Enterprise software maker Citrix Systems, Inc. (CTXS) on Wednesday reported a 31 percent decline in profit for the fourth quarter from last year, as higher revenues were more than offset by one-time charges.
However, both revenue and adjusted earnings per share for the quarter beat analysts' expectations. Looking ahead, the company forecast financial results for the first quarter as well as fiscal 2015 below Street estimates, and also said it will cut about 700 full-time and 200 contractor positions under a restructuring program.
Fort Lauderdale, Florida-based Citrix Systems' reported fourth-quarter net income of $95.23 million or $0.58 per share, down from $138.64 million or $0.74 per share in the year-ago period.
The latest quarter's results include impairment charges of $30 million, related to certain intangible assets that are included in amortization of product related and other intangible assets, as well as a charge of $3 million for severance costs related to a restructuring program implemented in the first quarter of 2014.
In addition, the latest quarter's results include net tax benefits of $12 million or $0.08 per share, primarily related to the extension of the 2014 federal research and development tax credit.
Adjusted net earnings for the quarter were $1.10 per share, compared to $1.04 per share in the year-ago period. On average, 32 analysts polled by Thomson Reuters expected the company to report earnings of $1.03 per share for the quarter. Analysts' estimates typically exclude special items.
Revenue for the quarter increased 6 percent to $851.48 million from $802.42 million in the same period last year. Analysts expected revenue of $844.07 million for the quarter.
Product and license revenue for the quarter decreased 1 percent from last year, while software as a service revenue increased 10 percent. Revenue from license updates and maintenance increased 9 percent, while professional services revenue, which is comprised of consulting, product training and certification, increased 15 percent.
For fiscal 2014, Citrix System's net income was $251.72 million or $1.47 per share, down from $339.52 million or $1.80 per share last year. Adjusted net earnings for the year were $3.30 per share, compared to $3.02 per share in the prior year.
Total net revenue for the year grew 8 percent to $3.14 billion from $2.92 billion in the prior year.
Street expected the company to earn $3.23 per share for the year on revenues of $3.14 billion.
Looking ahead to the first quarter, Citrix Systems forecasts earnings per share of $0.20 to $0.22, adjusted earnings per share of $0.70 to $0.72, and net revenue to be in a range of $780 million to $790 million. Analysts expect the company to report earnings of $0.80 per share for the quarter on revenue of $796.69 million.
For fiscal 2015, Citrix Systems forecasts earnings per share of $2.10 to $2.15, adjusted earnings of $3.60 to $3.65 per share, and revenues of $3.29 billion to $3.3 billion. Street expects the company to report earnings of $3.69 per share for the year on revenue of $3.36 billion.
Citrix also announced the implementation of a restructuring program that will affect about 700 full-time and 200 contractor positions. The company expects the restructuring to result in annualized pre-tax savings of about $90 million to $100 million.
Citrix expects to incur pre-tax charges in a range of about $40 million to $45 million related to employee severance arrangements, and $9 million to $10 million related to the consolidation of leased facilities during fiscal year 2015.
CTXS closed Wednesday's regular trading at $59.19, down $0.92 or 1.53 percent on a volume of 2.50 million shares. However, in after-hours, the stock gained $2.32 or 3.92 percent to $61.51.
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