NortonLifeLock Inc. (NASDAQ: NLOK), a global leader in consumer Cyber Safety, today reported results for its fiscal year 2021 fourth quarter which ended April 2, 2021.

This press release features multimedia. View the full release here: https://www.businesswire.com/news/home/20210510005931/en/

Q4 GAAP Financial Results YoY

Q4 GAAP revenue was $672 million, up 9% in USD. Q4 GAAP operating margin was 39.6%, up 32 points. Q4 GAAP diluted EPS from continuing operations was $0.35, up 52%. Q4 operating cash flow was $356 million.

Q4 Non-GAAP Financial Highlights and Commentary YoY

  • Record revenue of $677 million, up 11% in USD
  • Record diluted EPS of $0.40, up 54%
  • Operating margin was 50.5%, up 900 bps
  • Consumer reported billings was $748 million, up 17% in USD
  • Direct customer count of 23 million, up 2.8 million

“We’re on a mission to bring Cyber Safety to everyone,” said Vincent Pilette, CEO of NortonLifeLock. “I’m proud of what the team achieved in our first fiscal year. We accelerated growth, expanded our international footprint, and added freemium capability. In the fourth quarter alone, we added 2 million new customers, and achieved record revenue and profit. This is possible because we are all driven by our vision to protect and empower people to live their digital lives safely. We are just getting started.”

Fiscal 2022 Q1 Guidance

  • Non-GAAP Revenue is expected to be in the range of $680 to $690 million, translating to approximately 10 to 12% growth YoY
  • Non-GAAP EPS is expected to be in the range of $0.40 to $0.42

Quarterly Cash Dividend

NortonLifeLock’s Board of Directors has declared a quarterly cash dividend of $0.125 per common share to be paid on June 23, 2021, to all shareholders of record as of the close of business on June 09, 2021.

Share Repurchase Authorization Raised by $1.5 Billion

NortonLifeLock’s Board of Directors has approved an incremental share repurchase authorization of $1.5 billion. Along with the current $274 million authorization remaining, this new authorization increases the total share repurchase remaining to approximately $1.8 billion. The authorization has no expiration date. As of April 2, 2021, the Company has returned $1.33 billion to shareholders through the repurchase of 58 million common shares since becoming a standalone company in November 2019.

Amended Existing Credit Facilities Agreement

On May 7, 2021, NortonLifeLock entered into the first amendment of the Company’s existing credit agreement, which provides a credit facility of up to $1.0 billion and a term loan facility of up to $1.75 billion. The new credit facility increases borrowing capacity by $516 million. The credit facilities will remain senior secured and mature in May 2026. Following the amendment, the Company’s leverage ratio remains at 2.0x net debt to adjusted EBITDA.

2021 Investor Day: Transforming for Growth

NortonLifeLock will host its first annual Investor Day today, May 10, 2021.

Virtual event details Investor.NortonLifeLock.com

  • May 10, 2021: Watch-on-Demand presentations available after market close at 2 p.m. PT / 5 p.m. ET.
  • May 11, 2021: Live video Q&A webcast with leadership team at 9 a.m. PT / 12 p.m. ET.

For additional details regarding NortonLifeLock’s results and outlook, please see the Earnings Presentation and the Supplemental Information on the investor relations page of our website at Investor.NortonLifeLock.com.

About NortonLifeLock Inc.

NortonLifeLock Inc. (NASDAQ: NLOK) is a global leader in consumer Cyber Safety, protecting and empowering people to live their digital lives safely. We are the consumer’s trusted ally in an increasingly complex and connected world. Learn more about how we’re transforming Cyber Safety at www.NortonLifeLock.com.

Forward-Looking Statements

This press release contains statements which may be considered forward-looking within the meaning of the U.S. federal securities laws. In some cases, you can identify these forward-looking statements by the use of terms such as “expect,” “will,” “continue,” or similar expressions, and variations or negatives of these words, but the absence of these words does not mean that a statement is not forward-looking. All statements other than statements of historical fact are statements that could be deemed forward-looking statements, including, but not limited to: the statements under “Fiscal 2022 Q1 Guidance,” including expectations relating to first quarter non-GAAP revenue, non-GAAP revenue growth and non-GAAP EPS; the statements contained in the quotations; and any statements of assumptions underlying any of the foregoing. These statements are subject to known and unknown risks, uncertainties and other factors that may cause our actual results, levels of activity, performance or achievements to differ materially from results expressed or implied in this press release. Such risk factors include, but are not limited to, those related to: the current and future impact of the COVID-19 pandemic on the Company’s business and industry; the effect of the sale of substantially all of the Enterprise Security assets on NortonLifeLock’s retained businesses and products; retention of executive leadership team members; difficulties in improving sales and product development during leadership transitions; difficulties in executing the operating model for the consumer cyber safety business; lower than anticipated returns from the Company's investments in direct customer acquisition; difficulties and delays in reducing run rate expenses and monetizing underutilized assets; general business and economic conditions; matters arising out of our completed Audit Committee investigation and the ongoing U.S. Securities and Exchange Commission investigation; fluctuations and volatility in NortonLifeLock’s stock price; the ability of NortonLifeLock to successfully execute strategic plans; the ability to maintain customer and partner relationships; the ability of NortonLifeLock to achieve its cost and operating efficiency goals; the anticipated growth of certain market segments; NortonLifeLock’s sales and business strategy; fluctuations in tax rates and foreign currency exchange rates; the potential for corporate tax increases under the new Biden Administration; the timing and market acceptance of new product releases and upgrades; and the successful development of new products and the degree to which these products gain market acceptance. Additional information concerning these and other risk factors is contained in the Risk Factors sections of NortonLifeLock’s most recent reports on Form 10-K and Form 10-Q. NortonLifeLock assumes no obligation, and does not intend, to update these forward-looking statements as a result of future events or developments.

