Citrix warns it will miss Q1 earnings guidance
Where'd that US$25m go? Our re-org was a bit trickier than planned says CEO
Citrix has announced that it will not deliver the financial results it promised the markets.
“Revenue for the quarter is expected to be in the range of $755 million to $760 million, below the company's guidance of $780 million to $790 million,” says in its mea culpa preliminary Q1 results released today. “Net income for the first quarter of fiscal year 2015 per diluted share is expected to be in the range of $0.15 to $0.17 compared to guidance of $0.20 to $0.22 per diluted share. Non-GAAP net income for the first quarter of fiscal year 2015 per diluted share is expected to be in the range of $0.63 to $0.65, compared to guidance of $0.70 to $0.72 per diluted share.”
Mark Templeton, the company's president, had this to say about the preliminary results:
“We underestimated the impact caused by our restructuring, organizational evolution, and changes to our field and channel strategies, which were the result of important decisions made to get the business ready for our next phase of growth. Additionally, the increase in foreign exchange volatility impacted results and customer-buying behavior to a larger extent than anticipated in the quarter.”
Everyone's got foreign exchange problems at the moment, so if Citrix is finding that hard to deal with that's a problem for the CFO's office. More pressing is that the company has stronger competition that ever before. VMware's gunning for its application delivery business and, together with Microsoft, more or less wiped out its server virtualisation business. Citrix has a decent story in mobile application delivery, but that market is nascent. The company's online collaboration tools are anodyne.
Perhaps there's a rabbit in the hat: on Tuesday the company announced it will acquire small business cloud telephony and collaboration outfit Grasshopper for an undisclosed sum. ®