Citrix Layoffs – In 2023, the cloud software provider Citrix had let go of thousands of workers. After its merger with TIBCO, its sister company, there were layoffs. The commercial sales team and a few channel-facing employees were affected by the layoffs. The layoffs, according to one unnamed source, were the biggest ever at the company. When Citrix was established in 1989, it “pioneered remote access” using business software. In the fall of last year, two private equity companies paid $16.5 billion to acquire it. The company employs about 8,300 people.
Tom Krause, CEO of Cloud Software Group (CSG), explained plans in an email to staff members prior to the layoffs. He aimed to focus direct sales and marketing solely on its 1,600 top clients. He has a plan to restrict product development to a newly created roadmap. Let us learn more about the layoffs at Citrix in detail in this article.
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About the company
Citrix Systems, Inc. is a big American company. It specializes in cloud computing and virtualization technology. The company offers services like virtualizing servers, applications, and desktops, as well as providing networking, software as a service (SaaS), and cloud computing. Many companies around the world, including most of the top Fortune 100 and Fortune 500 companies, use Citrix products.
Citrix is based in Fort Lauderdale, Florida. It has offices in California and Massachusetts. Also, it has development centers in Canada, Denmark, Germany, India, and the United Kingdom. In 2021, Citrix made $3.2 billion in revenue and had 9,700 employees.
In September 2022, Citrix was acquired by Vista Equity Partners and Evergreen Coast Capital Corp. After that, Citrix merged with TIBCO Software to form the Cloud Software Group. They also separated their product, Citrix ADC, and renamed it Netscaler. This had become its own independent company under the same parent company.
The CEO’s announcement about Layoffs
The tech industry has been hit hard by layoffs. Even behemoths like Amazon and Salesforce have announced significant employment cuts at the start of 2023. Among them, Cloud Software Group, a business created through the union of Citrix and Tibco, has declared that it will lay off 15% of its employees. This development has caused worry about the future of thousands of employees.
Following the astounding $16.5 billion sale of Citrix by Vista Equity Partners and Evergreen Coast Capital, Cloud Software Group was established. The two enterprise-focused companies, Citrix and Tibco, wanted to combine their expertise. The merger’s aftermath has led to one of the biggest layoffs in the technology sector.
After the deal was closed, Tom Krause, the new CEO of CSG, delivered the sad announcement about the layoffs. He highlighted that these choices had not been made lightly and that they would have effects. The layoffs are part of a strategic initiative. This is to streamline the recently formed business and get it in line with its most important clients.
Responses from employees
CSG did not disclose the exact number of affected employees. But reports indicate that there may have been thousands of layoffs. Given the recent wave of tech industry layoffs, these employment cuts are especially notable.
A number of the affected employees posted their opinions on social media sites like LinkedIn. Many people expressed gratitude for their experience at Citrix and looked forward to the future. These layoffs have had a significant effect on the workforce. It’s because numerous long-term employees have left the organization.
Mark Simmons is an employee of this group who spent 22 years as Citrix’s senior NetScaler sales engineer. He said on LinkedIn:
“Like many other people at Citrix, I was caught up in today’s huge restructuring. For the past 22 years, I have worked for Citrix, either as a contract master instructor or a full-time sales engineer. Those were experiences that I wouldn’t swap for anything. I’m excited for the next phase in my career.”
Citrix area manager Shawn Hohn also spoke about how the layoffs affected him:
“If you or anyone in your network has any possibilities in account management or on the inside, please reach out! I appreciate any contacts, suggestions, or opportunities you may provide in advance.”
Tech industry challenges amid economic uncertainty
The job cuts at Cloud Software Group are an alarming indicator. It’s about the obstacles that companies going through mergers and acquisitions must overcome. Sure, the restructuring intends to improve efficiency and streamline operations. But it also has an impact on the livelihoods of many devoted workers. It will be interesting to watch how CSG’s strategic choices pan out in the competitive IT industry as it moves forward.
A wave of layoffs has rocked the tech sector as a whole. It’s due to the struggles with inflation, rising interest rates in the U.S., and concerns about a potential worldwide recession. Recent vendors to announce cutbacks include Salesforce, Cisco, HP, Intel, Elastic, Aqua Security, AvePoint, and N-able.
