CUPERTINO, Calif. – May 2, 2007 – Symantec Corp. (Nasdaq: SYMC) today reported results of its fiscal fourth quarter and the fiscal year 2007, ended March 30, 2007. GAAP revenue for the March 2007 quarter was $1.357 billion and non-GAAP revenue was $1.365 billion. Non-GAAP revenue grew 5 percent over the comparable period a year ago.
For the 2007 fiscal year, GAAP revenue was $5.20 billion and non-GAAP revenue was $5.25 billion. On a non-GAAP basis, 2007 fiscal year revenue grew 5 percent compared to the 2006 fiscal year’s non-GAAP revenue of $5 billion.
Symantec adopted Staff Accounting Bulletin 108 during the March quarter. As such, the GAAP and non-GAAP results for the fiscal year 2007 and the fiscal fourth quarter include the adoption of SAB 108. The resulting changes to the previously reported amounts are immaterial to the quarter and fiscal year.
GAAP deferred revenue at the end of March 2007 was $2.75 billion. Non-GAAP deferred revenue grew 19 percent to $2.77 billion compared to $2.32 billion, adjusted for SAB 108 at the end of March 2006.
GAAP Results: GAAP net income for the fiscal fourth quarter was $61 million, compared to $119 million for the same quarter last year. GAAP diluted earnings per share were $0.07, compared to earnings per share of $0.11 for the same quarter last year. For fiscal year 2007, Symantec reported net income of $404 million, compared to net income of $157 million for fiscal year 2006. Diluted earnings per share were $0.41 compared to earnings per share of $0.15 for fiscal year 2006. During the March quarter, GAAP earnings per share were impacted by a $51 million restructuring charge related to our recent reduction in force and further facilities consolidation activities.
Non-GAAP Results: Non-GAAP net income for fiscal fourth quarter was $227 million, compared to $279 million for the same quarter last year. Non-GAAP diluted earnings per share were $0.24, compared to earnings per share of $0.26 for the year-ago quarter. For fiscal year 2007, Symantec reported non-GAAP net income of $992 million, compared to $1.14 billion in fiscal year 2006. Non-GAAP diluted earnings per share for the year were $1.01, compared to earnings per share of $1 for fiscal year 2006. For a detailed reconciliation of our GAAP to non-GAAP results, please refer to the attached consolidated financial statements.
“The actions we implemented over the past few quarters to improve our business operations allowed us to end our fiscal year with a solid March quarter,” said John W. Thompson, chairman and chief executive officer, Symantec. “With a more stable operating environment and a much stronger product portfolio, we look forward to a stronger fiscal year 2008.”
For the quarter, Symantec’s Consumer business represented 30 percent of total non-GAAP revenue and grew 11 percent year-over-year. Services represented 5 percent of total revenue and grew 31 percent year-over-year. The Security and Data Management business represented 38 percent of total revenue and grew 2 percent year-over-year. The Data Center Management business represented 27 percent of total revenue and remained flat year-over-year.
International revenues represented 52 percent of total non-GAAP revenue in the fourth quarter and grew 9 percent year-over-year. The Asia Pacific/Japan revenue for the quarter represented 14 percent of total revenue and grew 9 percent year-over-year. The Americas, including the United States, Latin America, and Canada, represented 54 percent of total revenue and increased 3 percent year-over-year. The Europe, Middle East, and Africa region represented 32 percent of total revenue for the quarter and grew 7 percent year-over-year.
June Quarter 2007 Guidance
For the June 2007 quarter, GAAP revenue is estimated between $1.275 billion and $1.305 billion. GAAP diluted earnings per share is estimated between $0.00 and $0.02.
Non-GAAP revenue for the quarter is estimated between $1.295 billion and $1.325 billion. Non-GAAP diluted earnings per share is estimated between $0.18 and $0.20.
GAAP deferred revenue is expected to be in the range of $2.71 billion and $2.75 billion. Non-GAAP deferred revenue is expected to be in the range of $2.75 billion and $2.79 billion.
Cash flow from operations is expected to exceed the June 2006 results of $368 million adjusted for SAB 108.
Fiscal Year 2008 Guidance
For the fiscal year ending March 28, 2008, GAAP revenue is estimated between $5.59 billion and $5.69 billion. GAAP diluted earnings per share for the fiscal year ending in March 2007 is expected between $0.45 and $0.50.
Non-GAAP revenue is estimated between $5.65 billion and $5.75 billion. Non-GAAP diluted earnings per share is estimated between $1.10 and $1.15.
- Symantec signed 376 contracts worldwide worth more than $300,000 each, including 99 worth more than $1 million each, during the quarter. Of those 376 contracts, 77 percent were multiple product deals.
