Symantec ( SYMC ) announced its fiscal first quarter 2019 earnings on August 2, reporting a 5% decline in net revenues to $1.17 billion. While consumer digital safety revenues rose 13% on a y-o-y basis to $600 million for the quarter, enterprise security revenues fell 14% to $556 million. Revenues from recent acquisitions, notably Blue Coat and Fireglass , have helped drive consumer security revenues. On the other hand, the company refreshed its cloud security product portfolio at the end of FY'17 to help customers secure public cloud infrastructure and Platform-as-a-Service. This resulted in accelerated revenue growth in the enterprise space through the first half of FY'18, which slowed down in the latter half of the fiscal year. Enterprise revenues fell in the two most recent quarters, which the company attributed to lower than anticipated billings due to longer than expected sales cycles for large, multi-product platform sales, particularly in North America.
Going forward, Symantec's management expects revenues to fall slightly through FY'19 due to the expected decline in enterprise segment sales. We forecast enterprise security revenues to be 12-13% lower on a y-o-y basis to $2.2 billion. On the other hand, we expect the strong performance from consumer security to continue through the end of the year, with 10-11% revenue growth to $2.5 billion. In addition, we expect operating margin (non-GAAP) to be around a percentage point lower over FY'18 at around 36%. Based on these estimates, we forecast Symantec's net income and EPS to be around 2-4% lower on a y-o-y basis to $1 billion and $1.60, respectively. We have created an interactive dashboard on how Symantec will perform in fiscal 2019, where you can change expected segment revenue and margin figures to gauge how it will impact expected EPS for the year.
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