Citrix Systems Inc has produced yet another strong quarter as it awaits the nod from Microsoft Corp that will enable it to launch the product it must hang its future on – pICAsso, now renamed MetaFrame. Net revenues for the thin client software company’s first quarter were up 129% from the first quarter of last year to $49.3m, and net income reached $16.0m, or 0.36 per share, compared with $7.5m, or $0.18 per share last year. Per share information has been re-stated to reflect the three-for-two stock split the company announced back in February. The figures exclude a one-time charge of $23.8m resulting from the company’s technology acquisition from Insignia Solutions Ltd, which enabled it to add Unix and Macintosh clients to its WinFrame thin client software in March, and for the licensing agreement with EPiCON Inc for its management software (CI No 3,324). Citrix has now established a 40 person development team at Insignia’s UK headquarters in High Wycombe, Bucks. Citrix still had $221m in cash and investments and $203.6m in stockholders equity at the end of the quarter. WinFrame still accounts for 71% of Citrix’s revenues, but attention is focused on MetaFrame, now out at 6,000 beta customers worldwide, but awaiting the launch of Microsoft’s WTS Windows Terminal Server before it can ship. MetaFrame is intended to extend the functionality of WTS to offer cross platform capabilities and other features such as load balancing and administration. Citrix says it expects to ship the product commercially in the next ninety days, Microsoft release schedules allowing. Meanwhile, the company is viewing a change in its May 1997 agreement with Microsoft as a bonus. Back then Microsoft agreed to make a $75m one-off payment to Citrix plus up to $100m in royalties depending on how many copies of Windows NT 4.0 and 5.0 were shipped with Citrx technology as its preferred way to access to Windows applications from non-Windows devices (CI No 3,159). That agreement ran for two and a half years, and now Microsoft has agreed to spread out the $100m in payments evenly over the next seven quarters, regardless of the volume shipped. Citrix says the amended agreement gives it a more predictable revenue flow, and shows that Microsoft expects to ship the Citrix technology in the majority of its sales. Current Citrix users who upgrade to WTS and MetaFrame could face increased costs, due to the requirement for an NT Workstation license for each user, and Microsoft’s plans to abandon the Citrix concurrent licensing scheme in favor of per user pricing. Boundless Technologies Inc, Cruise Technologies Inc, Neoware Inc, Network Computing Devices Inc, Tektronix Inc and Wyse Technology Inc were all demonstrating CE-based devices for the first time at Comdex Spring in Chicago yesterday.
