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Symantec Closes Fiscal Year 2005 With Record Revenue And Earnings

CUPERTINO, Calif. - May 4, 2005 - Symantec Corp. (Nasdaq: SYMC), the global leader in information security, today reported results for the fiscal fourth quarter and the fiscal year ended April 1, 2005. Symantec posted revenue for the quarter of $713 million, a 28 percent increase compared to $556 million for the same quarter last year. Revenue for fiscal year 2005 was $2.6 billion, a 38 percent increase compared to $1.9 billion for fiscal year 2004.

GAAP Results:
GAAP net income for the fiscal fourth quarter was $120 million, compared to $117 million for the same quarter last year. Earnings per share were $0.16, compared to earnings per share of $0.16 for the same quarter last year. For fiscal year 2005, Symantec reported net income of $536 million, compared to net income of $371 million for fiscal year 2004. Earnings per share were $0.74, compared to earnings per share of $0.54 for fiscal year 2004.

GAAP net income and EPS for the March quarter includes a one-time tax expense of $54 million or $0.07 per diluted share related to Symantec's repatriation of $625 million in cash of which $500 million was subject to the American Jobs Creation Act of 2004.

Non-GAAP Results:
Non-GAAP net income for fiscal fourth quarter was $186 million, compared to $126 million for the same quarter last year. Non-GAAP earnings per share were $0.25, compared to earnings per share of $0.18 for the year-ago quarter. For fiscal year 2005, Symantec reported non-GAAP net income of $634 million, compared to $411 million in fiscal year 2004. Non-GAAP earnings per share for the year were $0.87, compared to earnings per share of $0.59 for fiscal year 2004.

Non-GAAP results, as outlined in the attached consolidated statements and related reconciliation, exclude amortization of acquisition-related intangibles, amortization of deferred stock-based compensation, acquired in-process research and development, restructuring charges, patent settlement charges, and integration planning expenses associated with the proposed VERITAS merger, as well as the related income tax benefits, and the one-time tax effect associated with the company's cash repatriation under the American Jobs Creation Act. See "Use of Non-GAAP Financial Information" below.

"Our team remains focused and continues to deliver outstanding results around the world," said John W. Thompson, Symantec chairman and chief executive officer. "Double-digit growth rates in all segments and all geographies underpinned the success of the quarter and the fiscal year."

Revenue Components
For the quarter, Symantec's worldwide enterprise business, including enterprise security, enterprise administration, and services, represented 49 percent of total revenue and grew 22 percent year-over-year. Symantec's enterprise security business represented 36 percent of total revenue and grew 23 percent; the enterprise administration business represented 11 percent of total revenue and grew 14 percent; and the services business represented 2 percent of total revenue and grew 60 percent. Symantec's consumer business represented 51 percent of total revenue and grew 34 percent.

International revenues represented 52 percent of total revenue in the fourth quarter and grew 25 percent over the same quarter last year. The Americas, including the United States, Latin America, and Canada, represented 54 percent of total revenue and grew 31 percent. The Europe, Middle East and Africa region represented 32 percent of total revenue and grew 24 percent. Japan/Asia Pacific represented 14 percent of total revenue and grew 28 percent.

Business Outlook
Symantec is providing forward-looking guidance, excluding any impact associated with our proposed merger with VERITAS, for the fiscal first quarter ending July 1, 2005, as follows:

  • Revenue is estimated between $700 million and $720 million.
  • At the mid-point of revenue guidance, GAAP earnings per share are estimated to be $0.23.
  • At the mid-point of revenue guidance, non-GAAP earnings per share are estimated to be $0.25.
Non-GAAP earnings per share guidance excludes expenses related to the amortization of acquisition-related intangibles and the amortization of deferred compensation of $15 million and any merger related fees associated with our announced merger with VERITAS.

