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Citrix (CTXS) Q2 Earnings and Revenues Beat; View Raised
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Citrix Systems Inc. posted encouraging results in the second quarter of 2016, reporting higher-than-expected earnings as well as revenues.
The cloud computing company’s earnings (excluding special items) came in at 99 cents per share, 7 cents ahead of the Zacks Consensus Estimate. Higher-than-expected revenues contributed to the earnings beat.
Operating Results
Net revenue came in at $843.0 million, up 5.8% on a year-over-year basis and also above the Zacks Consensus Estimate of $816 million. Gross margin stood at 83.2% in the quarter under review compared with 82.6% in the prior-year quarter. Quarterly operating margin was 28% versus 25% in the prior-year quarter. At the end of the reported quarter, deferred revenues grossed $1.6 billion compared with $1.5 billion a year ago.
During the second quarter of 2016, Citrix generated approximately $228 million of cash from operations compared with $201 million for the same quarter in 2015. The company exited the quarter with $666.2 million in cash and cash equivalents compared with $368.5 million at the end of 2015.
Revenues by Product Mix
Product and Licenses revenues grossed $219.6 million, up 7% year over year. License updates and maintenance revenues totaled $386.9 million, up 3% year over year. Software-as-a-Service (SaaS) revenues came in at $201.6 million, reflecting a 14% increase from the prior-year quarter while Professional Services revenues declined 6% to $34.9 million in the reported quarter.
Revenues by Geography
Revenues in the Americas (both North & Latin America) were up 11% year over year. Revenues in the Europe, Africa and the Middle East region decreased by less than 2% while the same in the Asia-Pacific region fell 9% year over year.
Citrix expects net revenues in the band of $820 million to $830 million for the third quarter of 2016. Earnings per share (on an adjusted basis) are projected in the range of $1.18 to $1.20. The Zacks Consensus Estimate for third quarter revenue and earnings is $815.2 million and 95 cents respectively.
Outlook for 2016
Fort Lauderdale, FL-based company raised its revenue estimates to a band of $3.37 billion to $3.39 billion from $3.34 billion to $3.36 billion issued earlier for full-year 2016. Earnings per share (on an adjusted basis) are now projected in the range of $5.00 to $5.10 instead of $4.90 to $5.00. The Zacks Consensus Estimate for 2016 revenue and earnings is $3.35 billion and $4.06 respectively.
Zacks Rank & Key Picks
Citrix currently has a Zacks Rank #4 (Sell). Better-ranked stocks in the same space include Adobe Systems Inc. (ADBE - Free Report) , Proofpoint Inc. and Servicesource International Inc. . All the companies sport a Zack Rank #1 (Strong Buy).
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Citrix (CTXS) Q2 Earnings and Revenues Beat; View Raised
Citrix Systems Inc. posted encouraging results in the second quarter of 2016, reporting higher-than-expected earnings as well as revenues.
The cloud computing company’s earnings (excluding special items) came in at 99 cents per share, 7 cents ahead of the Zacks Consensus Estimate. Higher-than-expected revenues contributed to the earnings beat.
Operating Results
Net revenue came in at $843.0 million, up 5.8% on a year-over-year basis and also above the Zacks Consensus Estimate of $816 million. Gross margin stood at 83.2% in the quarter under review compared with 82.6% in the prior-year quarter. Quarterly operating margin was 28% versus 25% in the prior-year quarter. At the end of the reported quarter, deferred revenues grossed $1.6 billion compared with $1.5 billion a year ago.
During the second quarter of 2016, Citrix generated approximately $228 million of cash from operations compared with $201 million for the same quarter in 2015. The company exited the quarter with $666.2 million in cash and cash equivalents compared with $368.5 million at the end of 2015.
Revenues by Product Mix
Product and Licenses revenues grossed $219.6 million, up 7% year over year. License updates and maintenance revenues totaled $386.9 million, up 3% year over year. Software-as-a-Service (SaaS) revenues came in at $201.6 million, reflecting a 14% increase from the prior-year quarter while Professional Services revenues declined 6% to $34.9 million in the reported quarter.
Revenues by Geography
Revenues in the Americas (both North & Latin America) were up 11% year over year. Revenues in the Europe, Africa and the Middle East region decreased by less than 2% while the same in the Asia-Pacific region fell 9% year over year.
CITRIX SYS INC Price, Consensus and EPS Surprise
CITRIX SYS INC Price, Consensus and EPS Surprise | CITRIX SYS INC Quote
Outlook for Third-Quarter 2016
Citrix expects net revenues in the band of $820 million to $830 million for the third quarter of 2016. Earnings per share (on an adjusted basis) are projected in the range of $1.18 to $1.20. The Zacks Consensus Estimate for third quarter revenue and earnings is $815.2 million and 95 cents respectively.
Outlook for 2016
Fort Lauderdale, FL-based company raised its revenue estimates to a band of $3.37 billion to $3.39 billion from $3.34 billion to $3.36 billion issued earlier for full-year 2016. Earnings per share (on an adjusted basis) are now projected in the range of $5.00 to $5.10 instead of $4.90 to $5.00. The Zacks Consensus Estimate for 2016 revenue and earnings is $3.35 billion and $4.06 respectively.
Zacks Rank & Key Picks
Citrix currently has a Zacks Rank #4 (Sell). Better-ranked stocks in the same space include Adobe Systems Inc. (ADBE - Free Report) , Proofpoint Inc. and Servicesource International Inc. . All the companies sport a Zack Rank #1 (Strong Buy).
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report >>