Thank you for standing by and welcome to the Autodesk Fourth Quarter and Full Year Fiscal 2022 Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speakers presentation, there will be a question-and-answer session. [Operator Instructions] As a reminder, today's program may be recorded. I would now like to introduce your host for today's program, Simon Mays-Smith, Vice President of Investor Relations. Please go ahead, sir.

Thanks, operator and good afternoon. Thank you for joining our conference call to discuss the fourth quarter and full year results of our fiscal '22. On the line with me are Andrew Anagnost, our CEO; and Debbie Clifford, our Chief Financial Officer. Today's conference call is being broadcast live via webcast. In addition, a replay of the call will be available at autodesk.com/investor. You can find the earnings press release, slide presentation and transcript of today's opening commentary on our Investor Relations website following this call. During this call, we may make forward-looking statements about our outlook, future results and related assumptions, acquisitions, products and product capabilities and strategies. These statements reflect our best judgment based on currently known factors. Actual events or results could differ materially. Please refer to our SEC filings, including our most recent Form 10-K for important risks and other factors, including developments in the COVID-19 pandemic and the resulting impact on our business operations that may cause our actual results to differ from those in our forward-looking statements. Forward-looking statements made during the call are being made as of today. If this call is replayed or reviewed after today, the information presented during the call may not contain current or accurate information. Autodesk disclaims any obligation to update or revise any forward-looking statements. During the call, we will quote a number of numerical growth changes as we discuss our financial performance. Unless otherwise noted, each such reference represents a year-on-year comparison. All non-GAAP numbers referenced in today's call are reconciled in our press release or Excel Financials and other supplemental materials available on our Investor Relations website. And now I will turn the call over to Andrew.

Thank you, Simon and welcome, everyone, to the call. Today, we reported record fourth quarter and full year revenue, non-GAAP operating margins and free cash flow. Our strong results and competitive performance were underpinned by some perennial factors. Our ability to deliver greater value to our customers and partners through consistent investment in our technology, workforce and business model and customer experience. Let me talk briefly about each of these as they are just as important to our future growth as they have been to our growth in the past. All of our technology investments, be it in 3D and BIM, enabling workflows in the cloud in generative design, in make and in newer verticals like water and construction. All of them connect siloed adjacent workflows in the cloud and lead our customers to new, more efficient and sustainable ways of working. At Autodesk University, we announced we were moving from products to platforms and capabilities and bringing those capabilities to any device anywhere to the cloud. Fusion 360 is the leading edge of this transition and our recent acquisitions of Prodsmart and CIMCO will enable us to further digitize and connect shop floor processes and manufacturing to help build connected factories while providing additional on-ramps into and usage of our manufacturing platform. Similarly, our acquisitions of Moxion and LoUPE enable us to connect Media and Entertainment workflows and data from postproduction to preproduction. With Media and Entertainment signing its largest ever EBA in the fourth quarter, the ability to connect preproduction workflows further expands our addressable TAM. We're also continuing to invest in our workforce, attract and retain the best talent in our industries and cultivate a shared sense of purpose and of diversity and belonging. We recently received recognition for that work with inclusion on the Corporate Knights…

