What To Expect From Symantec’s Fiscal Fourth Quarter

Symantec (NYSE:SYMC) is scheduled to announce its fiscal fourth quarter 2018 earnings on May 10. In recent quarters, the company has reported strong growth in revenues driven by additional revenues from the $4.7 billion Blue Coat acquisition in mid-2016. In the June quarter of last year, Symantec acquired Israeli company Fireglass for an estimated $250 million. This further helped Symantec enhance its portfolio in the ransomware, malware and phishing threat domains. The company also improved its presence in the enterprise cloud security market. Symantec refreshed its cloud security product portfolio at the end of FY’17 to help customers secure public cloud infrastructure and Platform-as-a-Service. This resulted in accelerated revenue growth through the first half of FY’18, which slowed down slightly through the December quarter. For the March quarter, Symantec’s management has given modest guidance for revenues due to tougher year-over-year comparisons.

Symantec’s net revenue for Q4 FY’18 is expected to increase by low single digits to around $1.2 billion. However, cost synergies from acquisitions are expected to drive operating income to increase almost 30% y-o-y to over $400 million. The resulting adjusted operating profit margin is expected to be almost 6 percentage points higher on a y-o-y basis to 33.5% for the March quarter. A similar trend was observed in the December quarter as well. Based on these estimates, we forecast Symantec’s net income and EPS to increase 40% on a y-o-y basis for the March quarter. We have created an interactive analysis where you can change expected segment revenue and margin figures to gauge how it will impact expected EPS for the quarter.

See our complete analysis for Symantec

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