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Form 10-K
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x
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ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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o
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
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Delaware
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75-2275152
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(State or other jurisdiction of
incorporation or organization)
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(IRS Employer
Identification No.)
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851 West Cypress Creek Road
Fort Lauderdale, Florida 33309
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(Address of principal executive offices, including zip code)
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Common Stock, $.001 Par Value
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The Nasdaq Stock Market LLC
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(Title of each class)
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(Name of each exchange on which registered)
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x
Large accelerated filer
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o
Accelerated filer
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o
Non-accelerated filer
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o
Smaller reporting company
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o
Emerging growth company
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Part I:
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Item 1
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Item 1A.
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Item 1B.
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Item 2
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Item 3
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Item 4
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Part II:
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Item 5
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Item 6
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Item 7
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Item 7A.
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Item 8
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Item 9
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Item 9A.
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Item 9B.
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Part III:
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Item 10
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Item 11
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Item 12
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Item 13
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Item 14
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Part IV:
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Item 15
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Item 16
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•
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Citrix Virtual Apps and Desktops (formerly XenDesktop)
is a fully-integrated, cloud-enabled app and desktop virtualization solution that gives customers the flexibility to remotely deliver desktops and applications - from any cloud, on-premises datacenters or both. Citrix Virtual Apps and Desktops include HDX technologies to give users a high-definition experience - even when using multimedia, real-time voice and video collaboration, USB devices and 3D graphics content - while consuming less bandwidth than competing solutions. Citrix Virtual Apps and Desktops is available in multiple editions designed for different requirements, from simple VDI-only deployments to sophisticated, enterprise-class desktop and application delivery services that can meet the needs of everything from basic call center environments to high-powered graphics workstations. With Citrix Virtual Apps and Desktops Advanced and Premium editions - as well as the cloud service - customers also receive Citrix Virtual Apps to manage and mobilize Windows applications.
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•
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Citrix Virtual Apps (formerly XenApp)
is a widely deployed solution that enables Windows and Linux applications to be remotely delivered to Macs, PCs, thin clients and Android/iOS mobile devices from any cloud, on-premises datacenter or both. Citrix Virtual Apps enable people to work better by running applications in the security of the data center or cloud, and using Citrix HDX technologies to deliver a superior user experience to any device, anywhere. Keeping business applications under the centralized control of IT administrators enhances security and reduces the costs of managing applications on every PC. Exclusively available as a cloud service, on-premises or hybrid solution, it allows customers to choose the deployment option that best aligns with their enterprise cloud strategy. In partnership with Microsoft, Citrix Virtual Apps is designed to embrace and extend Microsoft Remote Desktop technology by providing advanced provisioning, performance, monitoring and management functionality. Our joint solution with Microsoft lowers the cost of delivering and maintaining Windows applications for all users in the enterprise.
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•
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Citrix Endpoint Management
provides unified endpoint management for a secure digital workspace allowing IT to meet mobile device security and compliance requirements for "bring your own device" programs and corporate devices while enabling user productivity. As part of a workspace, Citrix Endpoint Management centralizes the management of mobile devices, traditional desktops, laptops and Internet of Things, or IoT, through a single platform. Citrix Endpoint Management directly integrates with Microsoft EMS/Intune to extend mobility and device management capabilities.
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•
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Citrix Content Collaboration (formerly ShareFile)
is a secure, cloud-based file sharing and storage solution built for mobile business, giving users enterprise-class data services across all corporate and personal mobile devices, while maintaining total IT control. Citrix Content Collaboration protects data throughout the storage and transfer process, using up to 256-bit encryption and SSL or Transport Layer Security, or TLS, encryption protocols for transfer and 256-bit encryption for files at rest on ShareFile servers. Password protection and granular access to folders and files stored with Citrix Content Collaboration ensure that data remains in control of the company. With Citrix Content Collaboration Enterprise, organizations can manage their data on-premises in customer managed StorageZones, select Citrix managed secure cloud options or create a mix of both to meet the needs for data sovereignty, compliance, performance and costs. For businesses that use multiple storage repositories, Citrix Content Collaboration provides unified access to a wide range of cloud-based and on-premises storage repositories, making it simple and easy for employees to find and access their files and documents. Additionally, Citrix Content Collaboration supports e-signature, feedback and approval workflows that help businesses adopt the mobile, digital office.
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•
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Citrix Workspace
delivers a unified user experience for any app or desktop on any device, including tablets, smartphones, PCs, Macs or thin clients. IT can securely deliver content over low-bandwidth high-latency WANs, highly variable 3G/4G mobile networks or a reliable corporate LAN to improve end-user experience while offering enterprise-grade security to data and applications. Citrix Workspace provides a unified, flexible solution that can streamline device, application and desktop deployment and lifecycle management to increase employee engagement, productivity, and reduce IT costs. Citrix Workspace offers choice of device, cloud and network and can be deployed on-premises, via the cloud or as a hosted service.
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•
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Citrix ADC (formerly NetScaler ADC)
is a software-defined application delivery controller designed to meet the demands of organizations undergoing digital transformation. Citrix ADC enables the adoption of hybrid and multi-cloud application delivery with improved application performance, reliability and security at an optimized price point. Citrix ADC allows customers to obtain detailed application analytics with the value of machine learning. It also optimizes application delivery for cloud native application architectures based on the Kubernetes orchestration platform, and provides service graph analytics for efficient troubleshooting within the microservices environment. Additionally, we extend the platform with best-of-breed web application firewall, or WAF, capabilities
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•
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Citrix SD-WAN (formerly NetScaler SD-WAN)
increases the security, performance and reliability of applications delivered from the legacy data center, cloud, or SaaS, while delivering additional value for virtualized applications and desktops. The platform combines routing, security, WAN optimization, and path control to simplify implementation and maintenance of the branch network, allowing customers to adopt a hybrid WAN architecture that effectively increases WAN capacity and manageability.
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Customer Success Services
are offered in support of our perpetual software and our cloud-based services. Customers are given a choice of tiered offerings combining product version upgrades, guidance, enablement, support and proactive monitoring to help customers and partners fully realize their business goals and maximize their Citrix investments. Additionally, customers may upgrade to receive personalized support from a dedicated team led by an assigned account manager. Fees associated with this offering are recognized ratably over the term of the contract.
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•
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Hardware Maintenance
is offered in support of our Networking products. Customers are given a choice of tiered offerings including technical support, software upgrades, and replacement of malfunctioning appliances. Dedicated account management is available as an add-on to the program. Fees associated with this offering are recognized ratably over the term of the contract.
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•
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Citrix Consulting
guides the successful implementation of Citrix technologies and solutions with proven methodologies, tools and leading practices. Citrix Consulting focuses on strategic engagements with enterprise customers who have complex, mission-critical, or large-scale Citrix deployments. These engagements are typically fee-based engagements for the most challenging projects in terms of scope and complexity, requiring consultants with project methodology qualifications and Citrix expertise. Citrix Consulting is also responsible for developing best practices which are disseminated to businesses, partners and end users through training and written documentation. Leveraging these best practices enables our integration resellers to provide more complex systems, reach new buyers within existing customer organizations, and provide more sophisticated system proposals to prospective customers.
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•
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Product Training & Certification
enables customers and partners to be successful with Citrix and achieve business objectives faster. Authorized Citrix training is available as needed. Traditional or virtual instructor-led training offerings feature Citrix Certified Instructors delivering Citrix-developed courseware in a classroom or remote setting at one of our Citrix Authorized Learning Centers, or CALCs, worldwide. Self-Paced Online offerings provide technically robust course content without an instructor and include hands-on practice via virtual labs. Certifications validate key skills and are available for administrators, engineers, architects and sales professionals.
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Strategic IT Executives including chief information officers, chief technology officers, chief information security officers and vice presidents of infrastructure, who have responsibility for ensuring that IT services are enablers to business initiatives and are delivered with the best performance, availability, security and cost.
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Desktop Operations Managers who are responsible for managing Windows Desktop environments including corporate help desks.
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IT Infrastructure Managers who are responsible for managing and delivering Windows-based applications.
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Directors of Messaging and Mobility, who are, respectively, responsible for messaging technologies and defining mobile strategies and solutions for securing and managing mobile devices including their content and applications.
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Network Architects who are responsible for delivering Web-based applications who have primary responsibility for the WAN infrastructure for all applications.
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Server Operations Managers who are responsible for specifying datacenter systems and managing daily operations.
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Small business owners who are responsible for choosing the systems needed to support their business goals, such as SaaS.
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Chief technology officer and engineering department (managers and architects, among others) for telecommunications service providers.
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Line of business and functional executives that determine the need for our cloud and subscription-based offerings at certain enterprises.
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Chief information officer and engineering departments within service providers, using our solutions to deliver desktops and applications as hosted cloud services.
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we may not be able to effectively or efficiently transition our customers from consuming our solutions and services as on premises solutions to cloud-based solutions;
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we may not be able to implement effective go-to-market strategies and train or properly incentivize our sales team and channel partners in order to effectively market our subscription offerings;
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we may be unsuccessful in maintaining our target pricing, adoption and renewal rates;
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we may select solution prices that are not optimal and could negatively affect our sales or earnings;
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we may incur costs at a higher than forecasted rate as we expand our cloud-delivered services thereby decreasing our gross margins;
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we may experience unpredictability in revenue as a result of usage fluctuations within our cloud service provider business;
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we may not be able to meet customer demand or solution requirements for cloud-delivered services;
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we may encounter customer concerns regarding changes to pricing, service availability, and security; and
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our cloud-delivered services are primarily operated through third party data centers, which we do not control and which may be vulnerable to damage, interruption and cyber-related risks.
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rapid technological change;
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evolving industry standards;
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fluctuations in customer demand;
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changing customer business models and increasingly sophisticated customer needs; and
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frequent new solution and service introductions and enhancements.
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new competitive product releases and updates to existing products delivered as on premises solutions, especially cloud-based products;
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industry trend to focus on the secure delivery of applications on mobile devices;
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introduction of new or alternative technologies, products or service offerings by third parties;
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termination or reduction of our product offerings and enhancements;
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•
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potential market saturation;
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failure to enter new markets;
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price and product competition resulting from rapid and frequent technological changes and customer needs;
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general economic conditions;
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complexities and cost in implementation;
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failure to deliver satisfactory technical support;
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dissatisfied customers; or
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lack of commercial success of our technology relationships.
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loss or destruction of customer data;
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interruption in the delivery of our cloud services;
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negative publicity and harm to our reputation or brand, which could lead some customers to seek to cancel subscriptions, stop using certain of our solutions or services, reduce or delay future purchases of our solutions or services, or use competing solutions or services;
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individual and/or class action lawsuits, which could result in financial judgments against us or the payment of settlement amounts, which would cause us to incur legal fees and costs;
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regulatory enforcement action under the General Data Protection Regulation or other legal authority, which could result in significant fines and/or penalties or other sanctions and which would cause us to incur legal fees and costs; and/or
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•
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in the event that we or one of our customers were the victim of a cyberattack or other security breach, additional costs associated with responding to such breach, such as investigative and remediation costs, and the costs of providing data owners or others with notice of the breach, legal fees, costs of any additional fraud detection activities required by such customers' credit card issuers, and costs incurred by credit card issuers associated with the compromise and additional monitoring of systems for further fraudulent activity.
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our sales force generally needs to explain and demonstrate the benefits of a large-scale deployment of our solution to potential and existing customers prior to sale;
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our service personnel typically spend a significant amount of time assisting potential customers in their testing and evaluation of our solutions and services;
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our customers are typically large and medium size organizations that carefully research their technology needs and the many potential projects prior to making capital expenditures for software infrastructure; and
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before making a purchase, our potential customers usually must get approvals from various levels of decision makers within their organizations, and this process can be lengthy.
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compliance with foreign regulatory and market requirements;
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variability of foreign economic, political, labor conditions and global policy uncertainty;
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changing restrictions imposed by regulatory requirements, tariffs or other trade barriers or by U.S. export laws;
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regional data privacy laws that apply to the transmission of our customers’ data across international borders;
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health or similar issues such as pandemic or epidemic;
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difficulties in staffing and managing international operations;
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longer accounts receivable payment cycles;
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potentially adverse tax consequences;
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difficulties in enforcing and protecting intellectual property rights;
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compliance with the Foreign Corrupt Practices Act, including potential violations by acts of agents or other intermediaries;
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burdens of complying with a wide variety of foreign laws; and
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as we generate cash flow in non-U.S. jurisdictions, if required, we may experience difficulty transferring such funds to the U.S. in a tax efficient manner.
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an uncertain revenue and earnings stream from the acquired company, which could dilute our earnings;
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difficulties and delays integrating the personnel, operations, technologies, solutions and systems of the acquired companies;
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undetected errors or unauthorized use of a third-party’s code in solutions of the acquired companies;
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our ongoing business may be disrupted and our management’s attention may be diverted by acquisition, transition or integration activities;
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challenges with implementing adequate and appropriate controls, procedures and policies in the acquired business;
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difficulties managing or integrating an acquired company’s technologies or lines of business;
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potential difficulties in completing projects associated with purchased in-process research and development;
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entry into markets in which we have no or limited direct prior experience and where competitors have stronger market positions and which are highly competitive;
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the potential loss of key employees of the acquired company;
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potential difficulties integrating the acquired solutions and services into our sales channel;
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assuming pre-existing contractual relationships of an acquired company that we would not have otherwise entered into, the termination or modification of which may be costly or disruptive to our business;
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being subject to unfavorable revenue recognition or other accounting treatment as a result of an acquired company’s practices;
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•
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potential difficulties securing financing necessary to consummate substantial acquisitions;
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•
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issuing shares of our stock, which may be dilutive to our stockholders; and
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intellectual property claims or disputes.
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the expansion of our product lines through product development and acquisitions;
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the volume of patent infringement litigation commenced by non-practicing entities;
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•
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an increase in the number of competitors in our industry segments and the resulting increase in the number of related solutions and services and the overlap in the functionality of those solutions and services;
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•
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an increase in the number of our competitors and third parties that use their own intellectual property rights to limit our freedom to operate and exploit our solutions, or to otherwise block us from taking full advantage of our markets;
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•
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our reliance on the technology of others and, therefore, the requirement to obtain intellectual property licenses from third parties in order for us to commercialize our solutions or services, which licenses we may not be able to obtain or continue to obtain from these third parties on reasonable terms; and
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•
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the unauthorized or improperly licensed use of third-party code in our solutions.