Quarterly Highlights

  • Symantec signed 401 contracts worldwide worth more than $100,000 each, including 109 worth more than $300,000 each and 22 worth more than $1 million each, during the quarter. Sixty-one percent of these deals included multiple Symantec enterprise products and services, an increase of 109 percent from the same quarter last year.
  • Symantec signed new or extended agreements with customers including Wynn Las Vegas Resort and Country Club; M&T Bank Corporation, a regional multi-bank holding company offering a diversified line of financial services; Fiserv Inc., the leading provider of information management solutions for the financial industry; Premier Inc., an alliance of nonprofit hospitals and healthcare systems; Providence Health System, a nonprofit, charitable, Catholic faith-based, integrated health care delivery system; Mirant Corporation, a competitive energy company that produces and sells electricity in the United States, the Caribbean, and the Philippines; Citrix Systems, the global leader in access infrastructure solutions; Lee Enterprises, Incorporated, the 12th largest newspaper company in the country, publishing 44 daily newspapers in 19 states; the University of Oklahoma; and the US-CERT, a public/private sector partnership charged with improving computer security preparedness and response to cyber attacks in the United States.
  • International customers from the quarter included Seiko Epson Corporation, a global leader in imaging products; Sompo Japan Insurance Inc., one of the leading non-life insurance companies in Japan; The Dai-Ichi Mutual Life Insurance Company, one of the leading life insurance companies in Japan; Softbank BB Corp., the broadband leader in Japan; Resona Bank, Limited, one of Japan's leading financial institutions; and Wistron, with headquarters in Taiwan, one of the world's largest original design manufacturing (ODM) companies producing information and communications technology (ICT) products.

Conference Call
Symantec has scheduled a conference call for 5 p.m. ET/2 p.m. PT today to discuss fiscal fourth quarter and fiscal year 2005 results, and to review guidance for the fiscal first quarter 2006. 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.

About Symantec
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.

NOTE TO EDITORS: If you would like additional information on Symantec Corporation and its products, please view the Symantec Press Center at http://www.symantec.com/about/news/release/index.jsp on Symantec's Web site. All prices noted are in US dollars and are valid only in the United States.

Symantec, the Symantec logo, VERITAS, and the VERITAS logo are trademarks or registered trademarks of Symantec Corporation or its affiliates in the United States and certain other countries. Additional company and product names may be trademarks or registered trademarks of the individual companies and are respectfully acknowledged.

FORWARD LOOKING STATEMENTS: This press release contains forward-looking statements, including forecasts of future revenue, GAAP and non-GAAP earnings per share, momentum in particular product areas and expected industry patterns, statements regarding completion of our proposed merger with VERITAS and other financial and business results. 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 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 and international; the positioning of Symantec's products in those segments; the competitive environment in the software industry; general market conditions; fluctuations in currency exchange rates; the timing of new product releases and upgrades; changes to operating systems and product strategy by vendors of operating systems; satisfaction of the conditions to closing our proposed merger with VERITAS; and whether Symantec can successfully develop new products and integrate 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 sections of Symantec's recently filed Form 10-Q for the quarter ended Dec. 31, 2004. Symantec assumes no obligation to update any forward-looking information contained in this press release.

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 amortization of acquisition-related intangibles, amortization of deferred stock-based compensation, in-process research and development, and certain other identified charges, such as restructuring, patent settlement, and integration planning expenses associated with the proposed VERITAS merger, as well as the tax effect of these items, and the one-time tax effect associated with the company's cash repatriation under the American Jobs Creation Act. 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 also be found on the investor relations Web site at www.symantec.com/invest/index.html.

Additional Information and Where to Find It
Symantec Corporation has filed a registration statement on Form S-4 containing a preliminary joint proxy statement/prospectus in connection with the merger transaction involving Symantec and VERITAS Software Corporation. We urge investors and security holders to read this filing (as well as the definitive joint proxy statement/prospectus when it becomes available) because it contains important information about the merger. Symantec, VERITAS and their directors and executive officers may be deemed to be participants in the solicitation of proxies from stockholders in connection with the merger. Information regarding the special interests of these directors and executive officers in the merger is included in the preliminary joint proxy statement/prospectus described above. Additional information regarding the directors and executive officers of Symantec or VERITAS is also included in Symantec's proxy statement for its 2004 Annual Meeting of Stockholders, which was filed with the SEC on July 30, 2004 or VERITAS' proxy statement for its 2004 Annual Meeting of Stockholders, which was filed with the SEC on July 21, 2004. Investors and security holders may obtain free copies of the documents described above and other documents filed with the SEC at www.sec.gov or by contacting Symantec Investor Relations at 408-517-8239 or VERITAS Investor Relations at 650-527-4523.

@Symantec