites,] [added: collections,] if these products are not successful, our revenue will be adversely affected.

We derive a substantial portion of our net revenue from sales of licenses of a limited number of our products, including AutoCAD software, products based on AutoCAD, which include our [removed: suites] [added: collections] that serve specific markets and products that are interoperable with AutoCAD.

During fiscal [removed: 2016] [added: 2017] and [removed: 2015,] [added: 2016,] combined revenue from our AutoCAD and AutoCAD LT products, not including [removed: suites] [added: collections (formerly suites)] having AutoCAD or AutoCAD LT as a component, represented [removed: 24%] [added: 16%] and [removed: 28%] [added: 24%] of our total net revenue, respectively.

In addition, in June 2016, voters in the United Kingdom approved an advisory referendum to withdraw from the European Union (commonly referred to as “Brexit”).

The Brexit vote and the perceptions as to the impact of the withdrawal of the United Kingdom from the European Union may adversely affect business activity, political stability and economic conditions in the United Kingdom, the European Union and elsewhere.

2017 Form 10-K 14

It is uncertain at this time how the new U.S. President, Administration and Congress will affect our business, including potentially through increased import tariffs and other influences on U.S. trade relations with other countries, such as Mexico and China.

The imposition of tariffs or other trade barriers could increase our costs and reduce the competitiveness of our offerings in certain markets.

In addition, other countries may change their own policies on business and foreign investment in companies in their respective countries.

Geopolitical trends toward nationalism and protectionism and the weakening or dissolution of international trade pacts may increase the cost of, or otherwise interfere with, conducting business.

If we are not able to meet customer requirements, either with respect to our software or


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2017 Form 10-K 16

Risks inherent in our international operations include:


2017 Form 10-K 17

The Brexit vote has exacerbated and may further exacerbate many of the risks and uncertainties described above.

The proposed withdrawal of the United Kingdom from the European Union could, among other potential outcomes, adversely affect the tax, tax treaty, currency, operational, legal and regulatory regimes to which our businesses in the region are subject.

The withdrawal could also, among other potential outcomes, disrupt the free movement of goods, services and people between the United Kingdom and the European Union and significantly disrupt trade between the United Kingdom and the European Union and other parties.

Further, uncertainty around these and related issues could lead to adverse effects on the economy of the United Kingdom and the other economies in which we operate.

For example, the June 23, 2016 announcement of Brexit caused significant volatility in global stock markets and currency exchange rate


2017 Form 10-K 18

fluctuations that resulted in the strengthening of the U.S. dollar against foreign currencies in which we conduct business.

Our exposure to adverse movements in foreign currency exchange rates could have a material adverse impact on our financial results and cash flows.

For example, cyber attacks could make our customers hesitant to adopt our cloud-based hosted subscription services, which could negatively impact our business model transition.

Additionally, some federal, state, or foreign governmental bodies have


2017 Form 10-K 19

We rely on other legal mechanisms for data transfer and continue to comply with the previous U.S.-EU Safe Harbor Framework and U.S.-Swiss Safe Harbor Framework as set forth by the U.S. Department of Commerce regarding the collection, use, and retention of personal information from European Union member countries and Switzerland.


2017 Form 10-K 20

If our non-renewing maintenance customers do not transition to our new business model subscriptions, our future revenue and financial results will be negatively impacted.


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2017 Form 10-K 22


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2016 Form 10-K 16

August 1, 2016.

Although we have articulated a strategy that we

2016 Form 10-K 17

2016 Form 10-K 18

Our intent is that amounts related to foreign earnings permanently reinvested outside the U.S. will remain outside the U.S., and we will meet our U.S. liquidity needs through ongoing cash flows, external borrowings (such as our 2012 and 2015 Notes), or both.

However, if, in the future, amounts held by foreign subsidiaries are needed to fund our operations in the U.S., or to service our external borrowings, the repatriation of such amounts to the U.S. could result in a significant incremental tax liability in the period in which the decision to repatriate occurs and payment of any such tax liability would reduce the cash available to fund our operations.

2016 Form 10-K 19

Despite significant efforts to create

2016 Form 10-K 20

Autodesk is currently awaiting additional guidance from European regulators on how the EU-US Privacy Shield will be implemented.

We continue to comply with the previous Safe Harbor principles and rely on other legal mechanisms for data transfers.

2016 Form 10-K 21

In particular, if one or more of such

2016 Form 10-K 22

If our customers do not renew their maintenance contract for our products, our maintenance revenue will decline and our financial results will suffer.

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2016 Form 10-K 24

2016 Form 10-K 25

2016 Form 10-K 26

Management initiated remediation plans including the following:

2016 Form 10-K 27

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Our financial results could be negatively impacted if our tax positions are overturned by tax authorities.

We believe our tax positions, including intercompany transfer pricing policies, are

2016 Form 10-K 29

consistent with the tax laws in the jurisdictions in which we conduct our business.

2016 Form 10-K 30

Forward-looking statements are any statements that look to future events and consist of, among other things, our business strategies, [removed: including those discussed in “Strategy” and “Overview of Fiscal 2015” and “Business Outlook” below, anticipated] future [removed: net revenue, future GAAP and non-GAAP net (loss) income per share, operating margin, operating expenses, billings, annualized recurring revenue, annualized revenue per subscription, other future] financial results [removed: (by] [added: (including by] product type and geography) and subscriptions, the effectiveness of our efforts to successfully manage transitions to new business models and markets, our expectations regarding the continued transition of our business model, our ability to increase our subscription base, expected market trends, including the growth of [removed: cloud, mobile,] [added: cloud] and [removed: social] [added: mobile] computing, the effect of [removed: unemployment and] [added: unemployment, the] availability of credit, our expectations for our restructuring, the effects of mixed global economic conditions, the effects of revenue recognition, [removed: our backlog,] expected trends in certain financial metrics, including expenses, the impact of acquisitions and investment activities, expectations regarding our cash needs, the effects of fluctuations in exchange rates and our hedging activities on our financial results, our ability to successfully expand adoption of our products, our ability to gain market acceptance of new businesses and sales initiatives, [removed: our ability to successfully increase sales of product suites as part of our overall sales strategy,] [added: and] the impact of economic volatility and geopolitical activities in certain countries, particularly emerging economy countries, [added: the timing] and [added: amount of purchases under our newly announced stock buy-back plan, and] the effects of potential non-cash charges on our financial results and the resulting effect on our financial results.

In addition, forward-looking statements also consist of statements involving expectations regarding product capability and acceptance, [removed: continuation of our stock repurchase program, remediations] [added: remediation] to our controls environment, statements regarding our liquidity and short-term and long-term cash requirements, as well as statements involving trend analyses and statements including such words as “may,” “believe,” “could,” “anticipate,” “would,” “might,” “plan,” “expect,” and similar expressions or the negative of these terms or other comparable terminology.

As such, our actual results could differ materially from those set forth in the forward-looking statements as a result of [removed: the factors] [added: a number of factors, including those] set forth above in Item 1A, “Risk Factors,” and in our other reports filed with the U.S. Securities and Exchange Commission.

Autodesk was founded during the platform transition from [removed: mainframes] [added: mainframe computers] and engineering workstations to personal computers.

[removed: For] [added: Our cloud service offerings, for] example, [removed: Autodesk] BIM 360, [removed: PLM 360,] [added: Shotgun,] Fusion 360, and [removed: AutoCAD360] [added: AutoCAD 360] Pro, [removed: some of our cloud based offerings,] provide tools, including mobile and social capabilities, to help streamline design, collaboration, and data management processes.

Our strategy is to lead the industries we serve to [removed: cloud based] [added: cloud-based] technologies and business models.

These offerings are designed to give our customers [removed: even] more flexibility with how they use our products and service offerings and to [removed: address new types] [added: attract a broader range] of [removed: customers] [added: customers,] such as project-based users and small businesses.

[removed: ][added: ]

[added: As part of the transition, we discontinued selling new] perpetual licenses of most individual software products effective February 1, 2016, and [removed: plan to discontinue] [added: discontinued] selling new perpetual licenses of suites effective August 1, 2016.

With the discontinuation of the sale of most perpetual licenses, we [removed: are accelerating] [added: have accelerated] our transition away from selling a [removed: hybrid] [added: mix] of perpetual licenses and term-based [removed: offerings] [added: product subscriptions] toward a single subscription model.

During the transition, [removed: billings,] revenue, [removed: gross margin, operating margin, earnings (loss) per share,] [added: margins, EPS,] deferred [removed: revenue,] [added: revenue] and cash flow from operations [added: have been and] will be impacted as more revenue is recognized ratably rather than [removed: up front] [added: upfront] and as new [added: product subscription] offerings [removed: bring] [added: generally have] a [removed: wider variety of price points.][added: lower initial purchase price.]

As we progress through the business model transition, [removed: billings and] reported revenue [removed: will become] [added: is] less relevant to measure the success of the business as perpetual license sales [removed: are] [added: have been] discontinued in favor of subscription offerings, which have considerably lower [removed: up-front] [added: upfront] prices.

Annualized recurring revenue ("ARR") and [removed: subscription additions will] [added: growth of subscriptions] better reflect business momentum and provide additional transparency into the transition.

To further analyze progress, we [removed: will also] disaggregate our growth in these metrics between the original maintenance [removed: subscription] model ("maintenance") and the new [removed: desktop, cloud and mobile, and enterprise flexible license agreements ("new model").][added: model subscription offerings.]

[removed: We expect maintenance subscriptions to peak as] [added: With the discontinuation of our] perpetual license [removed: sales end this year, and] [added: sales,] we [added: no longer offer new maintenance subscriptions and] expect [removed: them] [added: our maintenance subscription revenue] to decline [removed: slowly] over time.

[removed: In fiscal 2016, revenue] [added: Revenue] from emerging economies [removed: decreased 4% as compared to fiscal 2015 and] represented [added: 11% and] 15% of [removed: our] total net revenue for [removed: both] fiscal [removed: 2016] [added: 2017] and [removed: fiscal 2015,] [added: 2016,] respectively.

We offer free educational [removed: licenses] [added: subscriptions] of Autodesk software worldwide to students, educators, and educational institutions.

[removed: Beginning in the second quarter of fiscal 2016, we have] [added: We] also [added: have] made Autodesk Design Academy curricula available on iTunes U.

Our strategy depends upon a number of assumptions to successfully make the transition toward new cloud and mobile platforms, [removed: including] [added: including:] the related technology and business model shifts; making our technology available to mainstream markets; leveraging our large global network of distributors, resellers, third-party developers, customers, educational institutions, and students; improving the performance and functionality of our products; and adequately protecting our intellectual property.

For further discussion regarding these and related [removed: risks] [added: risks,] see Part I, Item 1A, “Risk Factors.”