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•
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pay damages (including the potential for treble damages), license fees or royalties (including royalties for past periods) to the party claiming infringement;
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•
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cease selling solutions or services that use the challenged intellectual property;
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•
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obtain a license from the owner of the asserted intellectual property to sell or use the relevant technology, which license may not be available on reasonable terms, or at all; or
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•
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redesign the challenged technology, which could be time consuming and costly, or not be accomplished.
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•
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undetected errors or unauthorized use of another person’s code in the third party’s software;
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•
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disagreement over the scope of the license and other key terms, such as royalties payable and indemnification protection;
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•
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infringement actions brought by third-parties;
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•
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the creation of solutions by third parties that directly compete with our solutions; and
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•
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termination or expiration of the license.
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•
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make us more vulnerable to adverse changes in general U.S. and worldwide economic, industry and competitive conditions and adverse changes in government regulation;
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•
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limit our flexibility in planning for, or reacting to, changes in our business and our industry;
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•
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place us at a disadvantage compared to our competitors who have less debt; and
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•
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limit our ability to borrow additional amounts to fund acquisitions, for working capital and for other general corporate purposes.
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•
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actual or anticipated variations in operating and financial results, including the failure to meet key operational metrics;
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•
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analyst reports or recommendations;
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•
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rumors, announcements, or press articles regarding our or our competitors’ operations, management, organization, financial condition, or financial statements; and
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•
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other events or factors, many of which are beyond our control.
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Total Number
of Shares
Purchased
(1)
|
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Average
Price Paid
per Share
|
|
Total Number
of Shares
Purchased as Part
of Publicly
Announced Plans
or Programs
|
|
Approximate dollar value of Shares that may yet be
Purchased under the
Plans or Programs
(in thousands)
(2)
|
||||||
October 1, 2018 through October 31, 2018
|
|
52,998
|
|
|
$
|
110.35
|
|
|
—
|
|
|
$
|
1,147,896
|
|
November 1, 2018 through November 30, 2018
|
|
1,361,524
|
|
|
$
|
107.84
|
|
|
1,297,589
|
|
|
$
|
1,007,896
|
|
December 1, 2018 through December 31, 2018
|
|
2,299,135
|
|
|
$
|
106.71
|
|
|
2,247,135
|
|
|
$
|
767,896
|
|
Total
|
|
3,713,657
|
|
|
$
|
107.17
|
|
|
3,544,724
|
|
|
$
|
767,896
|
|
(1)
|
Includes approximately 168,933 shares withheld from restricted stock units that vested in the fourth quarter of 2018 to satisfy minimum tax withholding obligations that arose on the vesting of restricted stock units.
|
(2)
|
Shares withheld from restricted stock units that vested to satisfy minimum tax withholding obligations that arose on the vesting of such awards do not deplete the dollar amount available for purchases under the repurchase program.
|
|
|
Year Ended December 31,
|
||||||||||||||||||
|
|
2018
|
|
2017(a)
|
|
2016(a)
|
|
2015(a)
|
|
2014(a)
|
||||||||||
|
|
(In thousands, except per share data)
|
||||||||||||||||||
Consolidated Statements of Income Data:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net revenues
|
|
$
|
2,973,903
|
|
|
$
|
2,824,686
|
|
|
$
|
2,736,080
|
|
|
$
|
2,646,154
|
|
|
$
|
2,563,064
|
|
Cost of net revenues
(b)
|
|
433,803
|
|
|
439,646
|
|
|
404,889
|
|
|
474,040
|
|
|
493,706
|
|
|||||
Gross margin
|
|
2,540,100
|
|
|
2,385,040
|
|
|
2,331,191
|
|
|
2,172,114
|
|
|
2,069,358
|
|
|||||
Operating expenses
(c)
|
|
1,862,140
|
|
|
1,814,043
|
|
|
1,771,027
|
|
|
1,969,322
|
|
|
1,894,438
|
|
|||||
Income from operations
|
|
677,960
|
|
|
570,997
|
|
|
560,164
|
|
|
202,792
|
|
|
174,920
|
|
|||||
Interest income
|
|
40,030
|
|
|
27,808
|
|
|
16,686
|
|
|
11,675
|
|
|
9,421
|
|
|||||
Interest expense
|
|
(80,162
|
)
|
|
(51,609
|
)
|
|
(44,949
|
)
|
|
(44,153
|
)
|
|
(28,332
|
)
|
|||||
Other (expense) income, net
|
|
(8,373
|
)
|
|
3,150
|
|
|
(4,131
|
)
|
|
(5,730
|
)
|
|
(7,694
|
)
|
|||||
Income from continuing operations before income taxes
|
|
629,455
|
|
|
550,346
|
|
|
527,770
|
|
|
164,584
|
|
|
148,315
|
|
|||||
Income tax expense (benefit)
|
|
53,788
|
|
|
528,361
|
|
|
57,915
|
|
|
(50,549
|
)
|
|
(18,904
|
)
|
|||||
Income from continuing operations
|
|
575,667
|
|
|
21,985
|
|
|
469,855
|
|
|
215,133
|
|
|
167,219
|
|
|||||
(Loss) income from discontinued operations, net of income tax expense
|
|
—
|
|
|
(42,704
|
)
|
|
66,257
|
|
|
104,228
|
|
|
84,504
|
|
|||||
Net income (loss)
|
|
$
|
575,667
|
|
|
$
|
(20,719
|
)
|
|
$
|
536,112
|
|
|
$
|
319,361
|
|
|
$
|
251,723
|
|
Diluted earnings (loss) per share:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Income from continuing operations
|
|
3.94
|
|
|
0.14
|
|
|
2.99
|
|
|
1.34
|
|
|
0.98
|
|
|||||
(Loss) income from discontinued operations
|
|
—
|
|
|
(0.27
|
)
|
|
0.42
|
|
|
0.65
|
|
|
0.49
|
|
|||||
Diluted net earnings (loss) per share
|
|
$
|
3.94
|
|
|
$
|
(0.13
|
)
|
|
$
|
3.41
|
|
|
$
|
1.99
|
|
|
$
|
1.47
|
|
Weighted average shares outstanding - diluted
|
|
145,934
|
|
|
155,503
|
|
|
157,084
|
|
|
160,362
|
|
|
171,270
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
|
|
December 31,
|
||||||||||||||||||
|
|
2018
|
|
2017
|
|
2016
|
|
2015
|
|
2014
|
||||||||||
|
|
(In thousands)
|
||||||||||||||||||
Consolidated Balance Sheet Data
(d)
:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Total assets
|
|
$
|
5,136,049
|
|
|
$
|
5,820,176
|
|
|
$
|
6,390,227
|
|
|
$
|
5,467,517
|
|
|
$
|
5,512,007
|
|
Total equity
|
|
551,519
|
|
|
992,461
|
|
|
2,608,727
|
|
|
1,973,446
|
|
|
2,173,645
|
|
(a)
|
The selected financial data for fiscal years ended December 31,
2017
,
2016
,
2015
and
2014
has been adjusted to be presented on a continuing operations basis. Refer to Note 3 Discontinued Operations in our Consolidated Financial Statements for additional information.
|
(b)
|
Cost of net revenues includes amortization and impairment of product related intangible assets of
$47.1 million
,
$65.7 million
,
$55.4 million
,
$127.3 million
, and
$142.2 million
in
2018
,
2017
,
2016
,
2015
and
2014
, respectively.
|
(c)
|
Operating expenses includes amortization and impairment of other intangible assets of
$15.9 million
,
$17.2 million
,
$15.1 million
,
$97.5 million
, and
$41.9 million
in
2018
,
2017
,
2016
,
2015
and
2014
, respectively. Operating expenses also include restructuring charges of
$16.7 million
,
$72.4 million
,
$67.4 million
,
$98.7 million
and
$14.1 million
in
2018
,
2017
,
2016
,
2015
and
2014
, respectively.
|
(d)
|
Balance Sheet amounts prior to 2017 include amounts for the GoTo Business. Refer to Note 3 Discontinued Operations in our Consolidated Financial Statements for additional information.
|
•
|
Subscription revenue increased
44.7%
to
$455.3 million
;
|
•
|
Product and license revenue decreased
4.2%
to
$734.5 million
;
|
•
|
Support and services revenue increased
2.3%
to
$1.78 billion
;
|
•
|
Gross margin as a percentage of revenue increased
1.0%
to
85.4%
;
|
•
|
Operating income increased
18.7%
to
$678.0 million
;
|
•
|
Diluted earnings per share increased from
$0.14
to
$3.94
; and
|
•
|
Unbilled revenue increased $258.4 million to $338.5 million.
|
•
|
Digital Workspace is primarily comprised of our Application Virtualization solutions which include Citrix Virtual Apps and Desktops, our unified endpoint management solutions, which include Citrix Endpoint Management, Citrix Content Collaboration, and Citrix Workspace; and
|
•
|
Networking products, which primarily include Citrix ADC and Citrix SD-WAN.
|
•
|
Customer Success Services, which gives customers a choice of tiered support offerings that combine the elements of product version upgrades, guidance, enablement, support and proactive monitoring to help our customers and our partners fully realize their business goals. Fees associated with this offering are recognized ratably over the term of the contract; and
|
•
|
Hardware Maintenance fees for our perpetual Networking products, which include technical support and hardware and software maintenance, are recognized ratably over the contract term; and
|
•
|
Fees from consulting services related to the implementation of our solutions, which are recognized as the services are provided; and
|
•
|
Fees from product training and certification, which are recognized as the services are provided.
|
|
Year Ended December 31,
|
|
2018 Compared to 2017
|
|
2017 Compared to 2016
|
||||||||||||||
|
2018
|
|
2017
|
|
2016
|
|
|
||||||||||||
|
(In thousands)
|
||||||||||||||||||
Revenues:
|
|
|
|
|
|
|
|
|
|
||||||||||
Subscription
|
$
|
455,276
|
|
|
$
|
314,735
|
|
|
$
|
245,606
|
|
|
$
|
140,541
|
|
|
$
|
69,129
|
|
Product and license
|
734,495
|
|
|
766,777
|
|
|
810,975
|
|
|
(32,282
|
)
|
|
(44,198
|
)
|
|||||
Support and services
|
1,784,132
|
|
|
1,743,174
|
|
|
1,679,499
|
|
|
40,958
|
|
|
63,675
|
|
|||||
Total net revenues
|
$
|
2,973,903
|
|
|
$
|
2,824,686
|
|
|
$
|
2,736,080
|
|
|
$
|
149,217
|
|
|
$
|
88,606
|
|
|
December 31, 2018
|
|
December 31, 2017
|
|
2018 compared to 2017
|
||||||
Deferred revenue
|
$
|
1,834,572
|
|
|
$
|
1,864,243
|
|
|
$
|
(29,671
|
)
|
Unbilled revenue
|
338,463
|
|
|
80,074
|
|
|
258,389
|
|
|
Year Ended December 31,
|
2018 Compared to 2017
|
|
2017 Compared to 2016
|
|||||||||||||||
|
2018
|
|
2017
|
|
2016
|
|
|
||||||||||||
|
(In thousands)
|
||||||||||||||||||
Cost of subscription, support and services
|
$
|
266,495
|
|
|
$
|
250,602
|
|
|
$
|
228,080
|
|
|
$
|
15,893
|
|
|
$
|
22,522
|
|
Cost of product and license revenues
|
120,249
|
|
|
123,356
|
|
|
121,391
|
|
|
(3,107
|
)
|
|
1,965
|
|
|||||
Amortization and impairment of product related intangible assets
|
47,059
|
|
|
65,688
|
|
|
55,418
|
|
|
(18,629
|
)
|
|
10,270
|
|
|||||
Total cost of net revenues
|
$
|
433,803
|
|
|
$
|
439,646
|
|
|
$
|
404,889
|
|
|
$
|
(5,843
|
)
|
|
$
|
34,757
|
|
|
Year Ended December 31,
|
|
2018 Compared to 2017
|
|
2017 Compared to 2016
|
||||||||||||||
|
2018
|
|
2017
|
|
2016
|
|
|
||||||||||||
|
(In thousands)
|
||||||||||||||||||
Sales, marketing and services
|
$
|
1,074,234
|
|
|
$
|
1,006,112
|
|
|
$
|
976,339
|
|
|
$
|
68,122
|
|
|
$
|
29,773
|
|
|
Year Ended December 31,
|
|
2018 Compared to 2017
|
|
2017 Compared to 2016
|
||||||||||||||
|
2018
|
|
2017
|
|
2016
|
|
|
||||||||||||
|
(In thousands)
|
||||||||||||||||||
Amortization and impairment of other intangible assets
|
$
|
15,854
|
|
|
$
|
17,190
|
|
|
$
|
15,076
|
|
|
$
|
(1,336
|
)
|
|
$
|
2,114
|
|
|
December 31,
|
|
2018 Compared to 2017
|
||||||||
|
2018
|
|
2017
|
|
|||||||
|
(In thousands)
|
||||||||||
Cash, cash equivalents and investments
|
$
|
1,776,700
|
|
|
$
|
2,731,974
|
|
|
$
|
(955,274
|
)
|
|
|
Payments due by period
|
||||||||||||||||||
|
|
Total
|
|
Less than 1 Year
|
|
1-3 Years
|
|
3-5 Years
|
|
More than 5 Years
|
||||||||||
Operating lease obligations
(1)
|
|
$
|
301,396
|
|
|
$
|
57,122
|
|
|
$
|
89,339
|
|
|
$
|
67,314
|
|
|
$
|
87,621
|
|
Convertible senior notes
(2)
|
|
1,164,497
|
|
|
1,164,497
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||
Senior Notes due 2027
(3)
|
|
750,000
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
750,000
|
|
|||||
Purchase obligations
(4)
|
|
71,888
|
|
|
46,888
|
|
|
25,000
|
|
|
—
|
|
|
—
|
|
|||||
Transition tax payable
(5)
|
|
285,627
|
|
|
—
|
|
|
53,540
|
|
|
78,500
|
|
|
153,587
|
|
|||||
Total contractual obligations
(6)
|
|
$
|
2,573,408
|
|
|
$
|
1,268,507
|
|
|
$
|
167,879
|
|
|
$
|
145,814
|
|
|
$
|
991,208
|
|
|
|
(1)
|
The amounts in the table above include $64.3 million in exited facility costs related to restructuring activities.
