Citrix Systems (NASDAQ: CTXS) posted better-than-expected fourth-quarter results. Yet at first sight, there's nothing to be excited about. Revenue increased to $810 million, up 1% year over year. And the near-term outlook doesn't look much brighter, since the midpoint of 2020 revenue guidance of $3.115 billion corresponds to 3.5% year-over-year growth. Also, management expects non-GAAP (adjusted) operating margin to decrease from 30% in 2019 to a range of 28% to 29%.
For a tech company that is expanding its business into the growing cloud computing market, this performance looks weak. But in the long term, Citrix should profit from this transition.
Citrix's legacy business consists of selling hardware and software that allows users to remotely access a virtual computer desktop hosted in a data center. Compared to a classic Windows 10 workstation, this solution offers the advantage of keeping the same desktop environment from any device, anywhere. Also, computer administrators benefit from the more efficient central management of employees' working environments.