Citrix Systems Reports Results for Third Quarter 2001.

Business Editors/Technology Writers

FORT LAUDERDALE, Fla.--(BUSINESS WIRE)--Oct. 23, 2001

Citrix Systems, Inc. (Nasdaq:CTXS):

-- Net revenues total $153.5 million

-- Adjusted earnings per share of $0.21

Citrix Systems, Inc. (Nasdaq:CTXS) today reported results for the third quarter ended September 30, 2001.

FINANCIAL RESULTS

Net revenues for the third quarter ended September 30, 2001, were $153.5 million, up 35.2% from $113.5 million in the comparable period of the prior year. Net income was $27.8 million for the third quarter of 2001, or $0.14 per share, as compared to $21.6 million, or $0.11 per share, in the comparable period of the prior year. Net income, adjusted to exclude the effect of amortization of intangible assets relating to business combinations, was $41.4 million for the third quarter, or $0.21 per share, as compared to $27.5 million, or $0.14 per share, in the comparable period of the prior year.

For the first nine months of 2001, net revenues were $433.6 million, up 24.9% from $347.1 million for the comparable nine months of 2000. Net income for the first nine months of 2001 was $79.6 million, or $0.41 per share, as compared with net income of $75.1 million, or $0.37 per share, for the comparable nine months of 2000. Net income, adjusted to exclude the effects of write-offs for in-process research and development and amortization of intangible assets relating to business combinations, was $112.0 million, or $0.57 per share, for the first nine months of 2001, as compared to $92.2 million, or $0.46 per share, in the same period last year.

"We are pleased that we were able to post our fifth consecutive quarter of positive results, especially given the economic uncertainty that remains in the marketplace," said Mark B. Templeton, Citrix president and chief executive officer. "The market has been very receptive to Citrix products and solutions in this environment, demonstrated in the accelerated shift to our MetaFrame XP platform, which accounted for almost two-thirds of our base product sold in the Americas this quarter. This rapid adoption of our new technology demonstrates Citrix's ability to provide effective solutions to our customers even in tough economic times."

FINANCIAL HIGHLIGHTS

-- The company reported comparable quarterly year-over-year

revenue growth of 35.2%.

-- International revenue was 47% vs. domestic revenue of 53% for

the quarter.

-- Electronic delivery of licenses this quarter amounted to 29%

of product sales.

-- Operating margin, excluding the effect of amortization of

intangible assets relating to business combinations, was 30.8%

for the quarter.

-- Cash flow from operations was approximately $53.0 million for

the quarter.

-- The company repurchased approximately 1.87 million shares of

its common stock during the quarter.

-- Cash and investments totaled $750.1 million at the end of the

quarter.

CUSTOMER WINS

"Citrix continued to grow its electronic licensing business, which accounted for approximately 29% of product sales during the quarter, the biggest electronic licensing quarter since the program began," commented John Burris, Citrix's senior vice president of worldwide sales and services. "With electronic licensing, customers are finding it easier to work with Citrix as ordering product and receiving delivery are much more efficient and timely, meeting partner and customer needs."

Significant customer agreements during the quarter included American Express, AOK Sachsen, Career Education Corporation, Cegelec S/A, Centura Health, Crane Group, Ericsson, IKEA, Nationwide Insurance, Qwest, the State of Oregon and Telkom S/A.

"This quarter, we saw more medium and large customers ordering product from Citrix as they continued to expand their internal deployments. We believe our customers continue to spend on products that provide a quick payback and decrease internal expenses," continued Burris. "As IT organizations move to a more efficient, centralized model of deploying applications, we are delivering solutions that help these organizations save costs, leverage their existing investments, and achieve a substantial ROI on their new investments."

OTHER HIGHLIGHTS

-- Citrix responded to the immediate needs of the American Red

Cross by supplying software, server support, and Citrix

engineers to support the relief effort in New York. Citrix

also donated a quarter of a million dollars to the Uniformed

Firefighters Association Widow's and Children's Fund and the

New York City Patrolmen's Benevolent Association.

-- The Citrix Consulting Services organization and sales team

have been proactive in serving customers and resellers

whose environments were severely impacted as a result of the

September 11 tragedy.

STRATEGIC RELATIONSHIPS, ALLIANCES, & COMPANY AWARDS

-- Citrix won Computerweek's "Best of Breed 2001" award as IT

managers rated Citrix the top brand in the category of

server-based computing / thin-client software.

