In case you don’t know, Citrix Systems had to make the heavy choice of laying off a number of their employees from their office in North Carolina. Citrix themselves believes the layoffs are only impacting 10% of the office. The bigger restructuring is within the company and therefore, could very well indicate that some full-time employees and consolidating facilities will approve a plan to restructure how the company works.
The effort will allow Citrix anywhere between $130 million to $240 million from where $90 million is likely to apply towards employee severance costs. Certainly, the Raleigh office is actually possessive of 700 employees and counting. The layoffs occur from after Elliot Management got themselves a $1 billion stake in Citrix. Elliot Management has a track record of shaking up companies.
Furthermore, Citrix has software that allows employees to access their desktop computers, virtually.
Therefore, it has enjoyed success during the COVID-19 Pandemic. However, with a new subscription model, the case may have been that a stock price declination has resulted in a lesser amount of shares. In which case, Citrix fell to 4.3% to $85.80, post-announcement. In the past year alone, the stock price has hit its own bottom, with a 27% drop. Citrix interim CEO, Bob Calderoni made it known to analysts that a restructure would allow the company growth to return. He believes that while change is on the way, restructuring is likely to focus on the company’s sales division.
“We’ve got too many instances where we have too many people getting compensated on the same deal. I don’t think that’s a good thing. I think that not only adds more cost, I think it also takes away sales capacity at the same time.” Finally, his plan is to remove distractions that risk depressed margins and growth. Maybe not the most surprising news this year but it does suck that the downsizing has hit so many Raleighites.