Seagate Technology Holdings
shares are promoting off on Wednesday even after the corporate reported monetary outcomes for the fiscal fourth quarter ended June 30 that had been forward of Street forecasts.
Apparently, traders wished an even bigger beat than the corporate delivered—and the corporate supplied steerage for fiscal 2022 that suggests disappointing decelerating development.
Seagate inventory (ticker: STX) was down 4%, at $82.09, in current buying and selling. The
was up 0.7%.
Expectations for the disk-drive maker had ratcheted increased heading into the quarter, pushed by a mix of upper IT spending, development in cloud computing, and the adoption of high-capacity disk drives by cryptocurrency miners—and the outcomes presumably didn’t meet the whisper numbers.
For the quarter, Seagate posted income of $3 billion, up 20% from the year-ago interval and forward of the Street consensus at $2.95 billion. Non-GAAP income had been $2 a share, topping the Street consensus at $1.84. Under usually accepted accounting ideas, the corporate earned $2.07 a share, up from 64 cents.
Revenue topped the $3 billion stage for the primary time in six years—and non-GAAP income had been the very best in 9 years. Non-GAAP gross margin expanded to 29.6%, from 27.3% a 12 months in the past, whereas non-GAAP working margin jumped to 18.1%, from 14.8% a 12 months in the past.
Seagate purchased again 2.6 million shares within the June quarter, rising the full quantity bought for the complete 12 months to 33.6 million and decreasing share rely by about 13%.
“Demand for data is rapidly accelerating in the cloud and at the edge, driving secular growth for mass capacity data storage,” Seagate CEO
stated in an announcement. “Seagate’s industry-leading product portfolio for mass data infrastructure places the company in an outstanding position to capitalize on robust demand trends, generate solid and increasing free cash flow and achieve our long-term financial objectives.”
For the September quarter, Seagate is projecting income of $3.1 billion, give or take $150 million, with non-GAAP income of $2.20 a share, give or take 15 cents. Previous Street consensus was $2.94 billion and $1.85 a share.
The firm stated on a convention name with analysts Wednesday morning that it expects income development within the 2021 calendar second half of about 15%, with fiscal 2022 income development within the excessive single digits or higher. The Street’s conclusion from these feedback is that development goes to decelerate, which explains the slide within the inventory worth.
Wedbush analyst Matt Bryson writes in a analysis observe that the steerage “implies substantial deceleration and even revenue declines” within the fiscal 2022 second half. Bryson provides that given the disk-drive trade’s “historic lack of visibility,” the forecast needs to be “significantly deemphasized.”
Write to Eric J. Savitz at [email protected]