CUPERTINO, Calif.--(BUSINESS WIRE)--Aug. 18, 2003--Symantec Corp.
(Nasdaq:SYMC - News), the world leader in Internet security, today announced
that it purchased a key security technology patent asset from
Hilgraeve, Inc., based in Monroe, Michigan. U.S. Patent Number
5,319,776 covers in-transit scanning for malicious code.
"This is a patent that is fundamental to several security
technology defenses, including antivirus technologies, and it is an
essential part of providing comprehensive protection against the
growing number of threats," said John W. Thompson, Symantec chairman
and chief executive officer. "In-transit scanning of multiple security
signatures is a must-have component of an effective security solution
and by purchasing this patent we are making sure that Symantec's
products, technologies and customers are protected today and in the
Symantec purchased the patent as part of a settlement in
Hilgraeve, Inc. vs. Symantec Corporation. As part of the settlement
Symantec also received licenses to the remaining patents in
Hilgraeve's portfolio, including patents related to data
The total cost of purchasing the patent and licensing additional
patents from Hilgraeve, Inc. is $62.5 million. This is a subsequent
non-recurring event to the financial results for the fiscal first 2004
quarter, ended July 4, 2003, and results in an adjustment to the
previously reported first quarter results. The financial impact of
this settlement on GAAP net income for the fiscal first quarter is
$9.5 million and the impact on earnings per share is $0.05, resulting
in revised GAAP net income for the fiscal first quarter of $59 million
and revised earnings per share of $0.36. Non-GAAP results are not
affected by the patent settlement, as it is a non-recurring event and
is excluded from the calculation of non-GAAP results.
Symantec's forward-looking guidance for the fiscal second quarter
2004, ending Oct. 3, 2003, has not changed. As previously stated:
- Revenue is expected to be in the range of $375 to $395
- GAAP earnings per share is expected to be $0.38 at the
midpoint of the revenue guidance.
- Non-GAAP earnings per share is expected to be $0.41 at the
midpoint of the revenue guidance.
Management offers the following forward-looking guidance for
fiscal year 2004, ending April 2, 2004, updated to reflect the actual
results from the fiscal first quarter, estimated results for the
fiscal second quarter, and the financial impact from the patent
- Revenue is expected to be approximately $1.665 billion, as
- GAAP earnings per share is expected to be $1.75 at the stated
revenue forecast. This is revised from $1.82.
- Non-GAAP earnings per share is expected to be $1.96 at the
stated revenue forecast, as previously stated.
Non-GAAP earnings per share excludes the amortization of
intangibles, restructuring charges from acquisitions and patent
settlement costs of approximately $7 million and $37 million for the
quarter ending Oct. 3, 2003 and the fiscal year ending April 2, 2004,
respectively. Investors are encouraged to review the more detailed
reconciliation of these non-GAAP financial measures to the comparable
GAAP measures, which can be found on the investor relations Web site
Symantec, the world leader in Internet security technology,
provides a broad range of content and network security software and
appliance solutions to individuals, enterprises and service providers.
The company is a leading provider of client, gateway and server
security solutions for virus protection, firewall and virtual private
network, vulnerability management, intrusion detection, Internet
content and e-mail filtering, remote management technologies and
security services to enterprises and service providers around the
world. Symantec's Norton brand of consumer security products is a
leader in worldwide retail sales and industry awards. Headquartered in
Cupertino, Calif., Symantec has worldwide operations in 36 countries.
For more information, please visit www.symantec.com.
NOTE TO EDITORS: If you would like additional information on
Symantec Corporation and its products, please view the Symantec Press
Center at http://www.symantec.com/PressCenter/ on Symantec's Web site.
Symantec and the Symantec logo are trademarks or registered
trademarks, in the United States and certain other countries, of
Symantec Corporation. Additional company and product names may be
trademarks or registered trademarks of the individual companies and
are respectfully acknowledged.
FORWARD LOOKING STATEMENT: This press release contains
forward-looking statements, including forecasts of future revenue and
earnings per share, expected activities, and other financial and
business results that involve known and unknown risks, uncertainties
and other factors that may cause our actual results, levels of
activity, performance or achievements to differ materially from
results expressed or implied by this press release. Such risk factors
include, among others: the sustainability of recent growth rates,
particularly in consumer products; the anticipation of the growth of
certain market segments, particularly enterprise security; the
positioning of Symantec's products in those segments; the competitive
environment in the software industry; general market conditions,
fluctuations in currency exchange rates, changes to operating systems
and product strategy by vendors of operating systems; and whether
Symantec can successfully develop new products and the degree to which
these gain market acceptance. Actual results may differ materially
from those contained in the forward-looking statements in this press
release. Additional information concerning these and other risk
factors is contained in the Risk Factors sections of Symantec's
previously filed Form 10-K for the fiscal year ended March 28, 2003.
Symantec assumes no obligation to update any forward-looking
information contained in this press release except as otherwise
required by law.
USE OF NON-GAAP FINANCIAL INFORMATION: In addition to reporting
financial results in accordance with generally accepted accounting
principles, or GAAP, Symantec reports non-GAAP financial results.
Non-GAAP net income and earnings per share exclude acquisition related
charges, such as amortization of goodwill and other intangibles, and
certain other charges, such as restructurings and site closures and
patent settlement costs, as well as the tax effect of these items.
Symantec's management believes these non-GAAP measures are useful to
investors because they provide supplemental information that
facilitates comparisons to prior periods. Management uses these
non-GAAP measures to evaluate its financial results, develop budgets
and manage expenditures. The method Symantec uses to produce non-GAAP
results is not computed according to GAAP, is likely to differ from
the methods used by other companies and should not be regarded as a
replacement for corresponding GAAP measures. Investors are encouraged
to review the reconciliation of these non-GAAP financial measures to
the comparable GAAP results, which can be found on the investor
relations Web site at www.symantec.com/invest/center.html.
Melissa Martin, 408-517-8475
Helyn Corcos, 408-517-8324