If we do not have VSOE for undelivered [added: product subscriptions,] maintenance or services, the revenue for the arrangement is recognized over the longest contractual service period in the arrangement.

For multiple elements arrangements involving non-software elements, including cloud subscription services, our revenue recognition policy is based upon the accounting guidance contained in [removed: ASC] [added: Accounting Standards Codification ("ASC")] 605, Revenue Recognition.

As part of this analysis, we monitor and evaluate the BESP against actual pricing to ensure that it continues to represent a reasonable estimate of the standalone selling price, considering several other external and internal factors including, but not limited to, pricing and discounting practices, contractually stated prices, the geographies in which we offer our products and services, and the type of customer (i.e. distributor, value-added [added: reseller, and direct end user, among others).]

If we do not believe that collection is probable, the revenue will be deferred until [removed: the earlier of when collection is deemed probable or] payment is received.

Our [removed: product license] [added: subscription] revenue from distributors and resellers [removed: are] generally [removed: recognized] [added: commences recognition] at the time [removed: title to our product passes] [added: access is provided] to [removed: the distributor, in a two-tiered structure, or reseller, in a one-tiered structure,] [added: their customers,] provided all other criteria for revenue recognition are met.

[removed: The] [added: Depending on how the payments are made, the] reserves associated with the partner incentive program are treated on the balance sheet as either contra account receivable [removed: (when due to distributors and direct resellers)] or accounts [removed: payable (when due to indirect resellers).][added: payable.]

However, determining the fair value of marketable securities [added: or convertible note investments in privately held companies] when observable inputs are not available (Level 3) requires significant judgment.

All of Autodesk’s marketable securities [added: and privately held company investments] are subject to a periodic impairment review.

| • | the acquired [removed: company’s] [added: company's] trade [removed: name] [added: name, trademark] and [added: existing] customer [removed: relationships] [added: relationship,] as well as assumptions about the period of time the acquired trade name and [removed: customer relationships] [added: trademark] will continue to be used in the [removed: combined company’s] [added: our] product portfolio; |

Beginning in the second quarter of fiscal 2016, we considered [removed: recent] cumulative losses in the [removed: United States] [added: U.S.] arising from the Company’s business model transition as a significant source of negative evidence.

Considering this negative evidence and the absence of sufficient positive objective evidence that we would generate sufficient taxable income in [removed: our United States tax jurisdiction] [added: the U.S.] to realize the deferred tax assets, we determined that [removed: is] [added: it] was [removed: not] more likely than not [removed: that the Company would realize US federal and state deferred tax assets and recorded a valuation allowance on our federal and state deferred tax assets.]

As we continually strive to optimize our overall business model, tax planning strategies may become feasible and prudent whereby management may determine that it is more [added: likely than not that the federal and state deferred tax assets will be realized; therefore, we will continue to evaluate the evidence around our ability to utilize our net deferred tax assets each quarter, both in the US and in foreign jurisdictions, based on all available evidence, both positive and negative.]

Overview of Fiscal [removed: 2016][added: 2017]

| | Fiscal Year Ended January 31, [removed: 2016] [added: 2017] | | | | [removed: As a % of Net Revenue] | | | [added: | | | |] Fiscal Year Ended January 31, [removed: 2015] [added: 2016] | | | | [removed: As a % of Net Revenue] | | [added: | | | | | Fiscal Year Ended January 31, 2015 | | |]

| | (in millions) | | | | | | | | | | | | | [added: | | | | | | |]

| Net Revenue | $ | [removed: 2,504.1] [added: 2,031.0] | | | 100 | % | | $ | [removed: 2,512.2] [added: (473.1] | [added: )] | | [added: (19 | )% | | $ | 2,504.1 | | |] 100 | % |

| Cost of revenue | [removed: 370.7] [added: 341.9] | | | | [removed: 15] [added: 17] | % | | [removed: 342.1] [added: (28.8] | | [added: )] | | [removed: 14] [added: (8] | [added: )% | | 370.7 | | | | 15 |] % |

| Gross [removed: Profit | 2,133.4 |] [added: profit] | [added: $] | [added: 1,689.1] | [removed: 85] | [removed: %] | [added: $] | [removed: 2,170.1] [added: 2,133.4] | | | [added: $] | [removed: 86] [added: 2,170.1] | [removed: %] |

| Operating expenses | [removed: 2,132.1] [added: 2,188.7] | | | | [removed: 85] [added: 108] | % | | [removed: 2,049.4] [added: 56.6] | | | | [removed: 82] [added: 3] | % | [added: | 2,132.1 | | | | 85 | % |]

| [removed: Income] [added: (Loss) income] from [removed: Operations] [added: operations] | $ | [removed: 1.3] [added: (499.6] | [added: )] | | [removed: —] [added: $] | [removed: %] [added: 1.3] | | [added: |] $ | 120.7 | | [removed: | 5 | % |]

Autodesk makes software for people who make things.

If you've ever driven a high-performance car, admired a towering skyscraper, used a smartphone, or watched a great film, chances are you've experienced what millions of Autodesk customers are doing with our software.

Autodesk gives you the power to make anything.

Our product subscriptions presently represent a hybrid of desktop software and cloud-based functionality, which provides a device-independent, collaborative design workflow for designers and their stakeholders.

As part of the transition, we discontinued selling new perpetual licenses of most individual software products effective February 1, 2016, and discontinued selling new perpetual licenses of suites while introducing industry collections effective August 1, 2016.

Industry collections allow access to a broad set of products and services that exceeds those previously available in suites - simplifying the customer ability to get access to a complete set of tools for their industry.

We now offer subscriptions for individual products and industry collections, cloud service offerings, and flexible enterprise business agreements ("new model subscription offerings").

As a result of this shift and various other factors described in Note 13, "Segments" in the Notes to our Consolidated Financial Statements, we have

2017 Form 10-K 36

reassessed the way we allocate resources and evaluate financial performance and now operate as a single operating segment.

Maintenance subscriptions peaked in the fourth quarter of our fiscal 2016, and we expect them to decline slowly over time.

We sell our products and services globally, through a combination of indirect and direct channels.

During the fiscal year ended January 31, 2017, 2016, and 2015, our indirect channels, which include value added resellers, direct market resellers, distributors, computer manufacturers, and other software developers, were responsible for 72%, 79%, and 83% of our overall revenue, respectively.

During the same periods, our direct channels, which include sales resources dedicated to selling in our largest accounts, our highly specialized products, and business transacted through our online Autodesk branded store, were responsible for 28%, 21%, and 17% of our overall revenue, respectively.

We anticipate that our channel mix will continue to change, particularly as we scale our digitally transacted online Autodesk branded store business and our largest accounts shift towards direct-only business models.

Importantly, we expect our indirect channel will continue to transact and support the majority of our revenue as we move beyond the business model transition.

We employ a variety of incentive programs and promotions to align our direct and indirect channels with our business strategies.

In addition, we have a worldwide user group organization and we have created online user communities dedicated to the exchange of information related to the use of our products.

One of our key strategies is to maintain an open-architecture design of our software products to facilitate third-party development of complementary products and industry-specific software solutions.

This approach enables customers and third parties to customize solutions for a wide variety of highly specific uses.

We offer several programs that provide strategic investment funding, technological platforms, user communities, technical support, forums, and events to developers who develop add-on applications for our products.

For example, we have established the Autodesk Spark program to support ideas that push the boundaries of 3D printing and nurture the companies that will advance innovations within 3D printing hardware and software.

We have also created the Autodesk Forge program to support innovators that build solutions to facilitate the development of a single connected ecosystem for the future of how things are designed, made, and used.


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Marketable Securities and Privately Held Company Investments.


2017 Form 10-K 39


2017 Form 10-K 40

that the Company would not realize U.S. federal and state deferred tax assets and recorded a valuation allowance on our federal and state deferred tax assets.

We continue to have a full valuation allowance against our U.S. deferred tax assets in fiscal 2017 and increased the amount of the valuation allowance to include deferred tax assets generated in fiscal 2017, including deferred tax assets that were established as a result of the adoption of ASU 2016-9 in the second quarter of fiscal 2017.

Restructuring Charges and other facility exit costs, net and Accruals.

In February 2016, the Board of Directors approved a world-wide restructuring plan (“Fiscal 2017 Plan”) in order to re-balance staffing levels and reduce operating expenses to better align them with the evolving needs of the Company's business.

The Company’s restructuring plans include one–time termination benefits as well as certain contractual termination benefits.

We record costs associated with exit activities related to restructuring plans in accordance with the ASC Topic 420, Exit or Disposal Obligations.

Liabilities for costs associated with an exit or disposal activity are recognized in the period in which the liability is incurred.

The timing of associated cash payments is dependent upon the type of exit cost and may extend over a 12-month period.

Autodesk’s vision is to help people imagine, design, and create a better world.

We do this by developing software and services for the world’s designers, architects, engineers, digital artists, professionals, and non-professionals alike—the people who imagine, design, and create the world's products, buildings, infrastructure, films, and games.

Autodesk serves professional customers in three primary markets: architecture, engineering, and construction; manufacturing; and digital media and entertainment.

Our goal is to provide our customers with the world’s most innovative, and engaging design software and services.

Our product and services portfolio allows our customers to digitally visualize, simulate, and analyze their projects, helping them to better understand the consequences of their design decisions; save time, money, and resources; and become more innovative.

We now have term-based license offerings, including desktop subscriptions, for certain products and flexible enterprise offerings.

As part of this transition, we discontinued licensing upgrades effective March 6, 2015, discontinued selling new

2016 Form 10-K 37

Another key element of our strategy is increasing our global penetration.

Emerging economies, such as Brazil, Russia, India, and China, represent a construction and manufacturing opportunity.

Emerging economies face many of the challenges that our design technology can help address, including infrastructure build-out and innovative design and manufacturing.

However, conducting business in these countries presents significant challenges, including economic volatility, geopolitical risk, local competition, limited intellectual property protection, poorly developed business infrastructure, scarcity of talent, software piracy, and different purchase patterns as compared to the developed world.

We believe that our move to the new model increases the number of potential markets for Autodesk.

By connecting all of the participants in the process of designing and making things, we can sell new offerings into the construction and manufacturing spaces.

Today, complex challenges such as globalization, urbanization, and sustainable design are driving our customers to new levels of performance and competitiveness, and we are committed to helping them address those challenges and take advantage of new opportunities.

To achieve these goals, we are capitalizing on two of our strongest competitive advantages: our ability to bring advanced technology to mainstream markets, and the breadth and depth of our product portfolio.

We bring powerful new design capabilities to volume markets.

