SECURE DIGITAL WORKSPACE
Citrix Announces Leadership Transition to Accelerate Cloud Transformation, Enhance Profitability and Return Capital to Shareholders
David J. Henshall Appointed President and Chief Executive Officer. Mark M. Coyle to Serve as Interim Chief Financial Officer. Board Forms Operations and Capital Committee with Focus on Margin Expansion and Capital Allocation. Robert Calderoni, Executive Chairman, to Lead Operations and Capital Committee. Reaffirms Guidance for the Second Quarter
FORT LAUDERDALE, Florida, July 10, 2017 ― Citrix Systems, Inc. today announced that its board of directors has appointed David J. Henshall, chief financial officer and chief operating officer of Citrix, as president, chief executive officer (CEO) and a member of the board, effective immediately. Mr. Henshall’s appointment follows the mutual separation decision between the Citrix board and Kirill Tatarinov, president, CEO and director of Citrix.
The Citrix board has identified the leadership team to drive the company’s long-term strategy and growth, led by David Henshall. In addition to product excellence and growth, Citrix is committed to operational efficiency and value creation. This includes a series of strategic initiatives intended to drive operating margin expansion, increase capital return and facilitate further investment in accelerating Citrix’s transformation to a cloud-based subscription business and in high-growth areas, such as data security and analytics services. Citrix will provide additional details on these initiatives on the upcoming second quarter earnings call.
“David is a proven leader who knows our company inside and out, and the board has the utmost confidence in him,” said Robert Calderoni, executive chairman of the Citrix board. “Moving forward, the board believes that accelerating our cloud transformation will position the company for even greater success in the years ahead, driving greater value for our shareholders. We now have the right team in place to execute on that vision.”
David Henshall said, “We have a talented team at Citrix, and I am honored to lead Citrix through this new chapter. We have created an impressive platform of best-in-class products and services that customers and partners rely on every day to embrace the future of work. I can assure you that we will continue to deliver and innovate for our customers and partners as we move forward as a more powerful Citrix. Citrix will also leverage Bob’s extensive experience successfully leading software companies through a transition to the cloud and establishing subscription-based businesses.
“Q2 demonstrated that the momentum of our cloud transformation is accelerating, resulting in a year-over-year double-digit increase in deferred revenue. Broad-based demand from customers for Citrix Cloud and other subscription solutions was strong, demonstrating the value of the innovation we are delivering to customers and partners.”
Mr. Calderoni concluded, “On behalf of the entire Citrix board, I want to thank Kirill for his leadership. The progress we made under his leadership has positioned Citrix well for the next phase of its corporate transformation.”
In connection with Mr. Henshall’s appointment, Mark M. Coyle, Senior Vice President, Finance, has been appointed interim CFO, effective immediately. The Company has retained a leading executive search firm to assist in a comprehensive search process to identify a permanent CFO with both internal and external candidates being considered.
The Board has also formed an Operations and Capital Committee that will work with Citrix’s management team and advise the Citrix Board on a comprehensive review of opportunities to drive margin expansion and return capital to shareholders. The Committee will be led by Citrix Executive Chairman, Robert Calderoni, joined by Citrix President and CEO, David Henshall, and Citrix Directors, Jesse Cohn and Peter J. Sacripanti.
Reaffirms Guidance for the Second Quarter
Citrix also reaffirmed guidance for the second quarter of fiscal year 2017 ended June 30, 2017. Revenue for the quarter is expected to be in line with the company’s current guidance of $685 million to $695 million with strong demand from customers for subscription-based solutions.
Net income for the second quarter of fiscal year 2017 per diluted share is expected to be in line with the company’s current guidance of $0.70 to $0.74 per diluted share. Non-GAAP net income for the second quarter of fiscal year 2017 per diluted share is expected to be in line with the company’s current guidance of $0.97 to $1.00 per diluted share. Non-GAAP net income for the second quarter of fiscal year 2017 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.
The above statements are based on management's initial review of operations for the quarter ended June 30, 2017, remain subject to change based on management's ongoing review of the second quarter results and actual results may differ materially.
Second Quarter 2017 Earnings Call
Citrix will host a conference call Wednesday, August 2, 2017 at 4:45 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 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.
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Citrix (NASDAQ:CTXS) aims to power a world where people, organizations and things are securely connected and accessible to make the extraordinary possible. Its technology makes the world’s apps and data secure and easy to access, empowering people to work anywhere and at any time. Citrix provides a complete and integrated portfolio of Workspace-as-a-Service, application delivery, virtualization, mobility, network delivery and file sharing solutions that enables IT to ensure critical systems are securely available to users via the cloud or on-premise and across any device or platform. With annual revenue in 2016 of $3.42 billion, Citrix solutions are in use by more than 400,000 organizations and over 100 million users globally. Learn more at www.citrix.com.
For Citrix Investors
This release contains forward-looking statements that 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 CEO and president, statements contained in the Financial Outlook sections and under the Non-GAAP Financial Measures Reconciliation section, 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, risks associated with failure to complete the separation of the GoTo Business and proposed Reverse Morris Trust transaction with LogMeIn on a timely basis or at all, and the related disruptions to management and the GoTo Business; risks associated with the future performance of core Citrix if the proposed transaction with LogMeIn is completed, failure to achieve the expected strategic, operational and competitive benefits of the proposed separation of the GoTo Business, and the effect of the separation on Citrix, its shareholders, customers, partners and employees; tax risks related to the separation of the GoTo Business; the impact of the global economy, volatility in global stock markets, 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 and networking products and secure data services; the introduction of new products by competitors or the entry of new competitors into the markets for Citrix's products and services; the concentration of customers in Citrix’s networking business; the company's ability to develop, maintain a high level of quality and commercialize new products and services while growing its established virtualization and networking products and services; risks associated with transitions in key personnel and succession risk; 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 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 large enterprise accounts and reliance on large service provider customers; 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 and divestitures, 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, failure to realize expected benefits or synergies from divestitures; the recruitment and retention of qualified employees; risks in effectively controlling operating expenses; ability to effectively manage our capital structure and the impact of related changes on our operating results and financial condition; 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; the ability to maintain and protect our collection of brands; 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; risks related to servicing our debt; unanticipated changes in tax rates, non-renewal of tax credits or exposure to additional tax liabilities; risks of political uncertainty 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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