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Press Release

Symantec Reports Fourth Quarter and Fiscal Year 2014 Results, Provides Fiscal Year 2015 Guidance

  • Delivers 4Q14 non-GAAP revenue at high-end of guidance; operating margin expansion and EPS exceed guidance
  • Continued cost reduction and efficiency improvements expected to achieve 30% non-GAAP operating margin by 4Q15; return to revenue growth in second half of fiscal 2015
  • Company is optimizing businesses based on lifecycle and growth potential
MOUNTAIN VIEW, Calif. – May 8, 2014 – Symantec Corp. (Nasdaq: SYMC) today reported the results of its fourth quarter and fiscal year 2014, ended March 28, 2014. GAAP revenue for the fourth quarter was $1.63 billion, down 7 percent year-over-year (as reported and after adjusting for currency). For the fiscal year, GAAP revenue was $6.68 billion, down 3 percent (as reported and after adjusting for currency).
“Our fourth quarter results, led by better performance from our sales teams and cost reductions, demonstrate the underlying health of our business,” said Michael Brown, Symantec interim president and chief executive officer. “In the new leadership team’s first 40 days, we’ve taken important steps to accelerate the pace of our transformation. There are substantial opportunities for us to improve our growth profile, maximize profitability and create value, and I’m confident we have the right team and plans in place to achieve our objectives.”
Thomas Seifert, executive vice president and chief financial officer, added, “We see further opportunities to streamline our operations and drive ongoing operating margin expansion, with the near-term goal of achieving 30 percent non-GAAP operating margin by 4Q15. We will also continue to return significant capital to shareholders while maintaining a strong balance sheet.”

GAAP Results for the Fourth Quarter of Fiscal Year 2014

  • GAAP operating margin was 18.8 percent, up 425 basis points and up 360 basis points after adjusting for currency, resulting in GAAP earnings per share of $0.31, up 15 percent year-overyear.
  • GAAP net income was $217 million, up 14 percent year-over-year.
  • GAAP deferred revenue as of March 28, 2014 was $3.90 billion, down 4 percent year-over-year and down 6 percent after adjusting for currency.
  • Cash flow from operating activities was $449 million, down 27 percent year-over-year.

GAAP Results for Fiscal Year 2014

  • GAAP operating margin was 17.7 percent, up 170 basis points and up 125 basis points after adjusting for currency, resulting in GAAP earnings per share of $1.28, up 21 percent year-overyear.
  • GAAP net income was $898 million, up 19 percent year-over-year.
  • Cash flow from operating activities was $1.28 billion, down 20 percent year-over-year.

Non-GAAP Results for the Fourth Quarter of Fiscal Year 2014

  • Non-GAAP revenue was $1.65 billion, down 6 percent year-over-year (as reported and after adjusting for currency).
  • Non-GAAP operating margin was 27.3 percent, up 320 basis points and up 250 basis points after adjusting for currency, resulting in non-GAAP earnings per share of $0.47, up 7 percent yearover- year.
  • Non-GAAP net income was $329 million, up 4 percent year-over-year.

Non-GAAP Results for Fiscal Year 2014

  • Non-GAAP revenue was $6.70 billion, down 3 percent year-over-year (as reported and after adjusting for currency).
  • Non-GAAP operating margin was 27.5 percent, up 200 basis points and up 160 basis points after adjusting for currency, resulting in non-GAAP earnings per share of $1.92, up 9 percent yearover- year.
  • Non-GAAP net income was $1.35 billion, up 8 percent year-over-year.

Capital Allocation

Symantec ended the quarter and fiscal year with cash, cash equivalents and short-term investments of $4.08 billion compared to $4.75 billion, a decrease of 14 percent year-over-year driven by a principal payment for our matured and settled convertible notes. On March 19, 2014, we paid a dividend of $0.15 per share for a total of $104 million. Also, during the quarter, Symantec repurchased 5.5 million shares for $125 million at an average price of $22.85. During the fiscal year 2014, the Company repurchased 21 million shares at an average price of $23.87, equivalent to $500 million. At the end of the fourth quarter, Symantec had $658 million remaining for future repurchases in the current board authorized stock repurchase plan.
Symantec's Board of Directors has declared a quarterly cash dividend of $0.15 per common share to be paid on June 25, 2014 to all shareholders of record as of the close of business on June 10, 2014. The exdividend date will be June 6, 2014.

