Citrix raises FY14 forecast, shares rise

Written By Unknown on Kamis, 25 Juli 2013 | 21.43

Cloud computing software maker Citrix Systems raised the lower end of its full-year earnings forecast after it sold more licenses in the second quarter to companies looking to switch to a cloud platform.

Shares of the company, which also reported a higher-than-expected profit for the quarter, rose as much as 10% in post-market trading on Wednesday.

Citrix attributed growth in quarter to its NetScaler product, a web application delivery tool that helps to improve the performance of other applications.

"We continue to leverage NetScaler as part of delivering integrated solutions to our enterprise accounts," chief financial officer David Henshall said in a call with analysts.

NetScaler cross selling efforts resulted in more than 550 desktop virtualization orders in the quarter, up about 20% from year earlier, Henshall said.

Virtualization refers to software that allows customers to access applications remotely from a central server, reducing costs by eliminating the need to upgrade and install software on each individual computer on site.

Citrix, which is also known for its GoToMeeting online meeting tool, forecast 2013 adjusted earnings of $3.09 to $3.11 per share on revenue of $2.96 billion to $2.98 billion.

Analysts on average were expecting earnings of $3.09 per share on revenue of $2.96 billion, according to Thomson Reuters I/B/E/S.

The company had earlier forecast 2013 adjusted earnings of $3.08 to $3.11 per share on revenue of $2.95 billion to $2.98 billion.

While there was a delay in large desktop virtualization deals in the quarter as customers reviewed IT budgets, there was strong demand for Citrix's networking products, which help customers deliver cloud services, Susquehanna analyst Derrick Wood said in a pre-earnings note.

Revenue in the quarter rose 18.7% to $730.4 million.

Product and license revenue, which includes networking and cloud products led by NetScaler, rose 21% to $227.2 million.

The company's software-as-a-service business, which includes products such as GoToMeeting and its data sharing product ShareFile, rose 15%.

Net income fell to $64.5 million, or 34 cents per share, in the second quarter, from $92 million, or 49 cents per share, a year earlier.

Excluding items, the company earned 66 cents per share.

Analysts on average had expected earnings of 63 cents per share on revenue of $710.2 million.

Shares of the company, whose competitors include Cisco Systems and F5 Networks, closed at $67.49 on the Nasdaq on Wednesday.


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