Our products are designed to be easy-to-learn and use, and to provide customers with a low cost of deployment, a low total cost of access to our software offerings, and a rapid return on investment.

In addition, our software architecture allows for extensibility and integration with other products.

The breadth of our technology and product line gives us a unique competitive advantage because it allows our customers to address a wide variety of problems in ways that transcend industry and disciplinary boundaries.

This is particularly important in helping our customers address the complex challenges mentioned above.

We also believe that our technological leadership and global brand recognition have positioned us well for long-term growth and industry leadership.

In fiscal 2016, we initiated Project Ignite, a free and open learning platform delivering a unique package of technology, learning content, and services created specifically for the classroom.

The Project Ignite learning platform additionally offers classroom bundles, which include hardware such as 3D printers and electronics kits along with professional development and training services to help educators.

2016 Form 10-K 38

2016 Form 10-K 39

reseller, and direct end user, among others).

Our policy also presumes that we have no significant performance obligations in connection with the sale of our product licenses by our distributors and resellers to their customers.

Marketable Securities.

2016 Form 10-K 40

Goodwill.

When we acquire a business, a portion of the consideration transferred is typically allocated to acquired technology and other identifiable intangible assets, such as customer relationships and developed technology.

The excess of the consideration transferred over the net of the acquisition-date fair value of identifiable assets acquired and liabilities assumed is recorded as goodwill.

The amounts allocated to acquired technology and other intangible assets represent our estimates of their fair values at the acquisition date.

We amortize the acquired technology and other intangible assets with finite lives over their estimated useful lives.

The estimation of acquisition-date fair values of intangible assets and their useful lives requires us to make assumptions and judgments, including but not limited to an evaluation of macroeconomic conditions as they relate to our business, industry and market trends, projections of future cash flows, and appropriate discount rates.

We test goodwill for impairment annually in our fourth fiscal quarter or sooner should events or changes in circumstances indicate potential impairment.

An optional assessment of qualitative factors of impairment (“optional assessment”) can be performed prior to necessitating a two-step quantitative impairment test.

Should the optional assessment be performed for any given fiscal year, qualitative factors to consider include cost factors; financial performance; legal, regulatory, contractual, political, business, or other factors; entity specific factors; industry and market considerations, macroeconomic conditions, and other relevant events and factors affecting the reporting unit.

If, after assessing the totality of events or circumstances, it is more likely than not that the fair value of the reporting unit is greater than its carrying value, then performing the two-step impairment test is unnecessary.

As of January 31, [removed: 2016] [added: 2017] and [removed: 2015,] [added: 2016,] we had open cash flow and balance sheet hedge contracts with future settlements within one to twelve months.

The notional amount of our option and forward contracts was [removed: $374.0] [added: $640.0] million and [removed: $381.2] [added: $374.0] million at January 31, [removed: 2016] [added: 2017] and [removed: 2015,] [added: 2016,] respectively.

A sensitivity analysis performed on our hedging portfolio as of January 31, [removed: 2016] [added: 2017] indicated that a hypothetical 10% appreciation of the U.S. dollar from its value at January 31, [removed: 2016] [added: 2017] and [removed: 2015] [added: 2016] would increase the fair value of our foreign currency contracts by [removed: $33.3] [added: $60.9] million and [removed: $35.1] [added: $33.3] million, respectively.

A hypothetical 10% depreciation of the dollar from its value at January 31, [removed: 2016] [added: 2017] and [removed: 2015] [added: 2016] would decrease the fair value of our foreign currency contracts by [removed: $25.6] [added: $32.5] million and [removed: $16.5] [added: $25.6] million, respectively.

At January 31, [removed: 2016,] [added: 2017,] we had [removed: $2,305.4] [added: $1,898.9] million of cash equivalents and marketable securities, including [removed: $897.9] [added: $686.8] million classified as short-term marketable securities and [removed: $532.3] [added: $306.2] million classified as long-term marketable securities.

If interest rates were to move up by 50 or 100 basis points over a twelve month period, the [removed: potential decline in fair] [added: market] value [removed: on] [added: change of] our marketable securities would [removed: be $5.5 million] [added: have an unrealized gain] or [removed: $9.8] [added: loss of $2.9 million and $5.6] million, respectively.

[removed: The privately] [added: Privately] held [removed: companies in which we invest] [added: company investments generally] are considered inherently risky.

[removed: ][added: ]

2017 Form 10-K 62

2016 Form 10-K 64

We serve customers in the architecture, engineering and construction; [added: product design and] manufacturing; and digital [removed: media, consumer,] [added: media] and entertainment industries.

Customers are able to [removed: imagine, design,] [added: design] and create [removed: their ideas] [added: better things and processes] by visualizing, simulating and analyzing real-world performance early in the design [removed: process by creating and manipulating digital prototypes.][added: process.]

[removed: ][added: ]

A summary of our [removed: net] revenue [added: by geographic area] and [removed: results of operations for our business segments] [added: product family] is found in Note 13, “Segments,” in the Notes to our Consolidated Financial Statements.

[removed: | • | Suites, which accounted for approximately 37% of our net revenue in fiscal 2016,] [added: Suites—Autodesk suites] are a combination of products that target a specific user objective (product design, building design, etc.) and support a set of workflows for that [removed: objective, including Autodesk Building Design Suites, Autodesk Product Design Suites, Autodesk Infrastructure Design Suites, and AutoCAD Design Suites. |][added: objective.]

Our [removed: AEC software] [added: architecture, engineering and construction] products [removed: help to] improve the way building, civil infrastructure, process plant and construction projects are designed, built, and used.

| • | [removed: Autodesk] Revit |

Our [removed: MFG segment] [added: product development and manufacturing software] provides manufacturers in [removed: automotive and] [added: automotive,] transportation, industrial machinery, consumer products and building products with comprehensive digital engineering solutions that bring together data from all phases of the product development and production life [removed: cycle] [added: cycle,] creating a single digital [removed: model based on Autodesk Inventor software.][added: model.]

| • | [removed: Autodesk] Inventor |

[removed: Autodesk] Inventor [removed: allows] [added: enables] manufacturers to go beyond 3D design to digital prototyping by giving engineers a comprehensive and flexible set of tools for 3D mechanical design, simulation, analysis, tooling, visualization, and documentation.

[removed: With Autodesk Inventor, engineers] [added: Engineers] can integrate AutoCAD drawings and model-based design data into a single digital model, creating a virtual representation of a final product that enables them to validate the form, fit, and function of the product before it is ever built.

| • | [removed: Autodesk] Fusion 360 |

AutoCAD software provides digital tools that can be used independently and in conjunction with other specific applications in fields ranging from construction [removed: to manufacturing,] [added: and] civil [removed: engineering,] [added: engineering to manufacturing] and [removed: process] plant design.

[removed: Animation products are sold as software only] [added: Our digital media] and [added: entertainment products] provide tools for digital sculpting, modeling, animation, effects, rendering, and compositing for design visualization, visual effects and games production.

| • | [removed: Autodesk] Maya |

[removed: Autodesk] Maya software provides 3D modeling, animation, effects, rendering and compositing solutions that enable film and video artists, game developers, and design visualization professionals to digitally create engaging, lifelike images, realistic animations and simulations, extraordinary visual effects, and full length animated feature films.

| • | [removed: Autodesk] 3ds Max |

[removed: Autodesk] 3ds Max software provides 3D modeling, animation, and rendering solutions that enable game developers, design visualization professionals and visual effects artists to digitally create realistic images, animations, and complex scenes and to digitally communicate abstract or complex mechanical, architectural, engineering, and construction concepts.

In addition, our customers’ requirements and preferences rapidly evolve, as do their expectations of the performance of our [removed: software.][added: software and services.]

In fiscal [removed: 2016,] [added: 2017,] we continued to successfully implement a strategic transition of our business model announced in fiscal 2014.

These offerings are designed to give our customers [removed: even more value and] [added: increased] flexibility [removed: to] [added: with how they] use our [removed: products,] [added: products] and [removed: also] [added: service offerings and] to attract [removed: new types] [added: a broader range] of [removed: customers,] [added: customers] such as project-based users and small [removed: businesses that have more variable needs.][added: businesses.]

[removed: Further, to] [added: To] support our transition, effective February 1, 2016, we discontinued the sale of new commercial seats of most individual software products, which are now exclusively available by desktop subscription, and [removed: we plan to discontinue] [added: discontinued] selling perpetual licenses of suites [removed: products] [added: while introducing industry collections] effective August 1, 2016.

[removed: IoT] [added: Digital manufacturing] provides a unique opportunity for [removed: our] [added: these] customers to connect designing, making, and using.

We anticipate ongoing [removed: investment] [added: investments] in [removed: IoT] [added: digital manufacturing and other product groups] to both serve existing customers and expand market opportunity.

Research and development expenditures were [removed: $790.0] [added: $766.1] million or [removed: 32%] [added: 38%] of fiscal [removed: 2016] [added: 2017] net revenue, [removed: $725.2] [added: $790.0] million or [removed: 29%] [added: 32%] of fiscal [removed: 2015] [added: 2016] net revenue and [removed: $611.1] [added: $725.2] million or [removed: 27%] [added: 29%] of fiscal [removed: 2014] [added: 2015] net revenue.

The majority of our research and product development is performed in the United States, China, Singapore, [added: Canada,] and [removed: Canada.][added: the United Kingdom.]

We plan to continue [removed: to manage] [added: managing] significant product development operations internationally over the next several years.

We believe that our ability to conduct research and development at various locations throughout the world allows us to optimize [removed: product development, lower costs, and integrate local market knowledge into our development activities.]

[removed: In addition, our business and our customers benefit from our relationships with a network of over 4,100 third-party] [added: These] developers [removed: who develop] [added: create] and sell their own [added: interoperable] products that further enhance the range of integrated solutions available to our customers.

We have a network of approximately [removed: 2,000] [added: 1,700] resellers and distributors worldwide.

For fiscal [removed: 2016,] [added: 2017,] approximately [removed: 79%] [added: 72%] of our revenue was derived from indirect channel sales through distributors and resellers, and we expect that the majority of our revenue will continue to be derived from indirect channel sales in the future.

Sales through our largest distributor, Tech Data Corporation and its [added: global] affiliates, accounted for [removed: 25%,] [added: 30%,] 25%, and [removed: 24%] [added: 25%] of our net revenue for fiscal years [added: 2017,] 2016, [removed: 2015,] and [removed: 2014,] [added: 2015,] respectively.

Fiscal [removed: 2016] [added: 2017] net revenue in the Americas, EMEA, and APAC was [removed: $972.8] [added: $871.9] million [removed: (39%), $934.6] [added: (43%), $800.4] million [removed: (37%),] [added: (39%),] and [removed: $596.7] [added: $358.7] million [removed: (24%),] [added: (18%),] respectively.

