Symantec Earnings Call Nuggets: Deferred Growth and Revenue Guidance
Walter Pritchard – Citi: James if you could talk about you are guiding to deferred growth could you talk about just how we should expect that to track versus revenue. Sure that it’s all historic patterns and then any comments on cash flow for fiscal ’14 would be helpful as well?
James Beer – EVP and CFO: So in terms of deferred revenue I would expect it to approximately track revenue. What we are seeing is increasing growth in the subscription businesses in the services business which of course start out as sales volumes as deferred revenue on the balance sheet. So I would expect directionally deferred revenues to continue tracking along with revenue. In terms of cash flow for fiscal ’14 first thought is I would expect over a longer run. The cash flow would track operating profit growth. In fiscal ’14 as we discussed back in January we’ll have some pretty sizeable severance charges of the order of $220 million to $250 million on severance coming up and so I would expect cash flow to be down year-over-year in fiscal ’14 as a result.
Walter Pritchard – Citi: Then Steve can you just talk about on the sales side I think we’ve become maybe hypersensitive at Symantec to disruptions in the sales force and impact of that. Could you give us a sense of just sort of order of magnitude how many people are changing roles and how you’ve accounted for that in both maybe your Q1 as well as your annual guidance?
Steve Bennett – Chairman, President and CEO: Walter I think the big thing is that virtually everybody is changing roles because we are moving from a full line of sales people that were all generally selling all of our products and services to having people that are specialists in information management or information security, which has been very well received from our customers and our partners as people have been asking us to be more specialized for a while. So, that our core sales people it’s a big change and so. But I would tell you in my discussions with them they are very fired up about the changes at Symantec and the new offerings that are coming and the progress we’re making. So, we have a talented and energized sales force, just going through some degree of change and you know, we think we’re thoughtful about the impact that could have on revenue. But my view is that will all the good things happening I think we’ll get through this without too many significant bumps, at least that’s what I’m hoping.
Ken Talian – JPMorgan: Hi, this is (Ken Talian) in for John. Just first looking at your guidance for the next quarter, on the revenue side and is any of that weakness focused on a specific segment of your business?
James Beer – EVP and CFO: No I wouldn’t say so. I’d just reemphasize the focus on the yen and the way that that has weakened quite significantly in the last few months in particular at our normal sequential variance of revenue from the March quarter to the June quarter.
Ken Talian – JPMorgan: Then just generally speaking on the consumer business, obviously we are facing a bit of a headwind given the PC unit market declines. As you think about that business, how much impact is the up-selling to premium in the emerging products like mobile. How much is that compensating for the slowdown in your core market?
Steve Bennett – Chairman, President and CEO: When you look at our performance recent times, I’d say about 1.5 points of growth are coming from the new emerging products and services such as mobile. But I think it’s important, Ken to say that OEM deals and PC slowdown is having less and less impact on our new – it’s a decreasing part of our new customer acquisition as we build up our direct e-commerce capability to acquire customers direct. So, it used to be like that was the majority and now its way, way less than 50% and going down. So, while the PC softness puts some pressure on us, I don’t think that’s going to have as much impact as people might be thinking.
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