|
(2)
|
During the second quarter of 2014, we completed a private placement of
$1.4 billion
principal amount of
0.5%
Convertible Senior Notes due 2019. The amount above represents the principal balance to be repaid in April 2019. See Note 13 to our consolidated financial statements included in this Annual Report on Form 10-K for the year ended
December 31, 2018
for detailed information on the Convertible Notes offering and the transactions related thereto.
|
(3)
|
During the fourth quarter of 2017, we completed the issuance of
$750.0 million
principal amount of
4.5%
Senior Notes due 2027. The amount above represents the balance to be repaid. See Note 13 to our consolidated financial statements included in this Annual Report on Form 10-K for the year ended
December 31, 2018
for detailed information on the 2027 Notes offering and the transactions related thereto.
|
(4)
|
Purchase obligations represent non-cancelable commitments to purchase inventory ordered before year-end 2018 of approximately
$5.3 million
and a contingent obligation to purchase inventory of approximately
$16.6 million
. It also includes minimum purchase commitments for our use of certain cloud services with a third-party provider of $50.0 million.
|
(5)
|
Represents transition tax payable on deemed repatriation of deferred foreign income incurred as a result of the 2017 Tax Act. See Note 11 to our consolidated financial statements included in this Annual Report on Form 10-K for the year ended
December 31, 2018
for further information.
|
(6)
|
Total contractual obligations do not include agreements where our commitment is variable in nature or where cancellations without payment provisions exist and excludes
$89.9 million
of liabilities related to uncertain tax positions recorded in accordance with authoritative guidance, because we could not make reasonably reliable estimates of the period or amount of cash settlement with the respective taxing authorities. See Note 11 to our consolidated financial statements included in this Annual Report on Form 10-K for the year ended
December 31, 2018
for further information.
|
(a)
|
1. Consolidated Financial Statements.
|
Exhibit No.
|
|
Description
|
2.1
|
|
|
2.2
|
|
|
2.3
|
|
|
2.4
|
|
|
2.5
|
|
|
2.6
|
|
|
3.1
|
|
|
3.2
|
|
|
4.1
|
|
Specimen certificate representing Common Stock (incorporated herein by reference to Exhibit 4.1 to the Company’s Registration Statement on Form S-1 (File No. 33-98542), as amended)
(P)
|
4.2
|
|
|
4.3
|
|
|
4.4
|
|
|
4.5
|
|
|
4.6
|
|
|
10.1*
|
|
|
10.2*
|
|
10.3*
|
|
|
10.4*
|
|
|
10.5*
|
|
|
10.6*
|
|
|
10.7*
|
|
|
10.8*
|
|
|
10.9*
|
|
|
10.10*
|
|
|
10.11*
|
|
|
10.12*
|
|
|
10.13*
|
|
|
10.14*
|
|
|
10.15*
|
|
|
10.16*
|
|
|
10.17*
|
|
|
10.18*
|
|
|
10.19*
|
|
|
10.20*
|
|
|
10.21*
|
|
|
10.22*
|
|
|
10.23*
|
|
10.24*
|
|
|
10.25*
|
|
|
10.26*
|
|
|
10.27*
|
|
|
10.28*
|
|
|
10.29*
|
|
|
10.30*
|
|
|
10.31*
|
|
|
10.32*
|
|
|
10.33*
|
|
|
10.34*
|
|
|
10.35*
|
|
|
10.36*
|
|
|
10.37*
|
|
|
10.38*
|
|
|
10.39*
|
|
|
10.40*
|
|
|
10.41*
|
|
|
10.42*
|
|
|
10.43*
|
|
10.44*
|
|
|
10.45*
|
|
|
10.46*
|
|
|
10.47*
|
|
|
10.48*
|
|
|
10.49*
|
|
|
10.50*†
|
|
|
10.51*†
|
|
|
10.52
|
|
|
10.53
|
|
|
10.54
|
|
|
10.55
|
|
|
10.56
|
|
|
10.57
|
|
|
10.58
|
|
|
10.59
|
|
|
10.60
|
|
|
10.61
|
|
|
10.62
|
|
|
10.63*†
|
|
|
21.1†
|
|
23.1†
|
|
|
24.1
|
|
|
31.1†
|
|
|
31.2†
|
|
|
32.1††
|
|
|
101.INS†
|
|
XBRL Instance Document
|
101.SCH†
|
|
XBRL Taxonomy Extension Schema Document
|
101.CAL†
|
|
XBRL Taxonomy Extension Calculation Linkbase Document
|
101.DEF†
|
|
XBRL Taxonomy Extension Definition Linkbase Document
|
101.LAB†
|
|
XBRL Taxonomy Extension Label Linkbase Document
|
101.PRE†
|
|
XBRL Taxonomy Extension Presentation Linkbase Document
|
*
|
Indicates a management contract or a compensatory plan, contract or arrangement.
|
**
|
Schedules (or similar attachments) have been omitted pursuant to Item 601(b)(2) of Regulation S-K. The registrant hereby undertakes to furnish supplemental copies of any of the omitted schedules (or similar attachments) upon request by the SEC.
|
†
|
Filed herewith.
|
††
|
Furnished herewith.
|
(P)
|
This exhibit has been paper filed and is not subject to the hyperlinking requirements of Item 601 of Regulation S-K.
|
|
|
CITRIX SYSTEMS, INC.
|
|
|
|
|
By:
|
/s/ DAVID J. HENSHALL
|
|
|
David J. Henshall
|
|
|
President and Chief Executive Officer
|
Signature
|
|
Title(s)
|
|
|
|
|
|
||
/S/ DAVID J. HENSHALL
|
|
President, Chief Executive Officer and Director (Principal Executive Officer)
|
|
|
David J. Henshall
|
|
|
||
|
|
|
||
/S/ ANDREW DEL MATTO
|
|
Executive Vice President and Chief Financial Officer (Principal Financial Officer)
|
|
|
Andrew Del Matto
|
|
|
|
|
|
|
|
|
|
/S/ JESSICA SOISSON
|
|
Vice President, Chief Accounting Officer and Corporate Controller (Principal Accounting Officer)
|
|
|
Jessica Soisson
|
|
|
|
|
|
|
|
|
|
/S/ ROBERT M. CALDERONI
|
|
Chairman of the Board of Directors
|
|
|
Robert M. Calderoni
|
|
|
|
|
|
|
|
||
/S/ NANCI E. CALDWELL
|
|
Director
|
|
|
Nanci E. Caldwell
|
|
|
|
|
|
|
|
|
|
/S/ JESSE A. COHN
|
|
Director
|
|
|
Jesse A. Cohn
|
|
|
|
|
|
|
|
|
|
/S/ ROBERT D. DALEO
|
|
Director
|
|
|
Robert D. Daleo
|
|
|
|
|
|
|
|
||
/S/ MURRAY J. DEMO
|
|
Director
|
|
|
Murray J. Demo
|
|
|
|
|
|
|
|
||
/S/ AJEI S. GOPAL
|
|
Director
|
|
|
Ajei S. Gopal
|
|
|
|
|
|
|
|
|
|
/S/ THOMAS E. HOGAN
|
|
Director
|
|
|
Thomas E. Hogan
|
|
|
|
|
|
|
|
|
|
/S/ MOIRA A. KILCOYNE
|
|
Director
|
|
|
Moira A. Kilcoyne
|
|
|
|
|
|
|
|
|
|
/S/ PETER J. SACRIPANTI
|
|
Director
|
|
|
Peter J. Sacripanti
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
December 31,
2018 |
|
December 31,
2017 |
||||
Assets
|
(In thousands, except par value)
|
||||||
Current assets:
|
|
|
|
||||
Cash and cash equivalents
|
$
|
618,766
|
|
|
$
|
1,115,130
|
|
Short-term investments, available-for-sale
|
583,615
|
|
|
632,516
|
|
||
Accounts receivable, net of allowances of $4,530 and $4,645 at December 31, 2018 and 2017, respectively
|
688,420
|
|
|
712,535
|
|
||
Inventories, net
|
21,905
|
|
|
13,912
|
|
||
Prepaid expenses and other current assets
|
174,195
|
|
|
147,330
|
|
||
Total current assets
|
2,086,901
|
|
|
2,621,423
|
|
||
Long-term investments, available-for-sale
|
574,319
|
|
|
984,328
|
|
||
Property and equipment, net
|
243,396
|
|
|
252,932
|
|
||
Goodwill
|
1,802,670
|
|
|
1,614,494
|
|
||
Other intangible assets, net
|
167,187
|
|
|
141,952
|
|
||
Deferred tax assets, net
|
136,998
|
|
|
152,362
|
|
||
Other assets
|
124,578
|
|
|
52,685
|
|
||
Total assets
|
$
|
5,136,049
|
|
|
$
|
5,820,176
|
|
Liabilities, Temporary Equity and Stockholders' Equity
|
|
|
|
||||
Current liabilities:
|
|
|
|
||||
Accounts payable
|
$
|
75,551
|
|
|
$
|
66,893
|
|
Accrued expenses and other current liabilities
|
290,492
|
|
|
277,679
|
|
||
Income taxes payable
|
44,409
|
|
|
34,033
|
|
||
Current portion of deferred revenues
|
1,345,243
|
|
|
1,308,474
|
|
||
Convertible notes, short-term
|
1,155,445
|
|
|
—
|
|
||
Total current liabilities
|
2,911,140
|
|
|
1,687,079
|
|
||
Long-term portion of deferred revenues
|
489,329
|
|
|
555,769
|
|
||
Long-term debt
|
741,825
|
|
|
2,127,474
|
|
||
Long-term income taxes payable
|
285,627
|
|
|
335,457
|
|
||
Other liabilities
|
148,499
|
|
|
121,936
|
|
||
Commitments and contingencies
|
|
|
|
|
|
||
Temporary equity from Convertible notes
|
8,110
|
|
|
—
|
|
||
Stockholders' equity:
|
|
|
|
||||
Preferred stock at $.01 par value: 5,000 shares authorized, none issued and outstanding
|
—
|
|
|
—
|
|
||
Common stock at $.001 par value: 1,000,000 shares authorized; 309,761 and 305,751 shares issued and outstanding at December 31, 2018 and 2017, respectively
|
310
|
|
|
306
|
|
||
Additional paid-in capital
|
5,404,500
|
|
|
4,883,670
|
|
||
Retained earnings
|
4,169,019
|
|
|
3,509,484
|
|
||
Accumulated other comprehensive loss
|
(8,154
|
)
|
|
(10,806
|
)
|
||
|
9,565,675
|
|
|
8,382,654
|
|
||
Less - common stock in treasury, at cost (178,327 and 162,044 shares at December 31, 2018 and 2017, respectively)
|
(9,014,156
|
)
|
|
(7,390,193
|
)
|
||
Total stockholders' equity
|
551,519
|
|
|
992,461
|
|
||
Total liabilities, temporary equity and stockholders' equity
|
$
|
5,136,049
|
|
|
$
|
5,820,176
|
|
|
Year Ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
|
(In thousands, except per share information)
|
||||||||||
Revenues:
|
|
|
|
|
|
||||||
Subscription
|
$
|
455,276
|
|
|
$
|
314,735
|
|
|
$
|
245,606
|
|
Product and license
|
734,495
|
|
|
766,777
|
|
|
810,975
|
|
|||
Support and services
|
1,784,132
|
|
|
1,743,174
|
|
|
1,679,499
|
|
|||
Total net revenues
|
2,973,903
|
|
|
2,824,686
|
|
|
2,736,080
|
|
|||
Cost of net revenues:
|
|
|
|
|
|
||||||
Cost of subscription, support and services
|
266,495
|
|
|
250,602
|
|
|
228,080
|
|
|||
Cost of product and license revenues
|
120,249
|
|
|
123,356
|
|
|
121,391
|
|
|||
Amortization and impairment of product related intangible assets
|
47,059
|
|
|
65,688
|
|
|
55,418
|
|
|||
Total cost of net revenues
|
433,803
|
|
|
439,646
|
|
|
404,889
|
|
|||
Gross margin
|
2,540,100
|
|
|
2,385,040
|
|
|
2,331,191
|
|
|||
Operating expenses:
|
|
|
|
|
|
||||||
Research and development
|
439,984
|
|
|
415,801
|
|
|
395,373
|
|
|||
Sales, marketing and services
|
1,074,234
|
|
|
1,006,112
|
|
|
976,339
|
|
|||
General and administrative
|
315,343
|
|
|
302,565
|
|
|
316,838
|
|
|||
Amortization and impairment of other intangible assets
|
15,854
|
|
|
17,190
|
|
|
15,076
|
|
|||
Restructuring
|
16,725
|
|
|
72,375
|
|
|
67,401
|
|
|||
Total operating expenses
|
1,862,140
|
|
|
1,814,043
|
|
|
1,771,027
|
|
|||
Income from continuing operations
|
677,960
|
|
|
570,997
|
|
|
560,164
|
|
|||
Interest income
|
40,030
|
|
|
27,808
|
|
|
16,686
|
|
|||
Interest expense
|
(80,162
|
)
|
|
(51,609
|
)
|
|
(44,949
|
)
|
|||
Other (expense) income, net
|
(8,373
|
)
|
|
3,150
|
|
|
(4,131
|
)
|
|||
Income from continuing operations before income taxes
|
629,455
|
|
|
550,346
|
|
|
527,770
|
|
|||
Income tax expense
|
53,788
|
|
|
528,361
|
|
|
57,915
|
|
|||
Income from continuing operations
|
575,667
|
|
|
21,985
|
|
|
469,855
|
|
|||
(Loss) income from discontinued operations, net of income tax expense of $2,900 and $22,737 in 2017 and 2016, respectively
|
—
|
|
|
(42,704
|
)
|
|
66,257
|
|
|||
Net income (loss)
|
$
|
575,667
|
|
|
$
|
(20,719
|
)
|
|
$
|
536,112
|
|
Basic earnings (loss) per share:
|
|
|
|
|
|
||||||
Income from continuing operations
|
$
|
4.23
|
|
|
$
|
0.15
|
|
|
$
|
3.03
|
|
(Loss) income from discontinued operations
|
—
|
|
|
(0.28
|
)
|
|
0.43
|
|
|||
Basic net earnings (loss) per share
|
$
|
4.23
|
|
|
$
|
(0.13
|
)
|
|
$
|
3.46
|
|
|
|
|
|
|
|
||||||
Diluted earnings (loss) per share:
|
|
|
|
|
|
||||||
Income from continuing operations
|
$
|
3.94
|
|
|
$
|
0.14
|
|
|
$
|
2.99
|
|
(Loss) income from discontinued operations
|
—
|
|
|
(0.27
|
)
|
|
0.42
|
|
|||
Diluted net earnings (loss) per share
|
$
|
3.94
|
|
|
$
|
(0.13
|
)
|
|
$
|
3.41
|
|
|
|
|
|
|
|
||||||
Weighted average shares outstanding:
|
|
|
|
|
|
||||||
Basic
|
136,030
|
|
|
150,779
|
|
|
155,134
|
|
|||
Diluted
|
145,934
|
|
|
155,503
|
|
|
157,084
|
|
|
