Citrix Reports Second Quarter Financial Results
Quarterly revenue of $843 million up 6 percent year over year Quarterly GAAP operating margin of 18 percent; non-GAAP operating margin of 28 percent Quarterly GAAP diluted EPS of $0.77; non-GAAP diluted EPS of $1.20
SANTA CLARA, Calif. — July 26, 2016 — Citrix Systems, Inc. (NASDAQ:CTXS) today reported financial results for the second quarter of fiscal year 2016 ended June 30, 2016.
For the second quarter of fiscal year 2016, Citrix achieved revenue of $843 million, compared to $797 million in the second quarter of fiscal year 2015, representing 6 percent revenue growth.
Net income for the second quarter of fiscal year 2016 was $121 million, or $0.77 per diluted share, compared to $103 million, or $0.64 per diluted share, for the second quarter of fiscal year 2015. GAAP net income includes net tax benefits of approximately $21 million, or $0.13 per diluted share, for the second quarter of fiscal year 2015 primarily related to the closing of audits with the IRS for certain tax years. In addition, net income for the second quarter of fiscal year 2016 includes $14 million in separation costs associated with the previously announced spin-off of the GoTo business.
Non-GAAP net income for the second quarter of fiscal year 2016 was $188 million, or $1.20 per diluted share, compared to $163 million, or $1.00 per diluted share for the second quarter of fiscal year 2015. Non-GAAP net income for the second quarter of fiscal years 2016 and 2015 excludes the effects of stock-based compensation expense, amortization of acquired intangible assets, amortization of debt discount, restructuring charges, and the tax effects related to these items. Non-GAAP net income for the second quarter of fiscal year 2016 also excludes separation costs associated with the previously announced spin-off of the GoTo business and the tax effect related to this item.
“I am very encouraged by our performance this quarter. It’s a clear signal that our renewed focus on the strategy to deliver the world’s best integrated technology services for secure delivery of apps and data is resonating well with our customers and the market,” said Kirill Tatarinov, president and CEO of Citrix. “Our restructuring efforts and continued progress on creating a ‘new Citrix’ are producing strong results.”
Q2 Financial Summary
In reviewing the results for the second quarter of fiscal year 2016 compared to the second quarter of fiscal year 2015:
During the second quarter of fiscal year 2016:
Financial Outlook for Third Quarter 2016
Citrix management expects to achieve the following results at the consolidated level for the third quarter of fiscal year 2016 ending September 30, 2016:
Financial Outlook for Fiscal Year 2016
Citrix management expects to achieve the following results at the consolidated level for the fiscal year ending December 31, 2016:
The above statements are based on current targets. These statements are forward-looking, and actual results may differ materially.
Second Quarter Earnings Conference Call
Citrix will host a conference call today at 5:15 p.m. ET to discuss its financial results, quarterly highlights and business outlook. The call will include a slide presentation, and participants are encouraged to listen to and view the presentation via webcast at http://www.citrix.com/investors.
The conference call may also be accessed by dialing: (888) 799-0519 or (706) 634-0155, using passcode: CITRIX. A replay of the webcast can be viewed for approximately 30 days on the Investor Relations section of the Citrix corporate website at http://www.citrix.com/investors.
Citrix (NASDAQ:CTXS) is leading the transition to software-defining the workplace, uniting virtualization, mobility management, networking and SaaS solutions to enable new ways for businesses and people to work better. Citrix solutions power business mobility through secure, mobile workspaces that provide people with instant access to apps, desktops, data and communications on any device, over any network and cloud. With annual revenue in 2014 of $3.14 billion, Citrix solutions are in use at more than 400,000 organizations and by over 100 million users globally. Learn more at www.citrix.com.
