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Symantec Reports Strong First Quarter Revenue and Earnings

  • 26 July, 2007 10:09

<p>CUPERTINO, Calif. – July 25, 2007 – Symantec Corp. (Nasdaq: SYMC) today reported the results of its first quarter of fiscal year 2008, ended June 29, 2007. GAAP revenue for the quarter was $1.40 billion and non-GAAP revenue was $1.42 billion. Non-GAAP revenue grew 10 percent over the comparable period a year ago.</p>
<p>GAAP deferred revenue at the end of the June 2007 quarter was $2.66 billion, compared to $2.31 billion at the end of the June 2006 quarter. Non-GAAP deferred revenue at the end of the quarter reached $2.71 billion, up 16 percent compared to $2.34 billion at the end of the June 2006 quarter. Symantec continues to benefit from an increasing volume of predictable revenue rolling off the balance sheet driven by its deferred revenue model.</p>
<p>GAAP Results: GAAP net income for the June 2007 quarter was $95 million, versus last year’s equivalent figure of $101 million. Diluted earnings per share of $0.10 were flat versus the same quarter last year. Profits were impacted by a $19 million restructuring charge related to the reduction in force announced in February 2007 and further facilities consolidation activities.</p>
<p>Non-GAAP Results: Non-GAAP net income for the June 2007 quarter was $263 million, up 4 percent compared to $253 million for the same quarter last year. Non-GAAP diluted earnings per share were $0.29, up 21 percent compared to diluted earnings per share of $0.24 for the same quarter last year. For a detailed reconciliation of our GAAP to non-GAAP results, please refer to the condensed consolidated financial statements below.</p>
<p>“Performance for the quarter was driven by strong demand in many of our core and emerging technology solutions, as well as solid execution by our services, consumer and Altiris teams,” said John W. Thompson, chairman and chief executive officer, Symantec. “We’re off to a good start to our fiscal year.”</p>
<p>Financial Highlights
For the quarter, Symantec’s Consumer segment represented 30 percent of total non-GAAP revenue and grew 11 percent year-over-year. The Security and Data Management segment represented 30 percent of total revenue and grew 4 percent year-over-year. The Data Center Management segment represented 28 percent of total revenue and grew 5 percent year-over-year. Services represented 6 percent of total revenue and grew 13 percent year-over-year. The Altiris segment includes revenues from the acquisition of Altiris and Symantec’s Ghost, pcAnywhere and LiveState Delivery solutions, and represented 6 percent of total revenue.</p>
<p>International revenues represented 51 percent of total non-GAAP revenue in the June 2007 quarter and grew 12 percent year-over-year. The Europe, Middle East and Africa region represented 33 percent of total revenue for the quarter and grew 15 percent year-over-year. The Asia Pacific/Japan revenue for the quarter represented 13 percent of total revenue and grew 8 percent year-over-year. The Americas, including the United States, Latin America and Canada, represented 54 percent of total revenue and increased 8 percent year-over-year.</p>
<p>September Quarter 2007 Guidance</p>
<p>For the September 2007 quarter, GAAP revenue is estimated between $1.35 billion and $1.38 billion. GAAP diluted earnings per share are estimated between $0.07 and $0.09.</p>
<p>Non-GAAP revenue for the September 2007 quarter is estimated between $1.37 billion and $1.40 billion. Non-GAAP diluted earnings per share are estimated between $0.24 and $0.26.</p>
<p>GAAP deferred revenue is expected to be in the range of $2.53 billion and $2.58 billion. Non-GAAP deferred revenue is expected to be in the range of $2.55 billion and $2.60 billion.</p>
<p>For the September 2007 quarter, we expect cash flow from operating activities to be below the September 2006 quarter cash flow from operating activities of $276 million.</p>
<p>Quarterly Highlights</p>
<p>·Symantec signed 249 contracts worldwide worth more than $300,000 each, including 48 worth more than $1 million each, during the quarter. Of those 249 contracts, more than 70 percent were multiple product deals.</p>
<p>·In North America, Symantec signed new or extended agreements with customers including Atmel, an industry leader in the design and manufacture of advanced semiconductors; Accor North America, a division of Accor, one of the world’s largest groups in travel, tourism and corporate services; Florida Department of Transportation, which oversees 7,450 employees statewide, 41,000 highway lane miles, 6,381 bridges, 14 seaports and 2,707 railway miles; GTECH Corp., a leading gaming technology and services company; Children’s Healthcare of Atlanta, one of the leading pediatric hospitals in the country, recognized for excellence in cancer, cardiac and neonatal care; AMN Healthcare, Inc., the nation's largest healthcare staffing company; Rite Aid Corporation, a leading drugstore chain with more than 5,000 stores in 31 U.S. states and the District of Columbia; Indiana University, educating 97,000 students on eight campuses across the state and South Carolina Department of Health and Environmental Control, a health agency that promotes and protects the health of the public and the environment.</p>
