Symantec revenue hop can't stop profit flop
Restructuring costs cramp company coffers
Symantec closed fiscal 2007 with fourth quarter profit plummeting 49 per cent from the period a year earlier, but beating analyst expectations with a five per cent increase in revenue.
The company posted net income of $60.9m in the quarter which ended in March, compared with $119m last year.
Major increases in restructuring and marketing and sales costs are to blame for the profit pratfall. Symantec spent $50.8m in restructuring during the quarter, a major leap from $4m the same quarter the previous year. Sales and marketing wrote out $575.5m worth of checks this quarter compared to $444.7m last year.
Last quarter, Symantec reported plans to implement $200m worth of cuts to cope with flagging demands for its data center offerings.
Symantec's revenue, however, hit $1.365bn during the quarter, rising from $1.29bn the year before. This exceeded analysts' Magic 8 Balls which forecast revenue between $1.29bn to $1.35bn.
Excluding items, Symantec's revenues for the year were $5.2bn, up from $5bn way back in 2006.
CFO James Beer credited beating analyst predictions with increased demand for its software and favorable foreign exchange rates.
In the quarter, Symantec's security and data management business represented 38 per cent of total revenue, growing 2 per cent year-over-year. The company's data center management gig represented 27 per cent of total revenue, remaining flat from last year.
Symantec forecasts revenue between $1.28bn and $1.3bn for the June 2007 quarter. At the end of fiscal 2008, the company said revenue will likely be between $5.65bn and $5.75bn. Analysts see things ending up at $5.36bn. ®