Autodesk Inc. (NASDAQ:ADSK)

Current Income Tax Expense

The current income tax expense exhibits a generally increasing trend from 2019 to 2024, rising from 50 million US dollars in 2019 to a peak of 398 million in 2023, before declining slightly to 313 million in 2024. This upward movement suggests growing taxable income or changes in applicable tax rates during this period, with a notable surge in 2023.

Deferred Income Tax Expense

The deferred income tax figures show significant volatility throughout the periods. Starting with a negative value of -12 million in 2019 (indicating a deferred tax benefit), it shifted to a positive 13 million in 2020, before plummeting sharply to -778 million in 2021. Afterwards, deferred taxes remain negative, albeit less dramatically, at -17 million in 2022, -275 million in 2023, and -83 million in 2024. The large fluctuations, especially the substantial benefit recorded in 2021, point to considerable timing differences between accounting earnings and taxable income that reversed or adjusted during these years.

Total Income Tax Provision (Benefit)

The overall income tax provision, combining current and deferred components, reflects the trends observed in its constituent parts. It rises overall from 38 million in 2019 to 80 million in 2020, dramatically dips to a net tax benefit of -662 million in 2021 due to the large deferred tax benefit, then recovers to positive provisions in subsequent years: 68 million in 2022, 123 million in 2023, and 230 million in 2024. This pattern indicates that the income tax expense was significantly influenced by deferred tax adjustments, with 2021 marking an exceptional year where deferred tax benefits outweighed current tax expenses.

Insights and Implications

The analysis reveals that deferred taxes introduce notable volatility in the income tax expense, with potential impacts on reported earnings. The sharp deferred tax benefit in 2021 suggests recognition of substantial deductible temporary differences or tax credits during that year. Meanwhile, the rising current tax expense over time may reflect the company's growing profitability, changes in tax legislation, or reduced use of tax planning strategies. The interplay between current and deferred taxes is crucial for understanding the effective tax rate dynamics.

U.S. Statutory Tax Rate

The U.S. statutory tax rate remained constant at 21% throughout the observed period from January 31, 2019 to January 31, 2024. No fluctuations or changes were detected, indicating a stable tax environment for the entity in relation to statutory tax obligations.

Effective Income Tax Rate

The effective income tax rate exhibited significant volatility over the examined timeline. Starting in 2019, the rate was notably negative at -89.23%, indicating unusual tax circumstances such as loss carrybacks, credits, or other adjustments negatively impacting tax expense relative to income. In 2020, the rate shifted abruptly to 27.24%, surpassing the statutory rate and reflecting a higher tax burden relative to income.

In 2021, the effective tax rate again turned negative and further decreased to -121%, suggesting continued extraordinary tax-related effects or accounting treatments impacting tax expenses.

From 2022 onwards, the rate stabilized at positive values but remained lower than the statutory rate: 11.99% in 2022, a slight increase to 13% in 2023, and further rising to 20.25% in 2024. This trend indicates an ongoing reduction in the effective tax burden relative to the statutory level, possibly reflecting ongoing tax planning, credits, or differing income mix.

Overall, the effective income tax rate demonstrates considerable fluctuation with periods of negative values followed by recovery towards but still below the statutory rate toward the latter years.

Stock-based compensation

Displayed a steady increase from 26 million USD in 2019 to a peak of 56 million USD in 2022, followed by a slight decline to 53 million USD in 2024, indicating elevated but somewhat stabilized compensation expenses over the years.

Research and development tax credit carryforwards

Experienced fluctuations, starting at 239 million USD in 2019, rising to 263 million USD in 2020, declining to 103 million USD in 2023, and slightly increasing to 118 million USD in 2024, suggesting variable utilization or changes in R&D tax credit opportunities.

Foreign tax credit carryforwards

Significantly declined from 199 million USD in 2019 to 4 million USD in 2024, with notable decreases after 2020, indicating diminishing foreign tax credits over the period.

Accrued compensation and benefits

Remained relatively low but showed an increasing trend from 7 million USD in 2019 to 11 million USD in 2024, possibly reflecting increased employee-related liabilities.

Other accruals not currently deductible for tax

Exhibited volatility, with values fluctuating between 14 million and 28 million USD, and a decrease to 15 million USD in 2024, indicating variability in accrual timing or tax regulations.

Capitalized research and development

Displayed substantial growth from 33 million USD in 2019 to 514 million USD in 2024, reflecting a significant increase in the capitalization of development costs and investment in long-term assets.

