Symantec forecasts sales below Street, shares drop

Reuters News
Posted: Oct 26, 2011 6:20 PM
Symantec forecasts sales below Street, shares drop

(Reuters) - Symantec Corp, the top maker of computer security software, failed to match Wall Street's high hopes for future sales growth even as the company benefits from a raised awareness of hackers.

The Silicon Valley-based company forecast fiscal third-quarter revenue of $1.7 billion to $1.715 billion, reflecting a 6 percent to 7 percent growth rate over last year. But that fell short of analysts' average estimate of $1.72 billion.

Symantec shares closed down 0.3 percent at $18.49 on the Nasdaq and fell a further 3.6 percent to $17.82 after hours, following the release of its second-quarter earnings.

Expectations for Symantec have been raised recently as hacking has become a top business concern, in the wake of high-profile attacks on Google Inc, Lockheed Martin Corp and Nasdaq OMX Group Inc. The National Security Agency is now helping Wall Street banks with intelligence on foreign hackers.

Awareness of the need for protection is at its highest in recent years, which is helping to boost the company's results, said Symantec Chief Executive Enrique Salem in a telephone interview.

"The threats are more targeted and you are definitely getting more visibility and awareness for the issues," he said. "Individuals, small businesses, large businesses, government. Everybody is a target right now."

Symantec posted a higher-than-expected 34 percent increase in fiscal second-quarter net profit on Wednesday, helped by the surge in demand.

The company reported fiscal second-quarter net profit of $182 million, or 24 cents per share, compared with $136 million, or 17 cents per share, in the year-ago quarter

Excluding one-time items, it earned 39 cents per share, meeting the average analyst estimate, according to Thomson Reuters I/B/E/S.

Sales rose 14 percent to $1.68 billion. Analysts were expecting $1.66 billion.

The Mountain View, California-based software maker also forecast third-quarter per-share profit, excluding items, of 40 or 41 cents per share, close to the average analyst forecast of 41 cents.

(Reporting by Bill Rigby in Seattle; Editing by Andre Grenon and Steve Orlofsky)