Year Ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
|
(In thousands)
|
||||||||||
|
|
|
|
|
|
||||||
Net income (loss)
|
$
|
575,667
|
|
|
$
|
(20,719
|
)
|
|
$
|
536,112
|
|
Other comprehensive income (loss):
|
|
|
|
|
|
||||||
Available for sale securities:
|
|
|
|
|
|
||||||
Change in net unrealized (losses) gains
|
(1,770
|
)
|
|
(3,285
|
)
|
|
996
|
|
|||
Less: reclassification adjustment for net losses (gains) included in net income
|
5,996
|
|
|
(273
|
)
|
|
(1,204
|
)
|
|||
Net change (net of tax effect)
|
4,226
|
|
|
(3,558
|
)
|
|
(208
|
)
|
|||
|
|
|
|
|
|
||||||
Gain on pension liability
|
1,569
|
|
|
2,768
|
|
|
906
|
|
|||
|
|
|
|
|
|
||||||
Cash flow hedges:
|
|
|
|
|
|
||||||
Change in unrealized (losses) gains
|
(3,842
|
)
|
|
6,046
|
|
|
(2,638
|
)
|
|||
Less: reclassification adjustment for net losses (gains) included in net income
|
699
|
|
|
(758
|
)
|
|
1,763
|
|
|||
Net change (net of tax effect)
|
(3,143
|
)
|
|
5,288
|
|
|
(875
|
)
|
|||
|
|
|
|
|
|
||||||
Other comprehensive income (loss)
|
2,652
|
|
|
4,498
|
|
|
(177
|
)
|
|||
|
|
|
|
|
|
||||||
Comprehensive income (loss)
|
$
|
578,319
|
|
|
$
|
(16,221
|
)
|
|
$
|
535,935
|
|
(In thousands)
|
Common Stock
|
|
Additional
Paid In Capital
|
|
Retained
Earnings
|
|
Accumulated Other
Comprehensive
(loss) income
|
|
Common Stock
in Treasury
|
|
|
Total
Equity
|
||||||||||||||||||
|
Shares
|
|
Amount
|
|
Shares
|
|
Amount
|
|
|
|||||||||||||||||||||
Balance at December 31, 2015
|
299,113
|
|
|
$
|
299
|
|
|
$
|
4,566,919
|
|
|
$
|
3,474,625
|
|
|
$
|
(28,527
|
)
|
|
(145,296
|
)
|
|
$
|
(6,039,870
|
)
|
|
|
$
|
1,973,446
|
|
Shares issued under stock-based compensation plans
|
3,009
|
|
|
3
|
|
|
41,244
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
41,247
|
|
||||||
Stock-based compensation expense
|
—
|
|
|
—
|
|
|
175,980
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
175,980
|
|
||||||
Common stock issued under employee stock purchase plan
|
729
|
|
|
1
|
|
|
57,514
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
57,515
|
|
||||||
Tax deficiency from employer stock plans, net
|
—
|
|
|
—
|
|
|
(574
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
(574
|
)
|
||||||
Stock repurchases, net
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(426
|
)
|
|
(28,689
|
)
|
|
|
(28,689
|
)
|
||||||
Restricted shares turned in for tax withholding
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(830
|
)
|
|
(66,638
|
)
|
|
|
(66,638
|
)
|
||||||
Other comprehensive loss, net of tax
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(177
|
)
|
|
—
|
|
|
—
|
|
|
|
(177
|
)
|
||||||
Temporary equity reclassification
|
—
|
|
|
—
|
|
|
(79,495
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
(79,495
|
)
|
||||||
Net Income
|
—
|
|
|
—
|
|
|
—
|
|
|
536,112
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
536,112
|
|
||||||
Balance at December 31, 2016
|
302,851
|
|
|
$
|
303
|
|
|
$
|
4,761,588
|
|
|
$
|
4,010,737
|
|
|
$
|
(28,704
|
)
|
|
(146,552
|
)
|
|
$
|
(6,135,197
|
)
|
|
|
$
|
2,608,727
|
|
Shares issued under stock-based compensation plans
|
2,614
|
|
|
3
|
|
|
2,110
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
2,113
|
|
||||||
Stock-based compensation expense
|
—
|
|
|
—
|
|
|
166,308
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
166,308
|
|
||||||
Common stock issued under employee stock purchase plan
|
286
|
|
|
—
|
|
|
19,326
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
19,326
|
|
||||||
Stock repurchases, net
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(7,384
|
)
|
|
(574,956
|
)
|
|
|
(574,956
|
)
|
||||||
Restricted shares turned in for tax withholding
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(975
|
)
|
|
(80,040
|
)
|
|
|
(80,040
|
)
|
||||||
Other comprehensive income, net of tax
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4,498
|
|
|
—
|
|
|
—
|
|
|
|
4,498
|
|
||||||
Other
|
—
|
|
|
—
|
|
|
(848
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
(848
|
)
|
||||||
Accelerated stock repurchase program
|
—
|
|
|
—
|
|
|
(150,000
|
)
|
|
—
|
|
|
—
|
|
|
(7,133
|
)
|
|
(600,000
|
)
|
|
|
(750,000
|
)
|
||||||
Cumulative-effect adjustment from adoption of accounting standard on stock-based compensation
|
—
|
|
|
—
|
|
|
5,691
|
|
|
(5,303
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
388
|
|
||||||
Distribution of the net assets of the GoTo Business
|
—
|
|
|
—
|
|
|
—
|
|
|
(475,231
|
)
|
|
13,400
|
|
|
—
|
|
|
—
|
|
|
|
(461,831
|
)
|
||||||
Temporary equity reclassification
|
—
|
|
|
—
|
|
|
79,495
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
79,495
|
|
||||||
Net loss
|
—
|
|
|
—
|
|
|
—
|
|
|
(20,719
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
(20,719
|
)
|
||||||
Balance at December 31, 2017
|
305,751
|
|
|
306
|
|
|
4,883,670
|
|
|
3,509,484
|
|
|
(10,806
|
)
|
|
(162,044
|
)
|
|
(7,390,193
|
)
|
|
|
992,461
|
|
||||||
Shares issued under stock-based compensation plans
|
2,258
|
|
|
3
|
|
|
161
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
164
|
|
||||||
Stock-based compensation expense
|
—
|
|
|
—
|
|
|
203,619
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
203,619
|
|
||||||
Common stock issued under employee stock purchase plan
|
461
|
|
|
—
|
|
|
33,462
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
33,462
|
|
||||||
Temporary equity reclassification
|
—
|
|
|
—
|
|
|
(8,110
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
(8,110
|
)
|
||||||
Stock repurchases, net
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(4,731
|
)
|
|
(511,153
|
)
|
|
|
(511,153
|
)
|
||||||
Accelerated stock repurchase program
|
—
|
|
|
—
|
|
|
150,000
|
|
|
—
|
|
|
—
|
|
|
(9,522
|
)
|
|
(900,000
|
)
|
|
|
(750,000
|
)
|
||||||
Restricted shares turned in for tax withholding
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(739
|
)
|
|
(71,593
|
)
|
|
|
(71,593
|
)
|
||||||
Cash dividends declared
|
—
|
|
|
—
|
|
|
—
|
|
|
(46,799
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
(46,799
|
)
|
||||||
Settlement of convertible notes and hedges
|
1,291
|
|
|
1
|
|
|
138,231
|
|
|
—
|
|
|
—
|
|
|
(1,291
|
)
|
|
(141,217
|
)
|
|
|
(2,985
|
)
|
||||||
Cumulative-effect adjustment from adoption of accounting standards
|
—
|
|
|
—
|
|
|
—
|
|
|
132,778
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
132,778
|
|
||||||
Other
|
—
|
|
|
—
|
|
|
3,467
|
|
|
(2,111
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
1,356
|
|
||||||
Other comprehensive income, net of tax
|
—
|
|
|
—
|
|
|
|
|
|
|
2,652
|
|
|
—
|
|
|
—
|
|
|
|
2,652
|
|
||||||||
Net income
|
—
|
|
|
—
|
|
|
—
|
|
|
575,667
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
575,667
|
|
||||||
Balance at December 31, 2018
|
309,761
|
|
|
$
|
310
|
|
|
$
|
5,404,500
|
|
|
$
|
4,169,019
|
|
|
$
|
(8,154
|
)
|
|
(178,327
|
)
|
|
$
|
(9,014,156
|
)
|
|
|
$
|
551,519
|
|
|
Year Ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
Operating Activities
|
(In thousands)
|
||||||||||
Net income (loss)
|
$
|
575,667
|
|
|
$
|
(20,719
|
)
|
|
$
|
536,112
|
|
Loss (income) from discontinued operations
|
—
|
|
|
42,704
|
|
|
(66,257
|
)
|
|||
Adjustments to reconcile net income (loss) to net cash provided by operating activities:
|
|
|
|
|
|
||||||
Amortization and impairment of intangible assets
|
62,913
|
|
|
82,878
|
|
|
70,494
|
|
|||
Depreciation and amortization of property and equipment
|
78,983
|
|
|
87,137
|
|
|
107,954
|
|
|||
Amortization of debt discount and transaction costs
|
39,099
|
|
|
38,298
|
|
|
37,085
|
|
|||
Amortization of deferred costs
|
38,144
|
|
|
—
|
|
|
—
|
|
|||
Stock-based compensation expense
|
203,619
|
|
|
165,120
|
|
|
152,739
|
|
|||
Deferred income tax (benefit) expense
|
(13,156
|
)
|
|
94,158
|
|
|
(21,654
|
)
|
|||
Excess tax benefit from stock-based compensation
|
—
|
|
|
—
|
|
|
(16,049
|
)
|
|||
Effects of exchange rate changes on monetary assets and liabilities denominated in foreign currencies
|
7,950
|
|
|
(7,645
|
)
|
|
5,189
|
|
|||
Other non-cash items
|
11,872
|
|
|
11,924
|
|
|
8,618
|
|
|||
Total adjustments to reconcile net income (loss) to net cash provided by operating activities
|
429,424
|
|
|
471,870
|
|
|
344,376
|
|
|||
Changes in operating assets and liabilities, net of the effects of acquisitions:
|
|
|
|
|
|
||||||
Accounts receivable
|
18,703
|
|
|
(33,904
|
)
|
|
(61,662
|
)
|
|||
Inventories
|
(8,239
|
)
|
|
(2,545
|
)
|
|
(4,133
|
)
|
|||
Prepaid expenses and other current assets
|
(7,855
|
)
|
|
(18,327
|
)
|
|
(12,077
|
)
|
|||
Other assets
|
(33,638
|
)
|
|
2,116
|
|
|
(2,747
|
)
|
|||
Income taxes, net
|
(56,988
|
)
|
|
318,795
|
|
|
42,431
|
|
|||
Accounts payable
|
6,804
|
|
|
(7,238
|
)
|
|
(16,365
|
)
|
|||
Accrued expenses and other current liabilities
|
36,967
|
|
|
34,886
|
|
|
22,650
|
|
|||
Deferred revenues
|
69,499
|
|
|
174,426
|
|
|
142,381
|
|
|||
Other liabilities
|
5,001
|
|
|
2,282
|
|
|
22,459
|
|
|||
Total changes in operating assets and liabilities, net of the effects of acquisitions
|
30,254
|
|
|
470,491
|
|
|
132,937
|
|
|||
Net cash provided by operating activities of continuing operations
|
1,035,345
|
|
|
964,346
|
|
|
947,168
|
|
|||
Net cash (used in) provided by operating activities of discontinued operations
|
—
|
|
|
(56,070
|
)
|
|
168,662
|
|
|||
Net cash provided by operating activities
|
1,035,345
|
|
|
908,276
|
|
|
1,115,830
|
|
|||
Investing Activities
|
|
|
|
|
|
||||||
Purchases of available-for-sale investments
|
(466,687
|
)
|
|
(1,155,659
|
)
|
|
(2,238,784
|
)
|
|||
Proceeds from sales of available-for-sale investments
|
455,417
|
|
|
775,135
|
|
|
1,294,636
|
|
|||
Proceeds from maturities of available-for-sale investments
|
468,145
|
|
|
466,900
|
|
|
632,517
|
|
|||
Purchases of property and equipment
|
(69,354
|
)
|
|
(80,901
|
)
|
|
(85,035
|
)
|
|||
Cash paid for acquisitions, net of cash acquired
|
(248,929
|
)
|
|
(60,449
|
)
|
|
(13,242
|
)
|
|||
Cash paid for licensing agreements and product related intangible assets
|
(3,210
|
)
|
|
(7,379
|
)
|
|
(25,940
|
)
|
|||
Other
|
(3,202
|
)
|
|
2,323
|
|
|
1,181
|
|
|||
Net cash provided by (used in) investing activities of continuing operations
|
132,180
|
|
|
(60,030
|
)
|
|
(434,667
|
)
|
|||
Net cash used in investing activities of discontinued operations
|
—
|
|
|
(3,891
|
)
|
|
(49,537
|
)
|
|||
Net cash provided by (used in) investing activities
|
132,180
|
|
|
(63,921
|
)
|
|
(484,204
|
)
|
|||
Financing Activities
|
|
|
|
|
|
||||||
Proceeds from issuance of common stock under stock-based compensation plans
|
164
|
|
|
2,114
|
|
|
41,247
|
|
|||
Proceeds from revolving credit facility
|
—
|
|
|
165,000
|
|
|
—
|
|
|||
Repayments on credit facility
|
—
|
|
|
(165,000
|
)
|
|
—
|
|
|||
Proceeds from 2027 notes, net of issuance costs
|
—
|
|
|
741,039
|
|
|
—
|
|
|||
Repayment of acquired debt
|
(5,674
|
)
|
|
(4,000
|
)
|
|
—
|
|
|||
Excess tax benefit from stock-based compensation
|
—
|
|
|
—
|
|
|
16,049
|
|
|||
Stock repurchases, net
|
(1,261,153
|
)
|
|
(1,174,957
|
)
|
|
(28,689
|
)
|
|||
Accelerated stock repurchase program
|
—
|
|
|
(150,000
|
)
|
|
—
|
|
|||
Cash paid for tax withholding on vested stock awards
|
(71,593
|
)
|
|
(80,040
|
)
|
|
(66,638
|
)
|
|||
