By Michael Calia
Symantec Corp.'s (SYMC) fiscal second-quarter profit rose 28% while lower expenses and flat input costs helped mask a decline in revenue.
Shares were down 13% to $21.41 in after-hours trading as the company posted lower-than-expected results, lowered its full-year guidance and issued current-quarter guidance below analysts' expectations.
The company, citing weak revenue in the fiscal second quarter, now expects revenue for the year to decline 3% to 4%, while it had expected growth of 0% to 2%. The company also lowered expectations for adjusted per-share earnings, calling for a decrease of 1% to 1.5%, down from its previous estimate of 5% to 7% growth.
For the current quarter, Symantec said it expects to post adjusted per-share earnings of 41 cents to 43 cents on revenue of $1.63 billion to $1.67 billion. Analysts surveyed by Thomson Reuters recently said they expected earnings of 51 cents a share and revenue of $1.79 billion.
Symantec, which makes Norton antivirus software and utilities to secure data-storage and corporate networks, is undergoing a reorganization to overcome expensive acquisitions and weak earnings. The company earlier this year laid out a plan to produce 5% organic-revenue growth and 30% operating margins by 2015.
Additionally, Symantec has faced some difficulty in its effort to shift its consumer security business to subscriptions, which provide recurring revenue and opportunities for additional sales, and away from one-time sales of licenses.
For the quarter ended Sept. 27, Symantec reported a profit of $241 million, or 34 cents a share, up from $189 million, or 27 cents a share, a year ago. Excluding items, adjusted per-share earnings rose to 50 cents from 45 cents. Revenue declined 3.7% to $1.64 billion.
The company in July had projected adjusted earnings of 42 cents to 44 cents and revenue of $1.65 billion to $1.69 billion.
Gross margin narrowed to 82.7% from 83.3% as input costs remained flat. Operating expenses were down 1.2%.
Symantec's user productivity and protection segment reported revenue slipped 3.2% from the prior-year period. The information security segment's revenue decreased 2.5%, while information management segment revenue fell 4.7%.
The stock is up 31% so far this year through the close.
Write to Michael Calia at email@example.com
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October 23, 2013 16:43 ET (20:43 GMT)Copyright (c) 2013 Dow Jones & Company, Inc.
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