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Seagate stock drops as lower consumer demand triggers earnings, outlook miss – News Opener

Seagate Technology Holdings PLC shares dropped in the extended session Thursday after the data-storage-device company said a slowdown in consumer demand led to quarterly results and an outlook that fell short of Wall Street forecasts.

Seagate
STX,
+1.88%

shares fell as much as 15% after hours, following a halt before the release of results. In the regular session, the stock rose 1.9% to close at $83.61.

The company reported fiscal fourth-quarter net income of $276 million, or $1.27 a share, compared with $482 million, or $2.07 a share, in the year-ago period. Adjusted earnings were $1.59 a share, compared with $2 a share in the year-ago period.

Revenue declined to $2.63 billion from $3.01 billion in the year-ago quarter.

Analysts surveyed by FactSet had forecast earnings of $1.89 a share on revenue of $2.79 billion.

“Our June-quarter results reflect stable mass capacity storage demand, offset by the impacts of COVID restrictive measures in Asia and weakening global economic conditions on our other end markets,” said Dave Mosely, Seagate’s chief executive, in a statement. “These impacts were most pronounced in our consumer-facing legacy markets.”

“The confluence of macro-related challenges is continuing into the September quarter,” Mosely said. “In this environment, we are reducing our production plans to maintain supply discipline as our customers manage through macro uncertainty and ongoing non-HDD component shortages, and we are diligently managing expenses to protect profitability.”

Seagate expects first-quarter earnings of $1.20 to $1.60 a share on revenue of $2.35 billion to $2.65 billion, while analysts had forecast $2.22 a share on revenue of $3 billion.

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