A summary of our financial information by geographic location is found in Note 13, “Segments,” in the Notes to Consolidated [added: Financial Statements.]

We have a worldwide user group organization and we have created online user communities dedicated to the exchange of information related to the use of our [removed: products.][added: products and services.]

The largest is our maintenance [added: plan] program, under which customers who own a perpetual use license for the most recent version of the underlying product are able to [removed: purchase] [added: renew a previously purchased] maintenance [added: plan] that provides them with unspecified upgrades [removed: when-and-if-available] [added: when] and [removed: are able to download e-Learning courses] [added: if available,] and receive online support [removed: over a one year or multi-year] [added: during the term of their] maintenance [removed: service period.][added: contract.]

Autodesk is committed to helping fuel a lifelong passion for design [removed: in] [added: and making among] students of all ages.

We offer free educational [removed: licenses] [added: subscriptions] of [removed: Autodesk] [added: Autodesk's professional] software [removed: worldwide] to students, educators, and educational [removed: institutions.][added: institutions worldwide.]

Through Autodesk Design Academy, we provide secondary and postsecondary [removed: school markets] [added: schools] hundreds of standards-aligned class projects to support design-based disciplines in Science, Technology, Engineering, Digital Arts, and Math (STEAM) [removed: while] using Autodesk's professional-grade [removed: 3D] design, engineering and entertainment [removed: software used in industry.][added: software.]

To help our customers imagine, design, and create a better world, our Sustainability [removed: Programs] [added: initiatives] focus our efforts [added: on the area] where we can have the greatest [removed: impact: providing sustainability solutions, delivering] [added: impact enabling] sustainable [removed: design] [added: practices through our products delivering free sustainable-design] learning and training [removed: opportunities, expanding access] [added: resources, providing software grants] to [removed: technology,] [added: qualifying nonprofits] and [added: entrepreneurs, and] leading by example with our sustainable business practices.

We report segment information based on the “management” approach.

The management approach designates the internal reporting used by management for making decisions, allocating resources and assessing performance as the source of our reportable segments.

Prior to the third quarter of fiscal 2017, we had four operating segments: Architecture, Engineering, and Construction (“AEC”), Manufacturing (“MFG”), Platform Solutions and Emerging Business (“PSEB”), and Media and Entertainment (“M&E”).

As a result of our business model transition, there have been a number of changes in the business including the shift from selling perpetual licenses to subscription-based offerings and organizational changes in how the business is managed including a restructuring announced in the first quarter of fiscal 2017.

In the third quarter of fiscal 2017, these organizational changes resulted in a change in the internal reporting provided to our chief operating decision maker (“CODM”).

These internal reports are used by the CODM to assess the performance of the business on a consolidated basis.

Accordingly, our CODM now allocates resources and assesses the operating performance of Autodesk as a whole.

As such, beginning in the third quarter of

2017 Form 10-K 4

fiscal 2017, we concluded that we had one segment manager (the CODM), one operating segment, and one reporting unit for goodwill impairment purposes.

Our portfolio of products and services enables our customers to foster innovation, optimize and improve their designs, save time and money, improve quality, communicate plans, and collaborate with others.

Autodesk’s product offerings include:

| • | Industry Collections |

Launched in August 2016, Autodesk's Industry Collections, our newest subscription offerings, provide our customers with increased access to a broader selection of Autodesk products, greater value, more flexibility, and a simpler way to subscribe and manage Autodesk subscriptions.

To make way for industry collections, we ended the sale of the Design and Creation Suites on July 31, 2016, including Building Design Suites, Infrastructure Design Suites, and Product Design Suites.

The collections are tailored to provide the essential software needed by professionals within each industry: AEC, Product Design, and M&E.

The AEC Collection aims to help our customers design, engineer, and construct higher quality, more predictable building and civil infrastructure projects, commonly used by AEC industry experts, such as AutoCAD, AutoCAD Civil3D, and Revit.


2017 Form 10-K 5

The Product Design Collection offers connected, professional-grade tools that help our customers make great products today and compete in the changing manufacturing landscape of the future.

The collection offers access to a wide range of our products, including AutoCAD and Inventor.

The M&E Collection provides end-to-end creative tools for entertainment creation.

This collection enables animators, modelers and visual effect artists to access the tool they need, including Maya and 3ds Max, to create compelling effects, 3D characters and digital worlds.

Revit software is built for Building Information Modeling ("BIM") to help professionals design, build, and maintain higher-quality, more energy-efficient buildings.

Using the information-rich models created with Revit, architects, engineers, and construction firms can collaborate to make better-informed decisions earlier in the design process to deliver projects with greater efficiency.

Revit includes features for architectural, mechanical, electrical and plumbing design as well as structural engineering and construction, providing a comprehensive solution for the entire building project team.

| • | CAM Solutions |

Our computer-aided manufacturing ("CAM") software, obtained via our Delcam acquisition, offers industry-leading solutions for Computer Numeric Control ("CNC") machining, inspection, and modelling for manufacturing.

A comprehensive line-up of expert products, including PowerMill, FeatureCAM, PowerInspect, PowerShare, and others, help our customers manufacture complex, innovative products and components with maximum quality, control, and production efficiency.

Fusion 360 is the first 3D CAD, CAM, and Computer-aided Engineering ("CAE") tool of its kind.

It connects the entire product development process on a single cloud-based platform that works on both Apple and PC operating systems.


2017 Form 10-K 6

| • | BIM 360 |

BIM 360 construction management software enables almost anytime, anywhere access to project data throughout the building construction lifecycle.

BIM 360 empowers those in the field to better anticipate and act, and those in the back office to optimize and manage all aspects of construction performance.

| • | Shotgun |

Shotgun is cloud-based software for review and production tracking in the M&E industry.

Creative companies use the Shotgun platform to provide essential business tools for managers and visual collaboration tools for artists and supervisors, who often work globally with distributed teams.

Industry collections allow access to a broad set of products and cloud services that exceeds those previously available in suites - simplifying the customers' ability to access a complete set of industry tools.

Our sophisticated software products enable our customers to experience their ideas before they are real.

Additionally, we offer tools and user communities for personal design and creativity.

These applications and user communities are available over the Internet and through various digital storefronts, including the Apple App Store and the Google Play Store.

We report based on four reportable operating segments:

| | |

| --- | --- |

| • | Architecture, Engineering, and Construction (“AEC”), which accounted for 38% of our net revenue in fiscal 2016; |

| • | Manufacturing (“MFG”), which accounted for 29% of our net revenue in fiscal 2016; |

2016 Form 10-K 4

| • | Platform Solutions and Emerging Business (“PSEB”), which accounted for 27% of our net revenue in fiscal 2016; and |

| • | Media and Entertainment (“M&E”), which accounted for 6% of our net revenue in fiscal 2016. |

Our AEC, MFG, and PSEB segments derive revenue from the sale of licenses and subscriptions for software products and services to customers who design, build, and own buildings, infrastructure, and manufactured products.

In addition to software products, the AEC, MFG, and PSEB segments offer a range of services, including consulting, support, and training, largely dedicated to enhancing our ability to sell licenses and subscriptions to our software products.

Our M&E segment derives revenue from the sale of licenses and subscriptions for software 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.

In addition, our animation products produced by our M&E segment are often used by customers of products from our other segments for the visualization of their designs.

The principal products and services of these segments include the following:

| • | Flagship products, which accounted for approximately 45% of our net revenue in fiscal 2016, are our core individual horizontal, vertical, and model-based design products including AutoCAD, AutoCAD LT, AutoCAD Mechanical, AutoCAD Civil 3D, AutoCAD Architecture, AutoCAD Map, Autodesk Maya, and 3ds Max. |

| • | New and Adjacent products, which accounted for approximately 18% of our net revenue in fiscal 2016, are new product offerings as well as products that are not considered flagship or suites, including Delcam, Moldflow, Alias Design, Vault, and Autodesk Creative Finishing products. |

The principal product offerings from Autodesk’s different segments are as follows:

AEC

A broad portfolio of solutions enables greater efficiency, accuracy, and sustainability across the entire project lifecycle.

Our AEC solutions include advanced technology for building information modeling (“BIM”), AutoCAD-based design and documentation productivity software, sustainable design analysis applications, collaboration, and project management solutions.

BIM, an integrated process for building and infrastructure design, analysis, documentation, and construction, uses consistent, coordinated 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.

The segment’s principal product offerings included the following during fiscal 2016:

2016 Form 10-K 5

| • | Autodesk Building Design Suites |

Autodesk Building Design Suites ("BDS") give the power of BIM or computer-aided design ("CAD"), with tools for modeling, visualization, and documentation.

With a comprehensive set of tools, BDS gives customers the ability to manage all phases of design and construction.

Three editions of BDS are available to meet each customer's particular business needs and offer the depth and breadth of the Autodesk portfolio.

| • | Autodesk Infrastructure Design Suites |

The Infrastructure Design Suites are the BIM for Infrastructure design solution that combines intelligent, model-based tools to help the user to gain more accurate, accessible, and actionable insight.

With unique access to the Autodesk infrastructure software portfolio, users can benefit throughout the execution and lifecycle of transportation, land, and water projects.

Three editions of Infrastructure Design Suites are available to meet each customer's particular business needs and offer the depth and breadth of the Autodesk portfolio.

| • | AutoCAD Map 3D |

AutoCAD Map 3D software provides direct access to data needed for infrastructure planning, design, and management activities.

AutoCAD Map 3D software helps professionals working on transportation, land development, water, and power projects to more easily create, manage, and analyze design geographic information system and asset data.

Purpose-built for BIM, the Autodesk Revit products collect information about a building project and allow this information to be coordinated across all other representations of the project, so that every drawing sheet, 2D and 3D view and schedule is based on internally consistent and complete information from the same underlying building database.

The Autodesk Revit products, including AutoCAD Revit Architecture Suite, AutoCAD Revit MEP Suite, and AutoCAD Revit Structure Suite, provide an intuitive, sophisticated, model-based design and documentation system for architects; mechanical, electrical, and plumbing ("MEP") engineers; structural engineers; design-build teams; and other design and building industry professionals.

MFG

For the fiscal year ended January 31, [removed: 2016][added: 2017]

As of July 31, [removed: 2015,] [added: 2016,] the last business day of the registrant’s most recently completed second fiscal quarter, there were approximately [removed: 225.6] [added: 208.4] million shares of the registrant’s common stock outstanding that were held by non-affiliates, and the aggregate market value of such shares held by non-affiliates of the registrant (based on the closing sale price of such shares on the NASDAQ Global Select Market on July 31, [removed: 2015)] [added: 2016)] was approximately [removed: $11.4] [added: $12.4] billion.