For Citrix Investors
This release contains forward-looking statements which are made pursuant to the safe harbor provisions of Section 27A of the Securities Act of 1933 and of Section 21E of the Securities Exchange Act of 1934. The forward-looking statements in this release do not constitute guarantees of future performance. Investors are cautioned that statements in this press release, which are not strictly historical statements, including, without limitation, statements by Citrix's president and chief executive officer, statements contained in the Financial Outlook for Fiscal Year 2015 and Third Quarter 2015 sections and under the Non-GAAP Financial Measures Reconciliation section, statements related to Citrix’s exploration of strategic alternatives regarding the GoTo family of products, statements related to Citrix’s potential sale of its ByteMobile business, statements concerning the formation of an Operations Committee of the Board of Directors of Citrix and its review of operations and capital structure, and statements regarding management's plans, objectives and strategies, constitute forward-looking statements. Such forward-looking statements are subject to a number of risks and uncertainties that could cause actual results to differ materially from those anticipated by the forward-looking statements, including, without limitation, the impact of the global economy, foreign exchange rate volatility and uncertainty in the IT spending environment; the success and growth of the company's product lines, including competition, demand and pricing dynamics and other transitions in the markets for Citrix’s virtualization products and collaboration services; the company’s ability to develop and commercialize new products and services, including its enterprise mobility products, while growing its established virtualization, networking and collaboration products and services; the uncertainty as to which strategic alternatives may be available with respect to the GoTo family of products, whether any transaction will be commenced or completed, and the timing and value of any such transaction; the uncertainty as to a potential sale of the ByteMobile business, whether such sale will be completed, and the timing and value of any such sale transaction; disruptions to execution due to Citrix’s restructuring programs and operational review, review of strategic alternatives with respect to the GoTo family of products, potential sale of the ByteMobile business and changes and transitions in key personnel and succession risk; risks associated with the on-going CEO succession process; the introduction of new products by competitors or the entry of new competitors into the markets for Citrix's products and services; changes in our revenue mix towards products and services with lower gross margins; seasonal fluctuations in the company's business; failure to execute Citrix's sales and marketing plans; failure to successfully partner with key distributors, resellers, system integrators, service providers and strategic partners and the company's reliance on and the success of those partners for the marketing and distribution of the company's products; the company's ability to maintain and expand its business in small sized and large enterprise accounts; the size, timing and recognition of revenue from significant orders; the success of investments in its product groups, foreign operations and vertical and geographic markets; the ability of Citrix to make suitable acquisitions on favorable terms in the future; risks associated with Citrix's acquisitions, including failure to further develop and successfully market the technology and products of acquired companies, failure to achieve or maintain anticipated revenues and operating performance contributions from acquisitions, which could dilute earnings, the retention of key employees from acquired companies, difficulties and delays integrating personnel, operations, technologies and products, disruption to our ongoing business and diversion of management's attention from our ongoing business; the recruitment and retention of qualified employees; risks in effectively controlling operating expenses, including failure to achieve anticipated cost savings from the restructuring programs, the planned review by the Operations Committee of the Board of Directors and other cost reduction initiatives; ability to effectively manage our capital structure and the impact of related changes on our operating results and financial condition; risks and costs associated with engaging with activist stockholders; the effect of new accounting pronouncements on revenue and expense recognition; the risks associated with securing data and maintaining security of our networks and customer data stored by our services; failure to comply with federal, state and international regulations; litigation and disputes, including challenges to our intellectual property rights or allegations of infringement of the intellectual property rights of others; the inability to further innovate our technology or enter into new businesses due to the intellectual property rights of others; changes in the company's pricing and licensing models, promotional programs and product mix, all of which may impact Citrix's revenue recognition; charges in the event of a write-off or impairment of acquired assets, underperforming businesses, investments or licenses; international market readiness, execution and other risks associated with the markets for Citrix's products and services; unanticipated changes in tax rates, non-renewal of tax credits or exposure to additional tax liabilities; risks of political and social turmoil; and other risks detailed in the company's filings with the Securities and Exchange Commission. Citrix assumes no obligation to update any forward-looking information contained in this press release or with respect to the announcements described herein.
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