Symantec’s Strategic Direction Presentation

Symantec's Strategic Direction and 3Q 2013
Earnings Presentation
1/23/2013
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Symantec’s Strategic Direction and
3Q 2013 Earnings Presentation
January 23, 2013
Welcome
Helyn Corcos
Vice President Investor Relations
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3Q FY13 Earnings Highlight
Strategic Direction and Operational Plan
Questions & Answers
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Forward Looking Statements
This presentation contains statements regarding our intention to execute a new strategy, implement operational and
organizational changes and our projected financial and business results, as well as our intention to return cash to shareholders
through dividends and continued share buyback activity, which may be considered forward‐looking within the meaning of the
U.S. federal securities laws. These statements are subject to known and unknown risks, uncertainties and other factors that may
cause our actual results, levels of activity, performance or achievements to differ materially from results expressed or implied in
this presentation. Such risk factors include those related to: maintaining customer and partner relationships; the anticipated
growth of certain market segments, particularly with regard to security and storage; the competitive environment in the software
industry; changes to operating systems and product strategy by vendors of operating systems; fluctuations in currency exchange
rates; the timing and market acceptance of new product releases and upgrades; the successful development of new products and
integration of acquired businesses; and the degree to which these products and businesses gain market acceptance. Actual
results may differ materially from those contained in the forward‐looking statements in this presentation. Additional information
concerning these and other risk factors is contained in the Risk Factors section of our Form 10‐K for the year ended March 30,
2012 and in our Form 8‐K filed on June 11, 2012.
Any information regarding pre‐release Symantec offerings, future updates or other planned modifications is subject to ongoing
evaluation by Symantec and therefore subject to change. This information is provided without warranty of any kind, express or
implied. Customers who purchase Symantec offerings should make their purchase decision based upon features that are
currently available.
We assume no obligation to update any forward‐looking information contained in this presentation.
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Use of GAAP and Non‐GAAP Financial Information
Our results of operations have undergone significant changes due to a series of acquisitions, the impact of SFAS 123(R),
impairment charges and other corporate events. To help our readers understand our past financial performance and our future
results, we supplement the financial results that we provide in accordance with generally accepted accounting principles, or
GAAP, with non‐GAAP financial measures. The method we use to produce non‐GAAP results is not computed according to GAAP
and may differ from the methods used by other companies. Our non‐GAAP results are not meant to be considered in isolation or
as a substitute for comparable GAAP measures and should be read only in conjunction with our consolidated financial statements
prepared in accordance with GAAP.
Our management regularly uses our non‐GAAP financial measures internally to understand, manage and evaluate our business
and make operating decisions. These non‐GAAP measures are among the primary factors management uses in planning for and
forecasting future periods. Investors are encouraged to review the reconciliation of our non‐GAAP financial measures to the
comparable GAAP results, which is attached to the financial review presentation, and which can also be found, along with other
financial information, on the investor relations page of our website at www.symantec.com/invest.
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3Q13 Earnings Highlights
James Beer
Chief Financial Officer
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Better than Expected Results for 3Q13
• Revenue Drivers
– Constant currency adjusted revenue grew 5% Y/Y
– Organic, constant currency revenue grew 4% Y/Y
– Strength in EMEA, Information Management and Trust Services
– License, constant currency revenue grew 8% Y/Y driven by strength in Information Management solutions
– Subscription, constant currency revenue grew 5% and maintenance revenue grew 5% Y/Y… Enterprise,
constant currency subscription revenue grew 12%
• Profitability Drivers
– Operating margin and EPS driven by higher revenue and lower spending
3Q’13 3Q’12
As Reported
Growth Y/Y
Revenue $1,791m $1,715m 4%
Non‐GAAP Operating Margin 25.6% 26.2% ‐60 bp
Non‐GAAP EPS $0.45 $0.42 7%
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Solid Revenue Results by Segment
3Q’13 3Q’12
FX Adjusted
Growth Y/Y
Consumer $530m $525m 2%
Security and Compliance $527m $510m 4%
Storage and Server Management $666m $618m 9%
Services $68m $62m 9%
• Consumer… up‐selling to premium suites and growing emerging backup, NortonLive services and mobile
• Security and Compliance… strength in Trust Services, MSS and Encryption
• Storage and Server Management
– Information Management revenue grew 12% Y/Y driven by double digit growth in NetBackup
