Symantec Profits Surpass Expectations on Acquisitions
BOSTON, Oct 27 (Reuters) - Software maker Symantec Corp (NASDAQ:SYMC) reported a profit above Wall Street forecasts on Wednesday, helped by newly acquired businesses, and its shares rose 6 percent after hours.
Chief Executive Enrique Salem attributed the performance to better-than-expected results from three recently acquired security companies -- VeriSign, PGP and Guardian Edge.
"The acquisitions are exceeding our expectations. They are strong generators of cash," Salem said in an interview.
He said that Symantec's backup and archiving software and its Web-based services were also generating strong profits.
"They have a good business. They are in the right markets," said FBR Capital Markets analyst Daniel Ives.
Symantec said excluding items its profit was 34 cents per share in the second quarter ended Oct. 1, beating analysts' average forecast of 28 cents, according to Thomson Reuters I/B/E/S.
Quarterly revenue rose 2 percent from a year earlier to $1.48 billion, exceeding analysts' average forecast of $1.46 billion.
Sales of consumer software rose 3 percent from a year earlier, while sales of backup and storage products declined 1 percent. Sales of security software to businesses rose 5 percent.
"They've digested a lot of acquisitions. Now it's about walking the walk," Ives said. "Acquisitions bearing fruit is key to this story."
Symantec forecast profit, excluding items, of 32 cents to 33 cents per share in the third quarter ending Dec. 31, compared with analysts' average forecast of 33 cents.
It also forecast that third-quarter revenue would rise 2 percent to 3 percent from a year earlier to between $1.57 billion and $1.59 billion, compared with analysts' average forecast of $1.56 billion.
Symantec shares were up 6 percent at $16.74 in extended trade from their Nasdaq close of $15.80. (Reporting by Jim Finkle)