Symantec 2003 Annual Report Download - page 33

Symantec 2003 31
NET REVENUES
Net revenues increased 31% to approximately $1.4 billion during fiscal
2003 from $1.1 billion during fiscal 2002 and 26% to $1.1 billion during
fiscal 2002 from $853.6 million during fiscal 2001. The increase during
fiscal 2003 as compared to fiscal 2002 was due primarily to increased
sales of our consumer products and enterprise security products. The
increased sales of our consumer products and enterprise security prod-
ucts was largely attributable to continuing growth in demand for our
virus protection solutions from large organizations as well as from small
businesses and consumers. From a regional standpoint, the increase
was primarily due to growth in net revenues internationally and, to a
lesser extent, in the United States. Strength in major foreign currencies
during fiscal 2003 also positively impacted our international revenue
growth.
The increase during fiscal 2002 as compared to fiscal 2001 was due pri-
marily to increased sales of our enterprise security products and a sig-
nificant increase in sales of our consumer products during the second
half of fiscal 2002. The increase in enterprise security products during
fiscal 2002 was attributable to a full year of sales related to AXENT solu-
tions as compared to approximately three months during fiscal 2001.
From a regional standpoint, this increase was primarily due to growth in
net revenues in the United States and to a lesser extent in EMEA.
A significant portion of our deferred revenue balance of $331.1 million
as of March 31, 2002 contributed to our total net revenues during fiscal
2003. We anticipate that our deferred revenue balance of $589.6 million
as of March 31, 2003, will also be a significant portion of our net rev-
enues during the first quarter of fiscal 2004.
Segments Our Enterprise Security segment provides organizations with
Internet security technology, global response and services to manage
their information security needs. Our Enterprise Security segment repre-
sented approximately 42%, 42% and 33% of net revenues during fiscal
2003, 2002 and 2001, respectively. Net revenues increased approxi-
mately $138.6 million, or 30%, during fiscal 2003 as compared to fiscal
2002. This increase was primarily due to strong growth in sales of our
virus protection and firewall/VPN product solutions. Net revenues
increased $172.2 million, or 61%, during fiscal 2002 as compared to
fiscal 2001. The increase was primarily due to our first full year of sales
of intrusion detection, security management and firewall product solu-
tions, as a result of our acquisition of AXENT in December 2000, and
in particular, significant growth in sales of virus protection product
solutions.
Our Enterprise Administration segment offers products that enable
companies to be more effective and efficient within their information
technology departments. Our Enterprise Administration segment repre-
sented approximately 15%, 21% and 27% of net revenues during fiscal
2003, 2002 and 2001, respectively. Net revenues decreased approxi-
mately $7.5 million, or 3%, during fiscal 2003 as compared to fiscal
2002 and decreased $8.1 million, or 4%, during fiscal 2002 as com-
pared to fiscal 2001. These decreases were primarily due to a decrease
in sales of our pcAnywhere product, partially offset by growth in our
Ghost Corporate Edition product. We anticipate net revenues from this
segment to comprise a smaller percentage of our overall revenues going
forward.
Our Consumer Products segment provides security and problem-solving
products to individual users, home offices and small businesses. Our
Consumer Products segment represented approximately 41%, 35% and
39% of net revenues during fiscal 2003, 2002 and 2001, respectively.
Net revenues increased approximately $194.1 million, or 52%, during
fiscal 2003 as compared to fiscal 2002. This increase was primarily
related to stronger than expected consumer and small business spend-
ing, which contributed to the increase in sales of our Norton AntiVirus
and Norton Internet Security products. Our electronic distribution chan-
nel, including original equipment manufacturer subscription renewals,
also contributed to the increase in sales during fiscal 2003 as compared
to fiscal 2002. Net revenues increased by approximately $45.8 million,
or 14%, during fiscal 2002 as compared to fiscal 2001. This increase
was primarily related to an increase in sales of our Norton AntiVirus
and Norton Internet Security products, mostly as a result of strong
consumer and small business spending, and an increase in the renewal
subscription pricing of our antivirus products. This increase was offset
by a decline in sales of our Winfax and Macintosh products. We do not
expect our Consumer Product net revenues to grow at as high a rate
during fiscal 2004 as during fiscal 2003.
Our Services segment provides information security solutions that
incorporate best-of-breed technology, security expertise and global
resources. Our Services segment represented approximately 2%, 1%
and less than 1% of net revenues during fiscal 2003, 2002 and 2001,
respectively. Net revenues increased approximately $15.5 million, or
142%, during fiscal 2003 as compared to fiscal 2002. This increase was
primarily related to sales from our managed security services, which
represented approximately $13.8 million of net revenues during fiscal
2003. Net revenues increased approximately $8.6 million, or 378%,
during fiscal 2002 as compared to fiscal 2001, due primarily to the
increase in demand for our consulting services.
Our Other segment is comprised of sunset products and products
nearing the end of their life cycle and represented less than 1% of net
revenues during each of the fiscal years 2003, 2002 and 2001.
International Net revenues outside of the United States represented
approximately 49%, 47% and 48% of net revenues during fiscal 2003,
2002 and 2001, respectively. International net revenues increased by
approximately $188.2 million, or 37%, during fiscal 2003 as compared
to fiscal 2002. This increase in net revenues was primarily the result of
sales growth in EMEA and to a lesser extent in Japan, primarily from
increased sales of our enterprise security and consumer products.
International net revenues increased by approximately $91.6 million,
or 22%, during fiscal 2002 as compared to fiscal 2001. This increase
in net revenues was the result of increased sales in EMEA and Asia
Pacific, primarily from increased sales of our enterprise security and
consumer products.