-- Citrix announced support for Microsoft's .Net initiative

through an agreement with Microsoft enabling Citrix to

leverage Microsoft SharePoint Portal Server functionality with

Citrix(R) XPS(TM) portal software. Citrix also joined

Microsoft's SharePoint Developer Community Partner Program.

-- Citrix announced alliances with eRoom and SiteScape, giving

Citrix XPS portal customers enhanced collaboration

capabilities to advance business processes and communications

regardless of geographic or organizational boundaries.

Sitescape and eRoom have both joined the Citrix Business

Alliance Internet Solutions Program to expand joint sales and

marketing opportunities.

-- Citrix announced alliances with Documentum and Interwoven,

bringing content management functionality and infrastructure

services to portal customers and users across the enterprise.

These features will give portal customers and users the

ability to access, create, manage and deploy enterprise Web

content in any format, enhancing productivity and

collaboration in the workflow process. Documentum and

Interwoven have both joined the Citrix Business Alliance

Internet Solutions Program to expand joint sales and marketing

opportunities.

-- Citrix and Entrust teamed up to enable enhanced security for

remote access and server-based applications, allowing

Entrust-secured applications to be rolled out quickly and

easily on a mass scale. The relationship demonstrates the

commitment of both companies to securely deliver Internet

applications with enhanced security that includes

identification, privacy, verification, and security

management.

ABOUT CITRIX

Citrix Systems, Inc. is a global leader in application serving and portal software and services that provide personalized access to any application or information source -- whether Windows(R), UNIX(R) or Web-based -- through any device, over any connection. Companies worldwide use Citrix technologies to integrate applications, content and business processes into a pervasive digital environment -- a virtual workplace -- offering seamless connectivity and a consistent user experience across the Internet, intranets, extranets, WANs, LANs and wireless networks. Citrix solutions drive cost efficiency, productivity and enhanced e-business opportunities by enabling companies to leverage existing IT resources and extend personalized information access to employees, partners, customers and suppliers.

Citrix products offer rapid, cost-effective deployment and include MetaFrame(R) application serving software, NFuse(TM) application portal software, XPS portal software, application management products, and Citrix Independent Computing Architecture (ICA(R)), a core application serving technology. The company markets its application serving products through a well-established reseller channel and sells its portal software products directly to customers to provide the level of customization they need. Citrix is traded on the Nasdaq Stock Market(SM) under the symbol CTXS, and is part of the Standard and Poor's 500 Index. Citrix is headquartered in Fort Lauderdale, Florida. For more information, please visit the Citrix Web site at http://www.citrix.com.

For Citrix Investors

This release contains forward-looking statements which are made pursuant to the safe harbor provisions of Section 21E of the Securities Exchange Act of 1934. The forward-looking statements in this release do not constitute guarantees of future performance. Investors are cautioned that statements in this press release which are not strictly historical statements, including, without limitation, statements regarding current or future financial performance, management's plans and objectives for future operations, product plans and performance, management's assessment of market factors, as well as statements regarding the strategy and plans of the company and its strategic partners, constitute forward-looking statements. Such forward-looking statements are subject to a number of risks and uncertainties that could cause actual results to differ materially from those anticipated by the forward-looking statements, including, without limitation, risks associated with the following: the success of the company's MetaFrame and portal software product line and the acceptance of the company's ICA protocol; the company's ability to develop and commercialize new products and services; the company's success in expanding into new geographic markets; the company's ability to expand its core business in large enterprise accounts; the company's ability to succeed in the transition to an electronic licensing model; the size, timing and recognition of revenue from significant orders; increased competition, including potential competition from Microsoft and other companies; the results of the company's iBusiness and other new licensing programs; the rate of growth of the ASP market, and the company's ability to continue to develop and market products to meet the requirements of this market; the proportion of revenues derived from distributors, OEMs and other channels; changes in the company's pricing policies or those of its competitors, including Microsoft; the costs of developing, acquiring, or integrating new technologies or enhancements to existing products; the risks associated with third party licensing arrangements; the company's ability to successfully integrate and manage merged or acquired companies; the company's reliance upon its strategic relationships with Microsoft and other strategic partners; management of growth; the possibility of undetected software errors; dependence on proprietary technology; as well as risks of downturns in economic conditions generally, and in the software industry specifically, and other risks detailed in the company's filings with the Securities and Exchange Commission. Citrix assumes no obligation to update any forward-looking information contained in this press release or with respect to the announcements described herein.

