Citrix Posts Big Losses for 2014, Announces Layoffs -- Virtualization Review

Citrix Posts Big Losses for 2014, Announces Layoffs

About 900 employees and contractors will be losing their jobs.

By Keith Ward
01/29/2015

While some of its chief rivals in the virtualization and cloud computing space are doing well financially, Citrix Systems Inc. is trending in the opposite direction, with a money-losing 2014, followed quickly by news of large layoffs.

Citrix reported revenue of $3.14 billion for 2014, an increase of 8 percent over 2013 revenue of $2.92 billion. However, net income for 2014 was $252 million, a huge drop from $340 million in 2013. Fourth-quarter 2014 numbers were equally weak: a 6 percent increase in revenues over the previous year, from $802 million to $851 million, but net income of just $95 million, compared to $139 million in Q4 2013.

After detailing the dismal results, Citrix announced -- in the same report -– that it was laying off about 900 people, including about 700 full-timers and 200 contractors. The layoffs are expected to save Citrix in the range of $90 million to $100 million.

That performance stands in marked contrast to the earnings reports earlier in the week from Microsoft and VMware Inc. Microsoft reported an 8 percent increase in revenue for the second quarter of its fiscal year, and its earnings beat analyst expectations. VMware had an even stronger showing for 2014; it set a record, with more than $6 billion in revenue, a 16 percent year-over-year increase. It increased revenues for each quarter in 2014.

Despite the discouraging showing, however, not everything is gloomy for Citrix. It recently announced the acquisition of Sanbolic, a storage virtualization vendor. The purchase was seen by Virtualization Review writers as an excellent buy, as it fills in an important missing gap in the Citrix virtualization lineup.