Common stock cash dividends paid
|
(46,799
|
)
|
|
—
|
|
|
—
|
|
|||
Repayment on convertible debt
|
(272,986
|
)
|
|
—
|
|
|
—
|
|
|||
Transfer of cash to GoTo Business resulting from the separation
|
—
|
|
|
(28,523
|
)
|
|
—
|
|
|||
Net cash used in financing activities
|
(1,658,041
|
)
|
|
(694,367
|
)
|
|
(38,031
|
)
|
|||
Effect of exchange rate changes on cash and cash equivalents
|
(5,848
|
)
|
|
8,186
|
|
|
(5,157
|
)
|
|||
Change in cash and cash equivalents
|
(496,364
|
)
|
|
158,174
|
|
|
588,438
|
|
|||
Cash and cash equivalents at beginning of period, including cash of discontinued operations of $0, $120,861 and $57,762, respectively
|
1,115,130
|
|
|
956,956
|
|
|
368,518
|
|
|||
Cash and cash equivalents at end of period
|
618,766
|
|
|
1,115,130
|
|
|
956,956
|
|
|||
Less cash of discontinued operations
|
—
|
|
|
—
|
|
|
(120,861
|
)
|
|||
Cash and cash equivalents at end of period
|
618,766
|
|
|
$
|
1,115,130
|
|
|
$
|
836,095
|
|
|
Supplemental Cash Flow Information
|
|
|
|
|
|
||||||
Cash paid for income taxes
|
$
|
110,808
|
|
|
$
|
61,126
|
|
|
$
|
64,361
|
|
Cash paid for interest
|
$
|
41,834
|
|
|
$
|
8,764
|
|
|
$
|
7,847
|
|
|
|
Year Ended December 31, 2018
|
||||||||||
|
|
As Reported
|
|
Balances without adoption of ASC 606
|
|
Effect of Change
Higher/(Lower)
|
||||||
|
|
(in thousands, except per share amounts)
|
||||||||||
Total net revenues
|
|
$
|
2,973,903
|
|
|
$
|
2,966,848
|
|
|
$
|
7,055
|
|
Total cost of net revenues
|
|
433,803
|
|
|
431,974
|
|
|
1,829
|
|
|||
Gross profit
|
|
2,540,100
|
|
|
2,534,874
|
|
|
5,226
|
|
|||
Total operating expenses
|
|
1,862,140
|
|
|
1,890,692
|
|
|
(28,552
|
)
|
|||
Income from operations
|
|
677,960
|
|
|
644,182
|
|
|
33,778
|
|
|||
Net income
|
|
$
|
575,667
|
|
|
$
|
548,430
|
|
|
$
|
27,237
|
|
|
|
|
|
|
|
|
||||||
Basic earnings per share
|
|
$
|
4.23
|
|
|
$
|
4.03
|
|
|
$
|
0.20
|
|
Diluted earnings per share
|
|
$
|
3.94
|
|
|
$
|
3.76
|
|
|
$
|
0.18
|
|
|
|
As of December 31, 2018
|
||||||||||
|
|
As Reported
|
|
Balances without adoption of ASC 606
|
|
Effect of Change
Higher/(Lower)
|
||||||
|
|
(in thousands)
|
||||||||||
Prepaid expenses and other current assets
(1)
|
|
$
|
174,195
|
|
|
$
|
147,554
|
|
|
$
|
26,641
|
|
Other assets
(2)
|
|
124,578
|
|
|
52,732
|
|
|
71,846
|
|
|||
Deferred tax assets, net
|
|
136,998
|
|
|
169,064
|
|
|
(32,066
|
)
|
|||
Total assets
|
|
$
|
5,136,049
|
|
|
$
|
5,069,628
|
|
|
$
|
66,421
|
|
|
|
|
|
|
|
|
||||||
Other liabilities
(3)
|
|
148,499
|
|
|
135,430
|
|
|
13,069
|
|
|||
Current portion of deferred revenues
|
|
1,345,243
|
|
|
1,413,839
|
|
|
(68,596
|
)
|
|||
Long-term portion of deferred revenues
|
|
489,329
|
|
|
526,763
|
|
|
(37,434
|
)
|
|||
Total liabilities
|
|
$
|
4,576,420
|
|
|
$
|
4,669,381
|
|
|
$
|
(92,961
|
)
|
|
|
|
|
|
|
|
||||||
Stockholders' Equity:
|
|
|
|
|
|
|
||||||
Retained earnings
|
|
$
|
4,169,019
|
|
|
$
|
4,009,637
|
|
|
$
|
159,382
|
|
Year Ended December 31, 2017
|
||||||||||||
As Previously Reported
|
|
Amount Reclassified
|
|
As Reported
|
||||||||
Revenues:
|
|
|
|
|
Revenues:
|
|
||||||
Software as a service
|
$
|
175,762
|
|
|
$
|
138,973
|
|
|
Subscription
|
$
|
314,735
|
|
Product and licenses
(1)
|
857,253
|
|
|
(90,476
|
)
|
|
Product and license
|
766,777
|
|
|||
License updates and maintenance
(2)
|
1,659,936
|
|
|
83,238
|
|
|
Support and services
(3)
|
1,743,174
|
|
|||
Professional services
|
131,735
|
|
|
(131,735
|
)
|
|
|
|
||||
Total net revenues
|
$
|
2,824,686
|
|
|
$
|
—
|
|
|
Total net revenues
|
$
|
2,824,686
|
|
Year Ended December 31, 2016
|
||||||||||||
As Previously Reported
|
|
Amount Reclassified
|
|
As Reported
|
||||||||
Revenues:
|
|
|
|
|
Revenues:
|
|
||||||
Software as a service
|
$
|
134,682
|
|
|
$
|
110,924
|
|
|
Subscription
|
$
|
245,606
|
|
Product and licenses
(1)
|
882,898
|
|
|
(71,923
|
)
|
|
Product and license
|
810,975
|
|
|||
License updates and maintenance
(2)
|
1,587,271
|
|
|
92,228
|
|
|
Support and services
(3)
|
1,679,499
|
|
|||
Professional services
|
131,229
|
|
|
(131,229
|
)
|
|
|
|
||||
Total net revenues
|
$
|
2,736,080
|
|
|
$
|
—
|
|
|
Total net revenues
|
$
|
2,736,080
|
|
(1)
|
Product and licenses as previously reported included revenue from CSPs and on-premise subscriptions that are now included in Subscription. Current period presentation only includes revenues from perpetual offerings and hardware.
|
(2)
|
License updates and maintenance as previously reported included revenue from CSPs and on-premise license updates and maintenance that are now included in Subscription.
|
(3)
|
Support and services includes revenues from license updates and maintenance from perpetual offerings as well as professional services.
|
|
|
December 31,
|
||||||
|
|
2018
|
|
2017
|
||||
|
|
(In thousands)
|
||||||
Buildings
|
|
$
|
76,152
|
|
|
$
|
76,152
|
|
Computer equipment
|
|
189,333
|
|
|
176,140
|
|
||
Software
|
|
433,033
|
|
|
388,583
|
|
||
Equipment and furniture
|
|
78,401
|
|
|
73,700
|
|
||
Leasehold improvements
|
|
182,848
|
|
|
168,656
|
|
||
|
|
959,767
|
|
|
883,231
|
|
||
Less: accumulated depreciation and amortization
|
|
(741,587
|
)
|
|
(675,892
|
)
|
||
Assets under construction
|
|
8,447
|
|
|
28,824
|
|
||
Land
|
|
16,769
|
|
|
16,769
|
|
||
Total
|
|
$
|
243,396
|
|
|
$
|
252,932
|
|
|
Balance at January 1, 2018
|
|
Additions
|
|
Other
|
|
Balance at December 31, 2018
|
|
Balance at January 1, 2017
|
|
Additions
|
|
Other
|
|
Balance at December 31, 2017
|
||||||||||||||||
Goodwill
|
$
|
1,614,494
|
|
|
$
|
188,176
|
|
(1)
|
$
|
—
|
|
|
$
|
1,802,670
|
|
|
$
|
1,585,893
|
|
|
$
|
28,601
|
|
(2)
|
$
|
—
|
|
|
$
|
1,614,494
|
|
|
|
(1)
|
Amount relates to preliminary purchase price allocation of goodwill associated with the 2018 business combinations. See Note 4 for more information regarding the Company's acquisitions.
|
(2)
|
Amount relates to the purchase price allocation of goodwill associated with the 2017 business combination. See Note 4 for more information regarding the Company's acquisitions.
|
|
December 31, 2018
|
||||||||
|
Gross Carrying
Amount
|
|
Accumulated
Amortization
|
|
Weighted-Average Life (Years)
|
||||
Product related intangible assets
|
$
|
746,152
|
|
|
$
|
601,993
|
|
|
6.06
|
Other
|
227,922
|
|
|
204,894
|
|
|
6.40
|
||
Total
|
$
|
974,074
|
|
|
$
|
806,887
|
|
|
6.14
|
|
December 31, 2017
|
||||||||
|
Gross Carrying
Amount
|
|
Accumulated
Amortization
|
|
Weighted-Average Life (Years)
|
||||
Product related intangible assets
|
$
|
663,004
|
|
|
$
|
554,934
|
|
|
6.10
|
Other
|
222,923
|
|
|
189,041
|
|
|
6.49
|
||
Total
|
$
|
885,927
|
|
|
$
|
743,975
|
|
|
6.20
|
Performance Obligation
|
When Performance Obligation
is Typically Satisfied
|
Subscription
|
|
Cloud hosted offerings
|
Over the contract term, beginning on the date that service is made available to the customer (over time)
|
CSP
|
As the usage occurs (over time)
|
On-premise subscription software licenses
|
When software activation keys have been made available for download (point in time)
|
Product and license
|
|
Software Licenses
|
When software activation keys have been made available for download (point in time)
|
Hardware
|
When control of the product passes to the customer; typically upon shipment (point in time)
|
Support and services
|
|
License updates and maintenance
|
Ratably over the course of the service term (over time)
|
Professional services
|
As the services are provided (over time)
|
|
|
For the Year Ended December 31, 2018
|
||
|
|
(In Thousands)
|
||
Products and services transferred at a point in time
|
|
$
|
821,111
|
|
Products and services transferred over time
|
|
2,152,792
|
|
|
Total net revenues
|
|
$
|
2,973,903
|
|
|
|
<1-3 years
|
|
3-5 years
|
|
5 years or more
|
|
Total
|
||||||||
Subscription
|
|
$
|
431,527
|
|
|
$
|
45,790
|
|
|
$
|
535
|
|
|
$
|
477,852
|
|
Support and services
|
|
1,637,387
|
|
|
55,738
|
|
|
2,059
|
|
|
1,695,184
|
|
||||
Total net revenues
|
|
$
|
2,068,914
|
|
|
$
|
101,528
|
|
|
$
|
2,594
|
|
|
$
|
2,173,036
|
|
|
|
|
|
|
||||
|
|
2017
|
|
2016
|
||||
|
(in thousands)
|
|||||||
Net revenues
|
|
$
|
58,215
|
|
|
$
|
682,185
|
|
Cost of net revenues
|
|
15,456
|
|
|
154,652
|
|
||
Gross margin
|
|
42,759
|
|
|
527,533
|
|
||
Operating expenses:
|
|
|
|
|
|
|
||
Research and development
|
|
9,108
|
|
|
93,892
|
|
||
Sales, marketing and services
|
|
20,881
|
|
|
209,475
|
|
||
General and administrative
|
|
7,636
|
|
|
63,270
|
|
||
Amortization of other intangible assets
|
|
1,176
|
|
|
14,097
|
|
||
Restructuring
|
|
3,189
|
|
|
3,721
|
|
||
Separation
|
|
40,573
|
|
|
54,084
|
|
||
Total operating expenses
|
|
82,563
|
|
|
438,539
|
|
||
(Loss) income from discontinued operations before income taxes
|
|
(39,804
|
)
|
|
88,994
|
|
||
Income tax expense
|
|
2,900
|
|
|
22,737
|
|
||
(Loss) income from discontinued operations, net of income tax
|
|
$
|
(42,704
|
)
|
|
$
|
66,257
|
|
|
Sapho
|
|
Cedexis
|
||||||||
|
Purchase Price Allocation
|
|
Asset Life
|
|
Purchase Price Allocation
|
|
Asset Life
|
||||
Current assets
|
$
|
4,671
|
|
|
|
|
$
|
8,961
|
|
|
|
Intangible assets
|
53,600
|
|
|
5 years
|
|
27,200
|
|
|
1-6 years
|
||
Goodwill
|
144,173
|
|
|
Indefinite
|
|
44,003
|
|
|
Indefinite
|
||
Deferred taxes
|
—
|
|
|
|
|
3,173
|
|
|
|
||
Other assets
|
—
|
|
|
|
|
69
|
|
|
|
||
Assets acquired
|
202,444
|
|
|
|
|
83,406
|
|
|
|
||
Current liabilities assumed
|
3,323
|
|
|
|
|
5,711
|
|
|
|
||
Assumed debt
|
—
|
|
|
|
|
5,674
|
|
|
|
||
Other long term liabilities assumed
|
370
|
|
|
|
|
—
|
|
|
|
||
Deferred taxes
|
12,094
|
|
|
|
|
—
|
|
|
|
||
Net assets acquired
|
$
|
186,657
|
|
|
|
|
$
|
72,021
|
|
|
|
|
Sapho
|
|
Asset Life
|
|
Cedexis
|
|
Asset Life
|
||||
Customer relationships
|
$
|
1,600
|
|
|
5 years
|
|
$
|
2,000
|
|
|
1 year
|
Developed technology
|
52,000
|
|
|
5 years
|
|
23,800
|
|
|
5-6 years
|
||
Tradenames
|
—
|
|
|
|
|
1,400
|
|
|
1 year
|
||
Total
|
$
|
53,600
|
|
|
|
|
$
|
27,200
|
|
|
|
|
|
Twelve Months Ended December 31
|
||||||
|
|
2018
|
|
2017
|
||||
Revenues
|
|
$
|
2,977,155
|
|
|
$
|
2,838,880
|
|
Income from continuing operations
|
|
651,047
|
|
|
530,470
|
|
||
Net income (loss)
|
|
550,985
|
|
|
(56,601
|
)
|
|
December 31, 2018
|
|
December 31, 2017
|
||||||||||||||||||||||||||||
Description of the Securities
|
Amortized
Cost
|
|
Gross
Unrealized
Gains
|
|
Gross
Unrealized
Losses
|
|
Fair Value
|
|
Amortized
Cost
|
|
Gross
Unrealized
Gains
|
|
Gross
Unrealized
Losses
|
|
Fair Value
|
||||||||||||||||
Agency securities
|
$
|
314,982
|
|
|
$
|
333
|
|
|
$
|
(2,367
|
)
|
|
$
|
312,948
|
|
|
$
|
441,315
|
|
|
$
|
509
|
|
|
$
|
(2,760
|
)
|
|
$
|
439,064
|
|
Corporate securities
|
612,698
|
|
|
116
|
|
|
(4,156
|
)
|
|
608,658
|
|
|
810,444
|
|
|
268
|
|
|
(3,020
|
)
|
|
807,692
|
|
||||||||
Municipal securities
|
2,500
|
|
|
4
|
|
|
—
|
|
|
2,504
|
|
|
3,965
|
|
|
2
|
|
|
(2
|
)
|
|
3,965
|
|
||||||||
Government securities
|
234,668
|
|
|
91
|
|
|
(935
|
)
|
|
233,824
|
|
|
367,595
|
|
|
44
|
|
|
(1,516
|
)
|
|
366,123
|
|
||||||||
Total
|
$
|
1,164,848
|
|
|
$
|
544
|
|
|
$
|
(7,458
|
)
|
|
$
|
1,157,934
|
|
|
$
|
1,623,319
|
|
|
$
|
823
|
|
|
$
|
(7,298
|
)
|
|
$
|
1,616,844
|
|
•
|
Level 1.
