Citrix Has a New President and CEO: David Henshall

In an unexpected move yesterday, Citrix announced that David Henshall has been appointed as its new president and CEO, effective immediately. The former president and CEO, Kirill Tatarinov, reportedly left the company as part of a “mutual separation decision.”

During his fourteen-year tenure at Citrix, David has held various executive positions, including those of chief financial officer and chief operating officer. More importantly, David knows the business, the customers, and the culture. Certainly, his financial prowess will enable him to make excellent business decisions.

What Wasn’t So Right about Kirill?

After the departure of Mark Templeton, Kirill made it very clear that Citrix was a business. People were expected to come to work every day and do just that: work. The days of “work hard, play hard,” were a memory. The close-knit, warm atmosphere within Citrix dwindled in favor of dollar signs and business decisions. As much as some of that was necessary to get the company back on track and propelled toward growth, the pendulum had swung too far, and employees lost a great deal of their zealousness.

Further, Kirill brought in Microsoft executives to fill top spots at Citrix. Quite a few long-term Citrites became ex-Citrites, and former Microsoft people occupied their positions in short order. Citrix employees jabbed that they might as well be working for Microsoft, because so many people on the sixth floor of the headquarters building had “Microsoft” plastered on their resumes.

Was it this linkage to Microsoft that inevitably brought about the abrupt change? Perhaps Kirill wanted the relationship with Microsoft to progress to the point of an acquisition? Or perhaps the board of directors wanted an acquisition, and Kirill was against it.

What Could Be Very Right about David Henshall?

David has been with the company for fourteen years. He has seen Citrix grow from a relatively small company to a well-known technology powerhouse. Over that span of time, he has delivered both stellar and abysmal financial reports during his portion of earnings calls. He’s had to make some tough financial decisions regarding the business during the difficult times. As a result, he not only sees Citrix from the perspective of the numbers, but he also feels the company. Thus, he is well experienced and engaged as he takes the helm.

Of course, as part of every new president/CEO announcement, there will be changes—some welcomed and some not. The internal kinship of former Microsoft employees will likely lose some steam, and hopefully some of the long-term Citrix employees who have been the behind-the-scenes drivers will come to the forefront.

But Wait…There’s More

While news of a change in the corner office was foremost in the announcement, several other key items were mentioned as well. Guidance for the second quarter was reaffirmed, which translates to Citrix reporting quarterly results in line with expectations. There had been suspicions that Citrix was facing severe headwinds.

But then there was the news that the board of directors has “formed an Operations and Capital Committee that will work with Citrix’s management team and advise the Citrix Board on a comprehensive review of opportunities to drive margin expansion and return capital to shareholders. The Committee will be led by Citrix Executive Chairman, Robert Calderoni, joined by Citrix President and CEO, David Henshall, and Citrix Directors, Jesse Cohn and Peter J. Sacripanti.”

News of a capital committee could be indicative of dicing up the company to sell off one or more components. With the GoTo sale completed last year, the most obvious misaligned portion of the company was separated. Even before this, Citrix advised that some acquisitions and technologies will cease, such as Melio, and we’re likely to see additional technologies go into end of life or be sold in order to hone down the business.

Will NetScaler or XenServer or any other key technologies be sold? Forming a capital committee consisting of four key directors signifies much more than just selling off a few ancillary technologies. While it’s debatable what mix of technologies compose the perfect virtualization solution, the current feature set is pretty darn good. If this capital committee starts slicing and dicing without fully understanding how Citrix technologies are intertwined, it could have a profoundly negative impact.

Citrix’s Q2 earnings call on August 2 at 4:45 PM Eastern will likely be well attended, as this will be David Henshall’s public debut as the new president and chief executive officer. Be there!


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