Fiscal Year 2015 Guidance

For the fiscal year 2015, we expect:
  • Revenue of $6.63 to $6.77 billion, compared to $6.70 billion in the year-ago period.
  • GAAP operating margin of 21.8 to 22.3 percent, compared to 17.7 percent in the year-ago period.
  • Non-GAAP operating margin of 27.7 to 28.2 percent, compared to 27.5 percent in the year-ago period.
  • GAAP diluted earnings per share between $1.43 and $1.51, compared to $1.28 in the year-ago period.
  • Non-GAAP diluted earnings per share between $1.84 and $1.92, compared to $1.92 in the yearago period.

First Quarter Fiscal Year 2015 Guidance

For the first quarter of fiscal 2015, we expect:
  • Revenue of $1.65 to $1.69 billion, compared to $1.71 billion in the year-ago period.
  • GAAP operating margin of 18.4 to 18.8 percent, compared to 13.1 percent in the year-ago period.
  • Non-GAAP operating margin of 24.1 to 24.5 percent, compared to 25.3 percent in the year-ago period.
  • GAAP diluted earnings per share between $0.31 and $0.33, compared to $0.22 in the year-ago period.
  • Non-GAAP diluted earnings per share between $0.41 and $0.43, compared to $0.44 in the year-ago period.
Guidance assumes an exchange rate of $1.38 per Euro for the June 2014 quarter versus the actual weighted average rate of $1.31 and an end of period rate of $1.30 per Euro for the June 2013 quarter and $1.38 per Euro for fiscal year 2015. Our guidance assumes an effective tax rate of 24.8 percent for the June 2014 quarter and 27.8 percent for the remaining quarters in fiscal year 2015 and a common stock equivalents total for the quarter and fiscal year of 695 million shares.

Conference Call

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 2014, ended March 28, 2014 and to review guidance. Interested parties may access the conference call on the Internet at http://www.symantec.com/invest. To listen to the live call, please go to the website at least 15 minutes early to register, download and install any necessary audio software. A replay and our prepared remarks will be available on the investor relations’ home page shortly after the call is completed.

About Symantec

Symantec Corporation (NASDAQ: SYMC) is an information protection expert that helps people, businesses and governments seeking the freedom to unlock the opportunities technology brings -- anytime, anywhere. Founded in April 1982, Symantec, a Fortune 500 company, operating one of the largest global data-intelligence networks, has provided leading security, backup and availability solutions for where vital information is stored, accessed and shared. The company's more than 20,000 employees reside in more than 50 countries. Ninety-nine percent of Fortune 500 companies are Symantec customers. In fiscal 2014, it recorded revenue of $6.7 billion. To learn more go to www.symantec.com or connect with Symantec at: go.symantec.com/socialmedia.
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FORWARD-LOOKING STATEMENTS: This press release contains statements regarding our financial and business results and business strategy, which may be considered forward-looking within the meaning of the U.S. federal securities laws, including projections of future revenue, operating margin and earnings per share, projections of amortization of acquisition-related intangibles and stock-based compensation and restructuring charges, operating margin expansion and future return of capital to shareholders. 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: general economic conditions; 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; our ability to reduce our operating expenses; fluctuations in currency exchange rates; our actual effective tax rate in future periods; 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. We assume no obligation, and do not intend, to update these forward-looking statements as a result of future events or developments. Additional information concerning these and other risks factors is contained in the Risk Factors sections of our Form 10-K for the year ended March 29, 2013.
USE OF NON-GAAP FINANCIAL INFORMATION: Our results of operations have undergone significant change due to a series of acquisitions, the impact of stock-based compensation, impairment charges and other corporate events, including the impact on revenue of the ongoing investigation into Symantec’s compliance with certain provisions of its 2007 GSA contract. 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 this release and which can be found, along with other financial information, on the investor relations’ page of our website at www.symantec.com/invest.