media and entertainment vertical solutions and beyond investor... · autodesk investor day 2005 1...

Autodesk Investor Day 2005 1

Media and Entertainment Vertical Solutions and Beyond

Martin VannVice President

© 2005 Autodesk Autodesk Investor Day 2005 2

Television

Film Advertising

Games

Media and EntertainmentCustomer Segments


Games

Smoke

Flame

Lustre

Stone Shared

3ds MaxFlint

Smoke

Lustre

3ds max

Combustion

Inferno

Fire

Lustre

Toxik

3ds max

Combustion

Stone Shared

AdvertisingTelevisionFilm

Media and Entertainment Solutions


Media and Entertainment Industry Trends

New TechnologyFilm digitization High Definition (HD) production solutionsNext-generation platforms

Increased focus on ROIMidrange seat expansionContent proliferationIntegrated 2D/3D workflowMedia and data management


Film Business is Growing

Market Growth2004 box office grew 10% over 2003 2004 DVD revenue grew 18% over 2003

Digital film is at its infancyOver 4000 globally released films in 2003; less than 100 used a digital intermediate workflow Less than 50 films globally acquired content digitallyLess than 1% of all movie screens are digitalCollaboration is still a highly manual process


Film Market is at Early Adopter Stage

Technicolor Creative Services invested over $5.5M in Autodesk digital film workflow solutions globallyNBC Universal invested $1M in Autodesk solutions for film trailersKodak invested $2.1M in Autodesk digital film solutions Asylum is the first company to deploy an all Autodesk digital workflow for film effects, grading and data-centric collaboration


Television Market is GrowingSale of High Definition (HD) televisions growing 50% annually

Global marketplace for content is accelerating as content’s value increases

Growth of graphically oriented sports

Increased focus on station branding and promos

Trendwatch reports that 81% of all facilities and studios have yet to invest in HD production solutions


HD Customer Adoption is Just Beginning

NBC has spent $1M on Autodesk solutions for HD promotions

Paramount invested in HD solution to convert “I Love Lucy” to HD

ABC, CBS, Fox, Australian Broadcasting Company, Beijing TV, Videoland Taiwan and Star TV-India all invested in standard definition and high definition production solutions


Advertising is Back on TrackGlobal advertising will grow 5.8% to $363B in 2005

Television advertising is expected to grow 12.5% in 2005 to $143B

Cinema advertising is the 3rd fastest growing medium behind the Internet and TV and grew 10.7% in 2004 to $1.5B

China is now the third largest ad market (in revenue) trailing the US and Japan

Autodesk provides the industry’s best client facing solutions

Best of breed creative toolset to solve any production problemAbility to work in multiple formatsIndustry Leading ROI


New Platforms and Formats Fuel Retooling in the Advertising Industry

Optimus invested over $1M in Autodesk HD solutions replacing competitor’s solutions Derwin invested in their first ever Autodesk SD and HD solutions GTN, Nice Shoes and Universal Images all standardized on Autodesk digital workflows for advertising


GamesGame market is now larger than worldwide film market

WW sales are expected to be $20B in 2005

Next generation game consoles will be available within next 18 months from Sony, Microsoft and Nintendo

Positioned to become next generation HD/DVD player

Budgets on best selling games exceed $10M with over 150 artists and programmers

Grand Theft Auto: San Andreas contains over 8 kilometers of cityscape modeled in 3ds Max


More than Half of All Games Released in 2004 were Created with Autodesk 3ds Max

Top Titles included Halo 2, World of Warcraft and Grand Theft Auto: San Andreas

Ubisoft’s latest Tom Clancy’s Splinter Cell game, had over 1.4M pre-orders

Next generation game development will be fueled by development partnerships

Microsoft’s XNASony’s Collada


Media and Entertainment Summary

Industry shift to digital entertainment is just beginning

Customers need to invest in collaborative, digital workflows to support digital entertainment creation

Growth over last year has been driven by early adopters

Autodesk will continue to lead this transition with:Technical innovation Workflow and collaboration solutionsCreative functionality


Ken BadoSenior Vice PresidentWorldwide Sales

Sales UpdateWhy We Win


The Sales Organization of the Future

2D 3D LifecycleManagement

Discipline-specificSoftware(Vertical)


Foundation For Success

Sales modelSolution sellingSales productivityChannel developmentSales capacityGeographic opportunity

Emerging markets

“Autodesk’s trusted advice was pivotal in making our solution a complete success.”

J.P. Jones, CIOMacerich Company

“Autodesk’s trusted advice was pivotal in making our solution a complete success.”

J.P. Jones, CIOMacerich Company


Indirect (VARs, Distribution)Direct Sales ForceN

ot R

eady

Rea

dyM

arke

t

Not Ready Ready

Product/Solution

Sales ModelRight Products, Right Customers, Right Time

IndirectDevelop

Develop


CapabilitiesCapabilitiesDifferen-tiationDifferen-tiationSolutionSolution

Selling Products to Solving Customer Problems

Standard methodology and terminology (1,600 direct & channel reps trained)

Sales productivity increasesDeal size increases

UniqueBusiness

Value

CompellingEvent

Business Drivers

Business Drivers

BusinessInitiativesBusinessInitiatives ProjectsProjects +


Solution SellingBenefits of Target Account Selling

Standard methodology and terminology (1,600 reps trained)

Technical solutions to solve customer business problemsBased on compelling event and unique business valueSales productivity increasesDeal size increases

“Any software solution we chose had to enhance our productivity and make us competitive with larger firms. That was first on my mind.”

John Mangan, PresidentMangan Group Architects

“Any software solution we chose had to enhance our productivity and make us competitive with larger firms. That was first on my mind.”

