Why Norton Parent Gen Digital Shares Are Plummeting Today

Gen Digital Inc GEN shares are trading lower by over 18% after the company reported worse-than-expected third-quarter FY24 financial results.

Revenue rose 2% Y/Y to $951 million, missing the consensus of $956.2 million. Bookings rose 4% Y/Y to $1.007 billion, up 3% Y/Y in constant currency.

Adjusted operating income increased 6% Y/Y to $558 million and up 7% Y/Y in constant currencies, with margins of 58.7%, up 250 basis points Y/Y.

Adjusted EPS rose 10% Y/Y to $0.49, missing the consensus of $0.50.

Dividend: The Board of Directors declared a regular quarterly dividend of $0.125 per share, payable on March 13, 2024, to shareholders of record as of February 19, 2024.

Outlook: For the fourth quarter, Gen expects revenue of $960 million-$970 million (vs. consensus $974.42 million) and adjusted EPS of $0.52-$0.54 (vs. $0.53 estimate).

For FY24, the company revised its revenue forecast to $3.805 billion-$3.815 billion (vs. street view $3.82 billion and prior guidance of $3.810 billion-$3.835 billion) and adjusted EPS guidance to $1.95-$1.97 (vs. consensus $1.97 and prior outlook of $1.95-$2.00).

“We remain steadfast in driving our long-term growth plan to acquire and retain customers and partners while leveraging our cross-sell and up-sell opportunities to both serve our customers better and grow the business,” said Natalie Derse, CFO of Gen Digital.

Price Action: GEN shares are down 18.44% at $19.51 on the last check Friday.