Symantec president and CEO replaced by company's chairman

Revenue grew by 1% in its first fiscal quarter

Security software vendor Symantec said Wednesday that Enrique Salem, its president and CEO, had stepped down effective immediately, after the company reported that its revenue for the quarter ended June 29 grew just 1% year-over-year to $1.7 billion, while its profits sagged by 10%, falling to $172 million.

Symantec said its board of directors appointed Steve Bennett, the board chairman, to also hold the posts of president and CEO.

The board's decision to make a leadership change was not based on any particular event or impropriety but was instead made after ongoing consideration and a deliberative process, said Dan Schulman, Symantec's newly appointed lead director, in a statement.

Bennett said "Symantec's assets are strong and yet the company is underperforming against the opportunity."

Bennett will take three to four months to outline a new strategy for Symantec, he said during a conference call discussing the quarterly results on Wednesday. The first thing that Symantec needs to do is sort through the way the market is evolving and then place its chips, Bennett said.

"This is an evolution not a revolution," he added.

After having assessed where Symantec is winning, where it's losing, and why, it will be time to take the required decisions, he said. Possible moves might include reallocations or reorganizations, but it is too early to speculate, Bennett said.

In response to a question, Bennett said that he did not expect any disruptions in the business due to the sudden leadership change.

Symantec needs to ramp up its competitiveness in the mobile market, according to Bennett, who said his primary goal as CEO is to "win in the mobile market as we did in the PC market."

Symantec will be focused on bringing new products to market that are oriented toward the mobile world, said James Beer, executive vice president and chief financial officer at Symantec, during the call.

Symantec has observed a clear shift toward people buying security products more for their immediate needs rather than investing in the future, Beer said. Instead of buying licenses, people and enterprises are shifting to buying products on a subscription basis, which is "quite surprising," Beer added. Enterprise subscriptions grew 24% year-over-year and Symantec was pleased with that result, he said.

Bennett emphasized that he will not be filling in as an interim leader. "I am the CEO," he said. "And I told my wife that this might be a five-year deal or may be a three-year deal." He said he will not turn over the leadership of the company until he's comfortable with the direction in which it's headed. When Bennett steps down, he plans to retain the post of chairman, he said.

Copyright © 2012 IDG Communications, Inc.

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