Symantec Storage Sales Issues Led to Flat Quarter
Symantec, which provides storage management and security software for IT systems, bucked a trend of sorts on July 28 when it reported plateaued financial results for its fiscal first quarter of 2010.
Symantec reported revenue for the fiscal first quarter of $1.43 billion, which is flat when compared with the same period a year ago.
Net income, however, was $161 million for the fiscal first quarter, up substantially over the net of $74 million for the same quarter in 2009.
Nonetheless, the stock price was down about 8 percent, or $1.20, to $13.48 in after-hours trading on July 28.
Due largely to the continuing need for companies and individuals to add data storage capacity to handle the exponential increase in content, the trend among storage companies for several years has been to report comfortable profit increases each quarter. This is especially true of market leaders EMC and NetApp and the storage divisions of Hewlett-Packard and IBM.
Symantec President and CEO Enrique Salem confirmed that the storage side of the house was the one that had some issues this quarter.
"This quarter, we saw lengthening of procurement cycles driven by continued cautiousness among IT buyers. In particular, this affected our storage management results," Salem said.
"We are optimistic about the strength we saw in the public sector as well as with our data loss prevention solutions. In addition, our software-as-a-service offerings posted double-digit growth as we continue to expand our leadership in this high-growth market."
Symantec completed the acquisitions of PGP and GuardianEdge in early June. The acquisitions generated quarterly revenue of $4 million, the company reported.