Symantec Reports Solid First Quarter Revenue and Earnings

International customers from the quarter included Australian Stock Exchange Ltd., the primary national stock exchange and provider of market data for Australia; Hutchison Telecommunications (Australia) Ltd., focused on delivering leading communications and multimedia services to the Australian consumer; Fabrica Nacional de Moneda y Timbre, the national mint of Spain; Jiangsu Mobile Communications, a subsidiary of China Mobile; Mahindra & Mahindra Ltd., an India-based conglomerate offering information technology, trade and finance related services, and infrastructure development. Conference Call

Symantec has scheduled a conference call for 5 p.m. ET/2 p.m. PT today to discuss the fiscal first quarter, ended June 30, 2006, and to review guidance for the fiscal year 2007. Interested parties may access the conference call on the Internet at http://www.symantec.com/invest/index.html. To listen to the live call, please go to the Web site at least 15 minutes early to register, download, and install any necessary audio software. A replay and script of our officers' remarks will be available on the investor relations' home page shortly after the call is completed.

About Symantec

Symantec is the world leader in providing solutions to help individuals and enterprises assure the security, availability, and integrity of their information. Headquartered in Cupertino, Calif., Symantec has operations in 40 countries. More information is available at www.symantec.com.

NOTE TO EDITORS: If you would like additional information on Symantec Corporation and its products, please visit the Symantec News Room at http://www.symantec.com/news. All prices noted are in U.S. dollars and are valid only in the United States.

Symantec and the Symantec Logo are trademarks or registered trademarks of Symantec Corporation or its affiliates in the U.S. and other countries. Other names may be trademarks of their respective owners.

FORWARD-LOOKING STATEMENTS: This press release contains statements regarding our financial and business results, which may be considered forward-looking within the meaning of the U.S. federal securities laws, including statements relating to projections of future revenue and earnings per share for the second quarter and year of fiscal 2007, and projections of deferred revenue, amortization of acquisition related intangibles and stock-based compensation. 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 press release. 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 press release. 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 31, 2006. We assume no obligation to update any forward-looking information contained in this press release.

USE OF NON-GAAP FINANCIAL INFORMATION: Our results of operations have undergone significant change due to a series of acquisitions, the impact of SFAS 123(R) 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 supplemental 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. All references to "combined non-GAAP" financial information for pre-acquisition periods include our results with those of Veritas Software Corporation for like fiscal quarters (i.e., combining our results for our first quarter of fiscal 2006, which ended July 1, 2005, with the result for Veritas' first quarter of fiscal 2005, which ended March 31, 2005). Investors are encouraged to review the reconciliation of our non-GAAP financial measures to the comparable GAAP results, which is attached to our quarterly earnings release and which can be found, along with additional combined non-GAAP and other financial information, on the investor relations page of our Web site at www.symantec.com/invest/center.html.

