Johnson Systems

CA Technologies, Inc.

Company type	Public
Industry	Enterprise software
Founded	1976 (1976)
Founder	Charles B. Wang
Defunct	2018
Fate	Acquired by Broadcom Inc.
Headquarters	Manhattan, New York City , United States
Area served	Worldwide
Key people	Charles B. Wang (founder)
Products	System software for IBM mainframes, distributed computing platforms, virtual machines, and cloud infrastructures
Number of employees	~7,000 (early 1990s)
Parent	Broadcom Inc.

CA Technologies, Inc., previously known as Computer Associates International, Inc., was a prominent American multinational company specializing in enterprise software development and publishing from 1976 until 2018. At its peak, CA ranked as one of the world's largest independent software firms, even achieving the position of the second-largest. The company focused on creating system software tailored for IBM mainframes, distributed computing platforms, virtual machines, and cloud infrastructures.

The firm’s foundation was largely driven by Charles B. Wang, with its rapid expansion fueled by the acquisition of numerous smaller software companies within the IBM mainframe industry. CA gained a reputation for extensive layoffs following acquisitions and often emphasized cash flow generation over product innovation. Its customer base frequently expressed dissatisfaction with the company’s technical support quality and aggressive business tactics. In the early 2000s, CA encountered a significant accounting scandal that led to prison sentences for several top executives. Despite this, by the 2010s, various industry organizations acknowledged CA for its corporate responsibility initiatives and other commendations.

Originally established through entities in Switzerland (Zurich and Geneva) and the United States (New York City), CA maintained its headquarters on Long Island for most of its existence—initially located in Jericho and Garden City within Nassau County, later spending two decades in Islandia, Suffolk County—before moving to Manhattan in 2014. In 2018, semiconductor giant Broadcom Inc. acquired CA Technologies in a deal valued at nearly $19 billion.

Origins

Computer Associates International emerged from the combination of a Swiss software enterprise and a New York-based data services company.

Samuel W. Goodner, a native Texan employed by Sam Wyly's University Computing Company (UCC), was assigned to manage Automation Center A.G., a Swiss organization founded by Walter Haefner and acquired by UCC. Due to financial difficulties at UCC around 1970, Goodner departed to establish his own software product firm, founding Computer Associates A.G. in Zurich.

IBM’s 1969 decision to separate hardware from software sales opened the mainframe software market to new competitors—a development Goodner capitalized on by creating software products targeted at IBM mainframe users.

Although initially lacking substantial funding, Computer Associates secured Hoffmann-La Roche as an early client with its efficient sorting solution, CA-SORT, introduced in Europe in 1971 as an alternative to IBM Sort on System/360 and System/370 systems. The company grew through European distribution channels and acquisitions, maintaining its headquarters in Geneva throughout the 1970s. By mid-1974, Pansophic Systems was distributing CA-SORT in the U.S. under the name Pansort. By that year, the company had adopted the name Computer Associates International Ltd.

Meanwhile, in New York City, Standard Data Corporation, founded in 1959 and based at 1540 Broadway, primarily operated as a service bureau. By 1973, it marketed SYMBUG, a symbolic debugger designed for COBOL running on IBM VM/370 systems, and expanded its VM/CMS product offerings by 1974. Standard Data established a Software Products Division led by Charles B. Wang as vice-president; Wang also sought to exploit IBM’s unbundling by developing software tailored for IBM mainframes.

In January 1976, Standard Data secured exclusive U.S. distribution rights for CA-SORT from Pansophic Systems, reinstating the original product name and acquiring rights to EARL (Easy Access Report Language), a report generator.

1970s

In October 1976, the union of Computer Associates International Ltd and the Software Products Division of Standard Data Corporation resulted in the creation of Computer Associates, Inc. with Charles Wang appointed as president. The newly formed company distributed CA-SORT throughout the Americas, while its European division managed certain Standard Data offerings such as SYMBUG. The initial U.S. headquarters was established at 655 Madison Avenue in Manhattan. Meanwhile, the original Standard Data Corporation continued to operate independently well into the 2010s.

This merger in 1976 represents the inception of the renowned Computer Associates firm, which initially comprised four employees, including co-founder Russell Artzt, who collaborated with Wang at Standard Data and contributed to early software developments.

By September 1977, the organization was operating under the name Trans-American Computer Associates, Inc., with products like DYNAM/D—a disk utility designed for IBM mainframes—registered under this American entity, underscoring a focus on U.S.-based software development.

In 1979, the company shifted its U.S. offices to 125 Jericho Turnpike in Jericho, New York.

By 1980, Computer Associates International had grown to approximately 300 employees worldwide and marketed a portfolio of 12 products to nearly 9,000 client locations, with the United States being its primary market. That same year, Wang secured complete ownership by purchasing out the Swiss parent company, thereby consolidating control under Computer Associates International, Inc..