Observable inputs such as quoted prices in active markets for identical assets or liabilities;
|
•
|
Level 2
. Inputs, other than the quoted prices in active markets, that are observable either directly or indirectly; and
|
•
|
Level 3
. Unobservable inputs in which there is little or no market data, which require the reporting entity to develop its own assumptions.
|
|
As of December 31, 2018
|
|
Quoted
Prices In
Active Markets
for Identical
Assets (Level 1)
|
|
Significant
Other
Observable
Inputs (Level 2)
|
|
Significant
Unobservable
Inputs (Level 3)
|
||||||||
|
(in thousands)
|
||||||||||||||
Assets:
|
|
|
|
|
|
|
|
||||||||
Cash and cash equivalents:
|
|
|
|
|
|
|
|
||||||||
Cash
|
$
|
505,363
|
|
|
$
|
505,363
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Money market funds
|
88,126
|
|
|
88,126
|
|
|
—
|
|
|
—
|
|
||||
Agency securities
|
3,296
|
|
|
—
|
|
|
3,296
|
|
|
—
|
|
||||
Corporate securities
|
9,371
|
|
|
—
|
|
|
9,371
|
|
|
—
|
|
||||
Government securities
|
12,610
|
|
|
|
|
|
12,610
|
|
|
—
|
|
||||
Available-for-sale securities:
|
|
|
|
|
|
|
|
||||||||
Agency securities
|
312,948
|
|
|
—
|
|
|
312,948
|
|
|
—
|
|
||||
Corporate securities
|
608,658
|
|
|
—
|
|
|
607,945
|
|
|
713
|
|
||||
Municipal securities
|
2,504
|
|
|
—
|
|
|
2,504
|
|
|
—
|
|
||||
Government securities
|
233,824
|
|
|
—
|
|
|
233,824
|
|
|
—
|
|
||||
Prepaid expenses and other current assets:
|
|
|
|
|
|
|
|
||||||||
Foreign currency derivatives
|
764
|
|
|
—
|
|
|
764
|
|
|
—
|
|
||||
Total assets
|
$
|
1,777,464
|
|
|
$
|
593,489
|
|
|
$
|
1,183,262
|
|
|
$
|
713
|
|
Accrued expenses and other current liabilities:
|
|
|
|
|
|
|
|
||||||||
Foreign currency derivatives
|
2,543
|
|
|
—
|
|
|
2,543
|
|
|
—
|
|
||||
Total liabilities
|
$
|
2,543
|
|
|
$
|
—
|
|
|
$
|
2,543
|
|
|
$
|
—
|
|
|
As of December 31, 2017
|
|
Quoted
Prices In
Active Markets
for Identical
Assets (Level 1)
|
|
Significant
Other
Observable
Inputs (Level 2)
|
|
Significant
Unobservable
Inputs (Level 3)
|
||||||||
|
(in thousands)
|
||||||||||||||
Assets:
|
|
|
|
|
|
|
|
||||||||
Cash and cash equivalents:
|
|
|
|
|
|
|
|
||||||||
Cash
|
$
|
556,520
|
|
|
$
|
556,520
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Money market funds
|
555,826
|
|
|
555,826
|
|
|
—
|
|
|
—
|
|
||||
Corporate securities
|
2,784
|
|
|
—
|
|
|
2,784
|
|
|
—
|
|
||||
Available-for-sale securities:
|
|
|
|
|
|
|
|
||||||||
Agency securities
|
439,064
|
|
|
—
|
|
|
439,064
|
|
|
—
|
|
||||
Corporate securities
|
807,692
|
|
|
—
|
|
|
807,299
|
|
|
393
|
|
||||
Municipal securities
|
3,965
|
|
|
—
|
|
|
3,965
|
|
|
—
|
|
||||
Government securities
|
366,123
|
|
|
—
|
|
|
366,123
|
|
|
—
|
|
||||
Prepaid expenses and other current assets:
|
|
|
|
|
|
|
|
||||||||
Foreign currency derivatives
|
2,498
|
|
|
—
|
|
|
2,498
|
|
|
—
|
|
||||
Total assets
|
$
|
2,734,472
|
|
|
$
|
1,112,346
|
|
|
$
|
1,621,733
|
|
|
$
|
393
|
|
Accrued expenses and other current liabilities:
|
|
|
|
|
|
|
|
||||||||
Foreign currency derivatives
|
814
|
|
|
—
|
|
|
814
|
|
|
—
|
|
||||
Total liabilities
|
$
|
814
|
|
|
$
|
—
|
|
|
$
|
814
|
|
|
$
|
—
|
|
|
Fair Value
|
|
Carrying Value
|
||||
2027 Notes
|
$
|
717,375
|
|
|
$
|
741,825
|
|
Convertible Senior Notes
|
$
|
1,648,567
|
|
|
$
|
1,155,445
|
|
|
|
December 31,
|
||||||
|
|
2018
|
|
2017
|
||||
|
|
(In thousands)
|
||||||
Accrued compensation and employee benefits
|
|
$
|
196,847
|
|
|
$
|
161,049
|
|
Other accrued expenses
|
|
93,645
|
|
|
116,630
|
|
||
Total
|
|
$
|
290,492
|
|
|
$
|
277,679
|
|
|
Year Ended
|
|
Year Ended
|
|
Year Ended
|
||
|
December 31, 2018
|
|
December 31, 2017
|
|
December 31, 2016
|
||
Expected volatility factor
|
0.26 - 0.29
|
|
0.27 - 0.29
|
|
|
0.27 - 0.41
|
|
Risk free interest rate
|
1.12% - 2.19%
|
|
0.60% - 1.12%
|
|
|
0.25% - 0.42%
|
|
Expected dividend yield
|
0% - 1.27%
|
|
0
|
%
|
|
0
|
%
|
Expected life (in years)
|
0.5
|
|
0.5
|
|
|
0.5
|
|
Income Statement Classifications
|
2018
|
|
2017
|
|
2016
|
||||||
Cost of subscription, support and services
|
$
|
7,979
|
|
|
$
|
4,281
|
|
|
$
|
2,179
|
|
Research and development
|
66,154
|
|
|
47,291
|
|
|
38,578
|
|
|||
Sales, marketing and services
|
72,406
|
|
|
55,173
|
|
|
48,514
|
|
|||
General and administrative
|
57,080
|
|
|
58,375
|
|
|
63,468
|
|
|||
Total
|
$
|
203,619
|
|
|
$
|
165,120
|
|
|
$
|
152,739
|
|
|
March 2017 Grant (Modified)
|
March 2017 Grant
|
March 2016 Grant
|
January 2016 Grant
|
||||
Expected volatility factor
|
0.16 - 0.32
|
|
0.27 - 0.32
|
|
0.29 - 0.39
|
|
0.29 - 0.37
|
|
Risk free interest rate
|
2.67
|
%
|
1.48
|
%
|
0.91
|
%
|
1.10
|
%
|
Expected dividend yield
|
0
|
%
|
0
|
%
|
0
|
%
|
0
|
%
|
|
|
Number of
Shares
|
|
Weighted-
Average
Fair Value
at Grant Date
|
|||
Non-vested stock units at December 31, 2017
|
|
4,622,546
|
|
|
$
|
82.83
|
|
Granted
|
|
3,903,225
|
|
|
92.20
|
|
|
Vested
|
|
(2,076,052
|
)
|
|
71.92
|
|
|
Forfeited
|
|
(596,218
|
)
|
|
74.07
|
|
|
Non-vested stock units at December 31, 2018
|
|
5,853,501
|
|
|
88.79
|
|
|
|
Operating
Leases
|
|
Sublease
Income
|
||||
|
|
(In thousands)
|
||||||
Years ending December 31,
|
|
|
|
|
||||
2019
|
|
$
|
57,122
|
|
|
$
|
241
|
|
2020
|
|
49,358
|
|
|
—
|
|
||
2021
|
|
39,981
|
|
|
—
|
|
||
2022
|
|
35,296
|
|
|
—
|
|
||
2023
|
|
32,018
|
|
|
—
|
|
||
Thereafter
|
|
87,621
|
|
|
—
|
|
||
Total
|
|
$
|
301,396
|
|
|
$
|
241
|
|
|
|
2018
|
|
2017
|
|
2016
|
||||||
|
|
(In thousands)
|
||||||||||
United States
|
|
$
|
174,519
|
|
|
$
|
78,897
|
|
|
$
|
59,344
|
|
Foreign
|
|
454,936
|
|
|
471,449
|
|
|
468,426
|
|
|||
Total
|
|
$
|
629,455
|
|
|
$
|
550,346
|
|
|
$
|
527,770
|
|
|
|
2018
|
|
2017
|
|
2016
|
||||||
|
|
(In thousands)
|
||||||||||
Current:
|
|
|
|
|
|
|
||||||
Federal
|
|
$
|
(19,461
|
)
|
|
$
|
374,602
|
|
|
$
|
18,832
|
|
Foreign
|
|
70,146
|
|
|
56,526
|
|
|
52,978
|
|
|||
State
|
|
16,259
|
|
|
3,075
|
|
|
7,759
|
|
|||
Total current
|
|
66,944
|
|
|
434,203
|
|
|
79,569
|
|
|||
Deferred:
|
|
|
|
|
|
|
||||||
Federal
|
|
1,899
|
|
|
52,842
|
|
|
(7,688
|
)
|
|||
Foreign
|
|
(14,804
|
)
|
|
(5,468
|
)
|
|
(3,139
|
)
|
|||
State
|
|
(251
|
)
|
|
46,784
|
|
|
(10,827
|
)
|
|||
Total deferred
|
|
(13,156
|
)
|
|
94,158
|
|
|
(21,654
|
)
|
|||
Total provision
|
|
$
|
53,788
|
|
|
$
|
528,361
|
|
|
$
|
57,915
|
|
|
|
December 31,
|
||||||
|
|
2018
|
|
2017
|
||||
|
|
(In thousands)
|
||||||
Deferred tax assets
|
|
$
|
136,998
|
|
|
$
|
152,362
|
|
Deferred tax liabilities
|
|
(15,075
|
)
|
|
(237
|
)
|
||
Total net deferred tax assets
|
|
$
|
121,923
|
|
|
$
|
152,125
|
|
|
|
December 31,
|
||||||
|
|
2018
|
|
2017
|
||||
|
|
(In thousands)
|
||||||
Deferred tax assets:
|
|
|
|
|
||||
Accruals and reserves
|
|
$
|
27,022
|
|
|
$
|
30,317
|
|
Deferred revenue
|
|
62,085
|
|
|
65,016
|
|
||
Tax credits
|
|
81,720
|
|
|
80,772
|
|
||
Net operating losses
|
|
54,747
|
|
|
36,674
|
|
||
Stock based compensation
|
|
30,936
|
|
|
21,714
|
|
||
Depreciation and amortization
|
|
—
|
|
|
4,939
|
|
||
Valuation allowance
|
|
(85,400
|
)
|
|
(76,789
|
)
|
||
Total deferred tax assets
|
|
171,110
|
|
|
162,643
|
|
||
Deferred tax liabilities:
|
|
|
|
|
||||
Acquired technology
|
|
(15,681
|
)
|
|
(2,882
|
)
|
||
Depreciation and amortization
|
|
(5,044
|
)
|
|
—
|
|
||
Prepaid expenses
|
|
(23,213
|
)
|
|
(7,414
|
)
|
||
Other
|
|
(5,249
|
)
|
|
(222
|
)
|
||
Total deferred tax liabilities
|
|
(49,187
|
)
|
|
(10,518
|
)
|
||
Total net deferred tax assets
|
|
$
|
121,923
|
|
|
$
|
152,125
|
|
|
|
Year Ended December 31,
|
|||||||
|
|
2018
|
|
2017
|
|
2016
|
|||
Federal statutory taxes
|
|
21.0
|
%
|
|
35.0
|
%
|
|
35.0
|
%
|
State income taxes, net of federal tax benefit
|
|
0.7
|
|
|
2.1
|
|
|
0.8
|
|
Foreign operations
|
|
(5.4
|
)
|
|
(20.0
|
)
|
|
(21.6
|
)
|
Permanent differences
|
|
2.0
|
|
|
2.6
|
|
|
3.2
|
|
The 2017 Tax Act - tax rate impact on deferred taxes
|
|
(0.7
|
)
|
|
11.8
|
|
|
—
|
|
The 2017 Tax Act - transition tax
|
|
(3.5
|
)
|
|
66.3
|
|
|
—
|
|
Change in valuation allowance reserve
|
|
0.4
|
|
|
8.8
|
|
|
—
|
|
Change in deferred tax liability related to acquired intangibles
|
|
(0.1
|
)
|
|
0.3
|
|
|
(0.8
|
)
|
Tax credits
|
|
(5.8
|
)
|
|
(7.6
|
)
|
|
(7.9
|
)
|
Stock-based compensation
|
|
(1.9
|
)
|
|
(3.6
|
)
|
|
0.3
|
|
Change in accruals for uncertain tax positions
|
|
1.8
|
|
|
0.3
|
|
|
2.2
|
|
Other
|
|
—
|
|
|
—
|
|
|
(0.2
|
)
|
|
|
8.5
|
%
|
|
96.0
|
%
|
|
11.0
|
%
|
Balance at December 31, 2016
|
$
|
69,801
|
|
Additions based on tax positions related to the current year
|
9,293
|
|
|
Additions for tax positions of prior years
|
7,656
|
|
|
Reductions related to audit settlements
|
(137
|
)
|
|
Reductions related to the expiration of statutes of limitations
|
(8,764
|
)
|
|
Balance at December 31, 2017
|
77,849
|
|
|
Additions based on tax positions related to the current year
|
10,168
|
|
|
Additions for tax positions of prior years
|
10,325
|
|
|
Reductions related to the expiration of statutes of limitations
|
(8,436
|
)
|
|
Balance at December 31, 2018
|
$
|
89,906
|
|
|
December 31,
|
||||||
|
2018
|
|
2017
|
||||
|
(In thousands)
|
||||||
Property and equipment, net:
|
|
|
|
||||
United States
|
$
|
185,091
|
|
|
$
|
189,465
|
|
United Kingdom
|
25,459
|
|
|
24,171
|
|
||
Other countries
|
32,846
|
|
|
39,296
|
|
||
Total property and equipment, net
|
$
|
243,396
|
|
|
$
|
252,932
|
|
|
December 31,
|
||||||||||
|
2018
|
|
2017
(4)
|
|
2016
(4)
|
||||||
|
(In thousands)
|
||||||||||
Net revenues:
|
|
|
|
|
|
||||||
Digital workspace
(1)
|
$
|
2,024,289
|
|
|
$
|
1,901,952
|
|
|
$
|
1,821,739
|
|
Networking
(2)
|
817,193
|
|
|
790,434
|
|
|
782,875
|
|
|||
Professional services
(3)
|
132,421
|
|
|
132,300
|
|
|
131,466
|
|
|||
Total net revenues
|
$
|
2,973,903
|
|
|
$
|
2,824,686
|
|
|
$
|
2,736,080
|
|
|
|
(1)
|
Digital Workspace revenues are primarily comprised of sales from the Company’s application virtualization solutions, which include Citrix Virtual Apps and Desktops, the Company's unified endpoint management solutions, which include Citrix Endpoint Management, related license updates and maintenance and support, Citrix Content Collaboration, and cloud offerings.