Thanks, Andrew. In an extraordinary year, we performed strongly across all metrics, perhaps best summarized by the sum of revenue growth and free cash flow margin for the year which was 49%. Our fourth quarter results were strong. Several factors contributed to that, including robust renewal rates, strong growth in subscriptions and rapidly expanding digital sales. Total revenue grew 17% or about 2 percentage points less in constant currency, with subscription revenue growing by 18%. Looking at revenue by product; AutoCAD and AutoCAD LT revenue grew 20%, AEC revenue grew 17% and manufacturing revenue grew 4%. Recall that Vault became ratable in fiscal '22 and that manufacturing also benefited in Q4 last year from a strong performance in automotive EBAs which included significant upfront revenue. Excluding these impacts, manufacturing revenue grew in double digits in Q4. M&A revenue grew 38% which included some upfront revenue from its largest ever EBA. Even if you exclude upfront revenue, M&E grew more than 20% in Q4. Across the globe, revenue grew 18% in the Americas and 16% in both EMEA and APAC. Direct revenue increased 27% and represented 38% of total revenue, up from 34% last year due to strength from both enterprise and e-commerce. We had our best ever revenue quarter for digital sales which helped annual e-commerce sales surpass $0.5 billion for the first time. Our product subscription renewal rates remained at record highs. And our net revenue retention rate remained strongly within our 100% to 110% target range. Billings increased 13% to $1.7 billion, reflecting robust underlying demand but also a tough EBA comparison from last year. Total deferred revenue grew 13% to $3.8 billion. Total RPO of $4.7 billion and current RPO of $3.1 billion grew 12% and 15%, respectively and as expected, reflecting billings growth and the timing…

Thank you, Debbie. Our strategy is to transform the industries we serve with end-to-end cloud-based solutions that enable our customers to drive efficiency and sustainability. Structural growth drivers underpinning the strategy have been reinforced by the pandemic, including increased workflow convergence and platform standardization, a growing focus on distributed working in the cloud, automation and workforce productivity and also the growing importance of sustainability. Our model is scalable and extensible into adjacent verticals from architecture and engineering, through construction and owners from product engineering through product manufacturing and product data management. And as I stated earlier, with our consistent investment in our technology, our workforce and our business model and customer experience, we are well positioned to realize these opportunities. And so by both leading and partnering with our customers on new ways of working, we will grow too. For example, Goldbeck is one of Europe's largest commercial design and construction companies and a leading practitioner of industrialized construction and they use Inventor, Revit, Forge and generative design on our platform to implement their precast and modular system concept. By standardizing the invisible and customizing the visible, Goldbeck has been able to design and build highly customized and aesthetically pleasing buildings reliably, quickly and efficiently. Having unified around BIM, Goldbeck is now seeking to grow and connect beyond the design process to further improve efficiency and reduce waste through design automation during capital planning, for which it is trialing Spacemaker and great collaboration across design and build phases of construction using Autodesk Construction Cloud. With the launch of Autodesk Build, the introduction of an account-based pricing business model and distribution through our channel partners, we are extending our reach into the construction market. For example, Lee Lewis Construction, an ENR 400 general contractor from Texas, has been driving innovation through…

[Operator Instructions] Our first question comes from the line of Phil Winslow from Credit Suisse.

Andrew, just a question on you -- to you about the supply chain and the labor disruptions you talked about on the last call. I wonder if you could just give us an update on that. Just sort of what were you hearing from customers over the course of the past -- in 3 months? And then really, if you could particularly focus on the AEC vertical because one of the things you obviously did call out in the slides was record construction property news and accelerating growth there.

Yes. Thank you, Philip. Good to hear from you. So yes, so first, let me kind of frame it this way. What we saw was the kind of improvement we expected to see when we talked to you about this in Q3. So we saw some nice improvement. Our customers are saying they're feeling like they're coming out of some of these supply chain constraints. Our partners are echoing some of these things. We didn't see the off too much stick expectations we had at the beginning of the fiscal year when we expected to see acceleration in the second half. But what we saw was consistent with what we told you in Q3 in terms of the improving climate, all right? So I think with regards to AEC, in particular which, by the way, I highlighted last quarter as being the key place that was feeling the most supply chain and cost pressure in terms of in-flight projects, that's where we saw the improvement. And yes, we did have a record quarter in construction and we did end the quarter with some nice acceleration and momentum heading into next year. But consistent with what we said in Q3, all right?

Got it. And then, just in terms of the backlog of projects you've been talking about for a couple of years now. Any thoughts on what sort of the customers are telling you about that? Do you think they're going to get unstick and sort of taken care of, call it, over the next 12 months? Or how are they thinking about that backlog?