Citrix(R), ICA(R), MetaFrame(R), MetaFrame XP(TM), XPS(TM)and NFuse(TM)are registered trademarks or trademarks of Citrix Systems, Inc. in the U.S. and other countries. All other trademarks and registered trademarks are property of their respective owners.

                         CITRIX SYSTEMS, INC.
              Condensed Consolidated Statements of Income
           (In thousands, except per share data - unaudited)

                            Three Months Ended      Nine Months Ended
                                 Sept 30,                Sept 30,
                              2001       2000       2001       2000
                              ----       ----       ----       ----

Revenues                    $143,486   $103,482   $403,759   $317,202
Other revenues                10,009     10,009     29,822     29,890
                            --------   --------   --------   --------
   Total net revenues        153,495    113,491    433,581    347,092

Cost of revenues               7,573      8,694     22,107     21,907
Cost of other revenues            --        160         --        480
                            --------   --------   --------   --------
   Total cost of revenues      7,573      8,854     22,107     22,387
                            --------   --------   --------   --------
Gross margin                 145,922    104,637    411,474    324,705

Operating expenses:
  Research and
   development                16,899     12,532     51,223     36,945
  Sales, marketing and
   support                    59,067     43,999    165,318    130,613
  General and administrative  22,677     14,305     59,753     43,173
  Amortization of intangible
   assets                     14,895      7,890     33,428     22,550
  In-process research and
   development                    --         --      2,580         --
                            --------   --------   --------   --------
Total operating expenses     113,538     78,726    312,302    233,281

Income from operations        32,384     25,911     99,172     91,424
Other income, net              7,891      4,970     16,218     15,912
                            --------   --------   --------   --------
Income before income
 taxes                        40,275     30,881    115,390    107,336

Income taxes                  12,485      9,264     35,771     32,201
                            --------   --------   --------   --------
Net income                  $ 27,790   $ 21,617   $ 79,619   $ 75,135
                            ========   ========   ========   ========

Earnings per share -
 diluted                    $   0.14   $   0.11   $   0.41   $   0.37
                            ========   ========   ========   ========
Weighted average shares
 outstanding - diluted       196,835    192,879    195,648    201,536
                            ========   ========   ========   ========

Adjusted net income         $ 41,378   $ 27,528   $112,035   $ 92,219
                            ========   ========   ========   ========
Adjusted net income per
 share - diluted            $   0.21   $   0.14   $   0.57   $   0.46
                            ========   ========   ========   ========

Note: The above presentation of adjusted net income and adjusted net income per share has been adjusted to exclude the effects of:

1) The write-off of acquired in-process research and development of $2,580 for the nine months ended September 30, 2001.

2) Amortization of intangible assets acquired from purchase business combinations and licenses of $14,895 and $7,890 for the three months ended September 30, 2001 and 2000, respectively, and $33,428 and $22,550 for the nine months ended September 30, 2001 and 2000, respectively. These intangible assets primarily include goodwill and core technology.

                 Condensed Consolidated Balance Sheets
                      (In thousands - unaudited)

                                          September 30,   December 31,
                                              2001            2000
                                              ----            ----

Cash and short-term investments            $  215,905     $  466,637
Accounts receivable, net                       79,203         37,299
Other current assets                           58,023         82,796
                                           ----------     ----------
     Total current assets                     353,131        586,732

Long-term investments                         534,201        382,524
Property and equipment, net                    79,682         55,559
Intangible assets, net                        196,390         52,339
Other assets                                   48,530         35,419
                                           ----------     ----------
     Total assets                          $1,211,934     $1,112,573
                                           ==========     ==========

Accounts Payable and accrued expenses      $   98,970     $   78,739
Current portion of deferred revenues           88,820         80,648
                                           ----------     ----------
     Total current liabilities                187,790        159,387

Convertible subordinated debentures           343,570        330,497
Other long-term liabilities                     5,249         14,082
Put warrants                                   19,284         15,732
Stockholders' equity                          656,041        592,875
                                           ----------     ----------
Total liabilities and stockholders'
 equity                                    $1,211,934     $1,112,573
                                           ==========     ==========