|
(2)
|
Networking revenues primarily include Citrix ADC and Citrix SD-WAN, related license updates and maintenance and support and cloud offerings.
|
(3)
|
Professional services revenues are primarily comprised of revenues from consulting services and product training and certification services.
|
(4)
|
Prior period amounts have not been adjusted under the modified retrospective method of adoption of the revenue recognition standard. See Note 2 for further information regarding the Company’s adoption of the revenue recognition standard.
|
|
December 31,
|
||||||||||
|
2018
|
|
2017
(1)
|
|
2016
(1)
|
||||||
|
(In thousands)
|
||||||||||
Net revenues:
|
|
|
|
|
|
||||||
Americas
|
$
|
1,716,876
|
|
|
$
|
1,644,008
|
|
|
$
|
1,598,896
|
|
EMEA
|
956,365
|
|
|
888,072
|
|
|
863,517
|
|
|||
APJ
|
300,662
|
|
|
292,606
|
|
|
273,667
|
|
|||
Total net revenues
|
$
|
2,973,903
|
|
|
$
|
2,824,686
|
|
|
$
|
2,736,080
|
|
|
December 31, 2018
|
December 31, 2017
|
||||
Liability component
|
|
|
||||
Principal
|
$
|
1,164,497
|
|
$
|
1,437,483
|
|
Less: note discount and issuance costs
|
(9,052
|
)
|
(51,159
|
)
|
||
Net carrying amount
|
$
|
1,155,445
|
|
$
|
1,386,324
|
|
|
|
|
||||
Equity component
|
|
|
||||
Temporary equity
|
$
|
8,110
|
|
$
|
—
|
|
Additional paid-in-capital
|
127,374
|
|
162,869
|
|
||
Total (including temporary equity)
|
$
|
135,484
|
|
$
|
162,869
|
|
|
Year Ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
Contractual interest expense
|
$
|
40,151
|
|
|
$
|
11,406
|
|
|
$
|
7,187
|
|
Amortization of debt issuance costs
|
4,663
|
|
|
4,050
|
|
|
3,863
|
|
|||
Amortization of debt discount
|
34,228
|
|
|
34,039
|
|
|
33,014
|
|
|||
|
$
|
79,042
|
|
|
$
|
49,495
|
|
|
$
|
44,064
|
|
|
Asset Derivatives
|
|
Liability Derivatives
|
||||||||||||
|
(In thousands)
|
||||||||||||||
|
December 31, 2018
|
|
December 31, 2017
|
|
December 31, 2018
|
|
December 31, 2017
|
||||||||
Derivatives Designated as
Hedging Instruments
|
Balance Sheet
Location
|
|
Fair
Value
|
|
Balance Sheet
Location
|
|
Fair
Value
|
|
Balance Sheet
Location
|
|
Fair
Value
|
|
Balance Sheet
Location
|
|
Fair
Value
|
Foreign currency forward contracts
|
Prepaid
expenses
and other
current
assets
|
|
$708
|
|
Prepaid
expenses
and other
current
assets
|
|
$2,481
|
|
Accrued
expenses
and other
current
liabilities
|
|
$1,811
|
|
Accrued
expenses
and other
current
liabilities
|
|
$110
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Asset Derivatives
|
|
Liability Derivatives
|
||||||||||||
|
(In thousands)
|
||||||||||||||
|
December 31, 2018
|
|
December 31, 2017
|
|
December 31, 2018
|
|
December 31, 2017
|
||||||||
Derivatives Not Designated as
Hedging Instruments
|
Balance Sheet
Location
|
|
Fair
Value
|
|
Balance Sheet
Location
|
|
Fair
Value
|
|
Balance Sheet
Location
|
|
Fair
Value
|
|
Balance Sheet
Location
|
|
Fair
Value
|
Foreign currency forward contracts
|
Prepaid
expenses
and other
current
assets
|
|
$56
|
|
Prepaid
expenses
and other
current
assets
|
|
$17
|
|
Accrued
expenses
and other
current
liabilities
|
|
$732
|
|
Accrued
expenses
and other
current
liabilities
|
|
$704
|
|
For the Year ended December 31,
|
||||||||
|
(In thousands)
|
||||||||
Derivatives Not Designated as Hedging Instruments
|
Location of Gain (Loss) Recognized in Income on
Derivative
|
|
Amount of Gain (Loss) Recognized in Income on Derivative
|
||||||
|
|
|
2018
|
|
2017
|
||||
Foreign currency forward contracts
|
Other (expense) income, net
|
|
$
|
7,062
|
|
|
$
|
(6,804
|
)
|
Foreign Currency
|
Currency
Denomination
|
Australian dollars
|
AUD 18,200
|
Brazilian Real
|
BRL 5,500
|
British pounds sterling
|
GBP 14,100
|
Canadian dollars
|
CAD 2,350
|
Chinese renminbi
|
CNY 41,800
|
Danish krone
|
DKK 6,329
|
Euro
|
EUR 9,736
|
Hong Kong dollars
|
HKD 20,600
|
Indian rupees
|
INR 62,000
|
Japanese yen
|
JPY 2,300,000
|
Korean Won
|
KRW 150,000
|
New Zealand Dollar
|
NZD 100
|
Singapore dollars
|
SGD 13,500
|
Swiss francs
|
CHF 19,450
|
|
Year Ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
Numerator:
|
|
|
|
|
|
||||||
Income from continuing operations
|
$
|
575,667
|
|
|
$
|
21,985
|
|
|
$
|
469,855
|
|
(Loss) income from discontinued operations, net of income taxes
|
—
|
|
|
(42,704
|
)
|
|
66,257
|
|
|||
Net income (loss)
|
$
|
575,667
|
|
|
$
|
(20,719
|
)
|
|
$
|
536,112
|
|
Denominator:
|
|
|
|
|
|
||||||
Denominator for basic earnings per share - weighted-average shares outstanding
|
136,030
|
|
|
150,779
|
|
|
155,134
|
|
|||
Effect of dilutive employee stock awards
|
2,653
|
|
|
2,493
|
|
|
1,950
|
|
|||
Effect of dilutive Convertible Notes
|
5,769
|
|
|
2,231
|
|
|
—
|
|
|||
Effect of dilutive warrants
|
1,482
|
|
|
—
|
|
|
—
|
|
|||
Denominator for diluted earnings per share - weighted-average shares outstanding
|
145,934
|
|
|
155,503
|
|
|
157,084
|
|
|||
|
|
|
|
|
|
||||||
Basic earnings (loss) per share:
|
|
|
|
|
|
||||||
Income from continuing operations
|
$
|
4.23
|
|
|
$
|
0.15
|
|
|
$
|
3.03
|
|
(Loss) income from discontinued operations, net of income taxes
|
—
|
|
|
(0.28
|
)
|
|
0.43
|
|
|||
Basic net earnings (loss) per share
|
$
|
4.23
|
|
|
$
|
(0.13
|
)
|
|
$
|
3.46
|
|
|
|
|
|
|
|
||||||
Diluted earnings (loss) per share:
|
|
|
|
|
|
||||||
Income from continuing operations
|
$
|
3.94
|
|
|
$
|
0.14
|
|
|
$
|
2.99
|
|
(Loss) income from discontinued operations, net of income taxes
|
—
|
|
|
(0.27
|
)
|
|
0.42
|
|
|||
Diluted net earnings (loss) per share:
|
$
|
3.94
|
|
|
$
|
(0.13
|
)
|
|
$
|
3.41
|
|
|
Foreign currency
|
|
Unrealized loss on available-for-sale securities
|
|
Unrealized gain (loss) on derivative instruments
|
|
Other comprehensive loss on pension liability
|
|
Total
|
||||||||||
|
(In thousands)
|
||||||||||||||||||
Balance at December 31, 2017
|
$
|
(2,946
|
)
|
|
$
|
(6,666
|
)
|
|
$
|
2,158
|
|
|
$
|
(3,352
|
)
|
|
$
|
(10,806
|
)
|
Other comprehensive (loss) income before reclassifications
|
—
|
|
|
(1,770
|
)
|
|
(3,842
|
)
|
|
1,569
|
|
|
(4,043
|
)
|
|||||
Amounts reclassified from accumulated other comprehensive loss
|
—
|
|
|
5,996
|
|
|
699
|
|
|
—
|
|
|
6,695
|
|
|||||
Net current period other comprehensive income (loss)
|
—
|
|
|
4,226
|
|
|
(3,143
|
)
|
|
1,569
|
|
|
2,652
|
|
|||||
Balance at December 31, 2018
|
$
|
(2,946
|
)
|
|
$
|
(2,440
|
)
|
|
$
|
(985
|
)
|
|
$
|
(1,783
|
)
|
|
$
|
(8,154
|
)
|
|
|
For the Year Ended December 31, 2018
|
||||
|
|
(In thousands)
|
||||
Details about accumulated other comprehensive loss components
|
|
Amount reclassified from Accumulated other comprehensive loss, net of tax
|
|
Affected line item in the Consolidated Statements of Income
|
||
Unrealized net loss on available-for-sale securities
|
|
$
|
5,996
|
|
|
Other income (expense), net
|
Unrealized net loss on cash flow hedges
|
|
699
|
|
|
Operating expenses *
|
|
|
|
$
|
6,695
|
|
|
|
|
Year Ended December 31,
|
||||||||||
|
2018
|
|
2017
|
|
2016
|
||||||
Employee severance and related costs
|
$
|
2,507
|
|
|
$
|
62,844
|
|
|
$
|
41,054
|
|
Consolidation of leased facilities
|
14,218
|
|
|
9,718
|
|
|
28,857
|
|
|||
Reversal of previous charges
|
—
|
|
|
(187
|
)
|
|
(2,510
|
)
|
|||
Total Restructuring charges
|
$
|
16,725
|
|
|
$
|
72,375
|
|
|
$
|
67,401
|
|
|
Total
|
||
Balance at January 1, 2018
|
$
|
55,283
|
|
Restructuring charges
|
16,725
|
|
|
Payments
|
(26,913
|
)
|
|
Balance at December 31, 2018
|
$
|
45,095
|
|
|
|
First
Quarter
|
|
Second
Quarter
|
|
Third
Quarter
|
|
Fourth
Quarter
|
|
Total Year
|
||||||||||
|
|
(In thousands, except per share amounts)
|
||||||||||||||||||
2018
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net revenues
|
|
$
|
697,192
|
|
|
$
|
742,365
|
|
|
$
|
732,476
|
|
|
$
|
801,870
|
|
|
$
|
2,973,903
|
|
Gross margin
|
|
588,906
|
|
|
633,616
|
|
|
628,559
|
|
|
689,019
|
|
|
2,540,100
|
|
|||||
Income from operations
|
|
165,563
|
|
|
145,147
|
|
|
164,779
|
|
|
202,471
|
|
|
677,960
|
|
|||||
Net income
|
|
144,259
|
|
|
106,833
|
|
|
158,857
|
|
|
165,718
|
|
|
575,667
|
|
|||||
Earnings per share - basic
|
|
1.04
|
|
|
0.79
|
|
|
1.18
|
|
|
1.24
|
|
|
4.23
|
|
|||||
Earnings per share - diluted
|
|
0.99
|
|
|
0.73
|
|
|
1.08
|
|
|
1.15
|
|
|
3.94
|
|
|||||
|
|
First
Quarter
|
|
Second
Quarter
|
|
Third
Quarter
|
|
Fourth
Quarter
|
|
Total Year
|
||||||||||
|
|
(In thousands, except per share amounts)
|
||||||||||||||||||
2017
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Net revenues
|
|
$
|
662,677
|
|
|
$
|
693,227
|
|
|
$
|
690,925
|
|
|
$
|
777,857
|
|
|
$
|
2,824,686
|
|
Gross margin
|
|
560,219
|
|
|
583,915
|
|
|
584,988
|
|
|
655,918
|
|
|
2,385,040
|
|
|||||
Income from continuing operations
|
|
70,325
|
|
|
108,829
|
|
|
126,720
|
|
|
(283,889
|
)
|
|
21,985
|
|
|||||
Loss from discontinued operations, net of tax
|
|
(42,704
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(42,704
|
)
|
|||||
Net income
|
|
27,621
|
|
|
108,829
|
|
|
126,720
|
|
|
(283,889
|
)
|
|
(20,719
|
)
|
|||||
Basic earnings per share:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Income (loss) from continuing operations
|
|
0.46
|
|
|
0.72
|
|
|
0.84
|
|
|
(1.93
|
)
|
|
0.15
|
|
|||||
Loss from discontinued operations
|
|
(0.28
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(0.28
|
)
|
|||||
Basic earnings (loss) per share
|
|
0.18
|
|
|
0.72
|
|
|
0.84
|
|
|
(1.93
|
)
|
|
(0.13
|
)
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Diluted earnings per share:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Income (loss) from continuing operations
|
|
0.44
|
|
|
0.70
|
|
|
0.82
|
|
|
(1.93
|
)
|
|
0.14
|
|
|||||
Loss from discontinued operations
|
|
(0.27
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(0.27
|
)
|
|||||
Diluted earnings (loss) per share
|
|
0.17
|
|
|
0.70
|
|
|
0.82
|
|
|
(1.93
|
)
|
|
(0.13
|
)
|
|
|
Beginning
of Period
|
|
Charged to
Expense
|
|
Charged
to Other
Accounts
|
|
|
|
Deductions
|
|
|
|
Balance
at End
of Period
|
||||||||||
|
|
(In thousands)
|
||||||||||||||||||||||
2018
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Deducted from asset accounts:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Allowance for doubtful accounts
|
|
$
|
3,420
|
|
|
$
|
3,586
|
|
|
$
|
457
|
|
|
(3)
|
|
$
|
3,829
|
|
|
(2)
|
|
$
|
3,634
|
|
Allowance for returns
|
|
1,225
|
|
|
—
|
|
|
1,561
|
|
|
(1)
|
|
1,890
|
|
|
(4)
|
|
896
|
|
|||||
Valuation allowance for deferred tax assets
|
|
76,789
|
|
|
—
|
|
|
8,611
|
|
|
(5)
|
|
—
|
|
|
|
|
85,400
|
|
|||||
2017
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Deducted from asset accounts:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Allowance for doubtful accounts
|
|
$
|
3,889
|
|
|
$
|
3,917
|
|
|
$
|
9
|
|
|
(3)
|
|
$
|
4,395
|
|
|
(2)
|
|
$
|
3,420
|
|
Allowance for returns
|
|
1,994
|
|
|
—
|
|
|
4,890
|
|
|
(1)
|
|
5,659
|
|
|
(4)
|
|
1,225
|
|
|||||
Valuation allowance for deferred tax assets
|
|
14,156
|
|
|
—
|
|
|
62,633
|
|
|
(5)
|
|
—
|
|
|
|
|
76,789
|
|
|||||
2016
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Deducted from asset accounts:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Allowance for doubtful accounts
|
|
$
|
6,241
|
|
|
$
|
954
|
|
|
$
|
—
|
|
|
|
|
$
|
3,306
|
|
|
(2)
|
|
$
|
3,889
|
|
Allowance for returns
|
|
1,438
|
|
|
—
|
|
|
2,088
|
|
|
(1)
|
|
1,532
|
|
|
(4)
|
|
1,994
|
|
|||||
Valuation allowance for deferred tax assets
|
|
16,673
|
|
|
—
|
|
|
(2,517
|
)
|
|
(5)
|
|
—
|
|
|
|
|
14,156
|
|
|
|
(1)
|
Charged against revenues.