Yes. So what I can tell you is that we monitor bid board activity and we monitor the growth in active projects on Construction Cloud and BIM 360 Docs. And what we're seeing in bid board is we're seeing consistent growth in bidding activity and we're seeing an increasing number of monthly active projects on our cloud applications around Construction Cloud and BIM 360 Docs. Those are usually leading indicators of project activity and backlog getting turned into active projects. So we consider those good signs, all right, in terms of how the environment is moving.

Our next question comes from the line of Saket Kalia from Barclays.

Andrew, maybe for you, a big renewal year here in fiscal '23. As we start to see maybe some more of those 3-year product subscriptions come up for renewal this year, what's the data sort of showing, the preliminary data maybe, on sort of customers' willingness to renew at that same duration. And perhaps just as importantly, their willingness to sort of expand their usage from prior levels. Does that make sense?

Yes, it does make sense. And the short answer to this, Saket, is that the willingness to renew is the same, or in some cases, better than the willingness to renew the shorter duration contracts. So customers who like long-duration contracts, who like the price lock tend to continue to grab the price lock and move on. That's what we've seen this -- so far. Now in terms of their willingness to buy more during these things; well, that's going to depend on their individual circumstances. So I'm not going to give you any kind of specific numbers on how we're doing around their willingness to buy more. However, the net revenue to retention rates for the company are indicative of kind of how the global cohort of the company works with regards to this. So Debbie, would you like to add anything to that or comment on it?

No, I think you covered it, Andrew.

Got it. Got it. Debbie, maybe for my follow-up for you. I mean, understanding that we're just starting out fiscal '23, I was wondering if you have any thoughts on how we'll be phasing out the multiyear product subscriptions in fiscal '24? And maybe just philosophically, how you think about the shape of that impact on cash flow now that we have a sort of revised fiscal '23 view. And again, I understand it's early but any thoughts on kind of how you think that works? And the best way to think about modeling that?

Yes, sure. So we aren't giving specific guidance today for fiscal '24 and beyond as you know. But as you can imagine, it's a big area of focus for us. And we are retaining the framework that we set out at Investor Day, so let's just recap that again. It is double-digit revenue growth through fiscal '26, non-GAAP operating margins in the 38% to 40% range and double-digit compound annual growth in free cash flow through fiscal '26. Now that's after that expected decline in fiscal '24 when we institute our transition to annual billings for multiyear contracts. And as I mentioned in the prepared remarks, these metrics are intended to provide a floor to our revenue growth ambitions and a ceiling to our spend growth expectations. Now in terms of the decline for free cash flow, specifically in fiscal '24, I know there's a lot of interest in both the magnitude of it and the slope of it. And while we're not providing specifics today, here's how I think you should think about it. If I start with the slope, the slope of the free cash flow decline and then its recovery is going to depend on the pace at which our customers adopt annual billings. Right now, we intend to offer our customers a choice but we're still working through the programmatic details. Our bias is going to be to go as quickly as possible. But we have customer, partner and operational constraints that we're working through as we navigate the transition. And then to give you an order of magnitude, I'd say, look at long-term deferred as a percent of total deferred back in fiscal '20. It was in that high 20s percent zone and we should see something similar in fiscal '23 because it's that same cohort that's coming up for renewal. And so then as we move to annual billings, eventually that long-term deferred will go away. And again, our bias is to move as quickly as possible but we're still working through the operational details. We'll give you updates on all of this as we progress through fiscal '23.

You know, Saket, one thing that -- oh sorry, Saket.

No, no, no. Please go ahead, Andrew. No, please.

