Updated from May 3

Veritas Software

(VRTS) - Get Report

delivered first-quarter revenue and earnings late Tuesday that were better than expected, but its self-described "cautious" outlook for the second quarter was below Wall Street's projections.

Revenue in the March quarter was $559 million, up 15% from the previous year, and about 4% better than the Thomson First Call consensus of $535.5 million. Net income for the quarter was $105 million, or 24 cents a share, compared with $100 million, or 22 cents a diluted share, a year earlier.

Included in the latest quarter were noncash charges and expenses of $20.5 million, including $12 million in costs related to the pending merger with Symantec

(SYMC) - Get Report

. Without the charges, the company would have earned 28 cents a share, said CFO Ed Gillis during a conference call with analysts. On the same basis, analysts were expecting a 24-cent profit.

License revenue increased to $323 million during the quarter from $302 million, while services revenue increased to $236 million from $183 million a year ago.

Veritas and Symantec have said that the merger should close during the second quarter, which means Tuesday's earnings announcement is likely to be Veritas' last as a standalone company.

But the merger still needs shareholder approval; Veritas CEO Gary Bloom said the companies will shortly announce the dates of those meetings.

Although the general tone of a postannouncement conference call was bullish, Veritas' guidance was admittedly conservative.

"With the combination of our strong performance in Q1, the normal seasonality of the second quarter and the ongoing activities related to the pending merger with Symantec, we are being cautious with our outlook for the June quarter," Bloom said.

Veritas expects revenue for the quarter ending June 30, 2005, of $500 million to $540 million, and earnings of 15 cents to 20 cents a share, excluding 2 cents to 3 cents in merger-related costs.

Analysts were expecting a per-share profit of 25 cents on sales of $551.1 million.

There was some confusion evident during the call regarding the size of the various charges on a per-share basis; but after Gillis had explained the costs several times, the potential earnings miss in the second quarter looked less serious than it had on the basis of the company's initial press release, and the first quarter looked better as well.

After hours, the stock recently lost 21 cents, or 1%, to $20.85, after closing the regular session with a gain of 44 cents.