Fixed assets

Varied modestly, decreasing from 15 million USD to 8 million USD by 2021, then rising to around 21 million USD by 2024, indicating moderate investment or disposals in fixed assets.

Lease liability

Commenced recording in 2020 at 106 million USD, gradually declining to 80 million USD by 2024, which may reflect lease maturities or renegotiations lowering the lease obligations.

Tax loss carryforwards

Decreased markedly from 237 million USD in 2019 to 10 million USD in 2024, indicating extensive utilization or expiration of tax loss deductions over the period.

Deferred revenue

Showed volatility with a large increase to 502 million USD in 2021, decreased to 390 million USD in 2022, then rose again to 653 million USD in 2023 before declining to 538 million USD in 2024, reflecting fluctuations in advance payments or subscription-based revenue recognition.

Purchased technology

Absent from 2019 to 2023, with a reported value of 33 million USD in 2024 for one instance and a negative entry of -26 million USD in 2023, suggesting acquisition-related accounting entries affecting this line item.

Other

Remained relatively stable, ranging from 23 million USD to 40 million USD, with no clear trend.

Deferred tax assets

Consistently increased from 851 million USD in 2019 to 1,428 million USD in 2024, indicating growth in temporary differences and carryforwards generating future tax benefits.

Valuation allowance

Significantly reduced in magnitude from -798 million USD in 2019 to approximately -149 million USD in 2024, reflecting increased confidence in the realization of deferred tax assets.

Net deferred tax assets

Improved considerably from 53 million USD in 2019 to 1,279 million USD in 2024, showing strong growth in deferred tax asset net realizability after allowances.

Indefinite lived intangibles

Reported as negative values increasing in absolute terms from -68 million USD to -128 million USD, indicating growing impairment or amortization of intangible assets with indefinite lives.

Right-of-use assets

Measured only from 2020 onwards, showing a decreasing negative balance from -101 million USD to -52 million USD by 2024, matching the declining lease liabilities.

Unremitted earnings of foreign subsidiaries

Minor negative values from -1 to -6 million USD, without consistent trend, suggesting limited impact or variable foreign earnings retention.

Deferred taxes on foreign earnings

Recorded negative amounts only in 2023 and 2024, decreasing slightly from -33 million USD to -29 million USD, indicating deferred tax liabilities associated with foreign profits.

Deferred tax liabilities

Fluctuated with an overall increasing negative trend from -68 million USD in 2019 to around -209 million USD in 2024, signifying rising deferred tax obligations.

Net deferred tax assets (liabilities)

Shifted from negative balances in 2019 and 2020 to positive values from 2021 onward, increasing from 752 million USD in 2021 to 1,070 million USD in 2024, reflecting improvement in net deferred tax asset position over liabilities.

Long-term deferred tax assets

There is a notable upward trend in long-term deferred tax assets over the observed period. Beginning at 65 million US dollars in early 2019, the figure slightly decreased in 2020 to 56 million. However, a significant increase is then observed in 2021, with assets rising sharply to 763 million, followed by a slight decline to 741 million in 2022. The upward momentum resumes in 2023 and 2024, reaching 1,014 million and 1,093 million respectively. This pattern indicates growing recognition or realization of deferred tax assets, particularly from 2021 onward, suggesting improved future tax benefit expectations.

Long-term deferred tax liabilities

The data for long-term deferred tax liabilities exhibits relative stability with minor fluctuations. Starting at 80 million US dollars in early 2019, the liabilities increased marginally to 83 million in 2020, then dropped sharply to 11 million in 2021. A subsequent gradual increase is seen in 2022 to 29 million and in 2023 to 32 million, followed by a slight decrease to 25 million in 2024. This volatility, especially the significant dip in 2021, may reflect changes in tax planning, timing differences, or asset revaluation processes impacting deferred tax liabilities.

The analysis of the financial data over the six-year period reveals several significant trends in the company's asset base, liabilities, equity, and net income, both on reported and adjusted bases.

Total Assets

Reported total assets experienced consistent growth every year, increasing from US$ 4,729 million in 2019 to US$ 9,912 million in 2024. Adjusted total assets follow a similar upward trend, growing from US$ 4,664 million to US$ 8,819 million over the same period, albeit with a somewhat slower pace of increase compared to reported values after 2020. This suggests an overall expansion in the company’s asset base, with adjustments for deferred income tax consistently reducing the asset figures relative to reported amounts.

