Symantec (SYMC) to Report Q2 Earnings: What's in the Offing?
Symantec Corporation SYMC is scheduled to report second-quarter fiscal 2019 results on Nov 1. The company beat estimates thrice in the trailing four quarters, delivering an average positive surprise of 5.60%.
In the last reported quarter, Symantec’s earnings, per the ASC 605, remained flat year over year at 33 cents, in line with the Zacks Consensus Estimate.
The company’s revenues had decreased 5.5% to $1.18 billion, per ASC 605. Nonetheless, the top line surpassed the Zacks Consensus Estimate of $1.15 million.
For the fiscal second quarter, Symantec anticipates non-GAAP revenues in the range of $1.130-$1.160 billion. Non-GAAP operating margin is projected to be about 30%. Further, management estimates earnings between 31 cents and 35 cents on a non-GAAP basis.
Let's see how things are shaping up for the upcoming announcement.
Factors at Play
Symantec is gaining from data breaches as security-related purchases continue to shoot up.
The company’s continuous efforts to strengthen its product suite are likely to benefit its top line, given the surge in demand for cybersecurity-related products.
The company continues to benefit from Integrated Cyber Defense Platform, which drives significant cross-sell and up-sell opportunities. Moreover, key customer wins for Cloud Proxy, Cloud Access Security Broker and cloud e-mail offerings are expected to remain positives.
Moreover, the company’s cost-saving strategy and successful acquisitions of Blue Coat and LifeLock, which primarily drive the Consumer Digital Safety business, continue to aid its earnings.
The Consumer Digital Safety segment, which constitutes nearly half of the entire business, is likely to remain strong in the to-be-reported quarter.
However, the company expects continuation of longer sales cycle to negatively impact Enterprise Security revenues. Moreover, foreign exchange headwinds are also expected to affect the top line.
Moreover, the Enterprise Security segment continues to display weakness due to decreased billings. This is likely to remain an overhang.
Furthermore, increased competition from the likes of Proofpoint PFPT, FireEye FEYE, and Check Point CHKP is a major headwind for the company.
For the fiscal second quarter, the Zacks Consensus Estimate for earnings is pegged at 33 cents, indicating a year-over-year decline of 17.5%. For revenues, the consensus estimate stands at $1.14 billion, indicating 7.71% decrease.
Symantec Corporation Price and EPS Surprise
Symantec Corporation Price and EPS Surprise | Symantec Corporation Quote
Symantec has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
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