<p>·New or extended agreements with international customers from the quarter included British Sky Broadcasting, which operates the UK's largest digital pay television platform, Sky Digital; National Health Insurance Corp., the only public health insurer in Korea; Beijing Mobile, a subsidiary of China Mobile Ltd., the leading mobile services provider in China; Colegio de Registradores de Espana, the Association of Spanish Property and Commercial Registrars; Siemens IT Solutions and Services Brazil, part of one of the world’s largest technology groups and Cable &amp; Wireless Jamaica, the leading full-service telecommunications provider in the Americas &amp; Caribbean region.</p>
<p>Conference Call</p>
<p>Symantec has scheduled a conference call for 5 p.m. ET/2 p.m. PT today to discuss the fiscal first quarter, ended June 29, 2007, and to review guidance. Interested parties may access the conference call on the Internet at . To listen to the live call, please go to the Web site at least 15 minutes early to register, download, and install any necessary audio software. A replay and script of our officers’ remarks will be available on the investor relations’ home page shortly after the call is completed.</p>
<p>About Symantec</p>
<p>Symantec is a global leader in infrastructure software, enabling businesses and consumers to have confidence in a connected world. The company helps customers protect their infrastructure, information and interactions by delivering software and services that address risks to security, availability, compliance and performance. Headquartered in Cupertino, Calif., Symantec has operations in 40 countries. More information is available at .</p>
<p>NOTE TO EDITORS: If you would like additional information on Symantec Corporation and its products, please visit the Symantec News Room at . All prices noted are in U.S. dollars and are valid only in the United States.</p>
<p>Symantec and the Symantec Logo are trademarks or registered trademarks of Symantec Corporation or its affiliates in the U.S. and other countries. Other names may be trademarks of their respective owners.</p>
<p>FORWARD-LOOKING STATEMENTS: This press release contains statements regarding our financial and business results, which may be considered forward-looking within the meaning of the U.S. federal securities laws, including statements relating to projections of future revenue, earnings per share, deferred revenue and cash flow from operations, as well as projections of amortization of acquisition-related intangibles and stock-based compensation. These statements are subject to known and unknown risks, uncertainties and other factors that may cause our actual results, levels of activity, performance or achievements to differ materially from results expressed or implied in this press release. Such risk factors include those related to: maintaining customer and partner relationships; the anticipated growth of certain market segments, particularly with regard to security and storage; the competitive environment in the software industry; changes to operating systems and product strategy by vendors of operating systems; fluctuations in currency exchange rates; the timing and market acceptance of new product releases and upgrades; the successful development of new products and integration of acquired businesses, and the degree to which these products and businesses gain market acceptance. Actual results may differ materially from those contained in the forward-looking statements in this press release. Additional information concerning these and other risk factors is contained in the Risk Factors section of our Form 10-K for the year ended March 30, 2007.</p>
<p>USE OF NON-GAAP FINANCIAL INFORMATION: Our results of operations have undergone significant change due to a series of acquisitions, the impact of SFAS 123(R) and other corporate events. To help our readers understand our past financial performance and our future results, we supplement the financial results that we provide in accordance with generally accepted accounting principles, or GAAP, with non-GAAP financial measures. The method we use to produce non-GAAP results is not computed according to GAAP and may differ from the methods used by other companies. Our non-GAAP results are not meant to be considered in isolation or as a substitute for comparable GAAP measures and should be read only in conjunction with our consolidated financial statements prepared in accordance with GAAP. Our management regularly uses our supplemental non-GAAP financial measures internally to understand, manage and evaluate our business and make operating decisions. These non-GAAP measures are among the primary factors management uses in planning for and forecasting future periods. Investors are encouraged to review the reconciliation of our non-GAAP financial measures to the comparable GAAP results, which is attached to our quarterly earnings release and which can be found, along with other financial information, on the investor relations page of our Web site at</p>
<p>Media Contact:</p>
<p>Debbie Sassine
+61 2 8879 1110</p>
<p>Laura Skelley
Max Australia
+61 2 9954 3492</p>

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