John Mangan, PresidentMangan Group Architects


Autodesk Sales ProductivitySales Affects Topline and Bottomline Profitability

RevenueSales Opex as % of revenue

FY03 FY04 FY05


Worldwide Channel Sales Productivity

Avg Revenue / VAR

# of VARs

# of VAR sales reps

FY03 FY04 FY05


Direct Sales ProductivityDirect deals over $100K grew 60% worldwide from FY04-05

+63%

+27%

+155%

“The strong direct partnership between Parker Hannifin and Autodesk supports us on the road to achieving our critical business strategies and objectives.”

Craig Maxwell, Vice PresidentTechnology and Innovation

Parker Hannifin Corporation

“The strong direct partnership between Parker Hannifin and Autodesk supports us on the road to achieving our critical business strategies and objectives.”

Craig Maxwell, Vice PresidentTechnology and Innovation



Channel DevelopmentBuilding Trust Through Predictability

Technical bootcampsBusiness skills trainingPackaged Service OfferingsValue Incentive Rebate programInvestment fundsR/E/A/L channel marketing programs

“We could not be more pleased with Autodesk’s commitment to the market by way of their product set, but more importantly,their commitment to us and the reseller community.”

Adi DrotleffFounder and CEO

Mensch und Maschine, Germany

“We could not be more pleased with Autodesk’s commitment to the market by way of their product set, but more importantly,their commitment to us and the reseller community.”

Adi DrotleffFounder and CEO

Mensch und Maschine, Germany


Future Emerging Markets

+43%

Russia +40%

China

+38%

India

“Using Civil 3D for our design work in JinpinGrade 1 Hydropower Plant, we are able to dramatically improve on the precision of excavation and our work efficiency.”

Xue LijunSenior Engineer

CHIDI, Chengdu, China

“Using Civil 3D for our design work in JinpinGrade 1 Hydropower Plant, we are able to dramatically improve on the precision of excavation and our work efficiency.”

Xue LijunSenior Engineer

CHIDI, Chengdu, China

Total revenue growth from FY04-05


Why We Will Continue to WinAnd build lasting business partnerships

“Our relationship with Autodesk holds strategic value for Parker Hannifin because they have invested in understanding our business needs, they consistently deliver to meet our requirements, and they truly understand what it takes to build lasting business partnerships.”

Bob McAdooDirector of Business Systems


“Our relationship with Autodesk holds strategic value for Parker Hannifin because they have invested in understanding our business needs, they consistently deliver to meet our requirements, and they truly understand what it takes to build lasting business partnerships.”

Bob McAdooDirector of Business Systems



Financial Update

Al CastinoChief Financial Officer


FY 2005 Goals

Invest for future growthStrong commitment to cost management

Continued productivity improvement Achieve operating margin targets 18% to 20% annual basis for FY2005 (One year early!)

Maintain balance sheet strengthManage stock option program

New accounting rulesDilutionStock option overhang Retain staff


FY 2005 Key Metrics ~ Doubled

Revenue growth doubledUp 30%

Operating margin nearly doubled11% to 21%

Cash from operations nearly doubledFrom $220 to $373M

EPS more than doubled$0.42 to $0.88


New Seats Drive Growth

$0

$250

$500

$750

$1,000

$1,250

FY03 FY04 FY05

Upgrades

Subscription

New Seats & Emerging Business


Additional Drivers of GrowthCritical changes in our model past 24 months

Strong annual releasesUpgrade price increaseSubscription growth2D to 3D migrationProductivity focusNew products & services Management changes


$0

$1,234

1 52Weeks

FY05 Autodesk Revenue Linearity

Benefits of Revenue Linearity:PredictabilityDSO ImprovementSales DisciplineOperation Efficiency


Deferred Revenue

0

50

100

150

200

FY03 FY04 FY05

Subscription

Other


Productivity Drivers

Company-wide process analysis Centralization and standardization of administrative processesBack office systems investmentsGross margin initiatives


Productivity Drivers

Procurement initiativesRationalization of direct vs. indirect sales effortsStrong target account selling modelMarketing initiativesOffshoring


Productivity is Increasing Significantly

FY03 FY04 FY05 FY03 FY04 FY05

Revenue per Employee Revenue per Labor Dollar


Productivity: Base Salaries Decreasing as Percent of Revenue

0%

5%

10%

15%

20%

25%

30%

35%

FY03 FY04 FY05


Stock Option Overhang is Under Control

16%

0%

5%

10%

15%

20%

25%

30%

FY03 FY04 FY05


FY2006 Key Financial Goals

Achieve guidanceContinued strong balance sheetReturn on shareholder equityContinued high integrityAchieve current year productivity targets

Set up for subsequent year achievementInvest for future growth


New Guidance Summary

Q1 FY 2006Revenue $340 to $350 MillionEPS $0.27 to $0.29

Q2 FY 2006Revenue $335 to $345 MillionEPS $0.21 to $0.23

Fiscal 2006Revenue $1.425 to $1.475 BillionEPS $1.10 to $1.15*

* Excludes Impact of Employee Stock Compensation Expensing


Return on Shareholders’ Equity Improving

34%

0%

5%

10%

15%

20%

25%

30%

35%

40%

FY03 FY04 FY05

We’re Proud Of Our Return On Investment


…And it is Among the Best

0%

5%

10%

15%

20%

25%

30%

35%

40%

Siebel

Macro

media

Microso

ftVeri

sign

BEAChe

ckpoin

tPara

metric

Citrix

IntuitSym

antec

Electro

nic Arts

Autodes

kAdo

beOrac

le

As Of Each Company’s Latest Fiscal Year

media and entertainment vertical solutions and beyond investor... · autodesk investor day 2005 1...

Documents