As of March [removed: 9, 2016,] [added: 10, 2017,] the registrant had outstanding [removed: 224,493,192] [added: 220,849,268] shares of common stock.

The Proxy Statement will be filed within 120 days of the registrant’s fiscal year ended January 31, [removed: 2016.][added: 2017.]

[removed: ][added: ]

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| Item 9B. | [Other [removed: Information](#sAA3466BDFFCF4BED729CB52627299E79)] [added: Information](#s78D174D921CBD158D5705EF80D6042AC)] | [removed: [112](#sAA3466BDFFCF4BED729CB52627299E79)] [added: [107](#s78D174D921CBD158D5705EF80D6042AC)] |

| [PART [removed: III](#s6BE1EF89EB95BD87F4F3B5262738DBB6)] [added: III](#s4ED688FED60817EDFDCC5EF80D8F1BCE)] | | |

| Item 10. | [Directors, Executive Officers and Corporate [removed: Governance](#sAB139C3CE8872462E48BB526277E120D)] [added: Governance](#sBEF876D88371739BDA155EF80DAEF74B)] | [removed: [113](#sAB139C3CE8872462E48BB526277E120D)] [added: [108](#sBEF876D88371739BDA155EF80DAEF74B)] |

| Item 11. | [Executive [removed: Compensation](#s64FB8D9557E01AFFFDF5B526279331E9)] [added: Compensation](#s222AD2396D293C4DE5F45EF80DEC86A7)] | [removed: [114](#s64FB8D9557E01AFFFDF5B526279331E9)] [added: [109](#s222AD2396D293C4DE5F45EF80DEC86A7)] |

| Item 12. | [Security Ownership of Certain Beneficial Owners and Management and Related Stockholder [removed: Matters](#s46F74A34FDEEAFDE9CA7B52627D39E20)] [added: Matters](#sB91D71730856B4E1F6395EF80E0BBC0F)] | [removed: [114](#s46F74A34FDEEAFDE9CA7B52627D39E20)] [added: [109](#sB91D71730856B4E1F6395EF80E0BBC0F)] |

| Item 13. | [Certain Relationships and Related Transactions, and Director [removed: Independence](#s344A26A3E1191DC8F9C8B52627E1B020)] [added: Independence](#s9990F4F2787A4CC16C125EF80E3A5DAA)] | [removed: [114](#s344A26A3E1191DC8F9C8B52627E1B020)] [added: [109](#s9990F4F2787A4CC16C125EF80E3A5DAA)] |

| Item 14. | [Principal Accounting Fees and [removed: Services](#sF54F50B700D98A953AEDB5262827E348)] [added: Services](#s9A0D1082689F301916495EF80E597ABD)] | [removed: [114](#sF54F50B700D98A953AEDB5262827E348)] [added: [109](#s9A0D1082689F301916495EF80E597ABD)] |

| Item 15. | [Exhibits and Financial Statement [removed: Schedules](#s8DE94C2009F2BA76417AB526287CCEC9)] [added: Schedules](#sAA50C34E2DD0D98C19755EF80EA788CC)] | [removed: [115](#s8DE94C2009F2BA76417AB526287CCEC9)] [added: [110](#sAA50C34E2DD0D98C19755EF80EA788CC)] |

Forward-looking statements are any statements that look to future events and consist of, among other things, our business strategies, [removed: anticipated] future [removed: net revenue, future GAAP and non-GAAP (loss) income per share, operating margin, operating expenses, billings, annualized recurring revenue, annualized revenue per subscription, other future] financial results [removed: (by] [added: (including by] product type and geography) and subscriptions, the effectiveness of our efforts to successfully manage transitions to new business models and markets, our expectations regarding the continued transition of our business model, [removed: revenue from] our [removed: channel partners and changes in mix of channel partners, our] ability to increase our subscription base, expected market trends, including the growth of [removed: cloud, mobile] [added: cloud] and [removed: social] [added: mobile] computing, the effect of [removed: unemployment and] [added: unemployment, the] availability of credit, [added: our expectations for our restructuring,] the effects of mixed global economic conditions, [removed: our expectations for our restructuring,] the effects of revenue recognition, [removed: our backlog,] expected trends in certain financial metrics, including [removed: expenses and the predictability and ratability of our revenue over time,] [added: expenses,] the impact of acquisitions and investment activities, expectations regarding our cash needs, the effects of fluctuations in exchange rates and our hedging activities on our financial results, our ability to successfully expand adoption of our products, our ability to gain market acceptance of new businesses and sales initiatives, and the impact of economic volatility and geopolitical activities in certain countries, particularly emerging economy countries, [added: the timing] and [added: amount of purchases under our newly announced stock buy-back plan, and] the effects of potential non-cash charges on our financial results and the resulting effect on our financial results.

In addition, forward-looking statements also consist of statements involving expectations regarding product capability and acceptance, [removed: continuation of our stock repurchase program, remediations] [added: remediation] to our controls environment, statements regarding our liquidity and short-term and long-term cash requirements, as well as statements involving trend analyses and statements including such words as “may,” “believe,” “could,” “anticipate,” “would,” “might,” “plan,” “expect,” and similar expressions or the negative of these terms or other comparable terminology.

10-K 1 adsk-0131201710xk.htm 10-K

2017 Form 10-K 1


2017 Form 10-K 2

| [PART I](#s9748BEBF85A3A55CDF3E5EF800949A01) | | |

| [PART II](#s007F6D0460AFE6B3507E5EF801AC3742) | | |

| [PART IV](#sE4A67C3136957E30C21D5EF80E889A83) | | |

| Item 16. | [Form 10-K Summary](#s2a1812297e554f109120c65c2194b452) | [111](#s2a1812297e554f109120c65c2194b452) |

| | | |

| | [Signatures](#sEEA6C4424C31410EFF8E5EF80F15AEC9) | [112](#sEEA6C4424C31410EFF8E5EF80F15AEC9) |


2017 Form 10-K 3

10-K 1 adsk-0131201610xk.htm 10-K

2016 Form 10-K 1

2016 Form 10-K 2

| [PART I](#sE3B60C494B758DFF775BB52616E022D1) | | |

| [PART II](#s4C6E410815CD946CC6D9B52618028E62) | | |

| [PART IV](#sF43D6E71287852D119FAB52628354C49) | | |

| | [Signatures](#s6DE5B40B65698A7F5515B52628CE6AAA) | [117](#s6DE5B40B65698A7F5515B52628CE6AAA) |

2016 Form 10-K 3


2016 Form 10-K 31

We lease [removed: 2,043,000] [added: 1,978,960] square feet of office space in [removed: 143] [added: 133] locations in the United States and internationally through our foreign subsidiaries.

In addition, we own [removed: 107,000] [added: 101,225] square feet of office space in [removed: six] [added: four] locations internationally through our foreign subsidiaries.

Our [removed: facilities, excluding those in restructuring,] [added: facilities] are operating at capacities averaging 82% occupancy worldwide as of January 31, [removed: 2016.][added: 2017.]

In February 2016, we announced a restructuring plan that will result in the consolidation of certain leased facilities.

[removed: ][added: ]

2017 Form 10-K 31

2016 Form 10-K 32

We did not declare any cash or stock dividends in either fiscal [removed: 2016] [added: 2017] or fiscal [removed: 2015.][added: 2016.]

As of January 31, [removed: 2016,] [added: 2017,] the number of common stockholders of record was [removed: 458.][added: 430.]

At January 31, [removed: 2016, 6.3] [added: 2017, 26.6] million shares remained available for repurchase under the repurchase program approved by the Board of Directors.

[removed: ][added: ]

The following table provides information about the repurchase of common stock in open-market transactions during the quarter ended January 31, [removed: 2016:][added: 2017:]

| (2) | These amounts correspond to the plan approved by the Board of Directors in [removed: June 2012] [added: September 2016] that authorizes the repurchase of 30.0 million shares. The plan does not have a fixed expiration date. |

There were no sales of unregistered securities during the three months ended January 31, [removed: 2016.][added: 2017.]

[removed: ][added: ]

| (1) | Assumes $100 invested on January 31, [removed: 2011,] [added: 2012,] in Autodesk’s stock, the Standard & Poor’s 500 Stock Index, and the Dow Jones U.S. Software Index, with reinvestment of all dividends. Total stockholder returns for prior periods are not an indication of future investment returns. |

| Fiscal 2017 | | | | | | | |

| First Quarter | $ | 62.42 | | | $ | 41.60 | |

| Second Quarter | 61.42 | | | | 49.82 | | |

| Third Quarter | 73.40 | | | | 56.80 | | |

| Fourth Quarter | 83.96 | | | | 67.15 | | |

The share repurchase program does not have an expiration date and the pace and timing of repurchases will depend on factors such as cash generation from operations, available surplus, the volume of employee stock plan activity, cash requirements for acquisitions, economic and market conditions, stock price and legal and regulatory requirements.

In September 2016, the Board of Directors approved a plan which authorized the repurchase of up to an additional 30.0 million shares of the Company's common stock.

As of January 31, 2017, 3.4 million shares have been repurchased under this plan.

During the three and twelve months ended January 31, 2017, we repurchased 2.9 million and 9.7 million shares, respectively, of our common stock under the existing and prior Board of Director authorized share repurchase programs.

2017 Form 10-K 32

| November 1- November 30 | 1.2 | | | $ | 73.51 | | | 1.2 | | | 28.3 | |

| December 1 - December 31 | 0.9 | | | 75.47 | | | | 0.9 | | | 27.4 | |

| January 1 - January 31 | 0.8 | | | 80.01 | | | | 0.8 | | | 26.6 | |

| Total | 2.9 | | | $ | 75.98 | | | 2.9 | | | | |


2017 Form 10-K 33


2017 Form 10-K 34

| Fiscal 2015 | | | | | | | |

| First Quarter | $ | 58.68 | | | $ | 44.76 | |

| Second Quarter | 57.59 | | | | 46.09 | | |

| Third Quarter | 58.75 | | | | 48.38 | | |

| Fourth Quarter | 63.00 | | | | 53.89 | | |

The number of shares acquired and the timing of the purchases are based on several factors, including general market and economic conditions, the number of employee stock option exercises and restricted stock unit issuances, the trading price of Autodesk common stock, cash on hand and available in the United States, cash requirements for acquisitions, and Company defined trading windows.During the three and twelve months ended January 31, 2016, we repurchased 1.6 million and 8.5 million shares, respectively, of our common stock.

This program does not have a fixed expiration date.