SYMANTEC CORPORATION Consolidated Balance Sheets (In thousands, except per share data) June 30, March 31, 2006 2006 ------------- ------------ (unaudited) ASSETS Current assets: Cash and short-term investments $ 4,099,397 $ 2,865,802 Trade accounts receivable, net 538,775 670,937 Inventories 40,919 48,687 Current deferred income taxes 136,337 131,833 Other current assets 188,368 190,673 ------------- ------------ Total current assets 5,003,796 3,907,932 Property and equipment, net 1,035,238 946,217 Acquired product rights, net 1,150,352 1,238,511 Other intangible assets, net 1,390,258 1,440,873 Goodwill 10,338,263 10,331,045 Other long-term assets 70,824 48,605 ------------- ------------ $ 18,988,731 $ 17,913,183 ============= ============ LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Convertible subordinated notes $ 518,200 $ 512,800 Accounts payable 161,938 167,135 Accrued compensation and benefits 261,528 277,170 Current deferred revenue 1,938,407 1,915,179 Other accrued expenses 174,005 185,882 Income taxes payable 362,061 419,401 ------------- ------------ Total current liabilities 3,416,139 3,477,567 Long-term deferred revenue 270,898 248,273 Long-term deferred tax liabilities 237,606 493,956 Convertible senior notes 2,100,000 - Other long-term obligations 26,320 24,916 Stockholders' equity: Common stock 9,875 10,409 Capital in excess of par value 11,552,840 12,426,690 Accumulated other comprehensive income 175,057 146,810 Deferred stock-based compensation - (43,595) Retained earnings 1,199,996 1,128,157 ------------- ------------ Total stockholders' equity 12,937,768 13,668,471 ------------- ------------ $ 18,988,731 $ 17,913,183 ============= ============ SYMANTEC CORPORATION GAAP Consolidated Statements of Income (In thousands, except per share data) Three Months Ended June 30, ------------------------- 2006 2005 ----------- ------------ (unaudited) Net revenues $ 1,259,086 $ 699,942 Cost of revenues: Cost of revenues 213,162 105,782 Amortization of acquired product rights 87,611 11,013 ----------- ------------ Cost of revenues 300,773 116,795 Gross profit 958,313 583,147 Operating expenses: Sales and marketing 464,437 211,915 Research and development 216,262 92,338 General and administrative 79,481 31,262 Amortization of other intangible assets 50,614 1,739 Restructuring 13,258 3,474 Integration - 7,901 Patent settlement - 2,200 ----------- ------------ Total operating expenses 824,052 350,829 Operating income 134,261 232,318 Interest and other income, net 27,634 22,758 Interest expense (6,678) - ----------- ------------ Income before income taxes 155,217 255,076 Provision for income taxes 60,426 56,443 ----------- ------------ Net income $ 94,791 $ 198,633 =========== ============ Net income per share - diluted $ 0.09 $ 0.27 =========== ============ Shares used to compute net income per share - diluted 1,048,833 737,211 =========== ============ SYMANTEC CORPORATION Reconciliation of Consolidated Statements of Income to Non-GAAP Statements of Income (In thousands, except per share data) (Unaudited) Three Months Ended June 30, ------------------------ 2006 2005 ----------- ----------- NET REVENUES: GAAP net revenues $ 1,259,086 $ 699,942 Fair value adjustment to Veritas deferred revenue (A) 22,282 - Veritas net revenue (D) - 559,258 ----------- ----------- Non-GAAP net revenue $ 1,281,368 $ 1,259,200 =========== =========== NET INCOME: GAAP net income $ 94,791 $ 198,633 Fair value adjustment to Veritas deferred revenue (A) 22,282 - Amortization of acquired product rights (B) 87,611 83,164 Stock-based compensation (M) 36,859 8,419 Integration (F) - 19,578 Executive incentive bonuses (C) 1,974 - Restructuring (E) 13,258 3,474 Amortization of other intangible assets (I) 50,614 48,503 Patent settlement (J) - 2,200 Gain on sale of strategic investments (K) - (732) Proposed Veritas SEC legal settlement (L) - 30,000 Income tax effect on above items (G) (59,690) (69,118) Veritas net loss (H) - (13,492) ----------- ----------- Non-GAAP net income $ 247,699 $ 310,629 =========== =========== NET INCOME PER SHARE - DILUTED: GAAP net income per share $ 0.09 $ 0.27 Stock-based compensation adjustment per share (M) 0.03 - Other non-GAAP adjustments per share (A)-(L) 0.12 (0.02) ----------- ----------- Non-GAAP net income per share $ 0.24 $ 0.25 =========== =========== SHARES USED TO COMPUTE NET INCOME PER SHARE - DILUTED: GAAP shares used to compute net income per share 1,048,833 737,211 Converted incremental Veritas shares* - 486,912 ----------- ----------- Non-GAAP shares used to compute net income per share 1,048,833 1,224,123 =========== =========== *Converted incremental Veritas shares equals Veritas historical shares multiplied by the exchange ratio of 1.1242. The non-GAAP financial measures included in the table above are non-GAAP net revenue, non-GAAP net income, and non-GAAP net income per share, which adjust for the following items: business combination accounting entries, expenses related to acquisitions, stock-based compensation expense, restructuring charges and charges related to the amortization of other intangible assets, and certain other items. We believe that the presentation of these non-GAAP financial measures is useful to investors, and such measures are used by our management, for the reasons associated with each of the adjusting items as described below. (A) Fair value adjustment to Veritas deferred revenue. We include revenue associated with Veritas deferred revenue that was excluded as a result of purchase accounting adjustments to fair value because we believe it is reflective of ongoing operating results. (B) Amortization of acquired product rights. The amounts recorded as amortization of acquired product rights arise from prior acquisitions and are non-cash in nature. We exclude these expenses because we believe they are not reflective of ongoing operating results in the period incurred and are not directly related to the operation of our business. (C) Executive incentive bonuses. Consists of bonuses related to the Veritas acquisition and executive sign-on bonuses for newly hired executives. We exclude these amounts because they arise from prior acquisitions and other infrequent events and we believe they are not directly related to the operation of our business. For the three months ended June 30, 2006 executive incentive bonuses were allocated as follows: Three months ended June 30, 2006 ------------------ (in thousands) Sales and marketing $ 676 Research and development 865 General and administrative 433 -------- Total executive incentive bonuses $ 1,974 ======== (D) Veritas' net revenue. This amount represents Veritas' net revenue for the three months ended March 31, 2005. We include Veritas' net revenue because we believe it is useful in comparing the ongoing operating results of the combined company with pre-merger results of the two companies. (E) Restructuring. These amounts arise from severance, benefits, outplacement services, and excess facilities resulting from our company restructurings and we believe they are not directly related to the operation of our business. (F) Integration. Consists of expenses incurred for consulting services and other professional fees associated with the integration activities for our acquisition of Veritas. These expenses arose from a specific prior acquisition and we believe they are not directly related to the operation of our business. The three months ended June 30, 2006 did not include integration expenses. For the three months ended June 30, 2005 integration expenses were allocated as follows:

