Citrix reports Q2 earnings results

In the second quarter of fiscal 2008, Citrix achieved revenue of $392m, compared to $334m in the second quarter of fiscal 2007, representing 17% revenue growth.

GAAP Results

Net income for the second quarter of fiscal 2008 was $35m, or $0.18 per diluted share, compared to $53m, or $0.29 per diluted share, for the second quarter of 2007.

Non-GAAP Results

Non-GAAP net income in the second quarter of 2008 increased 2% to $71m, or $0.38 per diluted share, compared to $70m, or $0.38 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, stock-based compensation expenses and the tax effects related to those items.

"I'm delighted with another solid quarter," said Mark Templeton, president and chief executive officer of Citrix.

"We saw double digit revenue growth in each of our geographic segments, and we achieved our non-GAAP EPS targets. Overall a great quarter in a tough macro-economic environment,"

he added.

Q2 Financial Highlights

In reviewing the second quarter results of 2008, compared to the second quarter of 2007:
• Product license revenue increased 12%;
• Revenue from license updates grew 16%;
• Online services increased 23%;
• Technical services revenue, which is comprised of consulting, education and technical support, grew 34%;
• Revenue grew in the EMEA region by 22%; the America's region by 13%, and the Pacific region by 11%;
• Deferred revenue totaled $476m, compared to $395m on June 30, 2007;
• Operating margin was 7% for the quarter; non-GAAP operating margin was 21% for the quarter, excluding the effects of amortization of intangible assets primarily related to business combinations and stock-based compensation expense;
• Cash flow from operations was $75m, bringing the total 12 month trailing cash flow from operations to $379m; and,
• Repurchased shares for the quarter were 2.1 million shares at an average price paid per share of $33.50.

Financial Outlook for Third Quarter 2008

Citrix management expects to achieve the following results during its third fiscal quarter of 2008 ending September 30, 2008:
• Net revenue is expected to be in the range of $385m to $400m, compared to $350m in the third quarter of 2007;
• GAAP diluted earnings per share is expected to be in the range of $0.12 to $0.16. Non-GAAP diluted earnings per share is expected to be in the range of $0.36 to $0.39, excluding $0.09 related to the effects of amortization of intangible assets primarily related to business combinations and $0.14 to $0.15 related to the effects of stock-based compensation expenses.

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

Financial Outlook for Fiscal Year 2008

Citrix management expects to achieve the following results for the fiscal year 2008:
• The company expects net revenue to be in the range of $1.59bn to $1.62bn.
• The company expects GAAP diluted earnings per share to be in the range of $0.57 to $0.64. Non-GAAP diluted earnings per share to be in the range of $1.54 to $1.60, excluding $0.34 related to the effects of the amortization of intangible assets and $0.62 to $0.63 related to the effects of stock-based compensation expenses.

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 second quarter of 2008, Citrix announced:
• Citrix XenDesktop 2.0 began shipping;
• Citrix NetScaler MPX, which reduces datacenter costs by delivering twice as many Web applications;
• A new Citrix Access Gateway release adding intelligent policy-based controls for Citrix XenDesktop;
• Citrix XenServer is now factory integrated on Dell PowerEdge servers;
• A new Citrix XenServer pricing model allowing unlimited virtual machines per server at a single low price; and,
• Microsoft honored the company with its 2008 Microsoft Partner of the Year Global ISV - Infrastructure and 2008 Microsoft Partner for Citizenship awards.