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Symantec Corp. Reports Operating Results (10-Q)
Posted by: gurufocus (IP Logged)
Date: February 2, 2011 05:21PM
Symantec Corp. (SYMC) filed Quarterly Report for the period ended 2010-12-31. Symantec Corp has a market cap of $13.96 billion; its shares were traded at around $17.99 with a P/E ratio of 13.8 and P/S ratio of 2.3. Symantec Corp had an annual average earning growth of 16% over the past 10 years. GuruFocus rated Symantec Corp the business predictability rank of 3.5-star.Hedge Fund Gurus that owns SYMC: Private Capital of Private Capital Management, John Paulson of Paulson & Co., Bruce Kovner of Caxton Associates, Steven Cohen of SAC Capital Advisors, George Soros of Soros Fund Management LLC. Mutual Fund and Other Gurus that owns SYMC: Mason Hawkins of Southeastern Asset Management, RS Investment Management, Dodge & Cox, PRIMECAP Management, Ronald Muhlenkamp of Muhlenkamp Fund, John Buckingham of Al Frank Asset Management, Inc., David Dreman of Dreman Value Management, HOTCHKIS & WILEY of Hotchkis & Wliey Capital Management LLC, Charles Brandes of Brandes Investment, Jeremy Grantham of GMO LLC.
Highlight of Business Operations:
Revenue increased by $56 million and $63 million for the three and nine months ended December 31, 2010, respectively, as compared to the same periods last year. For the three and nine months ended December 31, 2010, we experienced growth in our Security and Compliance segment primarily as a result of revenue associated with our fiscal 2011 acquisitions. During the nine months ended December 31, 2010, we acquired the identity and authentication business of VeriSign, Inc (VeriSign), PGP Corporation (PGP), GuardianEdge Technologies, Inc. (GuardianEdge) for an aggregate amount of approximately $1.5 billion, net of cash acquired. We expect that these acquisitions will continue to contribute positively to our revenue in future periods in the Security and Compliance segment. Within our Storage and Server Management segment, our backup and archiving solutions experienced growth and our storage management solutions stabilized for the three months ended December 31, 2010. For the nine months ended December 31, 2010, we experienced weakness in our storage management solutions evidenced in particular by lower revenues from our relationship with Sun Microsystems, Inc. (now a part of Oracle Corporation). Consumer segment revenues for the three and nine months ended December 31, 2010 benefited from the completion of our transition to an internally-developed eCommerce platform for our Norton-branded consumer products worldwide, excluding Japan, during the first quarter of fiscal 2011. The fees we had previously paid to Digital River had been recorded as an offset to revenue; however, we incur expenses resulting from our eCommerce platform that are recorded as a cost of revenue and an operating expense. We also experienced growth in our Consumer segment, driven by our multi-channel strategy which includes our retail, original equipment manufacturers (OEMs), internet service providers (ISPs), and online channels.
Fluctuations in the U.S. dollar compared to foreign currencies unfavorably impacted our international revenue by approximately $24 million and $75 million for the three and nine months ended December 31, 2010 as compared to the same periods last year. We are unable to predict the extent to which revenue in future periods will be impacted by changes in foreign currency exchange rates. If our level of international sales and expenses increase in the future, changes in foreign exchange rates may have a potentially greater impact on our revenue and operating results.
Our net income attributable to Symantec Corporation stockholders was $132 million and $429 million for the three and nine months ended December 31, 2010, respectively, compared with the net income attributable to Symantec Corporation stockholders of $301 million and $530 million for the three and nine months ended January 1, 2010, respectively. Our net income was negatively impacted by a loss of $21 million from the liquidation of certain foreign entities for the three and nine months ended December 31, 2010, as compared to a gain of $43 million and $46 million for the three and nine months ended January 1, 2010, respectively. Our net income was positively impacted by a decrease of $20 million and $97 million in the three and nine months ended December 31, 2010, respectively, in cost of revenue primarily related to certain acquired product rights. Net income was also positively impacted by tax benefits resulting from the reversal of accrued liabilities related to the Veritas Software tax assessment for 2000 and 2001 of $39 million for the nine months ended December 31, 2010 and $79 million for the three and nine months ended January 1, 2010.
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