Symantec Posts Downbeat Q1 Earnings, Agrees To Sell Veritas Business For $8B

Symantec Corporation SYMC reported weaker-than-expected earnings for its fiscal first quarter and issued a weak forecast for the current quarter. The company also agreed to sell its Veritas business to a group of investors led by The Carlyle Group for $8 billion in cash. The Mountain View, California-based company posted a quarterly net profit of $117 million, or $0.17 per share, versus a year-ago profit of $236 million, or $0.34 per share. Excluding non-recurring items, the company's adjusted earnings came in at $0.40 per share. Its revenue slipped 14 percent to $1.5 billion. However, analysts were expecting a profit of $0.43 per share on revenue of $1.53 billion. The average estimate among 13 Estimize users was for earnings of $0.43 per share and revenue of $1.53 billion. Michael A. Brown, president and CEO, said, "We made encouraging progress in several product segments, achieving growth in our enterprise security business for the first quarter in two years. However, our revenue was flat in Q1, adjusting for currency and an extra week in the June 2014 quarter. Reaching a definitive agreement to sell Veritas marks an important inflection point for Symantec. With a strong product pipeline of more than a dozen enterprise security products on track to be released this year, Symantec is now focused on extending its lead as the world's largest cybersecurity company." For the fiscal second quarter, Symantec projects adjusted earnings of $0.40 to $0.43 per share, on revenue of $1.485 billion to $1.525 billion. Analysts expected earnings of $0.45 per share on revenue of $1.54 billion. For the full year, the company expects earnings of $1.80 to $1.90 per share, versus analysts' estimates of $1.86 per share. It also expects revenue of $6.21 billion to $6.35 billion, versus analysts' expectations of $6.27 billion. The company also raised its stock repurchase program to $2.6 billion and maintained its dividend at $0.15 per share. Symantec shares surged 7.25 percent to $24.57 in pre-market trading.