1980s

In 1981, Computer Associates completed its initial public offering (IPO), generating $3.2 million in capital, with shares listed on the NASDAQ stock exchange under the ticker symbol "CASI".

The company's first significant acquisition occurred in 1982 with the merger of Capex Corporation, which increased revenues by 50%. Both companies specialized in IBM mainframe software; however, while CA was recognized for products supporting IBM's DOS mainframe operating system, Capex’s expertise lay within IBM's OS mainframe operating system, effectively complementing CA’s product line.

This acquisition marked the beginning of Computer Associates’ assertive acquisition strategy centered on third-party mainframe software solutions.

By 1986, CA had moved its corporate headquarters to Garden City and expanded into several buildings across Nassau County. That year, revenues reached $265 million with profits exceeding $30 million; estimated revenue from PC software ranged between $60 million and $70 million.

The company’s expansion accelerated dramatically in 1987 with an $800 million purchase of Uccel, a deal substantially larger than any prior acquisitions. Uccel, previously known as UCC, had experienced variable performance since Haefner assumed control in 1976. Following the acquisition, CA implemented restructuring measures that led to a reduction of 550 out of Uccel’s 1,200 employees, consistent with CA’s typical approach to cost management. Haefner became CA’s largest individual shareholder post-merger, holding approximately 25% ownership.

In that same year, CA’s stock transitioned to trading on the New York Stock Exchange under the ticker "CA". In 1988, the company acquired a critical software product from Consco.

By the conclusion of the decade, Computer Associates had become only the second software enterprise after Microsoft to exceed $1 billion in annual sales. Information Week positioned Computer Associates ahead of Microsoft in its 1990 ranking titled "Software's Heavy Hitters".

1990s

At the start of the 1990s, Computer Associates encountered criticism alongside a stock value decline exceeding 50% in 1990. The company countered these challenges by entering international markets such as Japan, Canada, Africa, and Latin America, revising its software maintenance fee structure, and enhancing interoperability with partners including Hewlett-Packard, Apple, and Digital Equipment Corporation. The recession early in the decade further affected CA’s performance, with its stock plummeting roughly 70% by October 1991 compared to its peak in May 1989. During this period, CA’s workforce numbered about 7,000 employees while generating sales near $1.4 billion.

In 1991, the acquisition of Pansophic Systems was completed. After extensive planning spanning two and a half years, CA relocated its headquarters to Islandia, New York in 1992, merging Nassau County operations into a sprawling corporate campus featuring three office buildings. By this time, CA had become the second-largest private employer on Long Island following Grumman Aerospace, benefiting from significant tax incentives and construction financing assistance from Suffolk County authorities.

The company expanded further in 1994 by acquiring the ASK Group and continued marketing the Ingres database management system under different brand names. In 1992, Electronic Data Systems (EDS), one of CA’s customers, initiated legal action alleging breach of contract and antitrust violations; CA responded with counterclaims. The dispute was resolved through settlement in 1996.

Throughout the decade, CA pursued major acquisitions: Legent Corporation was purchased for $1.78 billion in 1995—the largest software industry deal at that time—followed by Cheyenne Software for $1.2 billion in 1996, and Platinum Technology International for $3.5 billion in 1999, which set a new record for software industry acquisitions.

An attempted hostile takeover of Computer Sciences Corporation (CSC) in 1998 was unsuccessful and led to a bribery lawsuit against CA’s founder and CEO Charles Wang filed by CSC’s chairman.

By the close of the 1990s, CA controlled a dominant share of utility software tools for mainframe computers—a profitable but less publicly prominent sector compared to PC software companies like Microsoft and Lotus. A Business Week profile from 1996 underscored CA’s strong profitability despite limited public visibility.

In May 1998, stock awards totaling $1.1 billion were distributed to Wang and two other executives. The following year, Wang received an unprecedented $670 million stock bonus linked to the vesting of a 1995 option amidst weakening European markets and an Asian economic downturn that adversely impacted CA’s revenue and share price. These grants generated controversy; the company recorded a $675 million after-tax expense associated with $1.1 billion in executive payouts.

Company culture

Computer Associates (CA) developed a reputation for emphasizing sales over customer service, frequently frustrating clients through high pricing and inadequate technical support. The sales team occasionally treated customers as adversaries rather than partners. Critics charged that CA intentionally placed acquired software products into maintenance mode to maximize cash flow, thereby making vendor transitions costly and challenging for clients. Although this approach secured consistent revenue streams, it also bred customer dissatisfaction. Nonetheless, CA regularly outlasted its critics.

The organizational culture mirrored founder Charles Wang’s background—an immigrant who studied at Queens College—differing markedly from Silicon Valley’s culture. Much of CA’s sales personnel hailed from blue-collar roots in New York’s outer boroughs and Long Island, contributing to an image characterized as "smart, aggressive, and consistently profitable."

