Feeds

Symantec trims targets as subscriptions put off payday

Salem's lot not quite so big

Internet Security Threat Report 2014

Symantec's customers are cutting back on purchases and the company's revenues are going to be lower this quarter. Why is demand for its products lower?

The company announced preliminary results for its fourth fiscal 2011 quarter as there is an unexpected shortfall. It announced expected revenues of $1.68bn – below the issued guidance of $1.72bn to 1.73bn – which is a $40m shortfall at worst. However, the figure from its year-ago quarter – $1.67bn in revenue – will still be exceeded.

President and CEO Enrique Salem explained the shortfall: "A greater percentage of enterprise subscription contracts resulted in higher deferred revenue than expected. We experienced weaker than expected licence performance due to fewer licence-rich storage and server management deals in the quarter compared to the year ago period."

Enrique Salem

Symantec president and CEO Enrique Salem

Oddly, Symantec's net income, as implied by its earnings-per-share (EPS), is going up markedly. Its EPS in the quarter will be $0.78, contrasting to guidance of $0.23 to $0.24. The $0.78 number includes a one-time boost from Symantec's sale of its interest in the Huawei-Symantec joint venture to Huawei.

Symantec's deferred revenue is expected to be around $3.97bn – the prior guidance was $3.915bn to $3.935bn – and this compares to $3.82bn in the year-ago period, up 4 per cent year-over-year.

Stifel Nicolaus analyst Aaron Rakers said Symantec's reported total storage and server management revenue declined 5 per cent year-on-year: storage management solutions declined 8 per cent, and backup/archiving revenue declined 3 per cent. "The company noted there was less new licence business seen during the March quarter and stated it closed the number of deals it had anticipated in Financial Services, although deal sizes were not necessarily as large. Europe was noted as generally in line with expectations during the quarter."

Symantec had seen "some pause in front of its new Backup Exec solutions ... while seeing strength in its backup appliance solutions ... [It] believes the full release of its new NetBackup and Backup Exec solutions should result in a good uptake and improved demand going forward," said Rakers.

In related news, Symantec said Andrew Del Matto has become an SVP and its chief accounting officer. This is an internal promotion and is necessary because the previous chief accounting officer, Phil Bullock, is leaving to head Apple's tax department. This is "not due to any disagreement with the Company on any matters relating to the Company’s operations, policies or practices," Symantec emphasised.

Returning to the revenue shortfall, are other data protection and management software companies similarly affected? Are enterprise and public sector storage-related budgets under-shooting storage capacity growth more than anticipated?

In other words is this an industry problem, a data management software sector problem, or a Symantec problem? EMC's most recent results indicated no industry-wide or data management sector problems, so Salem may have to look closer to home for the source of the shortfall. ®

Beginner's guide to SSL certificates

More from The Register

next story
Scrapping the Human Rights Act: What about privacy and freedom of expression?
Justice minister's attack to destroy ability to challenge state
WHY did Sunday Mirror stoop to slurping selfies for smut sting?
Tabloid splashes, MP resigns - but there's a BIG copyright issue here
Google hits back at 'Dear Rupert' over search dominance claims
Choc Factory sniffs: 'We're not pirate-lovers - also, you publish The Sun'
EU to accuse Ireland of giving Apple an overly peachy tax deal – report
Probe expected to say single-digit rate was unlawful
Inequality increasing? BOLLOCKS! You heard me: 'Screw the 1%'
There's morality and then there's economics ...
Hey Brit taxpayers. You just spent £4m on Central London ‘innovation playground’
Catapult me a Mojito, I feel an Digital Innovation coming on
While you queued for an iPhone 6, Apple's Cook sold shares worth $35m
Right before the stock took a 3.8% dive amid bent and broken mobe drama
EU probes Google’s Android omerta again: Talk now, or else
Spill those Android secrets, or we’ll fine you
prev story

Whitepapers

A strategic approach to identity relationship management
ForgeRock commissioned Forrester to evaluate companies’ IAM practices and requirements when it comes to customer-facing scenarios versus employee-facing ones.
Storage capacity and performance optimization at Mizuno USA
Mizuno USA turn to Tegile storage technology to solve both their SAN and backup issues.
High Performance for All
While HPC is not new, it has traditionally been seen as a specialist area – is it now geared up to meet more mainstream requirements?
Beginner's guide to SSL certificates
De-mystify the technology involved and give you the information you need to make the best decision when considering your online security options.
Security for virtualized datacentres
Legacy security solutions are inefficient due to the architectural differences between physical and virtual environments.