Sourcefire Inc. announced yesterday that its chief executive is stepping down as the Columbia network security company struggles to meet Wall Street expectations after going public a year ago.

Chief Executive Officer E. Wayne Jackson III said he is leaving after six years to pursue other opportunities. Jackson intends to stay on until the board hires a successor.

Jackson's announcement came as the company, whose intrusion-prevention technology is designed to thwart network hackers, reported that fourth-quarter profit dropped 59 percent even as revenue increased.

Net income of $808,000, or 3 cents per share, in the three months that ended Dec. 31 was held down by higher-than-expected operating expenses. A year ago, the company reported a profit of $2 million, or 25 cents per share.

After overseeing the company's growth from a startup to a public company, Jackson said it was the "appropriate time to transition to new leadership that will take this company to the next level."

Started in the living room of founder and Chief Technology Officer Martin F. Roesch's Eldersburg home in 2001, Sourcefire has grown to a company with industry-leading technology and offices around the world.

The company made headlines in October 2005 when it announced it would be acquired by Israeli-based Check Point Software Technologies Ltd. for $225 million.

However, the acquisition raised national security concerns - Sourcefire holds contracts for protecting sensitive government networks - and came under investigation by the Committee on Foreign Investment in the United States. Check Point pulled out of the deal in March 2006.

In October of that year, Sourcefire filed an application for an initial public offering.

Sourcefire's trademark open-source intrusion-prevention technology, called Snort, sparked excitement and widespread interest in the March 2007 IPO. Shares sold for $15 a piece, raising more than $70 million.

Since then, the stock has dropped more than 50 percent.

Shares rose 7 cents to close at $6.54 yesterday on the Nasdaq stock market. The company released earnings after the market closed.

Fourth-quarter revenue climbed 21 percent to $19.3 million, from $16 million a year ago. Analysts polled by Thomson Financial expected $20 million in sales.

Operating expenses, including research and development, sales and marketing and general administrative costs, rose 47 percent to $15 million. That's compared with $10 million in the fourth quarter of 2006.

Jackson told analysts in a conference call yesterday that general and operating expenses associated with being a public company were substantially higher than the company had planned.

Excluding charges for stock-based compensation, amortization and payments related to an acquisition, Sourcefire said fourth-quarter net income was $2.6 million, or 10 cents per share. Analysts expected 14 cents.

For the year, the company reported a loss of $5.6 million, compared with a loss of $932,000 in 2006.

Last year's net loss included a $2.9 million charge related to the acquisition of open-source antivirus project ClamAV in the third quarter.

Sourcefire said revenue was $55.9 million in 2007, compared with $44.9 million in 2006.

In a separate move, the company announced yesterday that it will split the roles of chief executive officer and chairman.

The board appointed Joseph R. Chinnici, who served as its lead outside director, as nonexecutive chairman.

hanah.cho@baltsun.com

The Associated Press contributed to this article.