Citrix Systems today reported financial results for the second quarter ended June 30, 2010, sending its shares soaring.
In the second quarter of fiscal 2010, Citrix achieved revenue of $458 million, compared to $393 million in the second quarter of fiscal 2009, representing 17 percent revenue growth.
Net income for the second quarter of fiscal 2010 was $48 million, or $0.25 per diluted share, compared to $43 million, or $0.23 per diluted share, for the second quarter of fiscal 2009.
Net income for the second quarter of fiscal 2010 includes approximately $13 million in income tax expense, or approximately $0.07 per diluted share, for the settlement in principle the company reached with the Internal Revenue Service related to transfer pricing issues as previously announced.
Non-GAAP net income in the second quarter of fiscal 2010 was $78 million, or $0.41 per diluted share, compared to $72 million, or $0.39 per diluted share, in the comparable period last year. Non-GAAP net income for the second quarter of fiscal 2010 includes the $13 million tax expense, or approximately $0.07 per diluted share, as noted above.
Both periods exclude the effects of amortization of intangible assets primarily related to business combinations, stock-based compensation expenses, charges recorded in connection with the restructuring program that the company implemented in January 2009 and the tax effects related to those items.
In reviewing the second quarter results of 2010, compared to the second quarter of 2009:
- Product license revenue increased 15 percent;
- Revenue from license updates grew 13 percent;
- Online services revenue grew 18 percent;
- Technical services revenue, which is comprised of consulting, education and technical support, grew 35 percent;
- Revenue increased in the America’s region by 17 percent, increased in the EMEA region by 11 percent and increased in the Pacific region by 31 percent;
- Deferred revenue totaled $686 million, compared to $538 million on June 30, 2009;
- GAAP operating margin was 16 percent for the quarter and non-GAAP operating margin was 26 percent for the quarter, excluding the effects of amortization of intangible assets primarily related to business combinations, stock-based compensation expense and charges recorded in connection with the 2009 restructuring program;
- Other income decreased 83 percent primarily due to losses on the re-measurement of non U.S. dollar denominated financial statement balances;
- Cash flow from operations was $103 million, compared with $86 million in the second quarter of 2009; and
- The company repurchased 2.2 million shares at an average price of $46.74 or $101 million.
Citrix management expects to achieve the following results during its third fiscal quarter of 2010 ending September 30, 2010:
- Net revenue is expected to be in the range of $450 million to $460 million; and
- GAAP diluted earnings per share is expected to be in the range of $0.31 to $0.32. Non-GAAP diluted earnings per share is expected to be in the range of $0.48 to $0.49, excluding $0.08 related to the effects of amortization of intangible assets primarily related to business combinations, $0.16 related to the effects of stock-based compensation expenses, certain charges recorded in conjunction with the company’s 2009 restructuring program, and $(0.06) to $(0.08) for the effect of the differential between the GAAP and non-GAAP tax rates and tax effects related to these items.
- Interest income is expected to be $4 million.
- Adjusted tax rate is expected to be in the range of 23% to 24%.
The above statements are based on current expectations. These statements are forward-looking, and actual results may differ materially.