Use of Non-GAAP Financial Information

We use non-GAAP measures of operating margin, net income and earnings per share, which are adjusted from results based on GAAP and exclude certain expenses, gains and losses. We also provide the non-GAAP metrics of Consumer revenues, constant currency revenues and Consumer reported billings, which exclude revenues from our divested ID Analytics solutions, and free cash flow, which is defined as cash flows from operating activities less purchases of property and equipment. These non-GAAP financial measures are provided to enhance the user’s understanding of our past financial performance and our prospects for the future. Our management team uses these non-GAAP financial measures in assessing NortonLifeLock’s performance, as well as in planning and forecasting future periods. These non-GAAP financial measures are not computed according to GAAP and the methods we use to compute them may differ from the methods used by other companies. Non-GAAP financial measures are supplemental, should not be considered a substitute for financial information presented in accordance with GAAP and should be read only in conjunction with our consolidated financial statements prepared in accordance with GAAP. Readers are encouraged to review the reconciliation of our non-GAAP financial measures to the comparable GAAP results, which is attached to our quarterly earnings release and which can be found, along with other financial information including the Supplemental Information, on the investor relations page of our website at Investor.NortonLifeLock.com. No reconciliation of the forecasted range for non-GAAP EPS guidance is included in this release because most non-GAAP adjustments pertain to events that have not yet occurred. It would be unreasonably burdensome to forecast, therefore we are unable to provide an accurate estimate.

NORTONLIFELOCK INC.

Condensed Consolidated Balance Sheets

(In millions, unaudited)

 

April 2, 2021

 

April 3, 2020

ASSETS

Current assets:

 

 

 

Cash and cash equivalents

$

933

 

 

 

$

2,177

 

Short-term investments

18

 

 

 

86

 

Accounts receivable, net

117

 

 

 

111

 

Other current assets

237

 

 

 

435

 

Assets held for sale

233

 

 

 

270

 

Total current assets

1,538

 

 

 

3,079

 

Property and equipment, net

78

 

 

 

238

 

Operating lease assets

76

 

 

 

88

 

Intangible assets, net

1,116

 

 

 

1,067

 

Goodwill

2,867

 

 

 

2,585

 

Other long-term assets

686

 

 

 

678

 

Total assets

$

6,361

 

 

 

$

7,735

 

LIABILITIES AND STOCKHOLDERS’ EQUITY (DEFICIT)

Current liabilities:

 

 

 

Accounts payable

$

52

 

 

 

$

87

 

Accrued compensation and benefits

107

 

 

 

115

 

Current portion of long-term debt

313

 

 

 

756

 

Contract liabilities

1,210

 

 

 

1,049

 

Current operating lease liabilities

26

 

 

 

28

 

Other current liabilities

428

 

 

 

587

 

Total current liabilities

2,136

 

 

 

2,622

 

Long-term debt

3,288

 

 

 

3,465

 

Long-term contract liabilities

55

 

 

 

27

 

Deferred income tax liabilities

137

 

 

 

149

 

Long-term income taxes payable

1,119

 

 

 

1,310

 

Long-term operating lease liabilities

66

 

 

 

73

 

Other long-term liabilities

60

 

 

 

79

 

Total liabilities

6,861

 

 

 

7,725

 

Total stockholders’ equity (deficit)

(500

)

 

 

10

 

Total liabilities and stockholders’ equity (deficit)

$

6,361

 

 

 

$

7,735

 

NORTONLIFELOCK INC.

Condensed Consolidated Statements of Operations (1)

(In millions, except per share data, unaudited)

 

Three Months Ended

 

Year Ended

 

April 2, 2021

 

April 3, 2020

 

April 2, 2021

 

April 3, 2020

Net revenues

$

672

 

 

 

$

614

 

 

 

$

2,551

 

 

 

$

2,490

 

 

Cost of revenues

99

 

 

 

97

 

 

 

362

 

 

 

393

 

 

Gross profit

573

 

 

 

517

 

 

 

2,189

 

 

 

2,097

 

 

Operating expenses:

 

 

 

 

 

 

 

Sales and marketing

148

 

 

 

150

 

 

 

576

 

 

 

701

 

 

Research and development

68

 

 

 

70

 

 

 

267

 

 

 

328

 

 

General and administrative

52

 

 

 

97

 

 

 

215

 

 

 

368

 

 

Amortization of intangible assets

20

 

 

 

18

 

 

 

74

 

 

 

79

 

 

Restructuring and other costs

19

 

 

 

138

 

 

 

161

 

 

 

266

 

 

Total operating expenses

307

 

 

 

473

 

 

 

1,293

 

 

 

1,742

 

 

Operating income

266

 

 

 

44

 

 

 

896

 

 

 

355

 

 

Interest expense

(35

)

 

 

(50

)

 

 

(144

)

 

 

(196

)

 

Other income, net

58

 

 

 

263

 

 

 

120

 


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