2016 Form 10-K 33

| November 1- November 30 | 0.2 | | | $ | 62.95 | | | 0.2 | | | 7.7 | |

| December 1 - December 31 | 1.3 | | | 62.16 | | | | 1.3 | | | 6.4 | |

| January 1 - January 31 | 0.1 | | | 59.84 | | | | 0.1 | | | 6.3 | |

| Total | 1.6 | | | $ | 62.16 | | | 1.6 | | | | |

2016 Form 10-K 34

2016 Form 10-K 35

The financial data for the fiscal years ended January 31, [removed: 2016] [added: 2017] and [removed: 2015] [added: 2016] are derived from, and are qualified by reference to, the audited consolidated financial statements that are included in this Form 10-K.

The Consolidated [removed: Statement] [added: Statements] of Operations and the Consolidated [removed: Statement] [added: Statements] of Cash Flows data for the year ended January 31, [removed: 2014] [added: 2015] are derived from, and are qualified by reference to, the audited consolidated financial statements that are included in this Form 10-K.

The Consolidated Balance Sheet data for the fiscal year ended January 31, [removed: 2014] [added: 2015] and the remaining financial data for the fiscal years ended January 31, [removed: 2013] [added: 2014] and [removed: 2012] [added: 2013] are derived from audited, consolidated financial statements which are not included in this Form 10-K.

| | [removed: 2016] [added: 2017] | | | | [removed: 2015] [added: 2016] | | | | [removed: 2014] [added: 2015] | | | | [removed: 2013] [added: 2014] | | | | [removed: 2012] [added: 2013] | | |

| Net revenue | $ | [removed: 2,504.1] [added: 2,031.0] | | | $ | [removed: 2,512.2] [added: 2,504.1] | | | $ | [removed: 2,273.9] [added: 2,512.2] | | | $ | [removed: 2,312.2] [added: 2,273.9] | | | $ | [removed: 2,215.6] [added: 2,312.2] | |

| [removed: Income] [added: (Loss) income] from operations | [removed: 1.3] [added: (499.6] | | [added: )] | | [removed: 120.7] [added: 1.3] | | | | [removed: 284.8] [added: 120.7] | | | | [removed: 305.9] [added: 284.8] | | | | [removed: 355.6] [added: 305.9] | | |

| Net (loss) income | [removed: (330.5] [added: (582.1] | | ) | | [removed: 81.8] [added: (330.5] | | [added: )] | | [removed: 228.8] [added: 81.8] | | | | [removed: 247.4] [added: 228.8] | | | | [removed: 285.3] [added: 247.4] | | |

| Basic net (loss) income per share | $ | [removed: (1.46] [added: (2.61] | ) | | $ | [removed: 0.36] [added: (1.46] | [added: )] | | $ | [removed: 1.02] [added: 0.36] | | | $ | [removed: 1.09] [added: 1.02] | | | $ | [removed: 1.25] [added: 1.09] | |

| Diluted net (loss) income per share | [removed: (1.46] [added: (2.61] | | ) | | [removed: 0.35] [added: (1.46] | | [added: )] | | [removed: 1.00] [added: 0.35] | | | | [removed: 1.07] [added: 1.00] | | | | [removed: 1.22] [added: 1.07] | | |

| Total assets [removed: (1)] | $ | [removed: 5,515.3] [added: 4,798.1] | | | $ | [removed: 4,909.7] [added: 5,515.3] | | | $ | [removed: 4,589.9] [added: 4,909.7] | | | $ | [removed: 4,302.4] [added: 4,589.9] | | | $ | [removed: 3,227.8] [added: 4,302.4] | |

| Long-term liabilities | [removed: 2,304.7] [added: 1,879.1] | | | | [removed: 1,294.5] [added: 2,304.7] | | | | [removed: 1,262.0] [added: 1,294.5] | | | | [removed: 1,221.5] [added: 1,262.0] | | | | [removed: 390.8] [added: 1,221.5] | | |

| Stockholders’ equity | [removed: 1,619.6] [added: 733.6] | | | | [removed: 2,219.2] [added: 1,619.6] | | | | [removed: 2,261.5] [added: 2,219.2] | | | | [removed: 2,043.2] [added: 2,261.5] | | | | [removed: 1,882.9] [added: 2,043.2] | | |

[removed: ][added: ]

| Cash flow from operations (1) | 169.7 | | | | 414.0 | | | | 708.6 | | | | 572.6 | | | | 572.0 | | |

| (1) | During the three months ended July 31, 2016, the Company early adopted Accounting Standards Update No. 2016-09, “Improvements to Employee Share-Based Payment Accounting (Topic 718)” (“ASU 2016-09”), which addresses among other items, updates to the presentation and treatment of excess tax benefits related to stock based compensation. The Company has adopted changes to the consolidated statements of cash flows on a retrospective basis. The impact for the fiscal years ended January 31, 2015, 2014, and 2013 to net cash provided by operating activities and net cash used in financing activities was $0.5 million, $9.1 million, and $12.9 million, respectively. There was no impact to the fiscal year ended January 31, 2016. |

2017 Form 10-K 35

| Cash flow from operations | 414.0 | | | | 708.1 | | | | 563.5 | | | | 559.1 | | | | 573.5 | | |

| Dividends paid per share | — | | | | — | | | | — | | | | — | | | | — | | |

| (1) | Effective in the second quarter of fiscal 2016, Autodesk elected to retrospectively adopt ASU 2015-03, regarding Subtopic 835-30 “Interest - Imputation of Interest". The adoption resulted in the reclassification of debt issuance costs from other assets to a reduction of long term notes payable, net for the prior periods presented. |

2016 Form 10-K 36

| [removed: 2016] [added: 2017] | | | | [removed: 2015] [added: 2016] | | | | [removed: 2014] [added: 2015] | | | |

| Net [removed: revenue:] [added: revenue by geographic area (1):] | | | | | | | | | | | |

| License and other | [removed: $] [added: 741.0] | [removed: 1,226.9] | | | [removed: $] [added: 1,226.9] | [removed: 1,341.4] | | | [removed: $] [added: 1,341.4] | [removed: 1,254.9] | |

| Subscription | [removed: 1,277.2] [added: $] | [added: 1,290.0] | | | [removed: 1,170.8] [added: $] | [added: 1,277.2] | | | [removed: 1,019.0] [added: $] | [added: 1,170.8] | |

| Total net revenue | [removed: 2,504.1] [added: 2,031.0] | | | | [removed: 2,512.2] [added: 2,504.1] | | | | [removed: 2,273.9] [added: 2,512.2] | | |

| Cost of license and other revenue | [removed: 214.6] [added: 190.6] | | | | [removed: 208.5] [added: 214.6] | | | | [removed: 178.7] [added: 208.5] | | |

| Cost of subscription revenue | [removed: 156.1] [added: 151.3] | | | | [removed: 133.6] [added: 156.1] | | | | [removed: 95.6] [added: 133.6] | | |

| Total cost of revenue | [removed: 370.7] [added: 341.9] | | | | [removed: 342.1] [added: 370.7] | | | | [removed: 274.3] [added: 342.1] | | |

| Gross profit | [removed: 2,133.4] [added: 1,689.1] | | | | [removed: 2,170.1] [added: 2,133.4] | | | | [removed: 1,999.6] [added: 2,170.1] | | |

| Marketing and sales | [removed: 1,015.5] [added: 1,022.5] | | | | [removed: 998.0] [added: 1,015.5] | | | | [removed: 842.6] [added: 998.0] | | |

| Research and development | [removed: 790.0] [added: 766.1] | | | | [removed: 725.2] [added: 790.0] | | | | [removed: 611.1] [added: 725.2] | | |

| General and administrative | [removed: 293.4] [added: 287.8] | | | | [removed: 283.3] [added: 293.4] | | | | [removed: 211.8] [added: 283.3] | | |

| Amortization of purchased intangibles | [removed: 33.2] [added: 31.8] | | | | [removed: 39.8] [added: 33.2] | | | | [removed: 36.5] [added: 39.8] | | |

| Total operating expenses | [removed: 2,132.1] [added: 2,188.7] | | | | [removed: 2,049.4] [added: 2,132.1] | | | | [removed: 1,714.8] [added: 2,049.4] | | |

| [removed: Income] [added: (Loss) income] from operations | [removed: 1.3] [added: (499.6] | | [added: )] | | [removed: 120.7] [added: 1.3] | | | | [removed: 284.8] [added: 120.7] | | |

| Interest and other expense, net | [removed: (21.6] [added: (24.2] | | ) | | [removed: (37.7] [added: (21.6] | | ) | | [removed: (4.9] [added: (37.7] | | ) |

| (Loss) income before income taxes | [removed: (20.3] [added: (523.8] | | ) | | [removed: 83.0] [added: (20.3] | | [added: )] | | [removed: 279.9] [added: 83.0] | | |

| Provision for income taxes | [removed: (310.2] [added: (58.3] | | ) | | [removed: (1.2] [added: (310.2] | | ) | | [removed: (51.1] [added: (1.2] | | ) |

| Net (loss) income | $ | [removed: (330.5] [added: (582.1] | ) | | $ | [removed: 81.8] [added: (330.5] | [added: )] | | $ | [removed: 228.8] [added: 81.8] | |

| Basic net (loss) income per share | $ | [removed: (1.46] [added: (2.61] | ) | | $ | [removed: 0.36] [added: (1.46] | [added: )] | | $ | [removed: 1.02] [added: 0.36] | |

| Diluted net (loss) income per share | $ | [removed: (1.46] [added: (2.61] | ) | | $ | [removed: 0.35] [added: (1.46] | [added: )] | | $ | [removed: 1.00] [added: 0.35] | |

| Weighted average shares used in computing basic net (loss) income per share | [removed: 226.0] [added: 222.7] | | | | [removed: 227.1] [added: 226.0] | | | | [removed: 224.0] [added: 227.1] | | |

| Weighted average shares used in computing diluted net (loss) income per share | [removed: 226.0] [added: 222.7] | | | | [removed: 232.4] [added: 226.0] | | | | [removed: 229.6] [added: 232.4] | | |

