Feeds

Symantec secures profit rise as revenues fall

Swings meet roundabouts

New hybrid storage solutions

The good ship Symantec has adjusted to the recession and is making 19 per cent more profit despite three per cent lower revenue.

For its second 2010 quarter revenues were $1.47bn; they were $1.52bn a year ago, while net income was $150m, compared to $126m previously.

The $24m profit increase was down mostly to cost-cutting. Sales and marketing expense was $597m but is now $576m, and R&D costs were $219m andt have reduced to $210m. This gives us a $30m gain straight away. Sound familiar? These actions echo those of Quantum.

Symantec's CEO Enrique Salem called this a solid result, noted that consumer product revenues were good, and said Symantec was making "initial progress in SMB security" which was pleasing. There's more potential there.

It wasn't so good elsewhere; this being a swings and roundabouts story, with the storage and server management segment, representing 38 per cent of total revenue, declining nine per cent year-over-year. In comparison the consumer segment, 31 per cent of total revenue, increased six per cent year-over-year, hence Mr Salem's pleasure.

Geographically Europe, the Middle East and Africa stands out as it, 31 per cent of Symantec's revenues in the quarter, declined five per cent year-on-year. Asia-Japan revenues increased five per cent while the Americas declined four per cent.

Revenue for the next quarter is expected to be up slightly, between $1.48bn and $1.51bn. The Symantec cash generation machine is ticking over nicely and no dramas can be seen ahead.

Symantec, converged IT stacks and the cloud

We're seeing major systems vendors moving to a one-stop-shop model with integrated server, system software, storage and networking offerings. Symantec's senior product marketing director, Matthew Lodge, was at SNW in Frankfurt and was asked about customers' willingness to buy software from an independent software vendor in the future.

He said customers will still need multiple operating systems and hardware support. They won't move to single IT stack environments. They will have their legacy products and server virtualisation is becoming multi-vendor with Hyper-V becoming more important. Against this background "customers will still want to buy layered software" from independent software vendors.

Storage arrays and system software applications are moving to offer replication and snapshots, so will customers still need backup software? Lodge said: "Applications building backup into their offering means just another backup platform... [and] with snapshots there's no catalogue."

That means customers can't easily find out what's in a snapshot. Adding a catalogue to a snapshot would mean the snapshot process has to know about files and block-access storage arrays don't. "It comes down to management," Lodge explained. "You need to manage backups and protected data day-to-day and we already have an application that does that."

What about the cloud? "Backup Exec can already backup to the Symantec Protection Network. NetBackup will be able to do this in the future." There's no committed timescale for that yet.

He was asked about Symantec and Huawei Symantec, its joint venture with hardware-manufacturing Huawei: "We think hardware is very important and a lot of customers want to consume software as part of hardware/software appliances. But we don't see the need for an exclusive relationship."

There will be no investment in a hardware vendor such as Dell, no coming together with any hardware vendor in that way. Symantec says it has an open approach to IT hardware vendors.

However, the Huawei-Symantec JV says it is a global supplier, and that includes North America, where it does not have a presence yet. If and when it does come to North America then Symantec may well find its relationship with currently supportive hardware vendors, such as NetApp and Dell, under tension because the JV will be competing with them.

So long as Huawei-Symantec is a niche geographical player, which it more or less is now, things are OK. But as it grows and if it enters the USA, then Symantec may have some hard decisions to make. For example, is the JV's presence in the USA worth the loss of sympathetic relationships with Dell, NetApp and others? ®

New hybrid storage solutions

More from The Register

next story
Phones 4u slips into administration after EE cuts ties with Brit mobe retailer
More than 5,500 jobs could be axed if rescue mission fails
Apple CEO Tim Cook: TV is TERRIBLE and stuck in the 1970s
The iKing thinks telly is far too fiddly and ugly – basically, iTunes
Apple Pay is a tidy payday for Apple with 0.15% cut, sources say
Cupertino slurps 15 cents from every $100 purchase
Phones 4u website DIES as wounded mobe retailer struggles to stay above water
Founder blames 'ruthless network partners' for implosion
Huawei ditches new Windows Phone mobe plans, blames poor sales
Giganto mobe firm slams door shut on Microsoft. OH DEAR
Forget silly privacy worries - help biometrics firms make MILLIONS
Beancounter reckons dabs-scanning tech is the next big moneypit
Microsoft's Office Delve wants work to be more like being on Facebook
Office Graph, social features for Office 365 going public
prev story

Whitepapers

Providing a secure and efficient Helpdesk
A single remote control platform for user support is be key to providing an efficient helpdesk. Retain full control over the way in which screen and keystroke data is transmitted.
Top 5 reasons to deploy VMware with Tegile
Data demand and the rise of virtualization is challenging IT teams to deliver storage performance, scalability and capacity that can keep up, while maximizing efficiency.
Reg Reader Research: SaaS based Email and Office Productivity Tools
Read this Reg reader report which provides advice and guidance for SMBs towards the use of SaaS based email and Office productivity tools.
Security for virtualized datacentres
Legacy security solutions are inefficient due to the architectural differences between physical and virtual environments.
Secure remote control for conventional and virtual desktops
Balancing user privacy and privileged access, in accordance with compliance frameworks and legislation. Evaluating any potential remote control choice.