Press Releases

Symantec Reports First Quarter Fiscal Year 2018 Results

Financial Highlights

  • Enterprise Security and Consumer Digital Safety segment revenue exceed first quarter GAAP and non-GAAP guidance
  • Q1 GAAP revenue $1.175 billion, up 33% year over year; non-GAAP revenue $1.228 billion, up 39% year over year
  • Consumer Digital Safety returned to growth
  • Operating margin beats Q1 GAAP and non-GAAP guidance; cost efficiencies and integration synergies ahead of plan

Operational Highlights

  • Enterprise Security continuing to win recognition for innovation through new product integrations and technology acquisitions; driving significant pipeline growth
  • Consumer Digital Safety growth driven by new customer acquisition, improved retention and higher ARPU; Digital Safety bundles now available in market; Norton Core now shipping
  • Recent acquisitions of Skycure and Fireglass increase capabilities in mobile and real-time browser protection
  • Announced signing of definitive agreement with DigiCert to acquire Symantec’s Website Security and related PKI solutions

MOUNTAIN VIEW, Calif. – August 2, 2017 – Symantec Corp. (NASDAQ: SYMC) today reported its first quarter fiscal year 2018 results, ended June 30, 2017.

Greg Clark, Symantec CEO said, “Symantec has made tremendous progress transforming itself across both Enterprise Security and Consumer Digital Safety over the last year. Our Integrated Cyber Defense Platform is resonating with customers, and driving large increases in our pipeline, with wins built on our superior technology and unmatched integration. Consumer Digital Safety is gaining traction with customers and exceeding expectations, with growth ahead of plan and new offerings in the market.”

“The threat environment is more dangerous and complex than ever. Symantec protected its customers during the recent WannaCry and Petya attacks, blocking more than one billion incursions when many organizations were incapacitated. Our strong technology position, roadmap and recent acquisitions of Fireglass and Skycure demonstrate our continuing commitment to innovation that offers unparalleled security for the cloud generation,” Clark said.

In a separate press release issued today, Symantec announced a definitive agreement under which DigiCert will acquire Symantec’s Website Security and related PKI solutions. The addition of Symantec’s Website Security and related PKI solutions to DigiCert’s offerings provides customers with an enhanced technology platform, unparalleled customer support and market-leading innovations. Symantec is deeply committed to ensuring a seamless transition for its customers. Under the terms of the agreement, Symantec will receive approximately $950 million in upfront cash proceeds and approximately a 30 percent stake in the common stock equity of the DigiCert business at the closing of the transaction. The transaction, which has been unanimously approved by the Symantec Board of Directors, is expected to be completed in the third quarter of fiscal 2018, subject to the satisfaction of customary closing conditions. The transaction proceeds, net of expected taxes and expenses, will be primarily used to repay debt. Additional details related to the divestiture will be discussed on Symantec’s earnings call, which is scheduled for 5 p.m. ET/2 p.m. PT today.

To help 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 including constant currency information. 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. Additional information regarding our non-GAAP definition is provided below.

 

Results for the First Quarter of Fiscal Year 2018 (Dollars in millions, except EPS)

 

1Q18

1Q17

Reported Y/Y

Change

FX Adjusted Y/Y Change

GAAP

 

 

 

 

    Revenue

$1,175

$884

33%

34%

    Operating Margin

(3.7%)

12.0%

(1,570) bps

(1,520) bps

    Net Income (Loss)

($133)

$135

N/M

N/A

    EPS (Diluted)

($0.22)

$0.22

N/M

N/A

    CFFO*

$213

($770)

N/M

N/A

 

1Q18

1Q17

Reported Y/Y

Change

FX Adjusted Y/Y Change

Non-GAAP

 

 

 

 

    Revenue

$1,228

$884

39%

40%

    Operating Margin

30.7%

28.6%

210 bps

240 bps

    Net Income

$221

$177

25%

N/A

    EPS (Diluted)

$0.33

$0.29

14%

N/A

*Cash Flow from Operating Activities

 

Second Quarter 2018 Guidance (Dollars in millions, except EPS and FX rate)

This guidance does not contemplate the impact of the pending acquisition of Symantec’s Website Security and related PKI solutions by DigiCert.

 

2Q18

FX Adj. Y/Y Growth

GAAP

 

 

     Revenue

$1,225 – $1,255

26% 29%

       Enterprise Security

$685 – $705

20% 23%

       Consumer Digital Safety

$540 – $550

34% 37%

     Operating Margin

(4%) – (2%)

N/A

     EPS

($0.15) – ($0.11)

N/A

Non-GAAP

 

 

     Revenue

$1,260 – $1,290

25% – 28%

       Enterprise Security

$700 – $720

15% – 18%

       Consumer Digital Safety

$560 – $570

40% – 42%

     Operating Margin

34% – 36%

N/A

     EPS (Diluted)

$0.40 – $0.44

N/A

Non-GAAP Tax Rate

29.5%

N/A

Basic Share Count

~ 615 million

N/A

GAAP Fully Diluted Share Count

~ 615 million

N/A

Non-GAAP Fully Diluted Share Count

~ 670 million

N/A

FX Rate ($/€)

$1.14

N/A

 

Fiscal Year 2018 Guidance (Dollars in millions, except EPS and FX rate)

This guidance does not contemplate the impact of the pending acquisition of Symantec’s Website Security and related PKI solutions by DigiCert.