Total Liabilities

Reported total liabilities rose from US$ 4,940 million in 2019 to a peak of US$ 8,293 million in 2023 before slightly declining to US$ 8,057 million in 2024. Adjusted total liabilities mirror this pattern closely, peaking at US$ 8,261 million in 2023 and decreasing slightly to US$ 8,032 million in 2024. The growth in liabilities aligns with the expansion in assets, although the marginal decline in the last year may indicate initial steps toward deleveraging or stabilization of obligations.

Stockholders’ Equity (Deficit)

Reported stockholders’ equity showed a significant shift from negative territory in 2019 and 2020 (-US$ 211 million and -US$ 139 million, respectively) to positive values starting in 2021, reaching US$ 1,855 million in 2024. Adjusted stockholders’ equity remains substantially lower than reported figures, shifting from a slight deficit in initial years to a positive US$ 785 million in 2024. The divergence between reported and adjusted equity suggests the impact of deferred tax adjustments plays a meaningful role in equity presentation, with reported figures possibly overstating equity in later years.

Net Income (Loss)

Reported net income transitioned sharply from a loss of US$ 81 million in 2019 to profitability in 2020, with substantial increases in the following years, peaking at US$ 1,208 million in 2021 before moderating to US$ 906 million in 2024. Adjusted net income shows a similar directional pattern but with more moderated figures, increasing from a loss of US$ 93 million in 2019 to positive earnings of US$ 823 million in 2024. This suggests that adjustments related to deferred income tax reduce the reported profitability figures but do not alter the positive earnings trend established post-2019.

Overall, the data indicates a company that has grown significantly in asset size and improved its profitability after a loss year in 2019. Both reported and adjusted figures highlight a positive transformation in financial health, with reduced equity deficits and increasing net income. The presence of adjustments, particularly related to deferred income tax, consistently lowers asset, liability, equity, and income values but does not fundamentally change the observed trends, underscoring their importance in understanding the company's true financial position.

The analysis of the financial data over the reported periods reveals notable trends and variations in profitability, efficiency, leverage, and returns.

Profitability Margins

The reported net profit margin experienced significant fluctuations, beginning with a negative margin of -3.14% in early 2019, sharply rising to a peak of 31.88% in 2021, then declining and stabilizing around 16.44%-16.48% in the latest years. The adjusted net profit margin shows a similar initial trend but with less volatility, remaining relatively stable between 10.95% and 14.97% from 2021 onwards, indicating a smoother profitability trend after adjustments.

Asset Turnover Ratios

The reported total asset turnover ratio decreased slightly from 0.54 in 2019 to 0.51 in 2022, before recovering to 0.55 by 2024, suggesting minor fluctuations in asset utilization efficiency. Conversely, the adjusted total asset turnover improved notably from 0.55 in 2019 to 0.62 in 2024, indicating enhanced operational efficiency after accounting for adjustments over the entire period.

Financial Leverage

Financial leverage data are unavailable for the initial two years but show a steep increase in subsequent years. The reported financial leverage rose from 7.54 in 2021 to a peak of 10.14 in 2022, then declined to 5.34 by 2024, implying a reduction in reliance on debt or liabilities in the most recent period. Adjusted financial leverage displays an extreme peak of 57.25 in 2022 and subsequently decreases sharply to 11.23 in 2024, reflecting considerable adjustments affecting leverage that imply higher risk levels in the middle years, followed by significant deleveraging or capital structure improvement.

Return on Equity (ROE)

The reported ROE shows impressive but volatile values starting from 2021, with a high of 125.14% followed by a decline to 48.84% by 2024. The adjusted ROE displays even more pronounced variability, peaking at 349.49% in 2022 before reducing to 104.84% in 2024. These patterns indicate that while equity returns were substantial, they were subject to significant fluctuations, likely influenced by adjustments and changes in financial leverage.

Return on Assets (ROA)

The reported ROA rose from a negative -1.71% in 2019 to a peak of 16.6% in 2021, then declined and stabilized around 9.14% by 2024. Adjusted ROA exhibits a more moderated increase from -1.99% in 2019 to 9.33% in 2024, with less volatility compared to the reported figures, suggesting a consistent improvement in asset profitability following adjustments.

Overall, the data indicates a period of considerable financial performance volatility, with peaks in profitability and returns during 2021-2022, followed by moderate stabilization in subsequent years. Adjustments notably temper the reported figures, providing a smoother and more consistent perspective on operational efficiency and profitability. The trends in financial leverage highlight critical changes in the capital structure, which appear to have major impacts on returns, especially evident in the adjusted metrics.

