Autodesk (NASDAQ:ADSK) shares are down 12% after the company reports Q3 results that beat EPS and revenue estimates. Q4 guidance has revenue from $537M to $547M (consensus: $544.8M) and EPS from -$0.14 to -$0.10 (consensus: -$0.14).

FY18 guidance: $2.04B to $2.05B (consensus: $2.05B); EPS, -$0.53 to -$0.49 (consensus: -$0.54).

Key metrics: Subscription plan annualized recurring revenue, $924M (+108% Y/Y); total ARR, $1.9B (+25%); Subscription plan subscriptions, 1.9M (+307K Q/Q); total subscriptions, 3.6M (+146K Q/Q); deferred revenue, $1.76B (+15%); unbilled deferred revenue, $148M.

Restructuring plan: Autodesk announces a restructuring plan to prioritize the subscription transition, which will involve some divestments. The company expects to take a pre-tax restructuring charge of $135M to $149M with $91M to $100M taken in Q4 and the rest in FY19.

“We are pleased with another solid quarter of execution and progress on our business model transition,” said Andrew Anagnost, Autodesk president and CEO.  “We’re experiencing healthy trends in several key transition metrics, including ARR and deferred revenue growth, as customers continue to embrace our new subscription offerings.  As we enter the growth phase of our model transition, we need to re-balance investments to focus on our strategic priorities. This includes divesting from some areas and increasing our investment in others.  We’re taking this restructuring action from a position of strength.  This is not a cost reduction activity as we maintain our commitment to keep total non-GAAP spend flat this year and next.”

“Our third quarter results mark our return to revenue growth as we reached the one year mark of subscription-only sales,” said Scott Herren, Autodesk CFO.  “We are excited to have reached a significant milestone where the base of subscription plan subscriptions has surpassed the base of maintenance plan subscriptions for the first time.  We are also experiencing early success with the maintenance-to-subscription program, which is a winning combination for both our customers and Autodesk.  Our solid third quarter results and stable macro operating environment keep us confident in our near-term and long-term goals.”

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