Symantec’s Antivirus Market Share Will Decline

Symantec (NASDAQ:SYMC) in its recent quarterly earnings reported a decline in its consumer antivirus software market share to 52% in 2009 from 53% in 2008. We have updated the Trefis price estimate from $25.24 to $23.82 (versus market price of $17.04) in part to reflect continued market share declines for Norton.

Below we explain the significance of Norton software for Symantec and how Norton’s market share declines impact Symantec’s stock.

Norton constitutes 32% of Symantec’s stock price

Symantec provides security software to both consumers and businesses that help them block malicious software and spam emails as well as provide protection from phishing programs. Norton Antivirus is most the popular Symantec software product among consumers and we estimate that it constitutes around one-third of the Trefis price estimate for Symantec’s stock.

Symantec’s market share in consumer antivirus market to decline to 47%

Though Symantec leads the consumer antivirus market, it has lost market share to McAfee over the last few years. Symantec’s Share in Consumer Antivirus Software Market has declined from 53% in 2008 to 52% in 2009 due in part to the PC performance problems caused by the antivirus software.

Some Symantec customers have complained about how the software slows down their PCs and Symantec has made changes so that the new Norton Internet Security 2010 and Norton Antivirus perform better.  As a result of these changes, the Norton software has won more than 50 awards in the first four months after launch.

Despite the improved Norton, we expect Symantec’s share in the consumer antivirus software market to decline to 47% by the end of Trefis forecast period as a result of competition from McAfee and low-cost antivirus software.

You can modify our forecast above to see how Symantec’s stock is impacted by Norton’s market share.