CUPERTINO, Calif. - Oct. 22, 2003 - Symantec Corp. (Nasdaq: SYMC), the world leader in Internet security, today reported results for the fiscal second quarter 2004 ended Oct. 3, 2003. Symantec posted revenue for the quarter of $429 million, a 32 percent increase compared to $325 million for the same quarter last year, driven by strong enterprise security growth and higher than expected results in the consumer segment.
GAAP Results: Net income for the fiscal second quarter was $83 million, compared to $52 million for the same quarter last year. Earnings per share was $0.49, compared to earnings per share of $0.33 for the year-ago quarter.
Non-GAAP Results: Non-GAAP net income for the fiscal second quarter was $91 million, compared to $60 million for the same quarter last year. Non-GAAP earnings per share was $0.53, compared to earnings per share of $0.38 for the year-ago quarter. Non-GAAP results and related reconciliation, as outlined in the attached consolidated statements, exclude expenses from the amortization of other intangibles from acquisitions and acquired in-process research and development as well as related income tax benefits. See "Use of Non-GAAP Financial Information" below.
"It was a stellar quarter across the board with strong performances in all regions," said John W. Thompson, Symantec chairman and CEO. "Our integrated approach for enterprises and consumers continues to gain momentum and set the bar for the rest of the industry."
For the quarter, Symantec's worldwide enterprise business, including enterprise security, enterprise administration, and services, represented 55 percent of total revenue. Symantec's enterprise security business represented 41 percent of total revenue and grew 25 percent year-over-year; the enterprise administration business represented 12 percent of revenues and declined 8 percent in line with expectations; and the services business grew 53 percent and represented 2 percent of total revenue. Symantec's consumer business grew 56 percent and represented 45 percent of total revenue.
International revenues represented 50 percent of total revenue in the second quarter and grew 39 percent over the same quarter last year. Canada led the increase for the quarter with 49 percent growth, followed by the Europe, Middle East and Africa region with 46 percent growth. Japan recorded 27 percent year-over-year growth, Asia Pacific recorded 24 percent growth and Latin America had 9 percent growth. The United States grew at 26 percent.
Forward-looking guidance for the fiscal third quarter ending Jan. 2, 2004, is as follows:
Forward-looking guidance for the fiscal year, ending April 2, 2004, updated to reflect the fiscal year-to-date actual performance and estimated results for the fiscal third and fourth quarters is as follows:
Non-GAAP earnings per share excludes the pre-tax amortization of other intangibles from acquisitions, acquired in-process research and development, and other items such as patent settlement and restructuring charges of approximately $11 million and $58 million for the quarter ending Jan. 2, 2004, and the fiscal year ending April 2, 2004, respectively.
Symantec has scheduled a conference call for 5 p.m. EDT/2 p.m. PDT today to discuss fiscal second quarter 2004 results, and to review guidance for the fiscal third quarter. Interested parties may access the conference call on the Internet at http://www.symantec.com/invest/index.html. 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 the script of our officers' remarks will be available on the investor relations home page shortly after the call is completed.
USE OF NON-GAAP FINANCIAL INFORMATION: In addition to reporting financial results in accordance with generally accepted accounting principles, or GAAP, Symantec reports non-GAAP financial results. Non-GAAP net income and earnings per share exclude acquisition related charges, such as amortization of goodwill and other intangibles, and certain other charges, such as restructurings and site closures, as well as the tax effect of these items. Symantec's management believes these non-GAAP measures are useful to investors because they provide supplemental information that facilitates comparisons to prior periods. Management uses these non-GAAP measures to evaluate its financial results, develop budgets and manage expenditures. The method Symantec uses to produce non-GAAP results is not computed according to GAAP, is likely to differ from the methods used by other companies and should not be regarded as a replacement for corresponding GAAP measures. Investors are encouraged to review the reconciliation of these non-GAAP financial measures to the comparable GAAP results, which is attached to this release and can be found on the investor relations Web site at www.symantec.com/invest/center.html.
Symantec is the world leader in providing solutions to help individuals and enterprises assure the security, availability, and integrity of their information. Headquartered in Cupertino, Calif., Symantec has operations in more than 40 countries. More information is available at www.symantec.com.
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FORWARD LOOKING STATEMENT: This press release contains forward-looking statements, including forecasts of future revenue and earnings per share, expected activities, and other financial and business results that involve 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 by this press release. Such risk factors include, among others: the sustainability of recent growth rates, particularly in consumer products; the anticipation of the growth of certain market segments, particularly enterprise security; the positioning of Symantec's products in those segments; the competitive environment in the software industry; general market conditions, fluctuations in currency exchange rates, changes to operating systems and product strategy by vendors of operating systems; and whether Symantec can successfully develop new products and the degree to which these 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 sections of Symantec's previously filed Form 10-K and 10-Q. Symantec assumes no obligation to update any forward-looking information contained in this press release except as otherwise required by law.