Business software company Citrix Systems is planning to lay off 900 workers company-wide in a move to boost profitability.
It’s unclear how the layoffs will affect the company’s 600-employee Raleigh office, which became an anchor of downtown’s burgeoning Warehouse District when it opened last fall. Citrix has about 9,500 workers worldwide.
“At this time we cannot disclose reorganization details,” spokeswoman Lori Shen said in an email.
But top executives of the California-based company lauded the performance of its ShareFile business, the primary focus of its Raleigh site, during a conference call Wednesday.
The California-based company unveiled the job cuts in conjunction with the release of its fourth-quarter results. The company reported net income of $95 million, or 58 cents per share, which beat analysts’ estimates but nonetheless was down 32 percent from a year ago.
Fourth-quarter revenue rose 6 percent from a year ago to $851 million, also ahead of estimates.
“I’m proud of how we addressed market transitional and competitive challenges in 2014, but I’m not satisfied,” CEO Mark Templeton said during the call.
The layoffs of 700 full-time employees and 200 contracts is expected to generate annual pre-tax savings of $90 million to $100 million.
David Henshall, chief financial officer, said the restructuring “will drive operational efficiency while enabling continued investments in the areas that will power long-term growth like mobility, cloud services and networking.”
In response to a question from an analyst, Henshall declined to specify what departments or products would be most affected by the restructuring. He said that affected employees in the U.S. “will be notified shortly.”
Citrix software enables a company’s employees to work from anywhere online. The company moved into the Triangle in 2011 when it acquired Raleigh-based ShareFile for $54 million, and its local operations have grown much faster than the company expected.
Henshall told analysts that “ ShareFile continues to expand rapidly, up 60 percent year-on-year and now surpassing 50,000 customers and over 10 million individual users.” ShareFile’s software enables businesses to share large files confidentially.
Templeton said Citrix appears to be growing faster than archrival Dropbox.
“We’re just really delighted with the results that we’ve got with ShareFile,” he added.
When Citrix announced expansion plans in 2012 it committed to having 479 workers here, which made it eligible for state and local incentives worth more than $9 million. It has already exceeded that job target by 25 percent.
Bottom-line-oriented analysts had differing views on the restructuring.
“We are reiterating our Buy rating ... for Citrix as we believe management’s renewed focus on profitability and planned restructuring initiatives will likely be viewed positively by investors,” Mizuho Securities analyst Abhey Lamba said in an email message.
But BMO Capital Markets analyst Joel Fishbein Jr. called the size of the restructuring “disappointing relative to expectations.”
Citrix released its quarterly earnings and announced its restructuring after the markets closed Wednesday. Citrix shares rose $1.57, or 2.6 percent, to close at $60.76 on Thursday.
For all of 2014, Citrix revenue rose 8 percent to $3.14 billion. Its net income was $252 million, or $1.47 per share, down from $340 million in 2013.