One thing that excites me about this post annual billings transition is that the free cash flow starts tracking to the long-term strategic drivers that I really like talking about. The digital transformation drivers that we talked about at Investor Day, including in the adjacent industries we were going in, these things are going to be what tracked and drives the growth and the behavior of the free cash flow going forward, as well as labelling all those -- leveraging all those growth enablers around business models and around noncompliance. And also, don't forget, long term, our whole effort to monetize the long tail with not only with offerings like Flex but with new types of digital channels that reach deeper into places where we might not be reaching customers today. So that's the exciting thing about getting through this for me is the free cash flow tracks with those long-term strategic drivers. That's going to be a really great outcome for us.

Our next question comes from the line of Jay Vleeschhouwer from Griffin Securities.

Andrew, Debbie, your slide deck is interesting in disclosing the 6 million subscribers at the end of the fiscal year which indicates an increase of about 700,000 from the end of fiscal '21. Is it contemplated in your guidance for fiscal '23 that you might be able to add a similar, if not larger number to the sub space this year? Second question, your disclosure about the digital sales revenue rate is very interesting. Having grown now apparently to be the plurality of your direct revenue, is it your view Andrew, that the digital sales could become perhaps evenly split with the named accounts and EBA business? Or do you think named accounts and EBA remains the majority of the direct business?

Yes. All right. So first, let me address your first question. As you recall last year and this was on me, we had those up too much stick assessments of accelerating new business growth into the second half of the year, right? We're not assuming any of that moving into this year. We're assuming things stay exactly as they are and as the conditions that we see right now are. The exception I'll give to that is that in our guidance, we did not factor in war in Ukraine, how that might affect our business is completely unclear. I mean, I thought -- probably all of you heard President Biden's speech earlier today about some of his positions on this. But when it comes to looking at next year, we're assuming that current things move forward the way they are, right? And also, just remember, that some of those subscriber increases that you saw were a result of multiuser trade-ins as well, okay? I just want to make sure that we factor some of those things. But current course and speed is the general assumption here, right? Now with regards to digital sales. Digital sales is -- it's a great example. It's our fastest-growing channel. It's not growing at the expense of our partners. Our partners are growing robustly as well. It's also a great example of what we're doing with digital productivity for ourselves and for our sales force. The digital channel reaches customers that we believe we have not historically been serving well. And they have -- they are not only finding us and buying our existing offerings, they're also engaging on some of our more forward-looking offerings like Fusion 360. So that channel is going to continue to become more powerful. And as I've said many times before, as we look out to our long-term goal of half of our revenue being direct, half of that direct revenue is going to come from this digital channel. And clearly, you can see from the way -- what we've disclosed and the growth rates here, there is line of sight to those numbers over multiple years. And that channel is going to continue to help us reach deeper into the long tail. It's going to continue to benefit from the digital productivity tools we're building just to make our general overall sales force more productive. And I have high hopes for that channel in the future. Now Debbie, did you want to add anything about, for instance, since I mentioned the Ukraine situation, anything around the specifics about our exposure there? Or anything related to that? Or anything about the digital channel?

Yes, sure. I'll cover Russia and the Ukraine. Just to be explicit, Russia and the Ukraine, they represented a bit less than 2 percentage points of our total revenue in fiscal '22. And we have similar assumptions in our fiscal '23 roll up. Obviously, events are unfolding live. That's a very fluid situation. It's a coincidence that our earnings call is today. So we haven't baked anything, any potential risk that might occur there into our guidance. We're going to be watching things closely because at this point, we don't know if there's any impact at all. We don't know if there is impact, if it would be localized to Russia and the Ukraine specifically or whether or not it becomes a broader impact across Europe and beyond. It's just too early for us to tell. What I would say, though, is that as we pointed out at our Investor Day, our business is more resilient now after the business model transition. So that's one positive in the midst of all this. But as you can imagine, it's obviously a situation that we're watching really closely and we'll continue to update you as we know more.

The net headline is, Jay, we've assumed that things are going to continue as they are current course and speed. There's no accelerations, no anticipated uplift or anything that we were looking for in the coming guidance or moving forward guidance.

Our next question comes from the line of Adam Borg from Stifel.

