Symantec Earnings Lower With Acquisition Costs
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Security and backup software provider, Symantec reported lower thanyear before earnings for the December 2005 quarter thanks to Veritas acquisition related charges.

Without those, earnings would have been up 5 per cent on revenues which were up to US$1.15bn from US$695m the year-earlier. Net income was US$90.7m, down from US$163.6m.

Enterprise security sales rose 7 per cent for the company, though analysts have expressed concerns about the likelihood of Symantec coming under pressure from an increased Microsoft presence in the enterprise security market. On the consumer side, revenues declined as a percentage of the company’s business, accounting for 26 per cent, down 10 per cent due partly to accounting changes. Enterprise revenues represented 21 per cent of revenue.

The consumer market is another area the company has come under increased pressure from Microsoft, but executives made it clear the company has no intention of ceding this market to Redmond in the wake of its Veritas acquisition. The company plans to invest heavily in consumer marketing this year to take Microsoft head-on.

Symantec Chief Executive, John Thompson, did concede that Microsoft is likely to grab more marketshare in the consumer space. “But if Microsoft is true to form, over time they will certainly win some share of the marketplace,” he said. “We’re prepared for the battle. I’ve been in the industry 35 years, I’m looking forward to whooping on them again.”

“We continue to see increasing competition in the enterprise antivirus side of the market,” he said. “Negotiations for new and renewal business, especially in the SMB segment, are consistently aggressive.”

From the Veritas side of the house, storage management was up 9 per cent and was 23 per cent of total revenue. The Data Protection segment was 26per cent of revenue, up 16per cent. Services revenue was 4per cent of the total and was up 38per cent year-over-year.