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Press Release

Symantec Announces Record First Fiscal Quarter Results

Corporate revenue and international performance drive growth

Cupertino, Calif. July 21, 1999 - Symantec Corporation (Nasdaq: SYMC), today announced record results for the first quarter of fiscal 2000 driven by continued strong performance in the corporate market, international growth and successful product launches.

The quarter follows an announcement made earlier today that Symantec intends to redirect its strategy to focus on the rapidly growing markets of content security and management solutions that keep mobile workers who use remote devices secure and productive. As part of this strategy, the company has acquired URLabs, a privately held company recognized as a technology leader in areas of content security.

Symantec announced first quarter revenues of $175 million, an increase of 27 percent over the same period a year earlier. Net income before one-time charges was $26 million, or $0.45 per diluted share, compared to $24 million or $0.39 per diluted share for the same quarter a year ago. Earnings per share after one time charge of $2.8 million was $0.41.

International revenue grew 43 percent over the same quarter a year ago and contributed 39 percent or $68 million to total revenue for the first fiscal quarter. Revenue from Symantec's Europe, Middle East and Africa (EMEA) region and Asia Pacific region grew 48 percent and 87 percent respectively over the same period a year ago. Symantec announces record first fiscal quarter.

"We are extremely pleased to start our fiscal year by providing shareholders with another record quarter," said Symantec's president, CEO and chairman, John W. Thompson. "Growth has come from solid performance across the company. International revenues have grown significantly, we are strengthening our leadership position in the retail sector with increased market share across almost every category, and corporate revenue continues to grow."

Record Corporate Performance
Representing 46 percent of total revenue for the first fiscal quarter 2000, sales to corporate customers grew 68 percent compared to the same quarter a year ago.

Symantec's corporate growth was driven by the company's ability to leverage its partnerships with companies such as IBM and Intel. Since signing an alliance with IBM in May 1998, in which Symantec licensed IBM technologies and IBM agreed to re-market Symantec's Norton AntiVirus product, Symantec has converted 2.3 million IBM seats worldwide to its anti-virus solution.

Sales were strong across Symantec's range of corporate solutions comprising Norton AntiVirus, Norton Ghost, pcAnywhere and Norton 2000. New U.S. corporate customers during the quarter included: LandAmerica Financial Group and Wang Government Services. International wins include the French tax department and insurance groups AXA and AGF in France; SAP in Germany; and BP Amoco in the UK.

In May, Symantec announced its Digital Immune System strategy for providing corporate customers with intelligent tools that keep systems running at peak performance. The strategy for the Digital Immune System is to combine Symantec's virus detection technologies with IBM's virus analysis and Intel's management technologies.

Symantec also announced the preview release of Mobile Essentials 2.0 during the first fiscal quarter. The product reduces the cost of supporting a mobile workforce and is used by IT departments to create laptop configuration settings once and then quickly deploy those settings to mobile professionals. As a result, mobile workers place fewer calls to helpdesks for support, and IT departments spend less time on mobile support issues.

Retail Market Leadership
According to PC Data, the U.S. retail market showed signs of recovery in the June quarter. At the end of May, industry unit sales were up 19 percent on the same period a year ago, fuelled partly by growth in anti-virus sales resulting from a number of high profile virus outbreaks.

According to PC Data research, Symantec was the leading retail business software vendor overall in April and May based on units. In anti-virus, Symantec had a 63 percent market share in units - an increase of 77 percent over the same period a year ago. In the important utility suites category, Norton SystemWorks continues to be the customers' first choice with 72 percent of unit market share in April and May.

Symantec's e-commerce revenue in the first fiscal quarter increased 166 percent over the same quarter a year ago. Throughout the quarter Symantec continued to strengthen relationships with on-line resellers and on July 14 announced the first of a series of worldwide electronic stores created and managed by Internet superstore, Beyond.com.

Symantec was also the leading vendor in key international retail markets. In the UK, the company led the 'Home Office' category in units according to independent research firm, Chart Track. Throughout the quarter Symantec products held four or five positions in the monthly UK best selling top ten lists. In the anti-virus retail category, sales of Norton AntiVirus were more than double those of the second place vendor.

In Germany, according to the April/May GfK Marketing Services Report, Symantec led the overall utility market and anti-virus market with over 50 percent market share in revenue. The company was also the leading vendor measured in revenue in GfK's uninstaller and communication software market categories.

In France, according to GfK, Symantec lead the suite market with 89 percent share, the utilities category with 38 percent share, the anti-virus market with 66 percent share, the uninstaller category with 56.5 percent share, and the Y2K software category with 78.5 percent of the market.

Product launches/announcements and other quarter highlights

On June 10, Symantec announced plans to spin-off its successful Internet Tools Business Unit to create an independent Internet technology company focused on solutions for e-commerce and technology for Web-enabling business systems and legacy applications. The business unit is a market leader in Java development technology with award-winning products. The spin-off is intended to enable Symantec to realize the true potential of its leadership in the Java market as well as focus on building leadership in content security and support for remote mobile devices.

New products and product versions launched and announced in the first fiscal quarter 2000 included: Norton AntiVirus 2.0 for Lotus Notes/Domino; Norton 2000 Corporate Edition 2.0 and Norton 2000 Retail Edition 2.0; Tivoli Manager for Norton 2000; pcAnywhere 9.0 and Mobile WinFax for the Palm Computing® platform.

Product Awards and Accolades
Symantec won more than 70 industry awards during the quarter including:

  • Norton AntiVirus, Norton SystemWorks and Norton Utilities all received PC Magazine's coveted Editor's Choice awards.
  • Windows Magazine placed Norton SystemWorks in its prestigious WinList along with Norton 2000, Norton AntiVirus, WinFax Pro, Mobile Essentials, Norton Ghost and ACT!
  • PC/Computing placed Norton SystemWorks on its A-List, a listing of products deemed best in their class. Norton Your Eyes Only and ACT! also appeared on PC/Computing's A-List.
  • Norton AntiVirus was named Best AntiVirus Software, and received CNET's Editors' Choice award. Likewise, SC Magazine readers voted Norton AntiVirus as the Best Anti-Virus Solution and Norton Your Eyes Only as best encryption product in the June issue.
  • Windows NT Magazine awarded Ghost and pcAnywhere Editors' Faves awards.

Consolidated Balance Sheets

Forward looking statement
This press release contains forward-looking statements. There are certain important factors that could cause Symantec's future development efforts to differ materially from those anticipated by some of the statements made above. Among these are the anticipation of the growth of certain market segments, the positioning of Symantec's products in those segments, the competitive environment in the software industry, dependence on other products, changes to operating systems and product strategy by vendors of operating systems, and the importance of new Symantec products. Additional information concerning those and other factors is contained in the "Risk Factors" section of the company's annual report on Form 10-K for the fiscal year ended April 2, 1999.

About Symantec
Symantec is the world leader in utility software for business and personal computing. Symantec products and solutions help make users productive and keep their computers safe and reliable anywhere and anytime. Symantec offers a broad range of solutions and is acclaimed as a leader in both customer satisfaction and product brand recognition. Symantec is traded on Nasdaq under the symbol SYMC. More information on the company and its products can be obtained at www.symantec.com.

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