Autodesk ( ADSK) on Thursday reported that income and revenue were down year over year in the company's first fiscal quarter and warned that the current quarter would not meet Wall Street's expectations.

In the April quarter, net income for the maker of design and special effects software was $7.5 million, or 7 cents per share, compared with $17.6 million, or 15 cents per diluted share in the year-earlier period, according to generally accepted accounting principles. Revenue was $211 million, down 8% year over year.

However, revenue grew by 8% sequentially and EPS rose a penny compared with the fourth quarter. And the results were better than expected by analysts who had projected income of 5 cents on revenue of $205.9 million.

But looking to the second quarter, the company expects revenue to range from $207 million to $212 million, well below expectations. Net income will range from 7 cents to 10 cents a share.

Analysts polled by Thomson First Call expect the company to earn a net profit of 13 cents in the July quarter on sales of $217.6 million.

CEO Carol Bartz called the sequential growth a good beginning to the year and said in a prepared statement: "These results confirm that our new releases provide customers with the increased productivity and quick return on investment that they demand."

Autodesk is best known for AutoCAD, a longtime staple of engineering workstations. AutoCAD and its cheaper version, AutoCAD LT, last year accounted for just under 50% of the company's revenue.

Four years ago, the company purchased special effects software developer Discreet, and products derived from that acquisition now account for about 16% of the company's revenue. AutoCAD software is now popular in Hollywood and has been used on a number of films that won Academy Awards for special effects, including the first two installations of Lord of the Rings.

Last fiscal year was not a good one for the company; revenue declined 14% and income was off by 65%. In the last quarter of the fiscal year 2003, which ended Jan. 31, revenue was off by 23% year over year and income dropped to 6 cents a share from 19 cents.

Also hurting last year was the company's Discreet division, which lost money for eight straight quarters due to the collapse of the advertising market, Bartz said during a conference call. The division returned to profitability in the first quarter, she said.

Some of the company's top-line problems in fiscal 2003 were likely caused by an aging product line.

However, Autodesk announced 16 new products earlier this year, and all were shipped by the end of the April quarter. "There is no doubt that people are impressed with the 2004 products, but there is also no doubt that the environment is tough," wrote analyst Gene Munster, who follows the company for US Bancorp Piper Jaffray, which has a banking relationship with Autodesk. Munster said his recent channel checks don't show signs of a last-minute surge in sales and notes that customers seem to have little sense of urgency to purchase.

Munster wrote that "significant growth (in the July quarter) could be difficult until Autodesk is able to implement promotions that instill a sense of urgency into customers and the overall environment improves."

In regular trading Thursday,Audodesk gained 27 cents, or 1.8%, to close at $15.54. After-hours shares were down about 4.2%.