SYMC Symantec Corporation

By Robert McMillan and Nathan Becker 

Symantec Corp., best-known for its "antivirus" computer-security software, is again looking for a chief executive, after the company slashed its financial forecast Thursday and said CEO Michael Brown would step down.

A pioneer in the growing market for cybersecurity products, Symantec has struggled to diversify amid competition from younger rivals such as FireEye Inc. and Palo Alto Networks Inc.

Symantec's next CEO will be the company's fourth in as many years. Mr. Brown, the former chief executive of disk-drive maker Quantum Corp., refocused the company on security, in particular on efforts to predict threats, and to track and respond to hackers once they are inside a network.

The company said he would remain until a successor is named. On Thursday, it named Ajei Gopal as interim president and operating chief, part of an "office of the president" that includes other executives who will help fill the management void until the new CEO is hired. Mr. Gopal, who previously worked at Symantec, was most recently an operating partner at private-equity firm Silver Lake, which invested $500 million in Symantec in February.

Antivirus software, which emerged at Symantec and elsewhere in the late 1980s, aimed to keep hackers out of networks but proved less effective in recent years as hacking techniques evolved.

In January, Mr. Brown completed the sale of the company's Veritas data-storage division to Carlyle Group for $7.4 billion. Symantec was forced to slash the Veritas sale price by $600 million because of "uncertainties" about the deal, the company said. Symantec had bought Veritas for $10.2 billion in 2005 in an attempt to diversify its business, but it proved to be an unwieldy distraction

"They made a massive miss-turn when they bought Veritas," said Brent Thill, an analyst with UBS Group. "They went down a gravel road that went into a snake pit and then into a sewer."

For its fiscal fourth quarter, which ended April 1, Symantec said it expects revenue of $873 million, down from prior guidance of $885 million to $915 million. It also expects adjusted earnings of 22 cents, below its prior range of 24 cents to 27 cents.

Shares fell 6.7%, or $1.22, to $16.89. Symantec shares are down 32% over the past year.

Demand for Symantec's antivirus software has been stagnant for years. In 2015, the company's consumer business shrunk by 9% to $1.9 billion, roughly the same level as in 2010. Corporate security products, including corporate antivirus and server-security technologies, slipped 2% last year to $2.1 billion.

Like other technology giants, Symantec has struggled to respond to changing corporate buying habits. But Symantec's missteps are even more remarkable, Mr. Thill said, because the company has a long-established foothold in the fast-growing market for computer-security products.

"Symantec can't grow, and they're in the hottest space of IT spend," Mr. Thill said. "Either your sales force doesn't know what it's doing, or your products are not very good, or it's a combination of both."

During a conference call with analysts Thursday, Mr. Brown blamed the company's poor results on a slowdown in sales of Symantec's traditional products along with a shift toward subscription products, with their deferred-revenue streams, as reasons for the company's shortfall.

Symantec declined to make Mr. Brown available for an interview.

Write to Robert McMillan at Robert.Mcmillan@wsj.com and Nathan Becker at nathan.becker@wsj.com

(END) Dow Jones Newswires

April 28, 2016 16:42 ET (20:42 GMT)

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