Maybe just on the new product subscription growth in the quarter. Last quarter, you talked about that moderating to the mid-20s after kind of being in the 30% range in the first half of the year. I guess, how did that play out in 4Q? And I'm assuming, based on your prior comments Andrew, that whatever you saw in the back half of the year, you're assuming that going forward. But I'd love to hear a little bit more color, if you can, about how that played out in 4Q?

I'm going to let Debbie take that question, Adam.

Yes. Sure. I'll go ahead and take this. So Adam, yes, we have been talking quite a bit about new volume and it is a metric that we monitor very closely. Our new volume growth decelerated a few points in Q4 and that's because of a tough comp versus Q4 last year but the growth was very healthy and it was in line with our expectations. And so that growth is effectively what we're considering as we build our guidance into next year and to just reiterate what Andrew has been saying, we're assuming that the demand environment, including that new volume growth, is built into our guidance and that there is no changes to the upside or the downside as we look ahead. But the bottom line answer is that the volume growth decelerated a few points but it was as we expected and still with very healthy growth.

Great. That's really helpful. And maybe just as a quick follow-up. It's great to see the growing traction with Autodesk Construction Cloud. And kind of as you look forward a few years, maybe for you, Andrew, how expansive do you view the ACC opportunity relative to the current portfolio? And do you have any interest at all to go deeper into the financials aspects?

Yes. Certainly, at some point, yes. But look, I've always said that we believe the construction business is Autodesk's next billion dollar business. And I'd like to add just for those of you who are looking at these things, you're probably using make -- the make revenue growth as a proxy for what we're doing. I want to make sure that you remember that because we have a diversity of business models and we offer consumption models, account-based models, subscription models that we blend the actual ACC business between our design bucket and our make bucket. So, if you look at -- if you account for EBA impact on the make side of the business, the make side of the business grew about 30%, right? So we're looking at good robust growth here. I expect that growth to continue and I continue to say that construction is Autodesk's next billion dollar business and that should be the expectation in our group [ph].

Our next question comes from the line of Matthew Hedberg from RBC Capital Markets.

Andrew, obviously, it's great to hear the results on the Construction Cloud side. I'm wondering on the manufacturing side of your business, maybe using a baseball analogy, where do you think we are at in sort of the build-out of the manufacturing cloud business relative to maybe where you wanted to get to at some point?

Yes, it's a great question, Matt, because we're kind of in this transitional phase now, where we built out the technology, we've gotten to the early adopter audiences. We've established a strong stronghold, a strong base for the product, a strong kind of early market for Fusion. I mean, you heard in the opening commentary about the 189,000-plus subscribers. We're now moving into the phase of kind of trying to drive the acceleration of the growth in that space. I think we're early on. It's probably the third inning-or-so in the process, all right? We're starting off on a good base that's -- the threshold that we've got with subscribers here is, for those of you who know the history of this whole space, that is an excellent threshold to build on. That's usually where you start to cross the threshold of getting more and more material to the business. And we've had a leadership transition recently with Scott Reese taking a great job off to go work for GE, one of our customers, by the way which is always good, really happy for him. And Jeff Kinder is stepping in as part of the succession planning process there. And Jeff Kinder cares a lot about scaling and scaling growth and scaling transformation. And I think his skill set is going to provide some excellent capabilities in this next phase but it's still really early, all right? It's still third inning-ish in this game. And I think we should expect that to look like that. But over the next 5 years, again, this is going to be a significant driver of that growth that we've been talking about beyond fiscal '24.

That's great. And then maybe just as a quick follow-up. I think it was about a year ago, maybe when some of the supply chain questions first started coming up. We talked to a number of your partners who suggested that people were using Autodesk as a way to reduce waste and just become more efficient with tight supply markets. As you reflect back on the last year, I mean, do you think that actually played out? And do you think that remains a pretty critical driver, especially in the world of supply chain or just broad ESG concerns?

