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Citrix Reports Q1 09 Financial Results

Citrix Systems, Inc., the global leader in application delivery infrastructure, today reported financial results for the first quarter of fiscal 2009 ended March 31, 2009.

In the first quarter of fiscal 2009, Citrix achieved revenue of $369 million, compared to $377 million in the first quarter of fiscal 2008, representing a 2 percent decrease in revenue.

GAAP Results

Net income for the first quarter of fiscal 2009 was $7 million, or $0.04 per diluted share compared to $34 million, or $0.18 per diluted share, for the first quarter of 2008. These GAAP results include a restructuring charge of approximately $21 million.

Non-GAAP Results

Non-GAAP net income in the first quarter of fiscal 2009 was $59 million, or $0.32 per diluted share, compared to $66 million, or $0.35 per diluted share, in the comparable period last year. Non-GAAP net income excludes the effects of amortization of intangible assets primarily related to business combinations and stock-based compensation expenses and the tax effects related to those items. In addition, non-GAAP net income for the first quarter of 2009 also excludes the effect of the restructuring program that the company implemented in January 2009.

"I’m pleased with our Q1 execution in the toughest macro environment we’ve seen in years," said Mark Templeton, president and chief executive officer. "Smaller IT budgets are the new reality. We believe this makes our enterprise and SaaS products even more compelling because they lower IT costs while offering much-needed business flexibility."

In addition to quarterly financial results, Citrix also announced that its board of directors has authorized it to repurchase up to an additional $300 million of its common stock. As of March 31, 2009, approximately $50 million remained in authority from previous approvals.

Q1 Financial Summary

In reviewing the first quarter results of 2009, compared to the first quarter of 2008:

  • Product license revenue decreased 24 percent;
  • Revenue from license updates grew 11 percent;
  • Online services revenue grew 16 percent;
  • Technical services revenue, which is comprised of consulting, education and technical support, grew 8 percent;
  • Revenue decreased in the America’s region by 1 percent; the EMEA region by 11 percent, and the Pacific region by 9 percent;
  • Deferred revenue totaled $535 million, compared to $459 million on March 31, 2008;
  • GAAP operating margin was 1 percent for the quarter, and non-GAAP operating margin was 19 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 $82 million; and
  • The company repurchased 1.1 million shares at an average price of $22.66.

Financial Outlook

Due to the volatility of market conditions in the foreseeable future, it is more likely that Citrix’s actual results could differ materially from expectations. Consequently, the company is providing less quantitative guidance than in previous quarters.

Financial Outlook for Second Quarter 2009

Citrix management expects to achieve the following results during its second fiscal quarter 2009 ending June 30, 2009:

  • Net revenue is expected to be flat to slightly down compared to the net revenue reported for the second quarter of 2008; and,
  • Non-GAAP operating margin is expected to increase between 100 and 150 basis points compared to the second quarter 2008, excluding 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.

Financial Outlook for Fiscal Year 2009

Citrix management currently expects to achieve the following results for the fiscal year 2009:

  • The company expects net revenue to be flat as compared to 2008; and,
  • Non-GAAP operating margin to increase by as much as 100 basis points as 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 program, 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.

Company, Product and Alliance Highlights

During the first quarter of 2009, Citrix:

  • Unveiled a set of new improvements to its flagship application delivery product line, Citrix® XenApp��, that make delivering Windows® applications as an on-demand service even easier and more cost-efficient for IT;
  • Announced Citrix® HDX™ technology for Citrix® XenDesktop™ and Citrix XenApp, a broad set of capabilities that provide users with the best “high-definition experience” for virtual desktops and applications;
  • Unveiled a new version of Citrix® XenServer™ – the company’s enterprise-class, cloud-proven virtualization platform – offered free of charge to any user for unlimited production deployment;
  • Extended its collaboration with Microsoft into the server virtualization market with the availability of a new solution called Citrix Essentials™ for Microsoft® Hyper-V™, offering advanced virtualization management capabilities for Microsoft Windows Server® 2008 Hyper-V to help customers create highly scalable, manageable and agile virtual infrastructures; and,
  • Announced an agreement with Intel Corporation to develop the industry’s first application and desktop delivery solutions optimized for Intel® Core™2 desktops and Centrino® 2 laptops with Intel® vPro™ technology based on Xen® technology.
Published Thursday, April 30, 2009 6:43 AM by David Marshall
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