The reported net income (loss) exhibits significant fluctuations over the six-year period. Initially, a net loss of $81 million was recorded, which reversed to a positive net income of $215 million in the subsequent year. A pronounced increase occurred in the year ending January 31, 2021, with reported net income reaching $1,208 million. This was followed by a decrease to $497 million in 2022, then a recovery to $823 million in 2023 and $906 million in 2024, indicating a general upward trend after the sharp dip in 2022.

The adjusted net income shows a similar but less volatile pattern. Starting from a loss of $93 million, it rose to $228 million in 2020, peaked at $430 million in 2021, and then demonstrated steady growth reaching $480 million in 2022, $548 million in 2023, and $823 million in 2024. This steady rise suggests improving underlying profitability when adjustments for tax effects and other items are considered.

Regarding profitability margins, the reported net profit margin mirrors the trend in reported net income. It starts negative at -3.14%, climbs to 6.55% in 2020, sharply increases to 31.88% in 2021, then falls to 11.33% in 2022, and gradually improves to approximately 16.44% and 16.48% in 2023 and 2024, respectively. The margin demonstrates considerable volatility, especially around 2021, likely due to one-time factors or tax effects impacting the income statement.

The adjusted net profit margin provides a more stable insight into profitability. From a negative -3.62% in 2019, it rises steadily to 6.96% in 2020, then moves to 11.35% in 2021, remaining relatively stable at around 10.95% in 2022 and 2023 before improving to 14.97% in 2024. This steadier progression reflects consistent operational improvements excluding impacts of reported tax and accounting adjustments.

Overall, the reported figures indicate higher volatility due to tax and accounting treatments affecting net income and margins. In contrast, the adjusted data reveal a trend of gradual and sustained improvement in profitability from 2019 through 2024. The recovery from losses to positive income and increasing margins suggests strengthening financial performance over the analyzed period.

The analysis of the financial data reveals several notable trends in asset values and turnover ratios over the observed six-year period.

Total Assets

Reported total assets have shown a consistent upward trajectory, increasing from 4,729 million USD in early 2019 to 9,912 million USD by early 2024. This represents more than a doubling in asset base over the period, reflecting growth and possible investments or acquisitions.

Adjusted total assets, which account for deferred income tax considerations, also demonstrate growth, rising from 4,664 million USD to 8,819 million USD in the same timeframe. While the adjusted figures are slightly lower than the reported figures each year, the trend mirrors the reported assets closely with steady increases annually.

Total Asset Turnover

The reported total asset turnover ratio presents a relatively stable pattern, fluctuating marginally between 0.51 and 0.55 over the six periods. Starting at 0.54 in 2019, it dips slightly to 0.51 in 2022 before rebounding to 0.55 in 2024. This indicates that, according to reported data, the company's efficiency in generating revenue from its assets has remained fairly steady, with minor variations.

In contrast, the adjusted total asset turnover shows an overall improving trend. Beginning at 0.55 in 2019, the ratio experiences some fluctuations but climbs to 0.62 by 2024. The peak value in 2021 at 0.58 and the consistent rise thereafter suggest an increase in revenue generation efficiency when adjusted for deferred income taxes, indicating improved asset utilization over time.

Overall, the data indicates solid asset growth accompanied by stable to improving efficiency in asset usage. The adjusted metrics suggest a slightly more optimistic view of asset turnover and efficiency compared to the reported figures, highlighting the impact of income tax adjustments on financial performance interpretation.

The analysis of the financial data reveals several important trends and variations over the six-year period ending January 31, 2024.

Total Assets

Reported total assets have shown a steady upward trend from US$4,729 million in 2019 to US$9,912 million in 2024, indicating continuous growth in asset base. Adjusted total assets also increased over the same period, from US$4,664 million to US$8,819 million; however, the adjusted figures are consistently lower than the reported, implying that adjustments related to income tax considerations reduce the baseline asset valuation recognition.

Stockholders’ Equity

Reported stockholders’ equity exhibited a marked improvement, transitioning from a deficit position of US$211 million in 2019 and US$139 million in 2020 to positive equity beginning 2021. By 2024, reported equity reached US$1,855 million, signaling strengthening net asset value. Conversely, adjusted stockholders’ equity, which accounts for deferred tax adjustments, remained negative through 2019 and 2020 but turned positive at a lower level starting 2021, increasing to US$785 million by 2024. This discrepancy indicates that deferred income tax impacts significantly affect the equity figures.

