have been tumbling Friday immediately after memory-tech peer
blamed weaker-than-predicted earnings and a shaky product sales outlook on a rough economic environment.
(ticker: STX) stock was down 13% in premarket buying and selling Friday soon after the company said it was lessening its prepared creation in reaction to softer need. Seagate claimed earnings for each share of $1.59 on earnings of $2.6 billion, missing Wall Street’s estimates of $2.78 billion in product sales and the company’s possess forecast of $2.8 billion. The earnings determine fell perfectly quick of the $1.89 a share expected by analysts.
The earnings—and probably the macro impression, in particular—had a very poor read through-across for peers
(MU), which missing 5% in the premarket session, and
(WDC), which drop 6%.
“The confluence of macro-similar issues is continuing into the September quarter,” Seagate Chief Executive Dave Mosely mentioned in a statement. The information storage team blamed the effects of Covid-19 restrictions in Asia and the consequences of a weaker international economy for offsetting “stable mass capacity storage desire.”
It will get even worse for the quarter ending in September. Seagate expects profits of $2.5 billion in the 3rd quarter—with a margin of $150 million—which is considerably below the $3.03 billion Wall Street experienced expected.
“Seagate missed equally major and bottom line [June quarter] estimates, while the [September quarter] manual also arrived perfectly beneath the consensus and pushed by weakness across all segments,” Mehdi Hosseini, an analyst at Susquehanna Global Group, wrote in a observe Thursday.
“Given the weak [September quarter] information of $2.5 billion of revenue at the midpoint, Seagate would require to hit an regular of quarterly profits of $3.05 billion (in the vicinity of record revenues) through a downturn to attain their concentrate on,” Hosseini included.
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