Citrix – Industry Leader Turned Financial Tool
Citrix is the pioneer of central computing and desktop virtualization business. It started out in 1989 developing remote access solutions for Microsoft operating systems, which, over time, evolved into what is known today as server based computing, application delivery and virtualization technologies.
Since the company’s founding in 1989 through 2015 the company benefited from stable leadership and experienced steady growth. Founder Ed Lacobucci, together with CEO Roger Roberts, grew the company from nothing to $15 million in sales. In 1998 Mark Templeton took over as President; he was appointed CEO in 2001. Thanks to Mark’s inspiring leadership, sales grew spectacularly from $15 million to over $3 billion in annual sales during his tenure.
Any successful company can hit a bump in the road; Citrix hit one in 2014, when profit plunged from $339 million in 2013 to $251 million in 2014. When a large publicly traded company hits a big bump in the road, “activist investors” often smell blood and see an opportunity. In 2015 an activist hedge fund bought into the company, got a seat on the board, and started pushing the company to make changes to improve short term profitability. At that point in time, Citrix and Mark Templeton parted ways.
Unfortunately, things have changed in the two years since Templeton left the company.
The company has been struggling ever since. On July 10, 2017, Citrix announced the appointment of David J. Henshall as CEO; Henshall is the third person to hold the CEO title at Citrix in less than two years following Templeton’s departure.
It’s said that a “rising tide lifts all boats.” Accordingly, even though Citrix is our biggest competitor, we are saddened by the challenges the company is currently facing as it seems distracted from its core mission and innovative virtualization products.
Ericom Founder and Chairman, Eran Heyman, said, “Seeing what financial activists can do to our industry’s leader saddens me. A company that was focused on evolving, innovating, and growing through its amazing marketing engine over a period of two decades, has turned, within less than 24 months, into a tool for short-term financial gains, hurting the company itself, its partners, customers and its eco-system.”
The short term financial gains being sought by “activist investors” can cause lasting harm to the company and industry.
We at Ericom are proud of the many innovations we are bringing to the world of desktop virtualization and cybersecurity; however, we also believe that we, and our customers, benefit when the industry as a whole, including the dominant players, are managed for long term innovation and not for short-term profits.