Citrix aims to simplify, unload GoTo business as CEO retires
Citrix said it is reviewing plans for its GoTo family of products, best known for its GoTo Meeting service, as it aims to streamline its business and portfolio and simplify operations. CEO Mark Templeton also plans to retire.
The news was delivered as Citrix reported better-than-expected second quarter results.
Citrix said it is reviewing strategic alternatives for the GoTo products, which include GoToAssist, GoToMyPC, GoTo Training, GoToWebinar and GoToWebcast. In other words, Citrix is looking to spin off or sell its GoTo business. Citrix also said it has talked to third parties about the sale of ByteMobile.
The potential sale of product line come as part of a larger simplification effort. Citrix, under fire from activist investor Elliot Management Corp., said that it has formed a operations committee to review its operations and capital structure to boost profit margins.
According to a statement, the operations committee will be run by Robert Calderoni, who will become executive chairman of the board. Calderoni was the CEO of Ariba, which was sold to SAP. Elliott portfolio manager Jesse Cohn will also get a board seat. Citrix also said it will search for another independent board member.
Templeton will serve as CEO until a successor is found.
All the moving parts come as Citrix delivered a second quarter that showed improvement. Citrix has stumbled in recent quarters and has restructured.
Citrix reported second quarter earnings of $103 million, or 64 cents a share, on revenue of $797 million, up 2 percent from a year ago. The net profit figure includes tax benefits of 13 cents a share as well as restructuring charges. Non-GAAP earnings for the second quarter was $1 a share, but that includes the tax gain of 13 cents a share.
Wall Street was looking for second quarter non-GAAP earnings of 82 cents a share on revenue of $790.4 million.
Recent business trends for Citrix largely continued as product and license revenue fell 12 percent in the second quarter as software as a service sales jumped 11 percent.
As for the outlook, Citrix projected third quarter revenue of $780 million to $790 million with non-GAAP earnings between 83 cents a share to 85 cents a share.
Wall Street was looking for earnings of 88 cents a share on revenue of $791 million.
For 2015, Citrix sees non-GAAP earnings between $3.65 a share to $3.75 a share on revenue of $3.22 billion to $3.25 billion.