Trend Micro Reports Results for Q4 and Fiscal Year 2009

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Tokyo, Japan – February 18, 2010 – Trend Micro Incorporated (TSE: 4704), a global leader in Internet content security, announced earnings results for the fourth quarter and consolidated revenue for fiscal year 2009, ending December 31, 2009.

For the fourth quarter, Trend Micro posted consolidated net sales of 24,339 million Yen (or US $271 million, 89.72 JPY = 1USD). The company posted operating income of 7,479 million Yen (or US $83 million) and net income of 3,568 million Yen (or US $39 million) for the quarter. These figures reflect a 1 percent increase in net sales compared to the same period a year ago.

In Japan, sales for the fourth quarter experienced a 1 percent decrease from the same period last year.  North American sales fell 4 percent; European sales increased 4 percent; Asia Pacific sales increased 16 percent; and Latin America sales increased 20 percent. 
 

For 2009, Trend Micro posted consolidated net sales of 96,346 million Yen (or US $1,029 million, 93.59JPY=1USD). The company also reported operating income of 30,137 million Yen (or US $322 million) and net income of 17,638 million Yen (or US $188 million). Revenues from products and services sold to enterprise, mid-sized and small business customers worldwide comprised 66 percent of 2009 revenues; revenue from consumer products comprised the remaining 34 percent.
 

 “Our important alliances with key industry leaders this year have proven Trend Micro’s ability to provide ‘security that fits,’ positioning us as one of the pivotal leaders driving the cloud security phenomenon,” said Eva Chen, CEO. “Our mission to deliver customizable and scalable solutions for customers by providing the fastest response possible to unpredictable threats is complemented by our push to protect virtualized environments, the cloud and the dynamic datacenter.”
 

Based on information currently available to the company, consolidated net sales for the first quarter ending March 31, 2010 is expected to be 23,400 million Yen (or US $260 million, based on an exchange rate of 90 JPY = 1USD). Operating income and net income are expected to be 5,700 million Yen (or US $63 million) and 3,600 million Yen (or US $40 million), respectively.

Growth rate figures are calculated from Japanese Yen results. Some discrepancy may therefore be noted in US Dollar comparisons owing to fluctuations in currency conversion rates.
 

Q4 2009 Business Highlights

Trend Micro announced Threat Management Services, a new security layer for threat discovery, containment, and remediation. The new overwatch service targets threats that have evaded conventional security so enterprises gain increased protection, greater visibility and less management complexity.

Delivering on its commitment to “security that fits,” Trend Micro announced strategic alliances with key industry leaders, including RSA Security, AvePoint, Citrix, Phoenix Technologies, Samsung and Wipro Technologies. These relationships will enable Trend Micro to enhance and create new security product offerings that fit into any IT infrastructure.

Trend Micro advanced its server security strategy to extend protection for physical, virtualized and cloud-based servers. The company introduced the latest version of Trend Micro™ Deep Security 7.

The Trend Micro™ Smart Protection Network™ reached a new milestone this quarter with over 4 billion threats blocked a day.

Awards and Recognition for Q4 2009

Corporate

 
Trend Micro’s chairman and founder Steve Chang was honored with the “Lifetime Achievement Award” during the CNBC 2009 Asia Business Leader Awards. The award honors leaders who have made significant contributions in shaping, growing and developing the economic landscape.

Eva Chen was named “One of the 25 Most Influential Executives of 2009” by Everything Channel’s CRN.
 
Eva Chen was honored by Astia, which recognizes women innovators, with the Technology Innovator Award.

Trend Micro was selected to be a finalist as Channel Partner of the Year in 2010 Network Computing Awards.

  
Products and Innovation

Trend Micro™ Worry-Free Business Security 6.0 received a 4-star rating in V3.co.uk, which stated that “this new release of Worry-Free Business Security Advanced delivers a high level of security with far less impact on users and their PC resources.”
 

Trend Micro™ Internet Security was selected by PC Magazine Russia to be included in its “Best Software List.”
 

Trend Micro™ Internet Security received a 5-star comparative review in Computer Shopper U.K.
 

Trend Micro™ LeakProof and Trend Micro™ Office Scan were nominated as SC Award Finalists, which honors those companies and individuals whose innovative products and services have most strongly contributed to the vitality of the IT security industry in North America.
 

Trend Micro™ Internet Security Pro received a positive comparative review in Fortune Small Business. The reviewer praised the product’s ease-of-use and installation, all without slowing down her computer.
 

Trend Micro™ HouseCall received a “Good” rating by PC Magazine, which concluded that the free tool was more effective at removing commercial keyloggers than other free solutions.
 

Trend Micro™ InterScan Web Security Virtual Appliance, InterScan Messaging Security Virtual Appliance, and Advanced Reporting and Management received overall positive reviews in Network World, which noted Trend Micro’s strengths in reporting and malware blocking.    
 

Trend Micro Internet Security Pro was praised by Laptop Magazine for its virus and malware protection, tune-up utilities, online backup and most especially for its parental controls.

Trend Micro™ AntiVirus + AntiSpyware was reviewed by TopTenREVIEWS, which remarked that it’s “another great desktop antivirus software, combining a healthy dose of security features with simple usability. The software is well equipped to protect your computer from a number of threats with proactive technology and real-time protection.”

Patents

Trend Micro was awarded the following patents in Q4 2009:

Patent No. 7606214Anti-Spam Implementations in a Router at the Network Layer 

Patent No. 7613205 Token-Assignment Networks over Ethernet and Methods

Patent No. 7624435 Method And Apparatus For Managing Digital Assets  

Patent No. 7630982 Fast Identification of Complex Strings Data Stream  

Patent No. 7634262  Virus Pattern Update for Mobile Device  

Patent No. 7634479 Pre-Populating Local URL Rating Cache  

Patent No. 7636716  Method and Architecture for Blocking Email Spams  

Patent No. 7640434  System and Method for Identifying  Undesirable Content

Notice Regarding Forward-looking Statements

Certain statements that we make in this release are forward-looking statements. These forward-looking statements are based upon management’s current assumptions and beliefs in light of the information currently available to it, but involve known and unknown risks and uncertainties. Many important factors could cause our actual results to differ materially from those expressed in our forward-looking statements. These factors include:
• Difficulties in addressing new virus and other computer security problems
• Timing of new product introductions and lack of market acceptance for our new products
• The level of continuing demand for, and timing of sales of, our existing products
• Rapid technological change within the antivirus software industry
• Changes in customer needs for antivirus software
• Existing products and new product introductions by our competitors and the pricing of those products
• Declining prices for products and services
• The effect of future acquisitions on our financial condition and results of operations
• The effect of adverse economic trends on our principal markets
• The effect of foreign exchange fluctuations on our results of operations
* An increase in the incidence of product returns
• The potential lack of attractive investment targets and
• Difficulties in successfully executing our investment strategy

We assume no obligation to update any forward-looking statements. For more details regarding risk factors relating to our future performance, please refer to our filings with the U.S. Securities and Exchange Commission.

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