|
(2)
|
Uncollectible accounts written off, net of recoveries.
|
(3)
|
Adjustments from acquisitions.
|
(4)
|
Credits issued for returns.
|
(5)
|
Related to deferred tax assets on foreign tax credits, net operating loss carryforwards, and depreciation.
|
|
|
|
|
|
|
|
Subsidiary
|
|
Jurisdiction of Incorporation
|
1
|
|
Byte Squared Limited
|
|
United Kingdom
|
4
|
|
Bytemobile, Inc.
|
|
Delaware
|
5
|
|
Cedexis Inc.
|
|
Delaware
|
6
|
|
Cedexis Sas
|
|
France
|
7
|
|
Cedexis Ltd.
|
|
United Kingdom
|
8
|
|
Citrix Application Networking LLC
|
|
Delaware
|
9
|
|
Citrix Global Holdings B.V.
|
|
Netherlands
|
10
|
|
Citrix Global Holdings UK Limited
|
|
United Kingdom
|
1
|
|
Citrix Greece MEPE
|
|
Greece
|
12
|
|
Citrix Holanda B.V.
|
|
Netherlands
|
13
|
|
Citrix Online AUS Pty Ltd.
|
|
Australia
|
14
|
|
Citrix Overseas Holdings, B.V.
|
|
Netherlands
|
15
|
|
Citrix R&D India Private Limited
|
|
India
|
16
|
|
Citrix R&D Limited
|
|
United Kingdom
|
17
|
|
Citrix Sistemas de Argentina, S.R.L.
|
|
Argentina
|
18
|
|
Citrix Sistemas de Chile Ltda.
|
|
Chile
|
19
|
|
Citrix Sistemas de Colombia SAS
|
|
Colombia
|
20
|
|
Citrix Sistemas de Mexico, S. de RL de CV
|
|
Mexico
|
21
|
|
Citrix Sistemas do Brasil Ltda.
|
|
Brazil
|
22
|
|
Citrix Systems Asia Pacific Pty Ltd.
|
|
Australia
|
23
|
|
Citrix Systems Belgium S.P.R.L.
|
|
Belgium
|
24
|
|
Citrix Systems Canada, Inc.
|
|
Canada
|
25
|
|
Citrix Systems Czech Republic SRO
|
|
Czech Republic
|
26
|
|
Citrix Systems Denmark ApS
|
|
Denmark
|
27
|
|
Citrix Systems Finland Oy
|
|
Finland
|
28
|
|
Citrix Systems France SARL
|
|
France
|
29
|
|
Citrix Systems GmbH
|
|
Austria
|
30
|
|
Citrix Systems GmbH
|
|
Germany
|
31
|
|
Citrix Systems Hong Kong Limited
|
|
Hong Kong
|
32
|
|
Citrix Systems India Private Limited
|
|
India
|
33
|
|
Citrix Systems Information Technology (Beijing) Ltd
|
|
China
|
34
|
|
Citrix Systems International GmbH
|
|
Switzerland
|
35
|
|
Citrix Systems Ireland Ltd
|
|
Ireland
|
36
|
|
Citrix Systems Italy S.r.L.
|
|
Italy
|
37
|
|
Citrix Systems Japan Kabushiki Kaisha
|
|
Japan
|
38
|
|
Citrix Systems Korea Limited
|
|
Korea
|
39
|
|
Citrix Systems Malaysia Sdn Bhd
|
|
Malaysia
|
40
|
|
Citrix Systems Netherlands, B.V.
|
|
Netherlands
|
41
|
|
Citrix Systems New Zealand Ltd.
|
|
New Zealand
|
42
|
|
Citrix Systems Norway AS
|
|
Norway
|
43
|
|
Citrix Systems Overseas Holding GmbH
|
|
Switzerland
|
44
|
|
Citrix Systems Poland Sp. Zo.o
|
|
Poland
|
45
|
|
Citrix Systems Puerto Rico Corp.
|
|
Puerto Rico
|
46
|
|
Citrix Systems Saudi Arabia LLC
|
|
Saudi Arabia
|
47
|
|
Citrix Systems Singapore Pte Ltd.
|
|
Singapore
|
48
|
|
Citrix Systems Slovakia SRO
|
|
Slovakia
|
49
|
|
Citrix Systems South Africa (Pty) Ltd.
|
|
South Africa
|
50
|
|
Citrix Systems Spain, SL
|
|
Spain
|
51
|
|
Citrix Systems Sweden AB
|
|
Sweden
|
52
|
|
Citrix Systems Taiwan Ltd
|
|
Taiwan
|
53
|
|
Citrix Systems Turkey YVH Ltd S
|
|
Turkey
|
54
|
|
Citrix Systems UK Limited
|
|
United Kingdom
|
55
|
|
Citrix Technologies GmbH
|
|
Switzerland
|
56
|
|
Citrix-Systems Technologies Costs Rica SRL
|
|
Costa Rica
|
57
|
|
Mentat s.r.o.
|
|
Czech Republic
|
58
|
|
Octoblu, Inc.
|
|
Delaware
|
59
|
|
Peninsula Finance LLC
|
|
Delaware
|
60
|
|
Peninsula Investment Corp.
|
|
Delaware
|
61
|
|
Podio ApS
|
|
Denmark
|
62
|
|
Podio, Inc.
|
|
Delaware
|
63
|
|
Sanbolic, LLC
|
|
Delaware
|
64
|
|
Sapho, Inc.
|
|
Delaware
|
65
|
|
ShareFile LLC
|
|
Delaware
|
66
|
|
Unidesk Corporation
|
|
Delaware
|
67
|
|
Virtuall Solutions Ltd.
|
|
United Kingdom
|
68
|
|
Virtuall Solutions Sas
|
|
France
|
|
(1)
|
|
Registration Statement No. 333-61520 on Form S-8, dated May 23, 2001
|
|
|
|
|
|
|
|
(2)
|
|
Registration Statement No. 333-121420 on Form S-8, dated December 17, 2004
|
|
|
|
|
|
|
|
(3)
|
|
Registration Statement No. 333-125297 on Form S-8, dated May 27, 2005
|
|
|
|
|
|
|
|
(4)
|
|
Registration Statement No. 333-127991 on Form S-8, dated August 31, 2005
|
|
|
|
|
|
|
|
(5)
|
|
Registration Statement No. 333-132820 on Form S-8, dated March 29, 2006
|
|
|
|
|
|
|
|
(6)
|
|
Registration Statement No. 333-135519 on Form S-8, dated June 30, 2006
|
|
|
|
|
|
|
|
(7)
|
|
Registration Statement No. 333-135521 on Form S-8, dated June 30, 2006
|
|
|
|
|
|
|
|
(8)
|
|
Registration Statement No. 333-136731 on Form S-8, dated August 18, 2006
|
|
|
|
|
|
|
|
(9)
|
|
Registration Statement No. 333-147419 on Form S-8, dated November 15, 2007
|
|
|
|
|
|
|
|
(10)
|
|
Registration Statement No. 333-147421 on Form S-8, dated November 15, 2007
|
|
|
|
|
|
|
|
(11)
|
|
Registration Statement No. 333-149967 on Form S-8, dated March 28, 2008
|
|
|
|
|
|
|
|
(12)
|
|
Registration Statement No. 333-156266 on Form S-8, dated December 18, 2008
|
|
|
|
|
|
|
|
(13)
|
|
Registration Statement No. 333-156267 on Form S-8, dated December 18, 2008
|
|
|
|
|
|
|
|
(14)
|
|
Registration Statement No. 333-161164 on Form S-8, dated August 7, 2009
|
|
|
|
|
|
|
|
(15)
|
|
Registration Statement No. 333-165460 on Form S-8, dated March 12, 2010
|
|
|
|
|
|
|
|
(16)
|
|
Registration Statement No. 333-168688 on Form S-8, dated August 9, 2010
|
|
|
|
|
|
|
|
(17)
|
|
Registration Statement No. 333-172430 on Form S-8, dated February 25, 2011
|
|
|
|
|
|
|
|
(18)
|
|
Registration Statement No. 333-176148 on Form S-8, dated August 8, 2011
|
|
|
|
|
|
|
|
(19)
|
|
Registration Statement No. 333-179653 on Form S-8, dated February 23, 2012
|
|
|
|
|
|
|
|
(20)
|
|
Registration Statement No. 333-183120 on Form S-8, dated August 7, 2012 and amended by Post-Effective Amendment No. 1 dated February 16, 2018
|
|
|
|
|
|
|
|
(21)
|
|
Registration Statement No. 333-186784 on Form S-8, dated February 21, 2013
|
|
|
|
|
|
|
|
(22)
|
|
Registration Statement No. 333-196332 on Form S-8, dated May 28, 2014
|
|
|
|
|
|
|
|
(23)
|
|
Registration Statement No. 333-201399 on Form S-8, dated January 8, 2015
|
|
|
|
|
|
|
|
(24)
|
|
Registration Statement No. 333-202181 on Form S-8, dated February 19, 2015
|
|
|
|
|
|
|
|
(25)
|
|
Registration Statement No. 333-209583 on Form S-8, dated February 18, 2016
|
|
|
|
|
|
|
|
(26)
|
|
Registration Statement No. 333-221309 on Form S-3, dated November 3, 2017
|
|
|
|
|
|
|
|
(27)
|
|
Registration Statement No. 333-223069 on Form S-8, dated February 16, 2018
|
|
1.
|
I have reviewed this annual report on Form 10-K of Citrix Systems, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
5.
|
The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
|
By:
|
/S/ DAVID J. HENSHALL
|
|
|
David J. Henshall
|
|
|
President and Chief Executive Officer
|
|
|
(Principal Executive Officer)
|
1.
|
I have reviewed this annual report on Form 10-K of Citrix Systems, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
|
5.
|
The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):
|
|
By:
|
/S/ ANDREW DEL MATTO
|
|
|
Andrew Del Matto
|
|
|
Executive Vice President and Chief Financial Officer
|
|
|
(Principal Financial Officer)
|
(1)
|
The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and
|
(2)
|
The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.
|
|
|
|
By:
|
/S/ DAVID J. HENSHALL
|
|
|
David J. Henshall
|
|
|
President and Chief Executive Officer
|
|
|
(Principal Executive Officer)
|
|
|
|
|
By:
|
/S/ ANDREW DEL MATTO
|
|
|
Andrew Del Matto
|
|
|
Executive Vice President and Chief Financial Officer
|
|
|
(Principal Financial Officer)
|
|