DOW JONES NEWSWIRES
Citrix Systems Inc.'s (CTXS) third-quarter profit grew 64% as
the virtualization and infrastructure software company reported
higher revenue across all businesses and regions.
Shares rose 1.5% to $59.30 in after-hours trading as results
topped expectations and the company issued a strong outlook for the
current quarter. The stock is up 40% this year through Thursday's
close, although shares fell sharply earlier this month amid a broad
selloff in the data-center space after Equinix Inc. (EQIX) trimmed
its revenue targets. Concerns were also raised about the company's
bookings.
For the current quarter, Citrix predicted earnings of 59 cents
to 60 cents a share on revenue of $500 million to $510 million.
Analysts surveyed by Thomson Reuters expected 49 cents and $458
million, respectively.
The company reported its fourth consecutive quarterly growth in
its product-license segment after a year of declines, and also
noted higher sales in its other three businesses. Citrix earlier
this month announced a new version of XenServer with new storage
and networking innovations. The product continues to gain market
share, fueled by a free version.
Investment firm Pacific Crest earlier this week said investors
were taking a "myopic view on near-term XenDesktop bookings," which
it said was taking focus away from overall growth. The firm touted
the company's significant momentum in 2011 and beyond, saying
Citrix has only penetrated "a nominal number of existing
customers."
Citrix, which improves computer efficiency by allowing multiple
systems to operate on one computer, reported a profit of $87.8
million, or 46 cents a share, up from $53.4 million, or 29 cents a
share, a year earlier. Excluding stock-based compensation and other
impacts, earnings rose to 62 cents from 43 cents as revenue jumped
18% to $472.2 million.
In July, the company projected earnings of 48 cents to 49 cents
on revenue of $450 million to $460 million.
Operating margin widened to 17.3% from 14%.
Revenue from product licenses, or new product purchases, grew
18%, while license updates, which include annuity revenue from a
subscription paid when new licenses are purchased, increased 15%.
Sales at the online services and technical services segments grew
16% and 30%, respectively.
-By John Kell, Dow Jones Newswires; 212-416-2480;
john.kell@dowjones.com