– Storage Management revenue grew 1% Y/Y as customers continue to deploy more mission critical applications
on Linux and virtualized infrastructures
• Services… driven by Business Critical Services
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Strong Cash Generation
3Q’13 3Q’12
As Reported
Growth Y/Y
Cash From Operating Activities $463m $403m 15%
Cash, Cash Equivalents and Short Term
Investments Balance
$4,252m $2,380m 79%
• 43% of cash on shore… ~ 26% excluding $1 billion allocated to maturity of June 2013
convertible notes
• $200m to repurchase 11m shares at average price $17.94… $283m remaining in
the current board authorized share repurchase plan
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• ~73% or $1.26b of March quarter revenue coming from balance sheet
• Guidance assumes
– FX rate of $1.32 per Euro
– 24.6% effective tax rate and 702m CSE… R&D tax credit drives down our tax rate in 4Q13
4Q FY13 Guidance
4Q’13 Expected Y/Y Growth
FX Adjusted
Growth Y/Y
Revenue $1.70 to $1.74b 1 – 4% 1 – 3%
GAAP EPS 18¢ to 19¢ ‐ (75 – 76)% na
Non‐GAAP EPS 37¢ to 38¢ ‐ 2.6 – 0% na
Deferred Revenue $4.01 to $4.07b 1 – 2% 1 – 3%
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Symantec 4.0 ‐ Strategy
Steve Bennett
President and Chief Executive Officer
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Symantec 4.0 Financial Theme
Organic growth focused company
Complemented by accretive acquisitions… that add
value to customers
Growing operating margins and cash flow
Disciplined approach to capital allocation
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Strategy and Operating Plan Agenda
Learning Journey
Customers and Market Overview
Offering Strategy
Go‐to‐Market Strategy
Organization
Resource Allocation
Financial View
1313
Culver CityCulver City
SpringfieldSpringfield
HeathrowHeathrow
DublinDublin
PunePune
ChennaiChennai
ChengduChengdu
BeijingBeijing
TokyoTokyo
SydneySydney
Over 8000 employees in
town hall and small team
meetings
RosevilleRoseville
LondonLondon
ParisParisReadingReading
BarcelonaBarcelona
SingaporeSingapore
Washington DCWashington DC
New YorkNew York
BaltimoreBaltimore
BostonBoston
More than 1300 customers,
including presenting at
VISION Barcelona
36 Analyst meetings across all
regions, speaking to Gartner,
IDC, Forrester and others
78 financial analysts
including attending Citi
Investor Conference
251 partners at the
Baltimore Partner Exchange
Meetings with various House and Senate members,
including General Alexander and presenting to over 900
attendees at the Symantec Government Symposium
Mountain ViewMountain View
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Key Learnings… Strengths
Strong Assets
Deep Expertise
and Capability
Portfolio of
Leading
Products
Strong Brands
Reach and
Installed Base
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Key Learnings… Opportunities
Products and
Services
GTM and
Global
Strategy
People and
Organization
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Evolution
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A Revolution
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Market Trends, Competitive
Landscape and Product Offerings
Stephen Gillett
COO
Francis deSouza
President of Products & Services
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Voice of the Customer
• Global economic uncertainty
and enterprise security
• Full Emergence of Digital and
Social Media
• Explosive data and intelligence
growth
• Enterprise IT will need to adapt
and evolve
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Enterprise Security
• Redefined boundaries between
consumer and business
• Enterprise attack sophistication
is increasing
• Technology realm transfer
• Dispersion of authority
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Countries and Government
• Governments are responsible
for protecting their nation's
critical infrastructure
• Attacks on citizens and
institutions increasing in
complexity
• Cyber has become the fifth
domain for warfare — after
land, sea, air, and space
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Changing Landscape and Market Trends
Internet of “Things” Mobility
Computing EcosystemsDigital & Social Life
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Changing Market Requires a New Model For Protection
Corporate Network
Data CenterPCs
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Specialist
Integrated
Stack ProvidersStartups
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How We Win
Best of Need
Scale
Integration
Cross Platform
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We Will Strengthen Our Offerings: More R&D
Leverage
Innovation
Zero‐based
mindset
More
Innovation
• Whole company scope
• Resource best growth opportunities
• Eliminate redundancy
• Increase R&D spend
• Redeploy and hire
• Advanced research
File System
DLP
Security Intelligence
Centers of
Excellence
Better and
Easier
Customer
Experience
Right‐for‐Me
Offerings
New
Offerings
Better meet
customer
needs…faster
organic growth
Encryption
Endpoint
Protection
More R&D
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We Will Strengthen Our Offerings: Better and Easier
Customer Experience
• Focus product teams on end‐to‐
end customer use experience
• Simplified licensing
• Self‐healing technology
To Use, Upgrade
and Maintain
To Get Help and
Support
• Simplified support options
• Expanded support channels ex.
