Symantec Reports Better Than Expected Third Quarter Results
Increased Awareness for Security Drives Growth in Enterprise Business
CUPERTINO, Calif. - Jan. 16, 2002- Symantec Corp. (Nasdaq:SYMC), the world leader in Internet security technology, today reported results for the fiscal third quarter 2002, ended Dec. 28, 2001. Symantec posted revenue for the quarter of $290.2 million, as compared to $241.8 million for the same quarter last year.
Net income before one-time charges and the amortization of acquisition-related charges, primarily from the AXENT acquisition, for the fiscal third quarter was $59.4 million, compared to $40.4 million from the same quarter last year. Earnings per share before one-time charges and the amortization of acquisition related charges for the fiscal third quarter was $0.78, compared to earnings per share of $0.52 for the year ago quarter. All figures include historical results of operations from the acquired AXENT Technologies. Including one-time charges and the amortization of goodwill and all other acquisition related expenses, Symantec reported earnings per share at break even ($0.00), compared to a net income per share of $0.21 for the same quarter last year.
"During these times of complex threats and heightened awareness for security, the performance of our enterprise business underlines the strength of our technology and the breadth of our product portfolio," said John W. Thompson, Symantec chairman and CEO. "In addition, our consumer business performed exceedingly well with a record 5.3 million packaged products shipped during the third quarter, nearly 2 million more than has ever shipped in one quarter."
Symantec's worldwide enterprise solutions, comprised of both security and enterprise administration products, accounted for 60 percent of total sales. The enterprise security business performed solidly, representing 44 percent of total sales with growth of 44 percent over the same quarter last year. Symantec's consumer business grew 20 percent over the comparable period last year. International revenues comprised 43 percent of total revenues, led by 21 percent growth in the Europe Middle East Africa region compared to the same quarter last year.
- Symantec's enterprise success is punctuated by the continued expansion of its worldwide customer base, including new or extended contracts with 35 Global 500 and 28 Fortune 500 companies such as Nestle; CIGNA; Wachovia Corporation, one of the nation's leading providers of financial services; PPG Industries; Raytheon; as well as Los Angeles Unified School District, the nation's second largest school system; Penn State University; University of Louisville; and the largest public agency in Mexico. The company signed a record 119 deals worth more than $100,000, including 31 deals worth more than $300,000, during the quarter.
- Symantec continues to gain traction with its managed security services business. Several Fortune 1000 customers have selected Symantec to manage their network security operations including Aetna; American President's Line, a global logistics and transportation company; Blue Cross/Blue Shield of Louisiana; The Doctors Company, the first national, physician-owned malpractice insurer; and one of the world's largest life insurance companies.
- Symantec's total antivirus product sales increased 53 percent during the quarter as compared to the year ago quarter. Sales of the company's intrusion detection solutions increased 39 percent from the same quarter a year ago. Vulnerability management solutions grew 11 percent sequentially.
- In October, Symantec introduced the Symantec Firewall/VPN 100, 200 and 200R series, expanding its family of security firewall appliances. Designed for the small office and branch office environment, the Symantec Firewall/VPN appliance can be installed in minutes by a novice and provides firewall protection and a secure VPN connection between locations in a company. It received the PC Magazine Editor's Choice award and was the only solution to receive the "excellent" rating in the review of low-end firewall appliances.
- In addition, Symantec launched the latest version of Enterprise Security Manager, a highly scalable vulnerability management solution that automates planning, supervision and monitoring of security policies from a single location. It performs more than 2,000 security and vulnerability checks on the largest variety of operating systems, including Windows NT/2000/XP, Solaris, HP, Linux and IBM iSeries - and is updated using Symantec LiveUpdate technology.
- Introduced during the quarter, Norton Internet Security 2002 Professional Edition is the first Symantec consumer product to include intrusion detection, providing protection against both external and internal security breaches.
- During the quarter, Gartner Dataquest released a report titled "2000 Security Software Market Share" that ranked Symantec Corp. as the world's leading security software provider based on new license revenue in 2000. According to the report, Symantec moved from the number four position to the number one spot, holding 14.7 percent of the security software market.
Symantec has scheduled a conference call for 4:30 p.m. EDT today to discuss fiscal third quarter results. Interested parties may access the conference call on the Internet at www.symantec.com/invest/. 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. In addition, conference call numbers are available. The listen-only number for domestic callers is 1-800-946-0719, while international listeners can dial 719-457-2645. A replay of the call will be available on the Internet at www.symantec.com/invest/ until Feb. 15, 2002.
Consolidated Financial Statements
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 industry patterns, 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; whether certain market segments, particularly enterprise security, grow as anticipated; the positioning of Symantec's products in those segments; the competitive environment in the software industry; ability to integrate acquired companies and technology; ability to retain key employees; ability to successfully combine product offerings and customer acceptance of combined products; 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 Symantecís previously filed Form 10-K and Form 10-Q.
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