Citrix Systems Inc.'s (CTXS) first-quarter earnings rose 55% as
the virtualization and infrastructure software company reported
across-the-board revenue growth, led by product license and
technical services, while margins expanded.
Shares rose 3%, to $80.14 in after-hours trading, as results
topped the company's expectations and Citrix raised its outlook for
the year.
For the year, Citrix now sees earnings of $2.38 to $2.41 a share
on revenue of $2.14 billion to $2.17 billion, up from the January
view of earnings of $2.29 to $2.33 a share on revenue of $2.1
billion to $2.14 billion.
The company also forecast second-quarter earnings of 54 cents to
55 cents a share on revenue of $515 million to $525 million.
Analysts polled by Thomson Reuters expected 54 cents and $517
million, respectively.
Citrix earlier this year announced three permanent XenDesktop
program trade-up offers, as well as a limited-time promotion called
"Trade-Up Restart," which targets customers with expired
subscription advantage memberships.
Ahead of the results, investment firm Noble Financial said field
checks suggest that mobile computing devices continue to drive
remote computing, which fuels sales of XenDesktop. The firm added
the company has done well versus its primary competitor, VMware
Inc. (VMW), which last week reported its first-quarter profit
jumped 60%.
Citrix, which improves computer efficiency by allowing multiple
systems to operate on one computer, reported a profit of $73.5
million, or 38 cents a share, up from $47.3 million, or 25 cents a
share, a year earlier. Excluding stock-based compensation and other
impacts, earnings rose to 50 cents from 40 cents as revenue jumped
18%, to $490.9 million.
In January, the company projected earnings of 40 cents to 41
cents a share on revenue of $470 million to $475 million, with the
bottom line target falling short of Wall Street's then
expectations.
Operating margin improved to 16.5% from 12.6%.
Revenue from product licenses, or new product purchases,
increased 22%, while license updates, which includes annuity
revenue from subscription paid when new licenses are purchased,
climbed 9%. Sales at the online services and technical services
segments jumped 17% and 44%, respectively.
-By John Kell, Dow Jones Newswires; 212-416-2480; john.kell@dowjones.com