Press Release: NortonLifeLock's Q3 Growth Momentum Fueled by Cyber Safety Adoption
NortonLifeLock's Q3 Growth Momentum Fueled by Cyber Safety Adoption
Direct Customer Count Increased to 21 Million, Up 876,000 YoY and Up 334,000 QoQ
NortonLifeLock Inc. (NASDAQ: NLOK), a global leader in consumer Cyber Safety, today reported results for its fiscal year 2021 third quarter which ended January 1, 2021.
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NortonLifeLock's Q3 Growth Momentum Fueled by Cyber Safety Adoption
Q3 GAAP Financial Results YoY
Q3 GAAP revenue was $639 million, up 3% in USD. Q3 GAAP operating margin was 43.8%, up 33.8 points. Q3 GAAP diluted EPS from continuing operations was $0.29, down 47%. Q3 operating cash flow was $293 million.
Q3 Non-GAAP Financial Highlights and Commentary YoY
"Our vision to protect and empower everyone to live their digital lives safely has never been more relevant than it is today," said Vincent Pilette, CEO of NortonLifeLock. "Consumers are seeing the value of Cyber Safety with nearly 60% of our customers using Norton 360. We are accelerating our investments in new products and customer experiences that are driving our growth momentum, and with the Avira acquisition, we are just getting started."
"We delivered another quarter of accelerated top-line growth and achieved our long-term commitment of $1.50 in annualized EPS," said Natalie Derse, CFO of NortonLifeLock. "We are on the path to generate more than $900 million in annual free cash flow. We have a strong track record of execution that is built on a foundation of operational discipline."
Fiscal 2021 Q4 Guidance
Quarterly Cash Dividend
NortonLifeLock's Board of Directors has declared a quarterly cash dividend of $0.125 per common share to be paid on March 17, 2021 to all shareholders of record as of the close of business on February 22, 2021.
Avira Acquisition Complete
NortonLifeLock closed the acquisition of Avira in January 2021 (Q4 Fiscal 2021).
Q3 Conference Call
Fiscal 2021 Q3 Earnings Call
February 4, 2021
2 p.m. PST / 5 p.m. EST
Domestic: (833) 970-2458 | International: (929) 517-9556
Conference ID: 4409529
Live webcast: Investor.NortonLifeLock.com (replay will be posted after the conference call)
Detailed presentation slides available on Investor.NortonLifeLock.com
To help readers understand our past financial performance and our future results, we supplement the financial results that we provide in accordance with generally accepted accounting principles, or GAAP, with non-GAAP financial measures. The methods we use to produce non-GAAP results are not in accordance with GAAP and may differ from the methods used by other companies. Additional information regarding our non-GAAP measures are provided below. No reconciliation of the forecasted range for non-GAAP EPS guidance is included in this release because most non-GAAP adjustments pertain to events that have not yet occurred. It would be unreasonably burdensome to forecast, therefore we are unable to provide an accurate estimate.
For additional details regarding NortonLifeLock's results and outlook, please see the Earnings Presentation and the Supplemental Information on the investor relations page of our website at Investor.NortonLifeLock.com.
About NortonLifeLock Inc.
NortonLifeLock Inc. (NASDAQ: NLOK) is a global leader in consumer Cyber Safety, protecting and empowering people to live their digital lives safely. We are the consumer's trusted ally in an increasingly complex and connected world. Learn more about how we're transforming Cyber Safety at www.NortonLifeLock.com.
This press release contains statements which may be considered forward-looking within the meaning of the U.S. federal securities laws. In some cases, you can identify these forward-looking statements by the use of terms such as "expect," "will," "continue," or similar expressions, and variations or negatives of these words, but the absence of these words does not mean that a statement is not forward-looking. All statements other than statements of historical fact are statements that could be deemed forward-looking statements, including, but not limited to: the statements under "Fiscal Year 2021 Q4 Guidance," including expectations relating to fourth quarter non-GAAP revenue, non-GAAP revenue growth and non-GAAP EPS; the statements contained in the quotations, including expectations related to our growth strategies and free cash flow; and any statements of assumptions underlying any of the foregoing. These statements are subject to known and unknown risks, uncertainties and other factors that may cause our actual results, levels of activity, performance or achievements to differ materially from results expressed or implied in this press release. Such risk factors include, but are not limited to, those related to: the current and future impact of the COVID-19 pandemic on the Company's business and industry; the effect of the sale of substantially all of the Enterprise Security assets on NortonLifeLock's retained businesses and products; retention of executive leadership team members; difficulties in improving sales and product development during leadership transitions; difficulties in executing the operating model for the consumer cyber safety business; lower than anticipated returns from the Company's investments in direct customer acquisition; difficulties and delays in reducing run rate expenses and monetizing underutilized assets; general business and economic conditions; matters arising out of our completed Audit Committee investigation and the ongoing U.S. Securities and Exchange Commission investigation; fluctuations and volatility in NortonLifeLock's stock price; the ability of NortonLifeLock to successfully execute strategic plans; the ability to maintain customer and partner relationships; the ability of NortonLifeLock to achieve its cost and operating efficiency goals; the anticipated growth of certain market segments; NortonLifeLock's sales and business strategy; fluctuations in tax rates and foreign currency exchange rates; the timing and market acceptance of new product releases and upgrades; and the successful development of new products and the degree to which these products gain market acceptance. Additional information concerning these and other risk factors is contained in the Risk Factors sections of NortonLifeLock's most recent reports on Form 10-K and Form 10-Q. NortonLifeLock assumes no obligation, and does not intend, to update these forward-looking statements as a result of future events or developments.
Use of Non-GAAP Financial Information
We use non-GAAP measures of operating margin, net income and earnings per share, which are adjusted from results based on GAAP and exclude certain expenses, gains and losses. We also provide the non-GAAP metrics of Consumer revenues, constant currency revenues and Consumer reported billings, which exclude revenues from our divested ID Analytics solutions. These non-GAAP financial measures are provided to enhance the user's understanding of our past financial performance and our prospects for the future. Our management team uses these non-GAAP financial measures in assessing NortonLifeLock's performance, as well as in planning and forecasting future periods. These non-GAAP financial measures are not computed according to GAAP and the methods we use to compute them may differ from the methods used by other companies. Non-GAAP financial measures are supplemental, should not be considered a substitute for financial information presented in accordance with GAAP and should be read only in conjunction with our consolidated financial statements prepared in accordance with GAAP. Readers are encouraged to review the reconciliation of our non-GAAP financial measures to the comparable GAAP results, which is attached to our quarterly earnings release and which can be found, along with other financial information including the Supplemental Information, on the investor relations page of our website at Investor.NortonLifeLock.com.
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