Autodesk shares tumble on narrow Q3 beat; guidance raised

Autodesk (NASDAQ:ADSK) shares fell 8.5% in premarket trading Wednesday after the software company reported third-quarter earnings that narrowly beat expectations.

The design software maker reported adjusted earnings per share of $2.17 for the third quarter of fiscal 2025, surpassing analyst estimates of $2.12. Revenue grew 11% YoY to $1.57 billion, slightly above the consensus forecast of $1.56 billion.

For the fourth quarter, Autodesk forecast adjusted EPS of $2.10-$2.16, compared to analyst expectations of $2.12. The company projected Q4 revenue of $1.623-1.638 billion, with the midpoint marginally above the $1.62 billion consensus estimate.

CEO Andrew Anagnost highlighted the company's efforts to modernize its go-to-market approach, stating, "We have already seen significant benefits from these optimization initiatives and there's more to come in the next phase." However, he also noted ongoing macroeconomic and geopolitical challenges.

Interim CFO Betsy Rafael added, "Overall, macroeconomic, policy, and geopolitical challenges, and the underlying momentum of the business, were consistent with the last few quarters with continued strong renewal rates and headwinds to new business growth."

The company's GAAP operating margin decreased 2 percentage points to 22%, while non-GAAP operating margin fell 3 percentage points to 36%. Autodesk's net revenue retention rate remained within the 100% to 110% range on a constant currency basis.

Overall, Autodesk raised the midpoints of its full-year guidance ranges for billings, revenue, margins, earnings per share, and free cash flow.

However, "key debates on the new CFO&lack of visibility on FY26 left investors with more questions than answers," Morgan Stanley (NYSE:MS) analysts commented. 

"Mixed investor feedback on the new CFO announcement likely remains an overhang on execution risk to achieving goals," they noted.

Meanwhile, analysts at Wolfe Research said they see the post-earnings stock weakness "as a buying opportunity as ADSK successfully executes its agency model transition with good business momentum despite macro challenges."

Senad Karaahmetovic contributed to this report.