After a few difficult weeks in which its CEO has resigned and rumors of sale have been heard, Citrix has launched a restructuring program that will imply reduction of jobs and the closure of some offices. The layoffs appear to have already begun, according to The Register.
The company has already sent a report to the Securities and Exchange Commission of the United States, in which it details the restructuring that it is going to carry out, and specifies that it will cause «the elimination of full-time positions, the end of certain contracts and asset deficiencies, especially related to facility consolidations«. As planned by the company, the program will entail expenses of between 130 and 240 million dollars. Of these, between 65 and 90 million will be allocated to severance pay for employee layoffs.
It is not the only change Citrix faces. After the departure of its CEO, Robert Calderoni took the reins of the company on a provisional basis until the appointment of a definitive CEO and now he will have more support: Paul hough, which is currently the Citrix Product Manager, will be your advisor hereinafter.
Calderoni already warned of changes during the communication with shareholders after the communication of the company’s results for the third quarter of this year. During the meeting, in addition to talking about numbers, he described 2021 as “a dismal year in terms of margins and cash flow“, And regretted that some of the company structures, as well as various sales agreements, are not conducive to growth.
The current interim CEO of Citrix also warned of barriers to cash flow due to the huge commissions owed to sales personnel who took advantage of the demand for remote work tools from Citrix that created the pandemic. These payments, close to 100 million dollars, have reduced margins. In addition, Calderoni pointed out that the company would have to approach some of the things that have happened in the last couple of years differently, in order to make the business more attractive.
Apart from these changes, Citrix has also experienced movement in its shareholding structure, since the activist fund Elliot Management has taken 10% of the company, with everything that entails. This fund was crucial for Henstall, the CEO who resigned a few weeks ago, to once occupy the top position at Citrix. Henstall managed to reverse Citrix’s downward march after several rather difficult years. Now it is unknown what measures it will support and promote, but surely they will not stand still.