Within the company, abrupt large-scale layoffs often followed acquisitions, frequently resulting in substantial reductions of acquired companies’ staff. Notable examples include Applied Data Research in 1988 and Cullinet in 1989. This practice raised concerns among some sellers; for instance, Sterling Software’s Sam Wyly pointed out cultural incompatibility despite shareholder benefits.

Industry historian Martin Campbell-Kelly provided a more nuanced perspective, acknowledging CA’s role in advancing important database products such as DATACOM/DB and IDMS while promoting integration between its offerings. He described workforce reductions as rationalizations aimed at underperforming divisions. Likewise, Joseph A. Piscopo, founder of Pansophic Systems (acquired in 1991), observed that although many acquisitions were downsized to minimal maintenance teams, certain units—like Cheyenne Software—received investment aligned with strategic product development initiatives.

Accounting irregularities

By the year 2000, Computer Associates had completed approximately 200 acquisitions. That same year, Sanjay Kumar succeeded Wang as CEO, while Wang continued as chairman; in 2002, Wang fully exited the company and Kumar assumed the chairman role as well.

In 2000, a class-action lawsuit filed by shareholders alleged that CA had inflated its reported revenue by more than $500 million during the 1998 and 1999 fiscal years to artificially boost its stock valuation. The following year, shareholder Sam Wyly initiated a proxy contest targeting the board’s management decisions, particularly regarding his acquisition of Sterling Software. Although Wyly aimed to gain control of the board, he was unsuccessful and departed in 2002 after receiving a $10 million payout widely regarded as greenmail.

Investigations by the SEC and U.S. Attorney into CA’s accounting practices became public knowledge by early 2002. Moody’s downgraded CA’s credit rating, which led to the cancellation of planned debt refinancing activities. Additionally, the Department of Justice imposed restrictions on CA’s acquisition activities during that year.

The SEC formally accused CA and several former executives of engaging in accounting fraud, asserting that between 1998 and 2000, the company extended its fiscal periods to recognize revenue from contracts signed after quarter-end in order to meet Wall Street earnings targets. This scheme involved prematurely booking $3.3 billion from 363 software agreements. Executives held large stock option packages, providing strong motivation to inflate financial results.

Kumar stepped down as CEO and chairman in 2004 but briefly remained as chief software architect before his complete departure. The company restated its earnings for 2000 and 2001 due to improper revenue recognition practices. CA avoided criminal indictment by settling with both the SEC and DOJ, agreeing to pay $225 million in restitution and implement reforms in corporate governance and accounting procedures.

Eight executives admitted guilt on charges related to fraud or obstruction; several received prison sentences. Kumar himself was sentenced in 2006 to 12 years imprisonment and fined $8 million for his involvement in the fraudulent accounting scheme. In response to these events, CA undertook a comprehensive overhaul of its senior management team. The total expenditure on investigations and penalties associated with the scandal exceeded $500 million.

Developments during the 2000s

By 2001, Computer Associates had become the fourth-largest independent software firm worldwide, employing around 18,000 people. Attempts to expand beyond its core mainframe software business met with limited success.

On December 10, 2003, CA inaugurated its India Technology Centre located in Hyderabad. The following year, former IBM executive John Swainson was appointed CEO. Swainson sought to rejuvenate the company but encountered significant obstacles due to internal financial and accounting system challenges.

During this timeframe, CA unveiled its Enterprise IT Management (EITM) strategy aimed at streamlining and integrating enterprise IT operations. By 2006, the company’s workforce had contracted to approximately 15,000 employees.

In January 2006, Computer Associates International, Inc. rebranded itself as CA, Inc., reflecting a strategic emphasis on simplifying enterprise IT management; this rebranding occurred shortly before founder Kumar entered guilty pleas on multiple charges.

Starting in May 2008, CA was included in the Nasdaq-100 index.

On September 1, 2009, CEO John Swainson announced his intention to retire at year-end. William E. McCracken was named chairman and CEO effective January 28, 2010.

2010s

In May 2010, the company rebranded itself as CA Technologies to better represent its expanded technology offerings.

That same year, CA significantly accelerated its cloud computing capabilities by acquiring eight firms: 3Tera, Nimsoft, NetQoS, Oblicore, Cassatt, 4Base Technology, Arcot Systems, and Hyperformix. Additionally, it purchased Replay Solutions. In 2011, CA further expanded its portfolio by acquiring ITKO for $330 million. Two years later, in 2013, the company added application deployment specialist Nolio for approximately $40 million and also acquired Layer7.

Originally known for providing antivirus and internet security software to consumers, CA divested its antivirus division in 2011 to Updata Partners, which subsequently established Total Defense. Following this divestiture, CA redirected its focus toward business-to-business mainframe and distributed IT infrastructure software.