Financial Leverage

Reported financial leverage data is only available from 2021 onwards, showing a peak of 10.14 in 2022 followed by a decline to 5.34 in 2024. This pattern suggests a reduction in reliance on debt or other liabilities relative to equity in the most recent years. In contrast, adjusted financial leverage values are dramatically higher, with an extreme peak of 57.25 in 2022 and a decrease to 11.23 in 2024. These adjusted leverage ratios highlight substantial impacts from deferred tax liabilities or assets, reflecting a more conservative and risk-sensitive view of the company’s capital structure.

Overall, the financial data demonstrates growth in assets and improvement in equity positions. The significant differences between reported and adjusted figures, especially for stockholders’ equity and financial leverage, underscore the material influence of deferred income tax adjustments on the company’s financial profile. The decreasing trend in financial leverage ratios toward 2024, in both reported and adjusted metrics, may indicate efforts to strengthen the balance sheet and reduce financial risk.

The financial data reflects notable fluctuations and overall growth across the observed periods, with distinctions between reported and adjusted figures. Net income demonstrates a recovery trajectory following a loss in the initial period, with reported net income increasing substantially from a deficit of 81 million USD to a positive 906 million USD over six years. Adjusted net income likewise shows growth, albeit with less volatility, escalating from a loss of 93 million USD to a gain of 823 million USD by the latest period.

Stockholders' equity, both reported and adjusted, exhibits a similar pattern of recovery and expansion. Reported equity starts from a negative base of 211 million USD, turning positive in subsequent years and rising to 1,855 million USD by the end of the timeframe. Adjusted stockholders’ equity starts less negative and increases steadily to 785 million USD, though remaining consistently lower than the reported equity values.

Return on equity (ROE) metrics, differentiated by reported and adjusted calculations, reveal substantial variability and very high values in the mid-range periods, followed by a moderation in the latest year. Reported ROE is absent in the earlier years but peaks at 125.14% in 2021 before declining to just under 50% by 2024. Adjusted ROE is even more pronounced, with an exceptionally high peak of 349.49% in 2021, maintaining above 300% the following year and then decreasing sharply to about 105% in the most recent period.

Net Income Trends

A significant turnaround from initial losses to consistent profitability is evident. Adjusted income figures present a smoother increase compared to the reported figures, suggesting that adjustments moderate the volatility seen in reported earnings.

Stockholders’ Equity Trends

Equity positions improve notably across the period. The gap between reported and adjusted equity widens over time, indicating that adjustments, likely related to deferred tax effects or other accounting considerations, result in lower equity values than reported figures.

Return on Equity Trends

ROE measures show extreme variations, particularly in adjusted figures, hinting at underlying changes in either net income or equity affecting profitability metrics. The extraordinarily high adjusted ROE values in the middle years suggest small equity bases or significant adjustments impacting the calculation.

In conclusion, the company's financial profile, when adjusted for income tax considerations, illustrates less volatility and generally lower equity values versus reported metrics. Ratios such as ROE experience marked fluctuations that imply caution in interpretation, possibly due to the effects of deferred taxation adjustments. Overall, the data points to a strong recovery and improvement in profitability and equity over the six-year span, tempered by the impact of accounting adjustments on key financial indicators.

The financial data indicates a notable recovery and growth trajectory over the years analyzed. The reported net income (loss) exhibited a significant improvement from a loss of 81 million USD in early 2019 to a profit of 906 million USD by early 2024. Adjusted net income follows a similar trend, rising from a loss of 93 million USD to a profit of 823 million USD in the same period, though the adjusted figures show more moderate fluctuations between 2020 and 2023.

Total assets, both reported and adjusted, have shown steady growth across the years. Reported total assets increased from 4,729 million USD in 2019 to 9,912 million USD in 2024, demonstrating a robust expansion of the asset base. Adjusted total assets also rose consistently, albeit at a somewhat slower rate, from 4,664 million USD to 8,819 million USD over the same timeframe.

Return on assets (ROA) metrics, both reported and adjusted, reflect these income and asset trends. Reported ROA improved dramatically from a negative return of -1.71% in 2019 to a positive 9.14% in 2024, indicating more efficient use of assets to generate profits. Adjusted ROA, initially more negative at -1.99%, also improved to 9.33% by 2024, with a more stable progression and smaller fluctuations compared to the reported ROA. The convergence of reported and adjusted ROA values towards the end of the period suggests a narrowing difference between reported and adjusted profitability assessments.

Overall, the data demonstrates a significant recovery from losses to sustainable profitability, accompanied by continuous asset growth and improved asset utilization. The adjusted figures tend to moderate the reported values, providing a smoother representation of financial performance. These trends suggest strengthened operational efficiency and financial health over the six-year span.