Citrix shares surge on outlook
Executives at the software company say the second quarter is turning out better than expected and the acquisition of Sequoia Software is proceeding as planned.
Shares jumped 18 percent by market close, rising $4.25 to $27.96.
The company's core business is seeing a "modest acceleration" in growth, said Citrix Chief Financial Officer John P. Cunningham. The company now expects revenue to grow in the mid-20 percent range for the second quarter, compared to previous guidance of growth in the low-20 percent range.
Analysts were expecting the company to report earnings of 18 cents per share in the second quarter, with revenue of $136.9 million, according to First Call.
Citrix makes software that allows applications designed for Windows operating systems to be installed over a network and used on any terminal. The $184.6 million Sequoia acquisition adds Extensible Markup Language (XML), a system of defining common information formats to share data, to its products. That acquisition was completed April 30.
The acquisition resulted in a 2cent to 3 cent hit to earnings per share in the second quarter, and a similar charge in the third quarter. That figure will drop off to 1 cent to 2 cents per share by the fourth quarter of the year, and the deal is expected to begin adding to the bottom line in 2002.
While sales are going up, expenses are too. Cunningham said expenses are expected to rise by 10 percent on a quarterly basis, with the main increases coming in sales and marketing, and research and development.
Cunningham would not discuss specifics related to the revenue bump, but did say that "the core business is performing stronger than expected in all aspects in all regions."
Citrix recently named Mark Templeton to the CEO spot. Templeton had served as CEO before; he was moved to the position of president last June after the company missed estimates. Last month, the company reappointed him to the top spot, replacing Chairman Roger Roberts.
Templeton said that "it's great to be back a little grayer and a lot smarter, with an even stronger supporting cast and the support of the Citrix board."