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Shares of Autodesk plunged more than 12% in pre-market trading on Wednesday after the software company said the U.S.-China trade war could negatively impact its financials.
Autodesk beat expectations on both the top and bottom lines in its fiscal second quarter results, but cited concerns around the ongoing trade war as the reason for its conservative guidance.
“While we continue to execute well and are not materially impacted by current trade tensions and macro uncertainty, we are taking a prudent stance to our second half fiscal 2020 outlook,” Autodesk CFO Scott Herren said in a statement.
On Autodesk’s earnings call, Herren said the state of “various trade disputes and the geopolitical environment” were responsible for the adjusted guidance and that it “now reflects our current views based on what we know about the environment today.”
The company lowered its fiscal 2020 revenue guidance to a range of $3.43 billion to $3.49 billion, down from its previous estimates of $3.5 billion to $3.55 billion. Its fiscal third quarter estimates also missed projections, with the company expecting earnings of 70 cents to 74 cents per share on revenue of $820 million to $830 million vs. analysts’ expectations of 77 cents and $838.8 million.
For the fiscal second quarter ended July 31, Autodesk reported earnings of 65 cents per share on revenue of $797 million, which beat analysts’ projections for earnings of 61 cents per share and $787 million in revenue.
Autodesk isn’t the only one feeling the impacts of the trade war. Trade tensions have dragged down the broader market over the past month, causing some economists to warn of a looming recession. Elsewhere in the tech space, Apple and semiconductor stocks have fallen after President Donald Trump said U.S. companies should “immediately start looking for an alternative” to their operations in China.