On January 7, 2013, Michael P. Gregoire was named CEO and joined the board of directors. By June 2014, CA discreetly shifted its headquarters from Islandia, New York to 520 Madison Avenue in Manhattan.

In 2015, CA acquired Rally Software for $480 million along with Unifyalm, Gridtools, Idmlogic, and Xceedium to broaden its development and management capabilities.

Between 2016 and 2017, the company enhanced its automation and security product lines through the acquisitions of BlazeMeter, Automic, Veracode, and Runscope.

For the fiscal year ending March 31, 2018, CA Technologies reported revenues totaling $4.2 billion. Mainframe solutions accounted for the largest share at $2.2 billion; enterprise solutions contributed $1.75 billion; and services brought in $300 million. The firm maintained operations in over 40 countries with a workforce of roughly 11,300 employees.

On August 8, 2018, CEO Mike Gregoire was appointed chairman of the board, taking over from the retiring Art Weinbach.

Acquisition by Broadcom

On July 11, 2018, Broadcom Inc. declared its intention to purchase CA Technologies for $18.9 billion in cash. CA’s CEO, Mike Gregoire, remarked that this merger "brings together our software capabilities with Broadcom’s semiconductor expertise." The transaction caught many industry experts off guard because of the distinct nature of the companies’ core operations. One analyst observed that although Broadcom might benefit financially from CA’s business, the strategic justification remained ambiguous. The Register labeled it as the "Weirdest. Acquisition. Ever." The agreement was finalized on November 5, 2018.

The Register also pointed out the irony that CA, which had previously been a prolific acquirer itself, was now the entity being absorbed by Broadcom. Broadcom’s history of significant layoffs following acquisitions was well-known. After the deal closed, substantial reductions affected former CA staff located in Silicon Valley, Plano (Texas), Islandia (where 262 employees were impacted), and Manhattan. Reports suggested that approximately 40% of CA’s U.S.-based workforce—close to 2,000 employees—were dismissed. Eventually, the expansive CA campus in Islandia was vacated.

Corporate responsibility and recognition

During the mid-1990s, Computer Associates worked to improve its public image by creating a dedicated public relations team and implementing more employee-centered human resource policies.

Sustainability

In 2010, CA earned a spot among the most environmentally friendly corporations according to Newsweek's Green rankings. From 2012 through 2018, it consistently appeared on the Dow Jones Sustainability Indexes (DJSI). In both 2015 and 2016, Newsweek again recognized CA as one of America’s Greenest companies.

CA received an A− score from CDP in 2017 for its environmental transparency and performance. Its 2018 corporate sustainability report revealed a reduction exceeding 35% in its Greenhouse Gas emissions since 2006. That same year, CA was honored with the Climate Leadership Award for Excellence in GHG Management and was listed among Barron's 100 Most Sustainable Companies.

In February 2018, for the third year running, the Ethisphere Institute named CA one of the World's Most Ethical Companies.

Equality and diversity

CA Technologies earned recognition from Working Mother Magazine as a top employer for multicultural women from 2015 through 2018 and was included in their list of 100 Best Companies between 2015 and 2017. In 2017, InHerSight awarded CA a 4.3-star rating as one of the Top 10 IT Companies for Women. Fatherly.com also ranked CA among the Best Places to Work for New Fathers in both 2015 and 2016.

In 2018, CA was acknowledged as a NAFE top company supporting executive women and featured in the Bloomberg Gender-Equality Index (GEI). The Human Rights Campaign Foundation placed CA on its Best Places to Work for LGBTQ+ Equality list for the fourth consecutive year.

Reflecting its dedication to diversity initiatives, CA CEO Mike Gregoire is a signatory of the CEO Action for Diversity and Inclusion pledge.

Work environments

Between 2015 and 2018, Computerworld recognized CA as one of the Best Places to Work in IT. In 2017, it appeared on Forbes’ list of America’s Best Employers and received a STAR Award from the Technology Services Industry Association (TSIA) for Leadership and Innovation.

In 2018, Thomson Reuters included CA among the World’s Top 100 Technology companies. Additionally, CA secured the NorthFace ScoreBoard Award from the Customer Relationship Management Institute (CRMI) for six years running.

Acquisitions

Main article: List of mergers and acquisitions by CA Technologies

CA broadened its software offerings and expanded market presence through multiple acquisitions spanning enterprise system monitoring, ID management, security solutions, and anti-virus technologies—propelling its growth and diversification within the tech sector.

See also

• CA IT Process Automation Manager
• Computer Associates International, Inc. v. Altai, Inc.
• Tech companies in the New York metropolitan area

Further reading

• 21st Century Management: The Revolutionary Strategies That Have Made Computer Associates a Multibillion-Dollar Software Giant, by Hesh Kestin (1992, Atlantic Monthly Press)

External links

• CA-SORT User Manual, Broadcom official site