Seagate bought back 2.6 million shares in the June quarter.
shares are selling off on Wednesday even after the company reported financial results for the fiscal fourth quarter ended June 30 that were ahead of Street forecasts. Apparently, investors wanted a bigger beat than the company delivered.
Seagate stock (ticker: STX) was down 5.6%, at $80.70, in recent trading. The
was up 0.6%.
Expectations for the disk-drive maker had ratcheted higher heading into the quarter, driven by a combination of higher IT spending, growth in cloud computing, and the adoption of high-capacity disk drives by cryptocurrency miners—and the results presumably didn’t meet the whisper numbers.
For the quarter, Seagate posted revenue of $3 billion, up 20% from the year-ago period and ahead of the Street consensus at $2.95 billion. Non-GAAP profits were $2 a share, topping the Street consensus at $1.84. Under generally accepted accounting principles, the company earned $2.07 a share, up from 64 cents.
Revenue topped the $3 billion level for the first time in six years—and non-GAAP profits were the highest in nine years. Non-GAAP gross margin expanded to 29.6%, from 27.3% a year ago, while non-GAAP operating margin jumped to 18.1%, from 14.8% a year ago.
“Demand for data is rapidly accelerating in the cloud and at the edge, driving secular growth for mass capacity data storage,” Seagate CEO
said in a statement. “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 revenue of $3.1 billion, give or take $150 million, with non-GAAP profits of $2.20 a share, give or take 15 cents; previous Street consensus was $2.94 billion and $1.85 a share. The company said on a conference call with analysts Wednesday morning that it expects fiscal 2022 revenue growth in the high single digits or better.
Seagate bought back 2.6 million shares in the June quarter, increasing the total number purchased for the full year to 33.6 million and reducing share count by about 13%.
Write to Eric J. Savitz at firstname.lastname@example.org