Business News
Autodesk Announces Restructuring to Reduce Annual Operating Expenses
Thursday 15. January 2009 - Company provides updated business outlook
Autodesk, Inc. (NASDAQ:ADSK) today announced a restructuring plan to reduce its annual operating expenses. The company anticipates the restructuring will result in annual pre-tax cost savings of approximately $130 million annually starting in fiscal 2010.
As part of its restructuring plan, Autodesk plans to reduce its workforce by approximately 750 employees, representing approximately 10 percent of the company’s global workforce. The company also plans to consolidate certain facilities. The actions announced today are in addition to the ongoing cost reduction initiatives previously announced, which include a hiring freeze, business travel restrictions, and other reductions in its operating expenses.
As a result of this restructuring, the company anticipates taking a pre-tax charge in the range of $65 million to $75 million. Approximately $45 million to $50 million in pre-tax charges will be taken in the fourth quarter of fiscal 2009. Most of the remaining charge will be taken in the first quarter of fiscal 2010.
Updated Business Outlook
The following statements are forward-looking statements which are based on current expectations and which involve risks and uncertainties some of which are set forth below. This serves as an update to the previously announced business outlook issued on November 20, 2008.
Net revenue for the fourth quarter of fiscal 2009 is now expected to be in the range of $475 million and $500 million. GAAP loss per diluted share is now expected to be in the range of $0.12 and $0.05. Non-GAAP earnings per diluted share are now expected to be in the range of $0.18 and $0.24 and exclude $0.15 to $0.16 related to restructuring charges, $0.07 related to stock-based compensation expense and $0.07 for acquisition related charges.
In addition, although a final determination has not yet been made, the company may take an impairment charge of up to $125 million net of taxes in the fourth quarter of fiscal 2009. This impairment charge would reduce the value of goodwill related to the company’s Media and Entertainment business segment. This potential impairment charge is not included in the forecast provided above.
“Global economic conditions continue to impact our end-user demand,” said Carl Bass, president and chief executive officer. “Given the current uncertainty of the economic environment, the cost savings initiatives we are implementing are prudent. Autodesk has a strong cash position and leadership across multiple product sectors and geographies. The company has experienced several economic downturns during its 26-year history, and like before, we fully expect to emerge from the downturn stronger, more efficient, and more competitive.”
Spin Out of Location Services
Autodesk has signed a definitive agreement to spin out its Location Services business to Hale Capital Partners, a private equity firm. Autodesk believes this move will help position the Location Services business for greater success in the wireless industry, while allowing Autodesk to focus its on its core business. Details of the transaction were not disclosed.