McAfee Tops Estimates as Demand for Security Grows
McAfee Inc., the second-biggest maker of security software, reported fourth-quarter profit that beat analysts’ estimates after more consumers and businesses starting using its programs to ward off online threats.
Net income rose to $54.5 million, or 34 cents a share, from $45.4 million, or 29 cents, a year earlier, the Santa Clara, California-based company said today in a statement. Excluding some costs, profit was 64 cents, topping the 63-cent average estimate of analysts in a Bloomberg survey.
Chief Executive Officer Dave DeWalt has sought to gain market share among corporate customers by selling packages of security programs. The products handle everything from halting malicious code to stopping employees from sending confidential data. McAfee also is reaching consumers through trial offers on personal computers and Internet services.
“They had a very solid report, and phenomenal cash flow from operations,” said Sarah Friar, a San Francisco-based analyst with Goldman Sachs Group Inc. “We were looking for $70 million, and they did $145 million.”
Sales gained 24 percent to $525.7 million. Analysts had projected $514.8 million.
McAfee was little changed in late trading. The shares, down 6.6 percent this year, rose 55 cents to $37.89 in regular New York Stock Exchange trading.
The company announced that Chief Financial Officer Rocky Pimentel will step down. That news may hold down the stock price, said Friar said, who has a neutral rating on the shares and doesn’t own them.
“When a CFO resigns, people always worry,” she said. “In this case, it seems very benign.”
Excluding some costs, first-quarter profit will be 60 cents to 64 cents, the company said. Revenue will be $500 million to $520 million. Analysts estimated 62 cents in profit and $507.8 million in sales.
McAfee has started looking for a new finance chief and plans to complete the search later this year. Pimentel, who joined McAfee in 2008, will remain in the job to ease the transition, the company said.
The company’s board approved a buyback program of as much as $500 million in stock. That plan will last through the end of next year.