Autodesk cuts 9% of workforce as company pivots toward AI and cloud services

Autodesk Inc. (NASDAQ: ADSK) has announced a major workforce reduction, impacting approximately 1,350 employees, or 9% of its global workforce. The move is part of a broader restructuring strategy aimed at prioritizing artificial intelligence (AI) and cloud computing. While Autodesk’s fiscal 2025 fourth-quarter and full-year earnings report reflected solid financial performance, company executives have emphasized the need to optimize operations and shift resources toward high-growth areas.

The restructuring effort underscores Autodesk’s strategic transition toward AI-driven design and cloud-based solutions, reinforcing its long-term vision of integrating automation and data-driven insights into its software ecosystem. The layoffs, which come as part of a worldwide restructuring plan, will also include facility reductions and operational realignment, resulting in expected pre-tax charges of $135 million to $150 million.

How does Autodesk’s restructuring align with its AI and cloud strategy?

Autodesk’s leadership has framed the workforce reduction as a necessary step to accelerate the company’s shift toward AI and cloud-based platforms. President and Chief Executive Officer Andrew Anagnost stated that the company is committed to the convergence of design and make in the cloud, focusing on developing industry-specific cloud services that leverage machine learning, automation, and intelligent design tools.

With 97% of Autodesk’s total revenue coming from recurring subscription services, the company sees cloud-based design, engineering, and manufacturing software as its key growth driver. The transition involves reallocating internal resources toward core strategic areas, including its AI-enhanced Design and Make platform. Autodesk’s cloud-first approach aims to provide customers with seamless, collaborative workflows, reducing friction in product development, construction, and digital design.

What financial trends support Autodesk’s business transformation?

Despite the restructuring, Autodesk’s latest earnings report revealed a strong financial outlook, with total revenue for the fourth quarter of fiscal 2025 increasing by 12% year over year to $1.64 billion. The company’s non-GAAP operating margin improved to 37%, compared to 36% in the previous year, reflecting operational efficiency and disciplined execution.

The company’s subscription revenue reached $1.52 billion, a 14% increase from the previous year, reaffirming the strength of its subscription-based business model. Autodesk’s Make revenue—associated with its cloud services—grew 28% year over year, further highlighting the company’s growing reliance on AI and cloud-based solutions.

Chief Financial Officer Janesh Moorjani emphasized that the completion of Autodesk’s new transaction model in Q4 was a significant milestone. The transition to a fully optimized sales and marketing structure is expected to deliver GAAP margins among the highest in the industry once fully implemented.

What are the expected impacts of Autodesk’s restructuring on employees and operations?

The layoffs at Autodesk are expected to result in immediate cost savings and streamline operations, but the impact on employee morale and company culture remains a key consideration. Autodesk executives have stated that the workforce reduction is not merely a cost-cutting measure but rather a strategic reallocation of talent toward emerging priorities.

While the restructuring will involve job cuts across various departments, Autodesk has not specified which regions or business units will be most affected. The company has emphasized its commitment to supporting employees through the transition, offering severance packages and career assistance programs.

As Autodesk navigates this workforce reduction, investors and analysts are closely monitoring how the restructuring will affect productivity, innovation, and overall growth. While the shift toward AI-driven solutions is seen as a long-term positive, some industry experts have raised concerns about whether reducing headcount could impact Autodesk’s ability to execute on its ambitious AI strategy.

How are investors reacting to Autodesk’s restructuring and AI strategy?

Following the restructuring announcement, Autodesk’s stock performance has remained stable, with investors largely focusing on the company’s strong financial results and AI-driven growth potential. Analysts note that Autodesk’s ability to maintain double-digit revenue growth, despite restructuring costs, indicates strong demand for its software solutions.

The company’s commitment to persistent share repurchases and disciplined financial management has further reassured investors. Autodesk has projected a full-year fiscal 2026 revenue of $6.89 billion to $6.96 billion, with a non-GAAP EPS range of $9.34 to $9.67, signaling confidence in its AI-driven business model.

Some analysts, however, are watching closely to see how the company balances cost-cutting with continued investment in AI and cloud innovation. The long-term success of the restructuring will depend on whether Autodesk can effectively leverage AI and automation to drive higher efficiency and innovation without sacrificing product development.

What does Autodesk’s future look like in an AI-driven industry?

As AI continues to reshape design, engineering, and manufacturing, Autodesk is positioning itself to be a leader in AI-powered automation for architects, engineers, and digital creators. By integrating AI-driven insights into its software ecosystem, the company aims to enhance creativity, optimize workflows, and improve design efficiency.

The restructuring, while challenging for affected employees, underscores Autodesk’s commitment to long-term technological innovation. The company’s focus on AI, cloud computing, and industry-specific solutions suggests that it sees the future of design and engineering as increasingly data-driven and automated.

Autodesk’s transition aligns with broader industry trends, as major software companies increasingly invest in AI-driven tools and cloud-based services. If Autodesk successfully executes its AI and cloud strategy, it could strengthen its competitive position in the global design software market, ensuring sustainable growth in an evolving digital landscape.

Autodesk’s decision to cut 9% of its workforce marks a pivotal moment in its transformation toward AI-driven and cloud-based solutions. While the restructuring involves short-term challenges, including workforce reductions and restructuring costs, the company’s strong financial performance and commitment to innovation suggest a long-term growth trajectory.

As Autodesk moves forward with its AI-powered Design and Make strategy, the focus remains on enhancing efficiency, streamlining workflows, and delivering high-value solutions to customers. Investors and industry analysts will continue to watch how effectively Autodesk can balance cost optimization with continued investment in AI and automation.

With a solid financial foundation, a clear strategic vision, and a focus on AI-driven cloud solutions, Autodesk is positioning itself for a future defined by intelligent, data-driven design and engineering.