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Symantec Beats; View Mixed

The security software company's profit pales, but its revenue forecasts beat Street consensus.

Updated from 4:33 p.m. EST

Shares of


(SYMC) - Get Symantec Corporation Report

spiked nearly 6% after the company beat analysts' expectations for the fourth quarter despite lower profit.

The security software company said Wednesday it earned $61 million, or 7 cents a share, compared with $119 million, or 11 cents a share, in the same quarter last year.

Excluding items, the company posted earnings of $227 million, or 24 cents a share, vs. $279 million, or 26 cents a share, the year before. Analysts polled by Thomson Financial were expecting 20 cents a share.

Revenue for the quarter ended March 30 was up 5% to $1.365 billion from $1.29 billion the year before, topping the consensus estimate of $1.27 billion.

"The bottom line in our March quarter beats Wall Street expectations quite comfortably," said James Beer, chief financial officer. "Our performance has been driven by stronger bookings than we had previously projected and our cost reduction activities."

Shares of Symantec rose $1.08, or 5.9%, to $19.25 in recent after-hours trading.

Guidance for the first quarter and fiscal-year 2008 was mixed, although Symantec said it expects to launch new products and see increased demand for its storage and backup products for businesses.

For the first quarter of fiscal 2008, Symantec said revenue is estimated in the range of $1.295 billion to $1.325 billion, higher than Street expectations of $1.28 billion.

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Excluding items, EPS is estimated between 18 cents and 20 cents, lower than the analyst forecast of 24 cents a share.

For fiscal 2008, Symantec said revenue is likely to be between $5.65 billion and $5.75 billion, with EPS between $1.10 and $1.15. Analysts forecast revenue of $5.36 billion and earnings of $1.09 a share.

Symantec underwent some major changes in fiscal 2007.

The company integrated its salesforce and cut other costs that, while necessary, hurt the business. Symantec missed its third-quarter guidance, and the stock

had dropped 16.5% since the beginning of the year.

That challenging phase is now behind the company, said CEO John Thompson. "We are entering fiscal 2008 with the most difficult part of our transition behind us," he said.

Symantec said it also plans to release a new security product for businesses, code-named Hamlet, in June.

Meanwhile, the company's consumer business remains strong, representing 30% of total revenue in the fourth quarter, and grew 11% from last year.

The company's flagship consumer product, Norton Internet Security, grew 40% year over year in the March quarter. Its latest product, Norton 360, a security suite that offers antivirus, antispyware and backup, among other features, has sold 1 million units since its launch on Feb. 26.

Services, which represented 5% of total revenue, was another strong performer and grew 31% on an annual basis.

The security and data management business represented 38% of total revenue and grew 2% year over year, while the data center management unit represented 27% of total revenue and remained flat.

International revenue represented 52% of total revenue in the quarter and grew 9% from last year. The Asia-Pacific/Japan revenue for the quarter represented 14% of total revenue and grew 9%. Growth in the Americas region, which includes the U.S., Latin America and Canada, was 3% year over year.

Deferred revenue at the end of the fourth quarter grew 19% to $2.77 billion compared with $2.32 billion at the end of March 2006.