Symantec Finalizing CEO Candidates, Plans September Announcement

Symantec is nearing completion of its search to fill the chief executive position, telling Wall Street analysts on Wednesday that an announcement is planned by the end of September.

The board of directors will mull over the finalists this month, said Michael Brown, who has been serving as interim CEO since March, when the company's board of directors ousted Steve Bennett from the position.

"The search committee has received strong inbound interest and has already met with a number of highly qualified candidates," Brown said during its fiscal-first-quarter analyst call. "The committee is in the process of narrowing the field to a handful of executives and is vetting the finalists among those."

[Related: Symantec Partners Seek Balanced CEO To Jump-Start Momentum]

When pressed by financial analysts for more details about the likely candidates, Brown said the company is looking for an executive with experience in the technology industry who can operate a global-scale multiproducts business. The candidate must have a collaborative leadership style and, ideally, experience as a public company CEO.

"We've got from the finalists, candidates that meet all of those, and we have candidates where we're looking that may not meet all of those, but they might be outstanding in one or two of those," Brown said.

The Mountain View, Calif.-based company reported that earnings increased by 50 percent for its fiscal first quarter, beating analyst expectations. Symantec reported a profit of $236 million, or 34 cents a share, compared with $157 million, or 22 cents a share, a year earlier. Revenue rose nearly 2 percent to $1.74 billion. Symantec's earnings news was viewed positively by Wall Street. Its stock was up more than 3 percent Thursday morning with shares trading at $24.50.

Symantec's channel partners said a new chief executive would need to be more balanced than the company's previous CEOs, which either focused heavily on products and acquisitions or, like ousted CEO Steve Bennett, fully engaged in cost reduction and trimming the workforce. Some names that are quietly surfacing as potential candidates include Patricia Russo, who was chairman of Lucent Technologies and served as CEO of Alcatel-Lucent, and Paul Otellini, who retired from his last position as president and CEO of Intel. John Becker, who was appointed CEO of Sourcefire just prior to its acquisition by Cisco Systems last year, is also seen by some security industry observers as a possible suitor. The company also is said to have reached out to potential candidates from storage and cloud services vendors.

"There are customers asking questions, but they follow Symantec closely and understand that it is really trying to become more nimble and in a state of transition," said Kevin Wheeler, founder and managing director at Dallas-based information security services company InfoDefense, a Symantec partner. "The dust is starting to settle in some areas."

Symantec also is interviewing candidates for chief products officer, who would be responsible for product strategy across its portfolio.

NEXT: Data Loss Prevention, Trust Services Driving Growth

Symantec has been focusing on cuts to its consumer and small business software, getting out of unprofitable retail markets and OEM deals. It created a new consumer group for its Norton-branded products and introduced Norton for small business. It also is shifting more research and development funds to support its backup appliances, advanced threat prevention, mobile security and data loss prevention.

Brown said the company's backup appliances, trust services and data loss prevention technology contributed the most to the robust revenue growth. The separation of the Symantec sales force into new business and renewals teams resulted in improved performance in North America, with federal and renewals teams delivering one of its best quarters ever, he said.

Symantec's Information security segment increased 2 percent year-over-year to $345 million, driven by continued growth in trust services and the DLP businesses, and offset by weaknesses in its mail, web and data center security services.

Symantec's managed incident response service, launched in June, also has attracted interest, with 36 customers using the service to help triage live incidents.

In June, Symantec introduced its managed incident response service, which provides emergency on-demand service to help customers recover from a breach. Since our launch, 36 customers have engaged us to help triage live incidents. Two other services are planned. A managed adversary and threat intelligence service offering will be launched in the fall, along with a web-based cybersecurity simulation tool that provides security incident training scenarios for data center environments.

The company's Advanced Threat Protection service attracted several early adopters since it was launched in May. The service combines threat intelligence data with information from Symantec's networking security vendor partners to more efficiently detect targeted attacks.

Symantec's Information management segment was flat year-over-year at $650 million, but the company saw continued growth from its NetBackup and Backup Exec appliances.

Partners have cited renewed interest from potential customers in data loss prevention, monitoring, and identity and access management technologies to control data flow to cloud-based services and add encryption to protect the most sensitive data.

PUBLISHED AUG. 7, 2014