Symantec shares skidded 11% to $18.66 AH Wednesday after the maker of security software warned that third-quarter earnings would come in below forecasts, even as it posted second-quarter numbers that bested analysts' expectations. "While our first-half performance has been solid, exceeding our operating plan in both quarters, we have not met our planned new business targets," CEO John Thompson said on a conference call (full transcript). The cautiousness is due partly to worries about U.S. consumer spending given the housing and credit crisis. Against that backdrop, Symantec forecast third-quarter earnings of $0.25-$0.30/share, excluding items, on revenue of $1.41B-$1.45B; analysts had been expecting adjusted earnings of $0.31/share on revenue of $1.47B, on average. It expects third-quarter cash flow will be below the $454M reported a year earlier. Thomson continues to believe, however, that the company will meet its forecast for fiscal year earnings of $1.10-$1.15/share. Second-quarter earnings were $0.06/share, or $0.29 excluding items, on revenue of $1.42B, topping the average analyst forecast for earnings of $0.26/share and revenue of $1.39B.
Commentary: Analysts Looking for a Symantec Earnings Boost • Revisiting the Tech Stock/Subprime Connection
Stocks to watch: SYMC. Competitors: MFE, MSFT. ETFs: SWH, IAH, IGV
Earnings call transcript: Symantec F1Q08
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