Gen Digital Inc (NASDAQ:GEN) stock fell 8.06% (As on February 3, 11:07:12 AM UTC-4, Source: Google Finance) after the company reported better-than-expected third-quarter fiscal 2023 results. The monthly direct average revenue per user decreased to $7.09 from $8.62 in the year-ago quarter. The quarterly bookings increased 29% on a year-over-year basis to $966 million. Gen Digital’s average direct customer count increased to 38.4 million from 24.2 million in the year-ago quarter. Before the Avast acquisition, NortonLifeLock’s customer retention rate was slightly more than 85%. However, including Avast’s customer base and online customers, the aggregate retention rate for Gen Digital fell to 75% at the third-quarter end. The non-GAAP gross profit grew 34% year over year to $816 million from $610 million. Moreover, the gross margin expanded by 60 basis points (bps) to 87.2%. The non-GAAP operating income for the third quarter of fiscal 2023 totaled $526 million, up 41% year over year. The non-GAAP operating margin expanded by 340 bps to 56.2%, mainly due to an increased gross margin, cost synergies resulting from the NortonLifeLock and Avast merger and disciplined spending. Gen Digital exited the third quarter with cash and cash equivalents of $812 million compared with the previous quarter’s $1.1 billion. The long-term debt was $9.83 billion, down from $9.88 billion in the previous quarter.

GEN in the third quarter of FY 23 has reported the adjusted earnings per share of 45 cents, beating the analysts’ estimates for the adjusted earnings per share of 42 cents, according to the Zacks Consensus Estimate. The company had reported the adjusted revenue growth of 33 percent to $936 million in the third quarter of FY 23, beating the analysts’ estimates for revenue of $929.2 million. The robust top line was mainly driven by the inclusion of the Avast business, improved customer experiences and international business expansion. However, the negative impact of unfavorable foreign currency exchange rates hurt revenues by approximately $34 million. Direct customer revenues increased to $818 million from the $624 million reported in the year-ago quarter. Partner revenues improved by 39.7% to $95 million from the $68 million reported a year ago. The company generated operating and free cash flows of $306 million and $305 million, respectively, in the third quarter of fiscal 2023. In the first nine months of fiscal 2023, it generated operating and free cash flows of $433 million and $428 million, respectively.