said consumer appetites for bigger hard drives will help it post better-than-expected revenue and a pro forma profit in the current fourth quarter. The company also said it is cutting 500 positions.
The bullish forecast comes two days before industry leader
is set to sell a billion-dollar initial offering to the public following two years as a private company owned by buyout firms and its management.
Milpitas, Calif.-based Maxtor said fourth-quarter revenue will be $990 million to $1.03 billion, compared with analysts' average estimate of $966 million, as compiled by Thomson Financial/First Call. The company expects to lose between $43 million and $53 million using standard accounting. Excluding intangibles amortization and severance charges, the company expects to turn a pro forma profit of $25 million to $35 million, or 10 cents to 14 cents a share. The First Call consensus, which excludes amortization, is for a loss of 5 cents a share.
Maxtor, the No. 3 disk drive maker behind Seagate and
, attributed the results to success in ramping up new 60- and 80-gigabyte disks, strong demand for desktop and server hard disk drives, and a favorable pricing environment.
Despite the higher guidance, the company said it's in the process of cutting 500 positions in the U.S., a move that will have "minimal benefit in the fourth quarter, but will provide significant expense reduction in the quarters ahead."
Seagate is hoping to sell 17.5% of its shares at $13 to $15 each in a deal led by Morgan Stanley and Salomon Smith Barney. The proposed ticker is STX.