 

FY18

FX Adj. Y/Y Growth

GAAP

 

 

     Revenue

$5,037 - $5,137

25% 27%

       Enterprise Security

$2,820 – $2,890

19% 22%

       Consumer Digital Safety

$2,218 – $2,248

33% 35%

     Operating Margin

3% – 4%

N/A

     EPS

$0.01 – $0.11

N/A

Non-GAAP

 

 

     Revenue

$5,160 - $5,260

24% – 26%

       Enterprise Security

$2,880 – $2,950

16% – 19%

       Consumer Digital Safety

$2,280 – $2,310

35% – 37%

     Operating Margin

36% – 37%

N/A

     EPS (Diluted)

$1.79 – $1.89

N/A

Non-GAAP Tax Rate

29.5%

N/A

Basic Share Count

~ 616 million

N/A

GAAP Fully Diluted Share Count

~ 675 million

N/A

Non-GAAP Fully Diluted Share Count

~ 675 million

N/A

FX Rate ($/€)

$1.14

N/A

Symantec's Board of Directors has declared a quarterly cash dividend of $0.075 per common share to be paid on September 13, 2017, to all shareholders of record as of the close of business on August 21, 2017.

Conference Call

Symantec has scheduled a conference call for 5 p.m. ET/2 p.m. PT today to discuss its first quarter fiscal 2018 results, ended June 30, 2017, to review the pending acquisition of Symantec’s Website Security and related PKI solutions by DigiCert, and to review guidance, which does not contemplate the impact of this pending acquisition. 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. For telephone access to the conference, call (877) 475-6198 within the United States or (970) 297-2372 from outside the United States. Please call 15 minutes early and give the operator conference ID number 54539957.

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), the world’s leading cyber security company, helps organizations, governments and people secure their most important data wherever it lives. Organizations across the world look to Symantec for strategic, integrated solutions to defend against sophisticated attacks across endpoints, cloud and infrastructure. Likewise, a global community of more than 50 million people and families rely on Symantec’s Norton and LifeLock product suites to protect their digital lives at home and across their devices. For additional information, please visit www.symantec.com or connect with us on Facebook, Twitter, and LinkedIn.

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, the Symantec logo and the Checkmark 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 which may be considered forward-looking within the meaning of the U.S. federal securities laws, including the information contained under the caption “Second Quarter 2018 Guidance (Dollars in millions, except EPS and FX rate)” and “Fiscal Year 2018 Guidance (Dollars in millions, except EPS and FX rate)” and the statements regarding Symantec’s other projected financial and business results, including demand for its products and services, Symantec’s enhanced capabilities and the impact of the pending acquisition of Symantec’s Website Security and related PKI solutions by DigiCert.  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: the satisfaction of the conditions to closing of  the pending acquisition of Symantec’s Website Security and related PKI solutions by DigiCert and risks related thereto; the retention of employees of acquired companies and the ability of Symantec to successfully integrate acquired companies and to achieve expected benefits; general economic conditions; fluctuations and volatility in Symantec’s stock price; the ability of Symantec to successfully execute strategic plans; the ability to maintain customer and partner relationships; anticipated growth of certain market segments; our sales pipeline and business strategy; fluctuations in tax rates and currency exchange rates; the timing and market acceptance of new product releases and upgrades; and 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. Symantec assumes no obligation, and does not intend, to update these forward-looking statements as a result of future events or developments. Additional information concerning these and other risk factors is contained in the Risk Factors sections of Symantec’s Form 10-K for the fiscal year ended March 31, 2017.

USE OF NON-GAAP FINANCIAL INFORMATION: Our results of operations have undergone significant change due to the impact of purchase accounting on revenue and cost of revenue, certain acquisition and integration costs, discontinued operations, stock-based compensation, restructuring and transition matters, charges related to the amortization of intangible assets, non-cash interest expense and amortization of debt issuance costs and certain other income and expense items that management considers unrelated to the Company’s core operations. 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 including constant currency information. 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. Non-GAAP financial measures are supplemental, should not be considered a substitute for financial information presented in accordance with GAAP and should be read only in conjunction with our consolidated financial statements prepared in accordance with GAAP. Our management team uses these non-GAAP financial measures in assessing Symantec’s operating results, as well as when planning, forecasting and analyzing 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 website at: http://www.symantec.com/invest.

Contacts

MEDIA CONTACT:

Kristen Batch, 650-527-8000
Kristen_Batch@symantec.com

or

INVESTOR CONTACT:

Jonathan Doros, 650-527-5523
Jonathan_Doros@symantec.com