[removed: ][added: ]

| | [removed: 2016] [added: 2017] | | | | [removed: 2015] [added: 2016] | | | | [removed: 2014] [added: 2015] | | |

| Other comprehensive [removed: (loss) income,] [added: loss,] net of reclassifications: | | | | | | | | | | | |

| Net (loss) gain on derivative instruments (net of tax effect of [added: ($1.1),] $0.6, [removed: ($0.7),] and [removed: $1.1)] [added: ($0.7))] | [removed: (27.1] [added: (1.1] | | ) | | [removed: 39.3] [added: (27.1] | | [added: )] | | [removed: 0.7] [added: 39.3] | | |

| Change in net unrealized [removed: loss] [added: gain (loss)] on available-for-sale securities (net of tax effect of [added: ($0.5),] $0.0, [removed: ($0.2),] and [removed: $0.3)] [added: ($0.2))] | [removed: (1.4] [added: 1.3] | | [removed: )] | | [removed: (0.2] [added: (1.4] | | ) | | [removed: (1.1] [added: (0.2] | | ) |

| Change in defined benefit pension items (net of tax effect of [added: ($0.9),] $0.9, [removed: $1.8,] and [removed: $0.6)] [added: $1.8)] | [removed: (4.6] [added: (5.5] | | ) | | [removed: (16.0] [added: (4.6] | | ) | | [removed: 5.4] [added: (16.0] | | [added: )] |

| Net change in cumulative foreign currency translation [removed: (loss) gain] [added: loss] (net of tax effect of [added: $0.2,] $0.5, [removed: $4.9, and$2.1)] [added: and $4.9)] | [removed: (34.7] [added: (52.1] | | ) | | [removed: (75.8] [added: (34.7] | | ) | | [removed: 0.1] [added: (75.8] | | [added: )] |

| Total other comprehensive [removed: (loss) income] [added: loss] | [removed: (67.8] [added: (57.4] | | ) | | [removed: (52.7] [added: (67.8] | | ) | | [removed: 5.1] [added: (52.7] | | [added: )] |

| Total comprehensive (loss) income | $ | [removed: (398.3] [added: (639.5] | ) | | $ | [removed: 29.1] [added: (398.3] | [added: )] | | $ | [removed: 233.9] [added: 29.1] | |

| | [added: |] January 31, [added: 2017 | | | | January 31,] 2016 | | | | January 31, 2015 | | |

| Cash and cash equivalents | $ | [removed: 1,353.0] [added: 1,213.1] | | | $ | [removed: 1,410.6] [added: 1,353.0] | |

| Marketable securities | [removed: 897.9] [added: 686.8] | | | | [removed: 615.8] [added: 897.9] | | |

| Accounts receivable, net | [removed: 653.6] [added: 452.3] | | | | [removed: 458.9] [added: 653.6] | | |

| Deferred income taxes, net | [removed: —] [added: 63.9] | | | | [removed: 85.1] [added: 9.2] | | |

| Prepaid expenses and other current assets | [removed: 88.6] [added: 108.4] | | | | [removed: 100.9] [added: 88.6] | | |

| Total current assets | [removed: 2,993.1] [added: 2,460.6] | | | | [removed: 2,671.3] [added: 2,993.1] | | |

| Marketable securities | [removed: 532.3] [added: 306.2] | | | | [removed: 273.0] [added: 532.3] | | |

| Restructuring charges and other facility exit costs, net | 80.5 | | | | — | | | | 3.1 | | |

2017 Form 10-K 63

| Net (loss) income | $ | (582.1 | ) | | $ | (330.5 | ) | | $ | 81.8 | |


2017 Form 10-K 64

| Current portion of long-term notes payable, net | 398.7 | | | | — | | |

| Accumulated deficit | (964.2 | | ) | | (80.8 | | ) |


2017 Form 10-K 65

| Net (loss) income | $ | (582.1 | ) | | $ | (330.5 | ) | | $ | 81.8 | |

| Restructuring charges and other facility exit costs, net | 80.5 | | | | — | | | | 3.1 | | |

| (1) | During the three months ended July 31, 2016, the Company early adopted Accounting Standards Update No. 2016-09, “Improvements to Employee Share-Based Payment Accounting (Topic 718)” (“ASU 2016-09”), which addresses among other items, updates to the presentation and treatment of excess tax benefits related to stock based compensation. The Company has adopted changes to the consolidated statements of cash flows on a retrospective basis. The impact for the fiscal year ended January 31, 2015 to net cash provided by operating activities and net cash used in financing activities was $0.5 million. There was no impact to the fiscal year ended January 31, 2016. |


2017 Form 10-K 66


2017 Form 10-K 67

| Cumulative effect of accounting changes | — | | | 6.9 | | | | — | | | | 113.0 | | | | 119.9 | | |

| Net loss | — | | | — | | | | — | | | | (582.1 | | ) | | (582.1 | | ) |

| Other comprehensive (loss) | — | | | — | | | | (57.4 | | ) | | — | | | | (57.4 | | ) |

| Repurchase and retirement of common shares | (9.7 | ) | | (217.3 | | ) | | — | | | | (414.3 | | ) | | (631.6 | | ) |

| Balances, January 31, 2017 | 220.3 | | | $ | 1,876.3 | | | $ | (178.5 | ) | | $ | (964.2 | ) | | $ | 733.6 | |


2017 Form 10-K 68

January 31, 2017

During the third quarter of fiscal 2017, as a result of changes in our organizational structure from the business model transition and various other factors described further in Note 13, "Segments," management determined the Company operates as a single operating segment and single reporting unit.

However, the Company will continue to provide disaggregation of revenue by product family and geographical information within Note 13, "Segments."

Monetary assets and liabilities are


2017 Form 10-K 69

Marketable Securities and Privately Held Company Investments

Substantially all marketable debt and equity investments held by Autodesk are classified as current based on the nature of the investments and their availability for use in current operations.

Autodesk regularly invests in non-marketable debt and equity securities of privately held companies.

The carrying values of such investments are included in other long-term assets.

For the majority of our privately held company investments, we use the cost method of accounting.


2017 Form 10-K 70

| | 2017 | | | | 2016 | | |

| | 2017 | | | 2016 | |


2017 Form 10-K 71

| | | | | | | | | | | | |

| --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- | --- |

| | Fiscal year ended January 31, | | | | | | | | | | |

| Restructuring charges, net | — | | | | 3.1 | | | | 12.8 | | |

2016 Form 10-K 65

2016 Form 10-K 66

| Deferred income taxes, net | 9.2 | | | | 100.0 | | |

| Retained earnings | (80.8 | | ) | | 499.4 | | |

2016 Form 10-K 67

| Excess tax benefits from stock-based compensation | — | | | | (0.5 | | ) | | (9.1 | | ) |

| Excess tax benefits from stock-based compensation | — | | | | 0.5 | | | | 9.1 | | |

2016 Form 10-K 68

| Balances, January 31, 2013 | 223.6 | | | $ | 1,449.8 | | | $ | (5.7 | ) | | $ | 599.1 | | | $ | 2,043.2 | |

| Tax benefits from employee stock plans | — | | | (12.2 | | ) | | — | | | | — | | | | (12.2 | | ) |

| Net income | — | | | — | | | | — | | | | 228.8 | | | | 228.8 | | |

| Other comprehensive income | — | | | — | | | | 5.1 | | | | | | | | 5.1 | | |

| Repurchase and retirement of common shares | (10.5 | ) | | (220.7 | | ) | | — | | | | (203.1 | | ) | | (423.8 | | ) |

2016 Form 10-K 69

Current Period Adjustments

Subsequent to furnishing preliminary financial statements on Form 8-K on February 25, 2016 for the three and twelve months ended January 31, 2016, Autodesk identified a $4.5 million tax adjustment associated with deemed foreign withholding taxes related to non-permanently reinvested earnings in foreign jurisdictions which have not yet repatriated resulting in changes to the Consolidated Financial Statements as reflected in this Annual Report on Form 10-K.

This non-cash adjustment resulted in an increase to GAAP diluted loss per share from $(1.44) to $(1.46) for the full fiscal year.

Prior Period Adjustments

Autodesk previously established a valuation allowance against the Company’s deferred tax assets during the three months ended July 31, 2015.

In the course of preparing the Condensed Consolidated Financial Statements for the three and nine months ended October 31, 2015, Autodesk determined that it had understated income tax expense by $33.1 million for the three and six months ended July 31, 2015, primarily related to an error in the establishment of the valuation allowance, which had been understated at July 31, 2015.

Autodesk performed the analysis required by Staff Accounting Bulletin 99, Materiality, to evaluate the materiality of the error, quantitatively and qualitatively, and concluded it was not material to the Company’s Condensed Consolidated Financial Statements as of July 31, 2015 and for the three and six month periods ended July 31, 2015.

However, in light of the significance of a correction of the error to the results for the three months ended October 31, 2015, Autodesk chose to correct the error by revising the previously reported results for the three and six months ended July 31, 2015, to include the additional $33.1 million of non-cash income tax expense associated with the establishment of the valuation allowance.

See Note 16, "Selected Quarterly Financial Information (Unaudited)," in the Notes to the Condensed Consolidated Financial Statements for further discussion.

During the quarter ended April 30, 2015, Autodesk determined that it had not correctly accounted for certain liabilities primarily related to employee benefits and unclaimed property.

As a result, we recorded $5.7 million of additional operating expenses related to prior periods.

As these adjustments were related to the correction of errors, Autodesk performed the analysis required by Staff Accounting Bulletin 99, Materiality, and Staff Accounting Bulletin 108, Considering the Effects of Prior Year Misstatements When Quantifying Misstatements in Current Year Financial Statements.

Based on this analysis, Autodesk concluded that the effect of the errors was not material to the financial position, results of operations or cash flows of any prior fiscal year from both a quantitative and qualitative perspective and is not material to the full fiscal year 2016.

2016 Form 10-K 70

Reclassifications

During the second quarter of fiscal 2015, Autodesk elected to present amortization of purchased customer relationships, trade names, patents, and user lists as a separate line item within operating expenses.

As a result, amortization previously reflected in “General and Administrative” expense was reclassified to “Amortization of Purchased Intangibles" within Operating Expenses.

These expenses have been reclassified in the Consolidated Statements of Operations for fiscal years 2015 and 2014 to conform to the current period presentation as follows:

| | Fiscal year ended January 31, | | | | | | |

| | 2015 | | | | 2014 | | |

| Reclassifications within operating expenses: | | | | | | | |

| (Decrease) to general and administrative | $ | (10.9 | ) | | $ | (36.5 | ) |

Our disclosure controls and procedures are designed to ensure that information required to be disclosed in our Exchange Act reports is (i) recorded, processed, summarized and reported within the time periods specified in the rules of the Securities and Exchange Commission, and (ii) accumulated and communicated to Autodesk management, including our [removed: Chief] [added: Co-Chief] Executive [removed: Officer] [added: Officers] and Chief Financial Officer, to allow timely decisions regarding required disclosure.

We conducted an evaluation, under the supervision and with the participation of our [removed: Chief] [added: Co-Chief] Executive [removed: Officer] [added: Officers] and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures as of the end of the period covered by this Annual Report on Form 10-K.

Based upon this evaluation, our [removed: Chief] [added: Co-Chief] Executive [removed: Officer] [added: Officers] and Chief Financial Officer have concluded that our disclosure controls and procedures were not effective as of January 31, [removed: 2016] [added: 2017] for reasons described below.

