Tuesday, November 27, 2012
Slowing Revenues and Declining Income at Trend Micro Helping Kaspersky in Efforts to Reach Number Three
In the paid desktop antivirus and internet security world, Symantec and McAfee have generally been recognized as the 800-pound gorillas with Trend Micro trailing at number three. Kaspersky founder Eugene Kaspersky has expressed a strong desire to catch up to Trend Micro. In fact, Moscow based Kaspersky was listed as one of only 5 global security companies in the “Leaders” portion of the Gartner 2012 Magic Quadrant for Endpoint Protection Platforms.
Disappointing Q3 Results for Trend
Trend Micro did not have a great Q3. First, the good news. On the non-financial front - The company was issued over a dozen patents in Q3. They announced new mobile solutions. They rolled out their 2013 Internet Security product line. They announced their latest iteration of their cloud-based security infrastructure, the Smart Protection Network,
Now for the bad - Year over year sales were down 2% (Q3) , and net income, down 25%. The drop in net sales was due to declines in both North America and Europe. Not good signs when given that the economies have been improving in these markets. Japan had 3% growth.
On a revenue basis, (Pre GAAP before adjusting for deferred revenue) – North America revenue declined 10% and Europe 8%. Japan grew by 10%. (Q3 year over year)
Unlike the other major vendors, Trend Micro is heavily dependent on Japan for their revenue. This grew to 51% in Q3 2012. North America and Europe had 20% and 16% shares, respectively. Sales were down in both the enterprise and consumer segments.
Q4 is unlikely to help Trend. Net sales are projected to be flat and net income down 41%.
This isn’t a pretty trend for Trend. Since Kaspersky has decided to remain a private company, there aren’t many publically available financial numbers for them, but they have to be pleased. If these trends continue, Kaspersky may be able to reach number three in 2013.
Despite their financial miscues, Trend Micro continues to be innovating. There are the patents mentioned above. This week, Trend Micro announced their free Online Security Assessment Tools for Cloud, Cyber & Mobile Security. These tools are designed to provide customers with an assessment of their current business' security posture with respect to cloud adoption, consumerization, and targeted cyber attacks.
Trend Micro hasn’t participated in Virus Bulletin (www.virusbtn.com ) testing since 2008. They finished second in the AV-comparatives (www.av-comparatives.com ) "September 2012 Antivirus File Detection Test of Malicious software", however.
About Virus Bulletin www.virusbtn.com
UK based Virus Bulletin started in 1989. They provide PC users with a regular source of intelligence about computer viruses, their prevention, detection, and removal, and how to recover programs and data following an attack. The Virus Bulletin website is at www.virusbtn.com
About AV-comparatives www.av-comparatives.org
AV-Comparatives is an Austrian Non-Profit-Organization, which is providing independent Antivirus software tests free to the public. Go to their website to view all the great comparative reports and surveys they publish. A great number of their reports are free.