What Happened:
Shares of design software company Autodesk (NASDAQ:ADSK) jumped 8.78% in the pre-market session after the company reported an impressive "beat and raise" quarter. Second quarter results surpassed analysts' expectations for key topline metrics, including revenue, billings, and remaining performance obligation (RPO - a leading indicator of revenue). In addition, earnings per share beat Wall Street's expectations.
Moving ahead, guidance came in strong, with revenue projections for the next quarter and full year exceeding expectations, with management lifting the full year growth outlook. Similarly, the full year EPS guidance was raised and came in above consensus estimates.
Overall, we think this was a decent quarter, showing that the company is staying on target. After the initial pop the shares cooled down to $209, up 2.27% from previous close.
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What is the market telling us:
Autodesk's shares are very volatile and over the last year have had 7 moves greater than 5%. In context of that, today's move is indicating the market considers this news meaningful but not something that would fundamentally change its perception of the business.
Autodesk is up 12.9% since the beginning of the year, but at $209 per share it is still trading 10% below its 52-week high of $232.30 from November 2022. Investors who bought $1,000 worth of Autodesk's shares five years ago would now be looking at an investment worth $1,330.
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