[removed: However,] [added: Additionally,] corrective actions [removed: have been initiated] [added: continue] to address the internal control [added: material] weakness as described below under the section "Remediation Efforts with Respect to Material Weakness".

Our management assessed the effectiveness of our internal control over financial reporting as of January 31, [removed: 2016.][added: 2017.]

Our management, including our [removed: Chief] [added: Co-Chief] Executive [removed: Officer] [added: Officers] and Chief Financial Officer, does not expect that our disclosure controls and procedures or our internal control over financial reporting will necessarily prevent all errors and all fraud.

[removed: During the year ended January 31, 2016, our] [added: Our] management has concluded [added: that, as of January 31, 2017,] our internal control over financial reporting was not effective to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles due to the material weakness discussed in further detail below.

[removed: In] [added: Management first identified a material weakness in internal control over financial reporting in] connection with the preparation of our Condensed Consolidated [removed: Financial Statements] [added: financial statements] for the fiscal quarter ended October 31, [removed: 2015, our management concluded that a material weakness exists in our internal control over financial reporting related to our controls over the technical review of our reconciliation of our deferred tax accounts and the effective tax rate.][added: 2015.]

[removed: ][added: ]

| • | [removed: enhancing] [added: enhanced] our technical accounting review for complex income tax considerations; |

| • | [removed: enhancing] [added: enhanced the design of] our income tax controls to include specific activities to ensure proper classification of deferred [removed: taxes;] [added: taxes and calculation of income tax expense;] |

| • | [removed: supplementing] [added: supplemented] our accounting and tax professionals with the engagement of an internationally recognized accounting firm to assist us in the technical review regarding the application of tax rules around deferred tax assets and liabilities; and |

| • | [removed: assessed and] reorganized the structure of our tax function to enhance the level of documentation, technical oversight, and review. |

Management [removed: will continue to enhance] [added: has enhanced] its controls to include refinements and improvements to [removed: certain] controls over the accounting for income taxes.

Other than with respect to the remediation efforts described above, there were no changes in our internal controls over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Securities Exchange Act of 1934) during the quarter ended January 31, [removed: 2016] [added: 2017] that have materially affected, or are reasonably likely to materially affect, our internal controls over financial reporting.

In connection with the preparation of our Consolidated Financial Statements for the fiscal year ended January 31, 2017, our management concluded that it has a material weakness in our internal control over financial reporting related to the operating effectiveness of our controls over the calculation of income tax expense.

Since that time, management’s remediation activities have included the following:

2017 Form 10-K 106

While significant progress has been made as of January 31, 2017, management does not believe these controls are operating effectively.

As a result, management does not believe that the material weakness has been remediated and will continue to enhance its controls over the accounting for income tax expense.

2016 Form 10-K 111

Management initiated remediation plans including the following:

The Company’s enhanced controls will continue to evolve and have not had a sufficient period of time to operate for management to conclude that they were operating effectively.

Management believes the foregoing efforts will effectively remediate the material weakness.

[removed: ][added: ]

2017 Form 10-K 107

2016 Form 10-K 112

The following sets forth certain information as of March [removed: 23, 2016] [added: 21, 2017] regarding our executive officers.

| R. Scott Herren | [removed: 54] [added: 55] | | [removed: Senior Vice President] [added: SVP] and Chief Financial Officer |

[removed: |] Andrew Anagnost [removed: | 51 | |] [added: joined Autodesk in September 1997 and has served as our co-CEO since February 2017 and as our] Senior Vice President, Industry Strategy [removed: and] [added: &] Marketing [removed: |][added: since March 2012.]

| Jan Becker | [removed: 63] [added: 64] | | [removed: Senior Vice President,] [added: SVP, Chief] Human Resources [added: Officer] and Corporate Real Estate |

| Steve M. Blum | [removed: 51] [added: 52] | | [removed: Senior Vice President,] [added: SVP,] Worldwide Sales and Services |

[removed: | Pascal W.] [added: Mr.] Di Fronzo [removed: | 51 | |] [added: served as] Senior Vice President, General Counsel and Secretary [removed: |][added: from March 2007 to December 2016.]

[removed: ][added: ]

Jan Becker joined Autodesk in September 1992 and has served as Senior Vice President, [added: Chief] Human Resources and Corporate Real Estate since [removed: June 2000.][added: December 2016.]

Di Fronzo joined Autodesk in June 1998 and has served as [removed: Senior Vice President, General Counsel and] [added: SVP, Corporate Affairs, Chief Legal Officer &] Secretary since [removed: March 2007.][added: December 2016.]

Amar Hanspal joined Autodesk in June 1987 and has served as our [added: co-CEO since February 2017 and as our] Senior Vice President, Autodesk Product Group since November 2015.

| Andrew Anagnost | 52 | | Co-CEO, Chief Marketing Officer and SVP, BSM |

| Amar Hanspal | 53 | | Co-CEO, Chief Product Officer and SVP, PDG |

| Pascal W. Di Fronzo | 52 | | SVP, Corporate Affairs, Chief Legal Officer & Secretary |

Ms. Becker served as Senior Vice President, Human Resources and Corporate Real Estate from June 2000 to December 2016.

2017 Form 10-K 108

| Carl Bass | 58 | | President and Chief Executive Officer |

| Amar Hanspal | 52 | | Senior Vice President, Autodesk Product Group |

Carl Bass joined Autodesk in September 1993 and has served as President and Chief Executive Officer since May 2006.

Mr. Bass served as Interim Chief Financial Officer from August 2014 to November 2014 and August 2008 to April 2009.

From June 2004 to April 2006, Mr. Bass served as Chief Operating Officer.

From February 2002 to June 2004, Mr. Bass served as Senior Executive Vice President, Design Solutions Group.

From August 2001 to February 2002, Mr. Bass served as Executive Vice President, Emerging Business and Chief Strategy Officer.

From June 1999 to July 2001, he served as President and Chief Executive Officer of Buzzsaw.com, Inc., a spin-off from Autodesk.

Mr. Bass has also held other executive positions within Autodesk.

Mr. Bass served on the boards of directors of McAfee, Inc. from January 2008 until it was acquired by Intel Corporation in February 2011 and E2open, Inc. from July 2011 until it was acquired by Insight Venture Partners in April 2014.

Mr. Bass has served on the boards of directors of Autodesk, Inc. since January 2006, HP, Inc. since November 2015 and Zendesk, Inc. since February 2016.

Andrew Anagnost joined Autodesk in September 1997 and has served as our Senior Vice President, Industry Strategy & Marketing since March 2012.

2016 Form 10-K 113

[removed: ][added: ]

2017 Form 10-K 109

2016 Form 10-K 114

| 2. | Financial Statement Schedule: The following financial statement schedule of Autodesk, Inc., for the fiscal years ended January 31, [added: 2017,] 2016, [removed: 2015,] and [removed: 2014,] [added: 2015,] is filed as part of this Report and should be read in conjunction with the Consolidated Financial Statements of Autodesk, Inc.: |

[removed: ][added: ]

| Fiscal Year Ended January 31, [removed: 2014] [added: 2017] | | | | | | | | | | | | | | | |

2017 Form 10-K 110

| Allowance for doubtful accounts | $ | 7.6 | | | $ | (3.3 | ) | | $ | 2.8 | | | $ | 1.5 | |

| Product returns reserves | 1.6 | | | | (7.7 | | ) | | (6.3 | | ) | | 0.2 | | |

| Partner Program reserves (1) | 45.2 | | | | 240.3 | | | | 257.4 | | | | 28.1 | | |

| Restructuring | 1.3 | | | | 77.8 | | | | 70.7 | | | | 8.4 | | |

| | |

| --- | --- |

2016 Form 10-K 115

| Allowance for doubtful accounts | $ | 5.6 | | | $ | 1.3 | | | $ | 2.0 | | | $ | 4.9 | |

| Product returns reserves | 4.9 | | | | 23.1 | | | | 24.0 | | | | 4.0 | | |

| Partner Program reserves (1) | 48.3 | | | | 278.6 | | | | 288.5 | | | | 38.4 | | |

| Restructuring | 8.9 | | | | 12.8 | | | | 16.1 | | | | 5.6 | | |

____________________

2016 Form 10-K 116

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this Report to be signed on its behalf by the undersigned, thereunto duly authorized.

| | | | |

| --- | --- | --- | --- |

| | | AUTODESK, INC. | |

| | | By: | /s/ CARL BASS |

| | | | Carl Bass |

| | | | President and Chief Executive Officer |

| Dated: | March 23, 2016 | | |

2016 Form 10-K 117

POWER OF ATTORNEY

KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints Carl Bass and R.

Scott Herren each as his or her attorney-in-fact, each with the power of substitution, for him or her in any and all capacities, to sign any amendments to this Report on Form 10-K, and to file the same, with exhibits thereto and other documents in connection therewith, with the Securities and Exchange Commission, hereby ratifying and confirming all that each of said attorneys-in-fact, or his substitute or substitutes, may do or cause to be done by virtue hereof.

Pursuant to the requirements of the Securities Exchange Act of 1934, this Report has been signed below by the following persons on behalf of the Registrant and in the capacities as of March 23, 2016.

2016 Form 10-K 118

| | | |

| --- | --- | --- |

| Signature | | Title |

| /s/ CARL BASS | | President and Chief Executive Officer (Principal Executive Officer) |

| Carl Bass | | |

| /s/ R. SCOTT HERREN | | Senior Vice President and Chief Financial Officer (Principal Financial Officer) |

| R. Scott Herren | | |

| /s/ PAUL UNDERWOOD | | Vice President and Controller (Principal Accounting Officer) |

| Paul Underwood | | |

| /s/ CRAWFORD W. BEVERIDGE | | Director (Non-executive Chairman of the Board) |

| Crawford W. Beveridge | | |

| | | Director |

| Jeff Clarke | | |

| /s/ J. HALLAM DAWSON | | Director |

| J. Hallam Dawson | | |

| Scott Ferguson | | |

None.


2017 Form 10-K 111

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this Report to be signed on its behalf by the undersigned, thereunto duly authorized.

| | | | |

| --- | --- | --- | --- |

| | | | |

| | | AUTODESK, INC. | |

| | | By: | /s/ ANDREW ANAGNOST |

| | | | Andrew Anagnost |

| | | | Co-CEO, Chief Marketing Officer and SVP, BSM |

| Dated: | March 21, 2017 | | |

| | | | |

| --- | --- | --- | --- |

| | | | |

| | | AUTODESK, INC. | |

| | | By: | /s/ AMAR HANSPAL |

| | | | Amar Hanspal |

| | | | Co-CEO, Chief Product Officer and SVP, PDG |

| Dated: | March 21, 2017 | | |