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How Did Symantec’s Enterprise Security Perform in 4Q15?

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Endpoint protection and DLP support Enterprise Security in 4Q15

Symantec’s (SYMC) Enterprise Security software segment reported non-GAAP (generally accepted accounting principles) revenues for fiscal 4Q15 and fiscal 2015 of $491 million and $2.06 billion, respectively. The segment’s revenue dropped by 6% quarter-over-quarter and 2% year-over-year. The year-over-year decline was primarily due to the strength of the US dollar (UUP) as well as the softness in sales of endpoint management offerings.

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In fiscal 2015, Symantec’s revenues from endpoint protection and DLP (data loss prevention) revenues grew by 5% and 6%, respectively, on a year-over-year basis. In 4Q15, these businesses registered 6% and 33% growth, respectively. Symantec’s management stated that double-digit growth in its DLP segment in 4Q15 was due to the expansion of DLP into cloud deployments like Microsoft (MSFT) Office 365.

Symantec leads the DLP market

In its 4Q15 earnings release, Symantec’s management stated, “Our endpoint protection, data loss prevention, NetBackup appliances and NetBackup software all outperformed the market this quarter.” These areas provide hope for Symantec’s Enterprise Security division.

In its fiscal 2015 earnings presentation, Symantec stated that its DLP offering saw more than the market growth of 14% in fiscal 2015. It also claimed to be the market leader in this space with twice as much share as its next largest competitor.

NetBackup appliances are part of a PBBA (purpose-built backup appliance) market, which EMC Corporation (EMC) leads with 62.3% market share, as you can see in the above graph. The figures in the graph come from a 2015 report published by IDC (International Data Corporation). IDC expects the PBBA market to grow to $4.4 billion by 2018 at a five-year compound annual growth rate (or CAGR) of 7.5%. Symantec, Hewlett-Packard (HPQ), IBM (IBM), and Quantum (QTM) are the top five players in the PBBA market.

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