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NortonLifeLock (NLOK) Q4 Earnings Beat Estimates, Rise Y/Y

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NortonLifeLock’s fourth-quarter fiscal 2021 non-GAAP earnings increased 54% from the year-ago quarter to 40 cents per share. Also, the bottom line beat the Zacks Consensus Estimate of 37 cents.

Revenues of $677 million surpassed the consensus mark of $658 million and rose 11% year over year. This outperformance was mainly driven by impressive customer growth.

NortonLifeLock Inc. Price, Consensus and EPS Surprise

NortonLifeLock Inc. Price, Consensus and EPS Surprise

NortonLifeLock Inc. price-consensus-eps-surprise-chart | NortonLifeLock Inc. Quote

Quarter Details

Direct average revenue per user (ARPU) decreased 3% year over year to $9.10 per month. Continued stabilization of direct customer count was a positive.

The company’s direct customer count increased 2 million year over year during the fiscal fourth quarter, bringing the total count to 23 million.

In the reported quarter, gross profit climbed 10.8% year over year to $573 million. Moreover, gross margin expanded 110 basis points (bps) to 85.3%.

Operating income on a non-GAAP basis jumped 34% year over year to $342 million. Operating margin was 50.5%, up 900 bps.

Balance Sheet

As of Apr 2, 2021, NortonLifeLock had $933 million in cash and cash equivalents, down sequentially from $1.05 billion. Long-term debt was $3.29 billion, down slightly from the $3.54 billion witnessed in the previous quarter.

Net cash of $356 million was provided by operating activities in the fiscal fourth quarter, as compared to $293 million of cash used in operational activities in the previous quarter.

Notably, the company authorized a quarterly cash dividend of $0.125 per share, payable on Jun 23 to all shareholders of record as of Jun 09.

Moreover, an additional share repurchase of $1.5 billion was authorized by the company, along with the remaining $274 million remaining in the current authorization, increasing the total share repurchase remaining to approximately $1.8 billion.

Full-Year Highlights

For full-year fiscal 2021, revenues came in at $2.55 billion, up 2.4% year over year. Non-GAAP earnings of $1.44 per share grew 60% year over year.

Guidance

For the first quarter of fiscal 2022, NortonLifeLock expects revenues between $680 million and $690 million. Non-GAAP earnings are expected between 40 cents and 42 cents per share.

For fiscal 2022, the company projects 8-10% year-over-year growth.

Moreover, non-GAAP earnings from continuing operations are expected between $1.65 and $1.75 per share.

Zacks Rank and Stocks to Consider

NortonLifeLock currently carries a Zacks Rank #3 (Hold).

Better-ranked stocks in the broader technology sector include Apple Inc. (AAPL - Free Report) , Zoom Video Communications (ZM - Free Report) and Shopify (SHOP - Free Report) , all sporting a Zacks Rank #1 (Strong Buy), at present. You can see the complete list of today’s Zacks #1 Rank stocks here.

The long-term earnings growth rate for Apple, Zoom Video Communications and Shopify is currently pegged at 11.5%, 25% and 32.5%, respectively.

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