- In North America, Symantec signed new or extended agreements with customers including Chevron, the second-largest integrated energy company in the United States; San Antonio Independent School District, a K-12 district serving 55,000 students; Pittsburgh Public Schools, a K-12 school district with 29,000 students; Audio Visual Services Corp., a leading provider of audiovisual equipment rentals, staging services and related technical support; EDS Canada, a wholly owned subsidiary of the global EDS Corp.; Los Angeles Unified School District, the second largest school district in the nation with 708,000 students and ESRI, the world leader in GIS (geographic information system) mapping software and technology.
- New or extended agreements with international customers included Lufthansa Systems; Beijing Mobile, a subsidiary of China Mobile Ltd., the leading mobile services provider in China; MBF, which provides trusted solutions that aim to protect and enhance their customers' health and financial wellbeing; Hong Kong Air Cargo Terminals Limited, the world's leading air cargo terminal operator; IXE Banco S.A., a fast-growing Mexican bank; Servicios Liverpool S.A. de C.V., a leading operator of shopping centers in Mexico; Lotte Data Communication Co., a leading provider of total IT services in Korea; IZB Informatik-Zentrum, the German IT service provider and operator for secure datacenters for the Sparkassen finance group; Vodafone D2 GmbH, the leading mobile communication provider in Germany and Nanya Technology Corp., an innovator in DRAM design, manufacturing, and sales.
Fiscal Year Highlights
- Symantec unified its sales force to broaden account and opportunity coverage.
- The company consolidated two ERP systems to drive operational efficiencies and improve the ease of transacting business.
- The consumer team introduced two award-winning and market-leading products – Norton Internet Security 2007 and Norton 360.
- Symantec entered into a multi-year contract with Hewlett Packard that will result in new HP consumer PCs being delivered with a trial copy of Norton Internet Security.
- The Data Center Management Group rolled out the Data Center Foundation suite of products, which is the only offering that allows data center managers to standardize on solutions from a single vendor across disparate operating systems.
- Symantec repurchased $2.8 billion of its common stock.
- Global Security Services introduced two new service offerings for enterprise customers – Symantec Operational Services and Symantec Residency Services – which provide enterprise customers with an extended range of IT infrastructure management options to incorporate best practices, improve efficiencies, and ultimately improve overall IT risk management.
- The Security and Data Management Group launched the Information Foundation Suite to help organizations protect themselves against risks across the wide range of e-mail, instant messaging, Web communications, file sharing and other information systems within the enterprise.
Symantec has scheduled a conference call for 5 p.m. ET/2 p.m. PT today to discuss results from the fiscal fourth quarter and fiscal year 2007 results, and to review guidance for the fiscal first quarter and fiscal year 2008. 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 script of our officers’ remarks will be available on the investor relations’ home page shortly after the call is completed.
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 www.symantec.com.
NOTE TO EDITORS: If you would like additional information on Symantec Corporation and its products, please visit the Symantec News Room at http://www.symantec.com/news. All prices noted are in U.S. dollars and are valid only in the United States.
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.
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 31, 2006 and our Form 10-Q for the quarter ended Dec. 29, 2006. We assume no obligation to update any forward-looking information contained in this press release.
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 www.symantec.com/invest.
|Consolidated Balance Sheets|
|March 31,||March 31,|
|Cash and short-term investments||$ 2,987,653||$ 2,865,802|
|Trade accounts receivable, net||666,968||670,937|
|Current deferred income taxes||165,323||131,833|
|Other current assets||208,920||190,673|
|Total current assets||4,071,047||3,907,932|
|Property and equipment, net||1,092,240||946,217|
|Acquired product rights, net||909,878||1,238,511|
|Other intangible assets, net||1,245,638||1,440,873|
|Other long-term assets||91,719||48,605|
|$ 17,750,870||$ 17,913,183|
|LIABILITIES AND STOCKHOLDERS’ EQUITY|
|Convertible subordinated notes||$ -||$ 512,800|
|Accrued compensation and benefits||307,824||277,170|
|Current deferred revenue||2,387,733||1,915,179|
|Other accrued expenses||234,915||185,882|
|Income taxes payable||238,486||419,401|
|Total current liabilities||3,318,089||3,477,567|
|Convertible senior notes||2,100,000||-|
|Long-term deferred revenue||366,050||248,273|
|Long-term deferred tax liabilities||343,848||493,956|
|Other long-term obligations||21,370||24,916|
|Capital in excess of par value||10,061,144||12,426,690|
|Accumulated other comprehensive income||182,933||146,810|
|Deferred stock-based compensation||-||(43,595)|
|Total stockholders’ equity||11,601,513||13,668,471|
|$ 17,750,870||$ 17,913,183|