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Citrix’s Software-As-A-Service Segment Grows Substantially

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4Q15 financial summary

Citrix Systems (CTXS) announced its 4Q15 results last week. Revenues from its product and license segment rose 5% YoY (year-over-year), whereas revenues from its SaaS (software-as-a-service) segment rose 15% in 4Q15. Revenues from its license updates and maintenance segment increased 7%. Its revenues from professional services, which comprise consulting, product training, and certification, fell 24% YoY.

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Net revenues in the Americas region rose 11%, whereas revenues in the Pacific region fell 13% YoY. Revenues generated from EMEA (Europe, the Middle East, and Africa) rose by less than 1%. Deferred revenue in 4Q15 was $1.7 billion, an increase of 6%, compared with $1.6 billion in 4Q14. Cash flow from operations also increased, to $282 million from $190 million in the same period.

Fiscal 2015: Financial summary

Citrix’s revenues from its product and license segment fell 3% YoY, whereas revenues from its SaaS segment rose 12% in fiscal 2015. Revenues from license updates and maintenance increased 7%. Revenues from professional services fell 16% YoY.

Net revenues in the Americas region rose 5%, whereas revenues in the Pacific region fell 7% YoY. Revenues generated from EMEA rose by less than 1%. Cash flow from operations increased to $1.0 billion in fiscal 2015 from $846 million in fiscal 2014.

While revenues in the SaaS business segment saw impressive growth for Citrix, it still has to go a long way in gaining market share. The top players in the SaaS space include Oracle (ORCL), Salesforce (CRM), and Microsoft (MSFT), which have market shares of approximately 2%, 9%, and 3.5%, respectively. Microsoft constitutes 8.5% of the Power Shares QQQ ETF (QQQ).

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