Autodesk (ADSK) is one vendor at the forefront of the massive innovation wave that’s bringing generative AI technology to the design, construction, manufacturing and entertainment industries.
Autodesk provides software for a variety of use cases across the architecture, engineering, construction, product design, manufacturing and media & entertainment segments. The company has been steadily amping up its broad portfolio of solutions with generative AI.
In fiscal 2024 (January), Autodesk’s total revenue rose 10% to $5.5 billion. The company’s business is broken down into four operating units. Architecture, engineering and construction (AEC) is the biggest piece, representing 47% of total revenue. AutoCAD is the #2 unit, accounting for 27% of revenue. Manufacturing and media & entertainment represent 19% and 5%, respectively. For FY’25, the company’s initial outlook calls for total revenue of $6 billion.
Last May, Autodesk debuted the first set of capabilities for Forma, an industry cloud that unifies workflows across design, construction and operations teams. Forma is most useful in the early stages of the planning and design process, providing automation and AI-powered insights that simplify the exploration of design concepts, automate repetitive tasks and help evaluate environmental qualities surrounding a building site, giving architects more time to be creative.
With Forma, architecture professionals have the ability to work iteratively as opposed to sequentially between planning and detailed design, according to Autodesk. Forma helps users quickly evaluate dozens of different design options and improve upon the ones with the best features. Users can unlock advanced capabilities without needing to have deep technical expertise, improving overall productivity. Architects benefit by efficiently producing higher-quality deliverables for their clients.
One of Forma’s key capabilities is contextual modeling, which simplifies the process of starting a new building information modeling (BIM) project. Users can easily set up a 3D model of an entire project within minutes, either inputting their own data or buying data sets for specific geographies. Machine learning technology performs real-time analyses on initial designs across key density and environmental qualities—including sunlight, daylight, wind and microclimate.
Autodesk AI, introduced last fall, provides intelligent assistance as well as generative capabilities that allow customers to unlock creativity, rapidly solve problems and eliminate various types of non-productive work. Available throughout the Autodesk product portfolio, Autodesk AI is a virtual assistant that lowers the learning curve for designers and engineers, giving them the ability to operate more efficiently, boost productivity and accelerate innovation.
In the AEC operating unit. Autodesk’s Construction IQ offering uses AI to predict, prevent and manage construction risks that might impact quality, safety, costs and scheduling. AutoCAD leverages AI to help drafters iterate faster by being able to read handwritten and digital markups. It first determines the intent of the user and then recommends context-aware actions.
Autodesk’s new Machine Learning Deluge tool leverages AI to provide feedback to help prevent or limit water disasters. It enables designers to accurately predict flood maps in various types of projects, from housing developments to commercial properties and roadways. The tool quickly analyzes and predicts water channeling and ponding, making the drainage design process much more efficient.
In product design and manufacturing, Autodesk’s generative AI capabilities fully enable conceptual design exploration in the auto industry, leading to accelerated outcomes and 3D models that can be rapidly created and edited in real-time using semantic controls and natural language without advanced technical skills. In Autodesk’s Fusion platform for 3D CAD, users can automatically generate product designs optimized for manufacturing methods and costs.
Media & entertainment productions are able to deploy generative scheduling in Autodesk Flow to properly manage the constantly shifting variables between teams and budgets. Generative AI can come up with production schedules in minutes, a task that historically has taken days. Using AI, teams can plan, predict and right-size resources on the fly. For artists, Autodesk Flame uses AI to automate manual tasks such as keying, sky replacement, beauty work and camera tracking.
After rising 30% in 2023, Autodesk shares are up 7% YTD. The stock recently hit a new 52-week high of $279.53, but remains below the all-time high of $344.39 from August 2021. At recent prices, the forward P/E stands at 32.2. While the company these days is delivering only modest revenue growth (analysts on average look for FY’25 top-line expansion of 9.9%), it will benefit as new AI initiatives boost its competitive positioning.
