McAfee Shares Surge on Robust Sales

Shares of McAfee (MFE Quote) surged Friday after it reported strong third-quarter results on strong sales of its security software.

The company's results, which were reported late Thursday, were closely watched by industry watchers after McAfee's rival Symantec (SYMC Quote) had reported sluggish growth earlier this week in its security business.

Symantec also issued cautious third-quarter guidance, prompting speculation that security software may have lost its "recession-proof' reputation.

McAfee's strong results boosted its shares 9% in early trading Friday. The software company's third-quarter revenue was $409.7 million, up 27% from the same period a year ago, and well above analyst estimates of $395.21 million.

The firm also issued an optimistic fourth-quarter guidance Thursday, indicating strong demand for its products during the coming months. Fourth-quarter revenue is expected to be between $400 million and $420 million, compared to the consensus estimate of $405.5 million.

The company also expects fourth quarter net income of 54 to 60 cents a share. Its adjusted earnings are expected to between 50 cents and 56 cents a share, compared to analysts' estimate of 52 cents a share.

McAfee's shares rose $2.50, or 9.01%, to $30.25, Friday.

Despite an increasingly uncertain economic climate, McAfee experienced strong third-quarter growth in its North American and consumer businesses, which helped boost revenue.

Sales of McAfee's software in North America grew by almost a third compared to the same period last year, accounting for more than half of the company's total revenue. McAfee's consumer products also enjoyed good growth, with sales up 20% on the prior year.

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