According to the insider, Citrix’s acquisition and VMware’s planned acquisition by chipmaker Broadcom indicate “a major bellwether change” in the VDI market.
Citrix and VMware are seeing increased competition in the virtual desktop market. It’s due to the launch of similar offerings by cloud giants like Amazon Web Services and Microsoft. Also, it is due to the fact that they depend on outside providers to keep users within their environments.
The majority of the employees who were interviewed claimed that the past month (as of January 2023) at CSG has been stressful. It’s because of impending layoffs.
The sales representative added, “After all the changes have taken place, there are very few people who actually want to stay.” It’s particularly true, given how awful the new compensation system appears.
Citrix has appointed Ethan Fitzsimons as its new channel leader. Citrix also promised a “more predictable” and “more profitable” partner program. It was scheduled to debut on March 6, 2023, for Citrix partners. The modifications won’t have an impact on Tibco partners.
“It’s a bad day. Plenty of decent Citrix workers, families, and children are leaving the firm. This is terrible,” the insider was cited in the report.
Citrix’s commercial sales team and a few channel-facing employees were affected by the layoffs. Many laid-off workers posted their woes on LinkedIn. According to the source, positions in sales, channel sales engineers, and education sales were also terminated.
Employees of other vendors, such as IGEL, Aisera, and Seesy, posted job positions on LinkedIn. Those jobs were opened for anyone affected by CSG’s layoffs to apply for.
After completing the acquisition of Citrix Systems in September 2022 and merging it with Tibco Software, CSG was officially launched on December 1. It was started by its owners, investment firms Vista Equity Partners and Evergreen Coast Capital. According to Krause’s email to staff, CSG afterward began an in-depth evaluation of the combined business. They looked at every position, system, and business procedure.
Citrix stated this in a filing with the U.S. Securities and Exchange Commission in November 2021. It said that its board had authorized a restructuring plan. This plan included “the removal of full-time positions. Also, $65 million to $90 million is set aside for employee severance agreements. This was two months before Vista and Evergreen announced their acquisition plans. It is unknown if the layoffs in January 2023 are related to the pre-acquisition strategy.
CSG’s Citrix ShareFile and Tibco Jaspersoft businesses serve markets and client groups different from those of the rest of CSG. Tibco Jaspersoft is an analytics and reporting platform.
ShareFile is a platform for content collaboration and file sharing. According to Krause, these businesses will function on their own through their respective sales forces.
Shift in business focus
The change in CSG’s business approach is one evident change following the merger. The business aims to focus its efforts on its top 1,600 enterprise accounts. Mid-tier and commercial accounts will, therefore, be handled by channel partners. These partners may have fresh opportunities to succeed as a result of this strategic change.
One of the sources claimed that the channel would greatly benefit from this strategy change. “Now that Citrix has focused on the top accounts, the channel has the chance to service the remaining accounts.”
Despite the turmoil, CSG is still dedicated to a 2023 product roadmap that is clear and well-defined. The business wants to get rid of non-core divisions while investing in areas that fit with its roadmap. The purpose of this strategy is to make the organization’s goals clearer.
According to Krause, they must completely rethink how Citrix and Tibco conducted their business in order to create CSG.
Conclusion
For $16.5 billion, Elliot Investment Management and Vista Equity Partners took Citrix private. It turned out to be the icing on top of the terrible news. There were two significant rounds of layoffs prior to this. On January 10, 2023, there was a third round of layoffs. About 2,200 of their Cloud Services Group employees—which includes Netscaler—were affected.
Naturally, the Citrix layoffs have had a negative impact on the morale of the remaining staff. There was an additional rise in employee turnover. Many of the current employees are seeking other jobs and won’t be around for very long. They have a lot of potential job options as a result of their great resignation.
Customers of NetScaler will certainly suffer a great deal as a result of the layoffs and product realignment issues. Customers of NetScaler may experience less support and maintenance. There might be delays in product development and increased expenditures, just to name a few such negative effects.