Cloud News
Wade Tyler Millward
‘It’s a sad day for a company that pioneered the VDI (virtual desktop infrastructure) market. It’s a terrible day, with a lot of good Citrix employees with families and kids leaving the company,’ one source says.
Cloud Software Group—the parent company of cloud vendor Citrix and enterprise applications vendor Tibco—Tuesday began widespread layoffs, with thousands of employees throughout the organization getting pink slips, sources told CRN.
“There are thousands of employees being let go,” said a source close to Citrix, who spoke on condition of anonymity. “It’s a sad day for a company that pioneered the VDI (virtual desktop infrastructure) market. It’s a terrible day, with a lot of good Citrix employees with families and kids leaving the company. This is brutal.”
Another source, who did not want to be identified, also said that thousands are being let go in a round of layoffs the person called the “largest Citrix has ever had.”
The layoffs include much of Citrix’s commercial sales organization as well as some channel-facing employees, sources said.
[RELATED: Citrix Parent Company Names New Channel Chief, Introduces Partner Program Changes]
Several CSG employees posted about the layoffs on LinkedIn. For example, Mark Simmons, lead NetScaler sales engineer at Citrix, wrote, “Like so many others at Citrix, I was caught up in today‘s massive restructuring. I have been associated with Citrix for the past 22 years, either as a full-time sales engineer or contract master instructor. I wouldn’t trade those experiences for anything. Now I‘m looking forward to the next chapter in my career.”
Shawn Hohn, a territory manager for Citrix, also shared that he was one of the employees impacted by the cuts.
“I write this post to share that unfortunately, I have been one of the many impacted by the layoffs at Citrix this morning,” wrote Hohn. “If you or anyone in your network have any open roles in Account Management or Inside sides, please reach out! Thank you in advance for any connections, advice, or opportunities that you can share.”
Citrix employees who took to LinkedIn to say they were laid off from the company also included a networking, application delivery and security specialist for Florida and Georgia commercial field sales; a senior sales engineering manager who’d worked with Citrix for about 15 years; a software engineer; and an enterprise application delivery and security specialist, among others.
Another person familiar with the layoffs said that sales, channel sales engineers and education sales roles were also cut.
Employees of other vendors took to LinkedIn to post about job openings those affected by CSG’s layoffs could pursue, including IGEL, Aisera and Seesy.
CSG Shifting More Accounts To The Channel
The layoffs come as CSG moves to focus directly on its top 1,000 enterprise accounts, leaving mid-tier and commercial accounts to be supported and serviced by solution providers, sources familiar with the situation told CRN.
“This [strategic shift] could be really good thing for the channel,” said one of the sources. “With Citrix focusing on the top 1,000 accounts, that leaves the channel with the opportunity to service the remaining accounts. This could provide some explosive growth for Citrix service providers.”
That said, it is going to take some time for the aftershocks of the layoffs to wear off within the partner and customer community the source said.
“When there is this big a shakeup, it takes a while for things to shake out,” said the source. “But anytime you have this much change and transformation, there is an opportunity for the channel to make money.”
CRN has reached out to CSG for comment.
The changes come four months after the acquisition of Citrix in September for $16.5 billion. Investment firms Vista Equity Partners and Evergreen Coast Capital—an affiliate of Elliott Investment Management—took Fort Lauderdale, Fla.-based Citrix private, merged it with Palo Alto, Calif.-based Tibco and created a new parent organization, CSG.
In November 2021—two months before Vista and Evergreen unveiled their acquisition plans, Citrix had said in a filing with the U.S. Securities and Exchange Commission that its board had approved a restructuring plan that included “the elimination of full-time positions,” with $65 million to $90 million earmarked for employee severance agreements. It’s unclear if Tuesday’s layoffs stem from that pre-acquisition plan.
The source said that the Citrix acquisition and the impending acquisition of VMware by chipmaker Broadcom represent “a major bellwether change” in the VDI market.
The virtual desktop industry has gotten more competitive for Citrix and VMware as cloud giants such as Amazon Web Services and Microsoft have rolled out similar services and turned to third-party vendors to keep users within the hyperscalers’ environments.
The tech industry as a whole has been hit by a wave of cutbacks as the sector grapples with inflation and rising interest rates in the U.S. and concerns over a possible global recession. Salesforce, Cisco, HP, Intel, Elastic, Aqua Security, AvePoint and N-able are some of the vendors to announce cuts recently.
Upcoming Channel Program Changes
Earlier this month, Citrix named Ethan Fitzsimons its new channel chief and promised a “more predictable” and “more profitable” partner program, set to launch on March. 6 for Citrix partners. Tibco partners will not be affected by those changes.
“It’s about how do we allow [partners] to do their job faster, easier, simpler,” Fitzsimons told CRN. “How can we be simpler to work with? More predictable. More profitable. And really remove any of the inhibitors—in most cases, artificial inhibitors—that were slowing down the pace of business that we could do with our partners. … We allowed ourselves to become a little bit too complex when it came to our partner program. … That’s feedback that I received from our partners consistently.”
Mike Strohl, CEO of Concord, Calif.-based Citrix partner E360—No. 111 on CRN’s 2022 Solution Provider 500—told CRN in an interview that some CSG people he has worked with have been impacted.
Nevertheless, Strohl said that he is still confident in Citrix’s channel leadership, including Fitzsimons; Hector Lima, CSG’s executive vice president of field and channel sales; and Mike Fouts, CSG’s vice president of global service providers.
“The core DNA of what makes Citrix Citrix lives within those guys,” he said. “I fully believe in what they’re doing.”
Strohl said he is happy with the upcoming partner program changes he has heard about from Citrix.
“We’re most excited about the Citrix [Service Provider] program [changes] and what we can bring to market collectively with our customers,” he said. “There’s actually been a lot of work done on Citrix’s part to make that a much better and more-aligned go-to-market [motion].”
Steven Burke contributed to this story.
