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Excerpt from today's One Page Annotated Wall Street Journal Summary (which you can get emailed to you every morning by signing up here):

Symantec Is in $1 Billion IRS Dispute

  • Summary: The IRS is attempting to collect over $750 million in back taxes from Symantec's Veritas unit, plus over $300 million in penalties. The dispute is over transfer pricing: Veritas has an Irish subsidiary (which pays low taxes) and pays licensing fees to its US parent; the IRS claims the licensing fees were too low.
  • Comment on related stocks/ETFs: Negative for Symantec (NASDAQ:SYMC). But numberous other US tech companies have Irish subsidiaries and could be vulnerable to increased scrutiny of transfer pricing. They include Microsoft (NASDAQ:MSFT) and Google (NASDAQ:GOOG).

Red Hat's Profit Rises 11% Amid Open-Source Demand

  • Summary: Red Hat's results for the quarter ending May 31st: Revenue up 38% to $84 million, net income of $13.8 million versus $12.4 million a year earlier, EPS of $0.07, unchanged from a year earlier, missed consensus estimates of $0.09.
  • Comment on related stocks/ETFs: Red Hat for the first time included stock options expenses, of $7.6 million. Details in the full Red Hat conference call transcript.
Source: Symantec in $1 Bn Dispute, Red Hat Earnings