Seagate Technology Q3 Earnings Fail To Meet Expectations, But Shares Rise

Seagate Technology plc STX disclosed that it suffered a net loss of $21 million or a loss of $0.07 a share in the first quarter. In comparison, the company earned a profit of $291 million or $0.88 a share in the year-ago quarter.

On an adjusted basis, Seagate's net income would have plunged 86.2 percent to $66 million from $477 million while earnings plummeted 86 percent to $0.22 a share from $1.57 a share in the previous year quarter.

The company's top line fell 22.1 percent to $2.6 billion from $3.33 billion in the same quarter last year. Street analysts expected the storage firm to report earnings of $0.37 a share and revenue of $2.6 billion.

Seagate's Chairman and CEO, Steve Luczo, said "Our quarterly results fell short of our expectations as a result of several near-term demand factors. Despite these challenges, we believe we have the product portfolio, technology roadmap and operational leverage to ensure we are well-positioned for long-term success. Accordingly, we are aggressively working to position Seagate to respond to new demand levels and are committed to ongoing financial discipline."

Luczo added, "Although the short-term dynamics of our industry are challenging, we continue to see significant and growing Exabyte demand, particularly as enterprise applications shift to cloud environments. As we look forward, our strategic focus is unchanged -- we are broadening our storage portfolio to meet the needs of our growing global customer base, building upon our strong competitive position and optimizing our business for continued financial performance. These focus areas will enable us to build lasting value for shareholders."

The Company indicated it generated approximately $205 million in operating cash flow and paid cash dividends of $188 million in the three-month period January - March. At the end of the quarter, its cash, cash equivalents and short-term investments totaled approximately $1.2 billion.

In pre-market trading on Friday, the stock traded 0.74 percent higher.