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Citrix Reports Third Quarter Financial Results

Quarterly revenue of $713 million up 11% year over year. Cash flow from operations of $223 million up 23% year over year. Third quarter GAAP diluted earnings per share of $0.41. Third quarter non-GAAP diluted earnings per share of $0.70. Board of directors authorizes $500 million increase to share repurchase program.

Citrix Systems, Inc. (NASDAQ:CTXS) today reported financial results for the third quarter of fiscal year 2013 ended September 30, 2013. 

FINANCIAL RESULTS 

For the third quarter of fiscal year 2013, Citrix achieved revenue of $713 million, compared to $641 million in the third quarter of fiscal year 2012, representing 11 percent revenue growth. 

GAAP Results
Net income for the third quarter of fiscal year 2013 was $77 million, or $0.41 per diluted share, compared to $78 million, or $0.41 per diluted share, for the third quarter of fiscal year 2012. 

Non-GAAP Results
Non-GAAP net income for the third quarter of fiscal year 2013 was $132 million, or $0.70 per diluted share, compared to $128 million, or $0.68 per diluted share, for the third quarter of fiscal year 2012. Non-GAAP net income excludes the effects of amortization of acquired intangible assets, stock-based compensation expenses and the tax effects related to these items. 

In addition to quarterly financial results, Citrix also announced that its Board of Directors has authorized it to repurchase up to an additional $500 million of its common stock. As of September 30, 2013, approximately $179 million remained for repurchases from previous authorizations. 

“A number of factors influenced our results for the third quarter,” said David Henshall, acting chief executive officer for Citrix. “In addition to an uneven spending environment, we saw some customers delay buying decisions while they evaluate our newly released platforms in the desktop and mobile business. 

“However, we are very encouraged by the strong interest in our solutions as evidenced by a record pipeline for these opportunities. Enterprise mobility and cloud services represent an accelerating transformation in the workplace, and we are uniquely positioned to help our customers change the way they work, the devices and apps they use, and the way services are delivered.” 

Q3 Financial Summary
In reviewing the results for the third quarter of fiscal year 2013, compared to the third quarter of fiscal year 2012: 

• Product and license revenue increased 3 percent; 
• Software as a service revenue increased 14 percent; 
• Revenue from license updates and maintenance increased 16 percent; 
• Professional services revenue, which is comprised of consulting, product training and certification, increased 9 percent; 
• Net revenue increased in the EMEA region by 15 percent, increased in the Americas region by 9 percent and increased in the Pacific region by 7 percent; 
• Deferred revenue totaled $1.27 billion as of September 30, 2013, compared to $1.05 billion as of September 30, 2012, an increase of 21%; and 
• Cash flow from operations was $223 million for the third quarter of fiscal year 2013, compared with $181 million for the third quarter of fiscal year 2012. 

During the third quarter of fiscal year 2013:
GAAP gross margin was 83 percent and non-GAAP gross margin was 86 percent, excluding the effects of amortization of acquired product related intangible assets and stock-based compensation expense.
GAAP operating margin was 12 percent and non-GAAP operating margin was 24 percent, excluding the effects of amortization of acquired intangible assets and stock-based compensation expense.
The company repurchased 0.8 million shares at an average price of $72.05. 

Financial Outlook for Fourth Quarter 2013 

Citrix management expects to achieve the following results for the fourth quarter of fiscal year 2013 ending December 31, 2013: 

Net revenue is targeted to be in the range of $800 million to $810 million;
GAAP diluted earnings per share is targeted to be in the range of $0.66 to $0.70. Non-GAAP diluted earnings per share is targeted to be in the range of $0.95 to $1.00, excluding $0.19 related to the effects of amortization of acquired intangible assets, $0.26 related to the effects of stock-based compensation expenses, and $(0.11) to $(0.20) for the tax effects related to these items; 

The above statements are based on current targets. These statements are forward-looking, and actual results may differ materially.