Yes, absolutely. It's only going to become more important. So we actually have really compelling stories of old line industrial companies using Fusion 360, for example, at its generative capability to actually lightweight and take out mass from products and reduce their material usage for things as simple as hydraulic equipment, all right? Real-world examples and we're seeing more and more of that. With regards to construction, every redo that you eliminate is a waste -- is a reduction in waste and carbon footprint for that particular project. And as you know, more and more, it's not becoming a choice for construction firms. It's becoming a requirement. There are more and more mandates about what the carbon footprint of a particular project has to be both this embedded carbon footprint and its lifetime carbon footprint. So this capability to reduce energy, select the right materials, reduce the amount of materials used is going to become a critical differentiator for lots of people. And it's really exciting to see some of these companies that you would never expect adopting some of our newest technology simply because it helps them address that key challenge for their businesses to be more sustainable and to be greener.

Our next question comes from the line of Joe Vruwink from Baird.

First question was just more of a fact check on my part. But I'm wondering if the only change in the formal guidance you're providing today versus the preliminary view you provided last quarter, the only difference is just the strengthening in the dollar and the incremental FX headwind, is that correct?

That's correct. The overall headline is that the numbers are consistent with what we talked about last call. We've just adjusted them for our latest FX assumptions. And that's causing about 1 point of headwind to revenue growth and another about $30 million in incremental headwind to free cash flow and that's been baked into the guidance.

Okay. And then second question Andrew, I know you've said that AutoCAD maybe isn't the leading indicator that it once was but nevertheless, it did accelerate pretty nicely here at year-end. It might have been your fastest-growing business, if you've removed the upfront contribution from Media, so I'm just wondering if there's anything to kind of read between the lines there?

I think it's commensurate with an increase in monthly active usage which I still think is becoming a better proxy. So for instance, our total monthly active usage of all our products increased over 10% in Q4 year-over-year. So those 2 things correlate pretty closely. And I think that's still the proxy. But you're right, I think the AutoCAD performance is a result of that strong monthly active usage performance that we're starting to see heading into the fiscal year.

Our next question comes from the line of Steve Koenig from SMBC.

Was wondering about your -- in Q4, the kind of the elimination toning down the multiyear discounts. Kind of what was the reaction to that? And kind of how do you gauge what that will look like going forward? And then just for housekeeping, I missed the comment at the very start of the call about what drove -- the other line did very well. And I think there was some upfront revenue there. Could you just provide me that color again?

Thanks, Steve. Just lots to unpack there but let's start at the top on multiyear. So yes, we did see a discount change from 10% to 5% in the past quarter. And obviously, when we adjust pricing, we do see some customers take advantage of the window and buy ahead of that when the price change goes into effect. We saw a similar behavior with this price adjustment and that's as expected. We're always going to be looking at ways to optimize our business. This is just one example of that. And I'd also say that the multiyear renewal rates remained firm even after that discount reduction. And then in terms of other revenue, yes. Other revenue tends to be a little bit of a mixed bag but the other revenue is in part what drove the beat in our Q4 revenue. And a piece of that -- the big piece of that is non-cloud-enabled products that we sell through our EBAs that are recognized upfront. We typically see our highest EBA volume in Q4. And depending on the composition of those deals, it can sometimes drive a slight surge in upfront revenue as a result and that's what we saw in Q4 in the beat in and what you're seeing in other. We continue to expect, however, that upfront and other is going to be a relatively small part of our business over time and that recurring revenue should be 95% or greater.

Our next question comes from the line of Sterling Auty from JPMorgan.

Debbie, I want to circle back to cash flow. You had made the mention that there are some constraints from customers and partners on shift to annual billings. Can you give us maybe a quick example of what some of those constraints might be? And why you might not just be able to rip off the Band-Aid and move quicker to annual billings now?