Web, chat, community support
• Knowledge management
More R&D
Better and
Easier
Customer
Experience
Right‐for‐Me
Offerings
New
Offerings
Better meet
customer
needs…faster
organic growth
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We Will Strengthen Our Offerings: Right‐For‐Me Offerings
Tailored
Offerings
Choice of
Deployment
Option
• Consumers
• Small Businesses
• Large Enterprise
• Governments
• Software
• Appliance
• Cloud
• Hybrids
• Geographies
• Specific
Industries…verticals
More R&D
Better and
Easier
Customer
Experience
Right‐for‐Me
Offerings
New
Offerings
Better meet
customer
needs…faster
organic growth
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New Offerings Will Address Broader Customer Needs
• Integrated, modular, solving bigger jobs
•Customer can buy existing products OR
new integrated offerings
• Turn on new capability as needed
More R&D
Better and
Easier
Customer
Experience
Right‐for‐Me
Offerings
New
Offerings
Better meet
customer
needs…faster
organic growth
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Symantec Addresses Unmet, Underserved Needs In
Three Areas
Make it simple for me to be productive
& protected at home and work
Keep my business safe and compliant
Keep my business information and
applications up and running
User Productivity & Protection
Information Security
Information Management:
Availability & Scalability
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How Current Offerings Map to Customer Jobs
Current Offering Examples
Norton 360
Norton Mobile Security
Norton Data Services
Endpoint Protection
Enterprise Mobility
Endpoint Encryption
User Authentication
Managed Security Services
Data Loss Prevention
Mail and Web Security
O3
Control Compliance Suite
Critical System Protection
Trust Services
Storage Foundation HA
NetBackup
Enterprise Vault/eDiscovery
Backup Exec
BE.cloud
FileStore
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We Will Deliver New Integrated, Modular Offerings
Over the Next 6‐24 Months
New Higher‐Value Offerings
Mobile Workforce Productivity
Norton Protection
Norton Cloud
Information Security Service
Identity/Content‐aware
Security Gateway
Data Center Security
Business Continuity
Integrated Backup
Cloud‐based Info Management
Object Storage Platform
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Enables authorized users to access corporate resources from any corporate or
personal mobile device, PC or Mac while protecting data, applications,
devices and identities
New Higher‐Value Offering: Mobile Workforce Productivity
Employee Owned/BYOD
Corporate Owned
Enterprise Applications
Cloud Services
• Endpoint protection
• Corporate
• Personal
• Mobile device management
• Mobile container
• Mobile application
Management
• Enterprise app store
• Endpoint encryption
• Endpoint DLP
• User authentication
Integrated
Solves an important customer problem and builds competitive advantage
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Provides visibility into, and comprehensive protection from, advanced
threats leveraging Symantec and 3rd‐party products
New Higher‐Value Offering: Information Security Service
Enterprise Apps
Symantec Security Offerings
3rd‐Party Products and Tools
Symantec Global Security
Intelligence Network
• Analysis
• Correlation
• Visibility
• Dashboard
• Threat Detection
• Prioritization and
Workflow
• Incident Management
• Risk Management
Integrated
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New Higher‐Value Offering: Business Continuity
Applications
Platforms
Storage
• Windows Backup
• Unix/Linux Backup
• Virtual Backup
• Clustering
• Virtual HA
• Replication
• Disaster Recovery
• Service Orchestration
Integrated
Delivers high availability, performance, and scalability for business
applications in virtual, private cloud environments
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Examples of New or Expanded Centers of Excellence
Cloud Platform &
Capabilities
Hardware
Supply Chain
Information Fabric
Global Security
Intelligence
Network
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Solve Bigger
Problems
Better and
Easier
Right‐for‐Me
Offerings
How This
Benefits
Customers
How They
Want to Buy
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• Evaluated entire portfolio
• Two key criteria
– Stand‐alone offering or part of a
larger, modular future offering
– Asset to solve new, important
customer problems?
