Citrix Systems, Inc. (Nasdaq:CTXS) today reported financial results for the third quarter of fiscal 2009 ended September 30, 2009.
FINANCIAL RESULTS:
In the third quarter of fiscal 2009, Citrix achieved revenue of $401 million, compared to $399 million in the third quarter of fiscal 2008.
GAAP Results:
Net income for the third quarter of fiscal 2009 was $53 million, or $0.29 per diluted share, compared to $49 million, or $0.26 per diluted share, for the third quarter of 2008.
Non-GAAP Results:
Non-GAAP net income in the third quarter of fiscal 2009 and 2008 was $80 million, or $0.43 per diluted share. Non-GAAP net income for both periods excludes the effects of amortization of intangible assets primarily related to business combinations and stock-based compensation expense and the tax effects related to those items.
In addition, non-GAAP net income for the third quarter of 2009 excludes charges recorded in connection with the restructuring program that the company implemented in January 2009, and the tax effects related to those items.
“I'm pleased with our solid third quarter results," said Mark Templeton, president and chief executive officer for Citrix. “Our sales, product and operational teams executed very well in a tough economic climate to not only post good results, but to strengthen Citrix leadership in the web collaboration, desktop virtualization and datacenter transformation markets.”
Q3 Financial Summary:
In reviewing the third quarter results of 2009, compared to the third quarter of 2008:
•Product license revenue decreased 18 percent;
•Revenue from license updates grew 7 percent;
•Online services revenue grew 21 percent;
•Technical services revenue, which is comprised of consulting, education and technical support, grew 20 percent;
•Revenue decreased in the EMEA region by 15 percent; decreased in the Pacific region by 5 percent; and increased in the America’s region by 5 percent;
•Deferred revenue grew to $556 million, compared to $481 million on September 30, 2008;
•GAAP operating margin was 14 percent for the quarter and non-GAAP operating margin was 25 percent for the quarter, excluding the effects of amortization of intangible assets primarily related to business combinations, stock-based compensation expense and costs associated with the restructuring program;
•Cash flow from operations was $134 million; and
•The company repurchased 2.1 million shares at an average price of $35.56.
Financial Outlook:
Due to the volatility of market conditions in the foreseeable future, it is more likely that the company’s actual results could differ materially from expectations. Similar to the financial outlook we have provided for the last two fiscal quarters, Citrix is continuing to provide less quantitative guidance than it has historically.
Financial Outlook for Fourth Quarter 2009
Citrix management expects to achieve the following results during its fourth fiscal quarter 2009 ending December 31, 2009:
•Net revenue is expected to increase three to four percent compared to the fourth quarter of 2008; and
•Non-GAAP operating margin is expected to increase 50 to 100 basis points compared to the fourth quarter 2008, excluding the effects of amortization of intangible assets primarily related to business combinations, stock-based compensation expense, and restructuring charges as well as prior year exclusions of in-process research and development related to business combinations.
•Interest income is expected to be $5 million.
The above statements are based on current expectations. These statements are forward-looking, and actual results may differ materially.
Financial Outlook for Fiscal Year 2009
The company’s financial outlook for the full fiscal year 2009 for both net revenue and non-GAAP operating margin remains unchanged.
•The company expects net revenue to increase modestly as compared to 2008; and
•Non-GAAP operating margin is expected to increase by as much as 100 basis points compared to non-GAAP operating margin from the prior year, excluding the effects of amortization of intangible assets primarily related to business combinations, stock-based compensation expense, and restructuring charges, as well as prior year exclusions of in process research and development related to business combinations.
The above statements are based on current expectations. These statements are forward-looking, and actual results may differ materially.
Preliminary Financial Outlook for Fiscal Year 2010
The company’s preliminary financial outlook for the full fiscal year 2010 is for net revenue to increase between eight and nine percent over full fiscal year 2009, and to continue operational leverage to drive a 75 to 100 basis point expansion in non-GAAP operating margin over the full fiscal year 2009. Non-GAAP operating margin excludes the effects of amortization of intangible assets primarily related to business combinations, stock-based compensation expense, and restructuring charges.
The above statements are based on current expectations. These statements are forward-looking, and actual results may differ materially.
During the third quarter of 2009, Citrix announced:
•Availability of enhancements to Citrix® XenApp™ 5 including the ability to deliver on-demand applications from virtual machines (VMs) for 100 percent application compatibility, as well as new HDX™ 3D technology, also available in Citrix® XenDesktop®, that provides a high-definition experience for even the most intensive multimedia applications.
•Availability of the Citrix® NetScaler® VPX™ virtual appliance as well as a new Citrix Ready™ Open Networking Program to support it.
•Two new midrange appliances to the Citrix® NetScaler® MPX™ family of application networking systems that offer full enterprise functionality at a lower cost and half the power consumption of competing solutions.
•Xen.org introduced the Xen® Cloud Platform (XCP) initiative to accelerate the adoption of open source, enterprise-class cloud computing infrastructures.
•Downloads and activations of the free Citrix® XenServer™ virtualization platform surged this quarter, now totaling more than 150,000 users for the year – including 20 percent of Fortune 500 companies – in over 50 countries.