Yes. So as I mentioned back at the Investor Day, we do -- the first part is operational. So we are upgrading our systems to be able to handle this volume of multiyear contracts with annual billings at scale our systems don't provide for that capability today and it's a major system overhaul that we're working on and it's going to take us some time. And we're looking at how fast we can create that capability and over what time period. Again, I'd say that our bias is that we execute on this transition right away when we get to fiscal '24 but it is going to take us time and continued investment in both dollars and people to make sure that our systems are set up for that. And so we're looking at that right now. The second piece that we talked about at Investor Day that still is important to us is that our partners are very important to Autodesk, very important to our growth, very important to -- in our ability to drive breadth and depth across the globe and engaging with customers. And our partners, we want to make sure that we work with them as we execute on this transition to make sure that we optimize not only for us and for our customers but also for those partners that are important to us. And so we're going to be looking at the programmatic details of that over the next year with an eye towards making sure that we've set ourselves up for success in the entire ecosystem as we get to that start of fiscal '24.

Understood. Makes sense. And then maybe one follow-up. Outside of the $30 million FX headwind on free cash flow for fiscal '23, how else would we kind of think about the bridge from the guidance that you've given to the previous long-term target that was there?

Sure. So the previous long-term target was $2.4 billion. And on the last call, we talked about a couple of hundred million in risk to that, that was broken down roughly equally between the macro backdrop and FX. And then we have an incremental $30 million in FX now given the continued strengthening of the dollar in the last 90 days. So net-net, it's about $100 million in macro or business risk. Again, that we highlighted on the last call and then a total of $130 million risk from FX and that continued strengthening of the dollar and that's why you see the midpoint of the guide right there at that $2.17 billion.

Our next question comes from the line of Jason Celino from KeyBanc Capital.

Maybe just a couple for Andrew. I kind of want to go a little deeper on the architecture side of your business and this is obviously your bread and butter. How would you describe kind of the end market environment right now for that segment? And then what kind of growth initiatives should we be thinking of for this year and long term?

Yes. So architecture is coming out of this situation as coming out of pandemic, you've seen that there -- the index that drives our architecture activity is going up consistently. So architects are feeling better about the future and architects are also investing more in BIM which is the critical part of their transition from 2D-based practices to 3D-based practices. So that trend is going to continue. That's part of the bigger long-term digitization trend that we're seeing in architecture, in particular. More and more people are moving to 3D processes, 3D BIM and they're looking to adopt Revit and tools like Revit more aggressively so that they can stay competitive in the new world of the market. It's also a lot of increased labor productivity for them. So they're going to be looking at some of these new tools that allow them to do more with the labor pool they have, especially in the tight labor market. So that's where we're looking at with construction. The ongoing digitization move to BIM, that's going to accelerate as architects continue to get more optimistic about their project pipeline. But all the data is out there saying that we're seeing a better pipeline for the architecture segment.

Yes. And then when I kind of just think about the architecture job, is it unfair to think that maybe that role, in particular, has been hit maybe harder than some of the other jobs within AEC?

It certainly was hit harder early on. There's no doubt about it, all right? It was the least prepared for remote work because it was essentially an office-type profession. It has adapted. They have certainly adopted our cloud-based tools at a rate significantly higher than prior to the pandemic. So they've gotten on to BIM Collaborate and BIM Collaborate Pro at higher rates than we ever saw previously. So they're adapting but yes, early on in this, the pandemic and in the last few years, they were hit relatively harder. But they're coming back and they're adapting. They still have to build up their book of business, they still have to build up their cushion but that segment is absolutely coming back. And it's coming back in the cloud too.

Thank you. That's all the time we have for Q&A today. I'll now hand the program back to Simon Mays-Smith for any further remarks.

Thanks, everyone, for coming along. If you have any further questions, please do get in touch with me. Otherwise, we'll look forward to updating you on our Q1 results call. Thanks so much.

Thank you, ladies and gentlemen, for your participation in today's conference. This does conclude the program. You may now disconnect. Good day.