Symantec 4.0 Portfolio Strategy
• Portfolio review continues over
time
• Will deal with anything that
doesn’t fit
Nothing to announce today
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Applied “Right for GEO” manner
Customer Segment
Commercial
Global
Consumer and
Small Business
Enterprise
• Global & Enterprise… Symantec direct + Customer led channel
involvement
• New Verticals business… Telco/ISPs, SIs, XaaS, National Public Sector
• Channel‐led… dedicated Symantec team supports
• Combination of direct through e‐business and channel‐led
Simplified Go‐to‐Market (GTM) Strategy
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• Expanded high quality/
lower cost models
‐ Telesales
‐ e‐Business
‐ In product
• New business growth
‐ Field paid only on new over time
‐ Separate renewals org
• New global sales and partner
enablement organization
New Marketing and Sales Capabilities
• New, enhanced partner program
‐ More selective based on capabilities
‐ Better enablement & Symantec support
‐ New performance‐based incentives
• Expanded Marketing
‐ Total customer experience
‐ New centers of excellence
‐ Strategic Pricing & Licensing
Offerings Customers
Beyond
Current
Point
Products to
Integrated
Offerings
Beyond
Short-Term
Bookings to
Lasting
Customer
Value
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Organizational Strategy
July 25th to Present
• Common company level objectives
• Financial results + customers + partners +
employees
• New staff performance objectives
• Changed staff meeting cycle
• Trained 95% of directors and VPs on SYMC
4.0 leadership
Today
• Symantec 4.0 strategy and plan
• New org structure and leadership team
• New organization simplification initiative
• Splitting Chairman and CEO roles
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New Organization Design: Objectives
Improve Teamwork Increase Customer Focus Functionalize Upgrade Growth Capability
• Office of the CEO
• Senior leadership
decision on talent +
collaboration skills
• Consumer & business
world merging
• Customer jobs vs.
segments
• Break up BU structure
that created silos
• Global in thinking and
actions… GEO leaders
• Upgrade process
capability
• Consolidation for
leverage
– Centers of excellence
– Eliminate redundancies
• Right talent… Fewer,
bigger roles for our
best and brightest
• Marketing
• Sales process
management
• IT
• Cloud Ops
• HR
Strengthen leadership… Improve Organic Growth Capabilities…
Minimize Execution Risk
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Creation of the Office of the CEO New Roles or
Major Changes
Office of the CEO
• COO
• President Products & Services
• CFO
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New Structure 11 Direct Reports to the CEO New Roles or
Major Changes
Product &
Services
COO Verticals Business
Strategic Sales
NA Enterprise
Sales
EMEA
APJ
CFO HR Legal
Strategy & Corp
Dev
CEO
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President of Products and Services Organization
CEO
New Roles or
Major Changes
Products
Mobile
Information
Security
Information
Management
CTO
Business Critical
Services
Enterprise & Norton
Endpoint PD
Education
Enterprise & Norton
Endpoint PM
Global/Vertical
Offering Integration
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COO Organization
CEO
COO
Consumer Sales
Renewals
e‐Business
CIO
Cloud Ops
CMO
Sales Process &
Enablement
Customer Care
Communications
New Roles or
Major Changes
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Operational Plan
James Beer
Chief Financial Officer
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Opportunities to Drive Efficiency & Redeploy Resources
Company‐wide Opportunities
Drove
Duplication and
Complexity
Partially integrated acquisitions
Siloed organization; redundancy
Too much management
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Product Development
2 Significant duplication today… 24 cloud service platforms and 54 data center locations
1 Consolidated $1.8 billion spending pool
3 Align point product spending with market opportunity
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Sales & Marketing
1 Simplify pricing & licensing … 31 price lists and 41 license meters
5 Field sales real estate consolidation
3
4 Streamline route to market structure … 23 distinct sales channels
6 Fewer individualized compensation plans
2 Build high performance and cost effective renewals team
Consolidate worldwide marketing spend
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Cross‐company
Management ranks have expanded steadily
• High cost
• Slow decision making, removed from front line reality
Organization Simplification Initiative
• Move from 10 layers of management to 6‐7
• Move from average of 4 spans to ~8
1
2
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Existing offerings
New integrated offerings
Product delivery capabilities
• Cloud infrastructure platform
• Hardware Supply Chain
• Information Fabric
• Global security intelligence
network
IT a strategic enabler
• Insource some activity
• Applications and infrastructure
HR… building talent and
organizational capability
Process capability
Marketing