Three months ended June 30, 2005 -------------------------- (in thousands) Symantec Veritas Total -------- -------- -------- Cost of revenues $ - $ 1,057 $ 1,057 Sales and marketing 1,557 3,094 4,651 Research and development 774 2,700 3,474 General and administrative 5,570 4,826 10,396 -------- -------- -------- Total integration expenses $ 7,901 $ 11,677 $ 19,578 ======== ======== ======== (G) Income tax effect on above items. This amount adjusts the provision for income taxes to reflect the effect of the non-GAAP adjustments on non-GAAP operating income. (H) Veritas' net loss. This amount represents Veritas' net loss for the three months ended March 31, 2005 and includes the following: $399 million of gross profit less $400 million of operating expenses less $12 million of other expense and taxes, net. We include Veritas' net loss because we believe it is useful in comparing the ongoing operating results of the combined company with pre-merger results of the two companies. (I) Amortization of other intangible assets. The amounts recorded as amortization of other intangible assets arise from prior acquisitions and are non-cash in nature. We exclude these expenses because we believe they are not reflective of ongoing operating results in the period incurred and are not directly related to the operation of our business. (J) Patent settlement. On May 12, 2005, we resolved the Altiris patent litigation matter with a cross-licensing agreement that resolved all legal claims between the companies. We exclude this amount because it arose from a specific litigation matter and we believe it is not directly related to the operation of our business. (K) Gain on sale of strategic investments. We have equity investments in privately held companies for business and strategic purposes. We exclude the gain on sale of strategic investments because we believe it is not reflective of ongoing operating results in the period incurred and is not directly related to the operation of our business. (L) Proposed Veritas SEC legal settlement. Prior to our acquisition of Veritas, Veritas accrued a $30 million penalty based on settlement discussions with the SEC. We exclude the proposed SEC legal settlement because we believe it is not reflective of ongoing operating results in the period incurred and is not directly related to the operation of our business. (M) Stock-based compensation. Consists of expenses for employee stock options, restricted stock units, and employee stock purchase plan determined in accordance with APB 25 and SFAS 123(R) pre and post adoption of SFAS 123(R) on April 1, 2006, respectively. We exclude these stock-based compensation expenses because they are non-cash expenses that we believe are not reflective of ongoing operating results. Further, we believe it is useful to investors to understand the impact of the application of SFAS 123(R) to our results of operations. For the three months ended June 30, 2006 and 2005, stock-based compensation was allocated as follows: Three months ended June 30, 2006 2005 -------- -------------------------- (in thousands) Symantec Veritas Total -------- -------- -------- Cost of revenues $ 3,981 $ - $ 901 $ 901 Sales and marketing 14,186 806 1,482 2,288 Research and development 14,098 1,105 2,062 3,167 General and administrative 4,594 874 1,189 2,063 -------- -------- -------- -------- Total stock-based compensation expenses $ 36,859 $ 2,785 $ 5,634 $ 8,419 ======== ======== ======== ======== SYMANTEC CORPORATION Reconciliation of GAAP Revenue Components to Non-GAAP Revenue Components (In thousands, except per share data) (Unaudited) Three Months Ended June 30, 2006 ----------------------------------------- GAAP Non-GAAP Symantec Adjustments Non-GAAP ----------- ------------ --- ----------- Net Revenues (1) $ 1,259,086 $ 22,282 A $ 1,281,368 Revenue By Segment: Security and Data Management $ 480,872 $ 6,877 A $ 487,749 Data Center Management $ 335,714 $ 15,201 A $ 350,915 Services $ 57,915 $ 202 A $ 58,117 Consumer $ 384,814 $ - A $ 384,814 Other $ (229) $ 2 A $ (227) Revenue by Geography: Americas $ 686,751 $ 14,883 A $ 701,634 EMEA $ 398,292 $ 4,752 A $ 403,044 Asia Pacific/Japan $ 174,043 $ 2,647 A $ 176,690 Total International Revenue $ 639,652 $ 8,406 A $ 648,058 Three Months Ended June 30, 2005 ------------------------------------------------ Non-- GAAP GAAP GAAP Combined Symantec* VERITAS** Adju- stme- nts Non-GAAP ------------ ------------ --- ----- ------------ Net Revenues (1) $ 699,942 $ 559,258 B $ - $ 1,259,200 Revenue By Segment: Security and Data Management $ 325,531 $ 172,895 B $ - $ 498,426 Data Center Management $ - $ 349,286 B $ - $ 349,286 Services $ 12,382 $ 37,027 B $ - $ 49,409 Consumer $ 361,884 $ - B $ - $ 361,884 Other $ 145 $ 50 B $ - $ 195 Revenue by Geography: Americas $ 386,288 $ 319,600 B $ - $ 705,888 EMEA $ 217,755 $ 182,604 B $ - $ 400,359 Asia Pacific/Japan $ 95,899 $ 57,054 B $ - $ 152,953 Total International Revenue $ 353,518 $ 264,882 B $ - $ 618,400 (*) Net revenues include Symantec's net revenues for the three months ended June 30, 2005. (**) Net revenues include Veritas' net revenues for the three months ended March 31, 2005. Footnotes: 1 We believe the non-GAAP revenue measures set forth above are useful to investors, and such items are used by our management, because revenue associated with Veritas deferred revenue that was excluded as a result of purchase accounting adjustments to fair value is reflective of ongoing operating results, and we believe such items are useful in comparing the ongoing operating results of the combined company with pre-merger results of the two companies. A To include Veritas' deferred revenue that was excluded as a result of adjustments to fair value. B To include Veritas' historical net revenues for the three months ended March 31, 2005. SYMANTEC CORPORATION Reconciliation of GAAP deferred revenue to non-GAAP deferred revenue (Unaudited) June 30, June 30, 2006 2005 ----------- ----------- Deferred revenue reconciliation GAAP deferred revenue $ 2,209,305 $ 1,268,399 Add back: Fair value adjustment to Veritas deferred revenue (**) 35,247 - Veritas deferred revenue (***) - 519,499 ----------- ----------- Non-GAAP deferred revenue (*) $ 2,244,552 $ 1,787,898 =========== =========== (*) We believe that providing the non-GAAP item set forth above is useful to investors, and such item is used by our management, for the reasons associated with each of the adjusting items as described below. (**) Fair value adjustment to Veritas deferred revenue. We include revenue associated with Veritas deferred revenue that was excluded as a result of purchase accounting adjustments to fair value because we believe it is reflective of ongoing operating results. (***) Veritas' historical deferred revenue. This amount represents Veritas' historical deferred revenue as of March 31, 2005. We include this historical deferred revenue because we believe it is useful in comparing the ongoing operating results of the combined company with pre-merger results of the two companies. SYMANTEC CORPORATION Reconciliation of projected GAAP revenue and earnings per share to non-GAAP revenue and earnings per share (Unaudited) Q2 FY'07 FY'07 ----------------- ----------------- Revenue reconciliation (in billions) GAAP revenue range $ 1.265 - $ 1.295 $ 5.100 - $ 5.300 ================= ================= Add back: Fair value adjustment to Veritas deferred revenue (1) $ 0.010 $ 0.100 ----------------- ----------------- Non-GAAP revenue range* $ 1.275 - $ 1.305 $ 5.200 - $ 5.400 ================= ================= Earnings per share reconciliation GAAP earnings per share range $ 0.11 - $ 0.12 $ 0.46 - $ 0.56 ================= ================= Add back: Stock-based compensation (2) $ 0.03 $ 0.12 Fair value adjustment to Veritas deferred revenue and amortization $ 0.12 $ 0.48 of acquired product rights and other intangible assets (1,3) ----------------- ----------------- Non-GAAP earnings per share range* $ 0.26 - $ 0.27 $ 1.06 - $ 1.16 ================= ================= * We believe that providing a forecast of the non-GAAP items set forth above is useful to investors, and such items are used by our management,

for the reasons associated with each of the adjusting items as described below. (1) Fair value adjustment to Veritas deferred revenue. We include revenue associated with Veritas deferred revenue that was excluded as a result of purchase accounting adjustments to fair value because we believe it is reflective of ongoing operating results. (2) Stock-based compensation. Consists of expenses for employee stock options,restricted stock units, and employee stock purchase plan determined in accordance SFAS 123(R). We exclude these stock-based compensation expenses because they are non-cash expenses that we believe are not reflective of ongoing operating results. Further, we believe it is useful to investors to understand the impact of the application of SFAS 123(R) to our results of operations. (3) Amortization of acquired product rights and other intangible assets. The amounts recorded as amortization of acquired product rights and other intangible assets arise from prior acquisitions and are non-cash in nature. We exclude these expenses because we believe they are not reflective of ongoing operating results in the period incurred and are not directly related to the operation of our business.

MEDIA CONTACT: Yunsun Wee Symantec Corporation 310-449-7009 ywee@symantec.com

INVESTOR CONTACT: Helyn Corcos Symantec Corporation 408-517-8324 hcorcos@symantec.com

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