• Pricing resources
• Customer analytics
• Brand building
Sales
• Process improvements
• Renewals team
• e‐Business expansion
Investments to Build Organic Growth Engine
Product Development
General &
Administrative
Sales & Marketing
People InfrastructureProducts
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FY12A FY17E Median High
R&D 14% 16% 13% 17%
S&M 41% 27% 28% 50%
G&A 6% 5% 8% 13%
Expense to Revenue Ratios
Benchmark1
Invest to drive faster organic growth
Symantec
1Benchmark includes 3 year averages for BMC, CA, CVLT, CRM, ORCL, MSFT, SAP, INTU, CTXS, ADBE 54

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Commitment to 5%+ organic revenue growth and 30%+ operating margins
• Organic revenue… 5%+ CAGR FY15‐17
• Operating margins… 30% goal in FY15
Financial Plan
FY14 ‐ A Transition Year… Expect
• 0‐2% revenue growth
• Operating margins grow 200 bps
• Free cash flow impacted by
• ~$275 million severance payments
• Incremental CapEx $100‐$150 million
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Capital Allocation
• CapEx and acquisitions that support strategy + meet IRR hurdles
• Return excess cash to shareholders
• 15%+ IRR hurdle
• Target returning 50% of free cash flow longer‐term
• Over time, ~50/50 balance between dividends and repurchases
Strategy
Strategy
Elements
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Capital Allocation
• Initiating dividend with targeted yield of 2.5% in 1Q14
• New $1B share repurchase authorization
• Continue opportunistic buybacks
• Expect to return $800m
• Will invest $375‐425m for severance and CapEx investments
Announcing
Today
FY14
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Symantec 4.0 Operating Theme… Better and Easier
How we play… As a Team… Making High Quality, Timely Decisions
• Symantec‐wide objectives and performance metrics
• One Symantec strategy with cascading organizational strategies and operational priorities
• Individual accountability… to their role and the team
What we do… People and Partnerships… Internal and external… creating customer value
How we think… Innovation + Execution…. Global and Local… Big and Small
• Innovation everywhere with special focus on customer driven and technology innovation
• Excellence in execution through people, process and technology
• Act big where there is value… act small everywhere else
• Eliminate complexity not valued by customers or partners
• Create and leverage global centers of excellence
How we organize… Simplified and Streamlined
• Inverted triangle organizational philosophy
• Lean and effective management structure
• Culture of learning and sharing to make us better
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Symantec 4.0 Company Theme
Enabling people, businesses and
countries… to protect and manage
their digital information… so they
can focus their time and energy
achieving their aspirations
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Appendix
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4Q FY13 Guidance
Revenue Guidance
Three Month Ending March 29, 2013
Year‐Over‐Year Growth Rate
Range Actual Constant Currency
GAAP revenue range $1.70 ‐ $1.74B 1% ‐ 4% 1% ‐ 3%
Earnings Per Share Guidance and Reconciliation Range Actual
GAAP diluted earnings per share range $0.18 ‐ $0.19 (76)% ‐ (75)%
Add back:
Stock‐based compensation, net of tax $0.04
Amortization of intangible assets, non‐cash interest expense
and transition & transformation expenses, net of tax $0.15
Non‐GAAP diluted earnings per share range $0.37 ‐ $0.38 (3)% ‐ 0%
Deferred Revenue Guidance Range Actual Constant Currency
GAAP deferred revenue range $4.01 ‐ $4.07B 1% ‐ 2% 1% ‐ 3%
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GAAP to Non‐GAAP Reconciliation
($ In millions, except per share data) Three Months Ended
Year-Over-Year
Non-GAAP Growth Rate
December 28, 2012 December 30, 2011 Constant
GAAP Adj Non-GAAP GAAP Adj Non-GAAP Actual Currency
Net revenue: $1,791 N/A $1,791 $1,715 N/A $1,715 4% 5%
Gross profit: $1,492 $20 $1,512 $1,444 $26 $1,470 3% 4%
Stock-based compensation 4 4
Amortization of intangible assets 16 22
Gross margin % 83.3% 84.4% 84.2% 85.7% -130 bps -110 bps
Operating expenses: $1,194 $140 $1,054 $1,144 $123 $1,021 3% 4%
Stock-based compensation 38 42
Amortization of intangible assets 71 73
Restructuring and transition 27 5
Acquisition/divestiture-related expenses 4 3
Operating expenses as a % of revenue 66.7% 58.8% 66.7% 59.5% -70 bps -40 bps
Operating income $298 $160 $458 $300 $149 $449 2% 2%
Operating margin % 16.6% 25.6% 17.5% 26.2% -60 bps -80 bps
Net income: $212 $101 $313 $240 $74 $314 0% N/A
Gross profit adjustment 20 26
Operating expense adjustment 140 123
Non-cash interest expense 15 12
China VAT tax refund (24) -
Income tax effect on above items (44) (45)
Tax related adjustments:
Release of pre-acquisition tax contingencies (6) (42)
Diluted net income per share attributable to
Symantec Corporation stockholders $0.30 $0.15 $0.45 $0.32 $0.10 $0.42 7% N/A
Diluted weighted-average shares outstanding
attributable to Symantec Corporation stockholders 702 702 740 740 -5% N/A
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