Updated from 8:31 a.m. EDT

Investors knocked 8% off the value of Seagate ( STX) Wednesday after the disk-drive maker warned that March quarter earnings would fall well below expectations. But analysts said the problems appear to be specific to Seagate and don't reflect weakening demand in the broader tech sector.

Seagate shares were recently down $1.23 to $14.36.

The trouble at Seagate is mostly due to a slight inventory build-up at major customer Hewlett-Packard ( HPQ), which ordered too many notebook PCs late last year.

H-P is still working through the inventory, though it's likely to be mostly cleared up by the end of its April quarter, said Goldman Sachs' Laura Conigliaro. In the meantime, Seagate could continue to be affected through its June quarter, the company cautioned Tuesday.

Granted, Seagate isn't the only big tech player to be stymied by an inventory build-up. In March, Intel ( INTC) shares took a hit after the chipmaker reduced the midpoint of its quarterly sales guidance, flagging a slight inventory build overseas. Though the chipmaker said the overhang had been worked through by early March, the news was enough to prompt a slew of downward earnings revisions.

But despite the painful admissions from Seagate (and to a much lesser extent, Intel), the March quarter appears to be mostly on track for tech companies. Though Nokia's ( NOK) warning earlier this week rattled some investors, the tech business is actually looking much more solid this quarter than last year. According to Thomson First Call, technology companies have so far issued 168 negative preannouncements and 133 positive announcements (out of a pool of over 1000 companies), leading to a ratio of 1.3 to 1 of negative to positive comments.

By comparison, the average ratio in all of 2003 stood at 1.7 to 1. And last year at this time, when technology purchases dropped off sharply before the war in Iraq, the ratio was 2.4.

Investors may get more news on tech trends late Wednesday, when some analysts expect computer giant Dell ( DELL) to affirm earnings guidance ahead of its annual meeting the next day.

In a note out Monday, Merrill Lynch analyst Steve Milunovich noted Dell's management "seems optimistic about a recovery in corporate PC demand (stronger employment numbers help) and lower component prices," both trends that bode well for technology hardware in general.

Meanwhile, analysts on Wednesday slammed Seagate for its seeming cluelessness, noting it has now reined in its forecast three times for the quarter.

That "rais es pretty serious questions about the kind of visibility the company actually has," said Conigliaro. When it last issued comments on March 2 , with two-thirds of the quarter wrapped up, Seagate "was still looking at forecasts that were three times higher than where they seem to have actually ended the quarter," she pointed out.

J.P. Morgan slashed its rating on the stock from an overweight to an underweight. Wrote analyst Bill Shope, "The unexpected fall-off in Seagate notebook market share demonstrates that the December quarter was an anomaly for the company. The issue is that Seagate's market share was temporarily lifted because of a year-end push by H-P."

In fact, even with the unexpected boost, Seagate still came up short on sales and earnings in its December quarter .

In any case, Shope said, the shortfall in notebooks for the March quarter suggests Seagate's 12% share isn't sustainable, meaning the company will find it harder to offset soft prices for hard drives in the enterprise and desktop segments.

Late Tuesday, Seagate said it expects to post earnings per share of 6 cents to 8 cents for the fiscal third quarter ending April 2, excluding a 25-cent benefit from an income tax credit. In January, Seagate had predicted earnings between 20 cents and 30 cents a share.

Leading up to Seagate's latest announcement, Wall Street analysts were expecting earnings of 21 cents on sales of $1.523 billion, according to estimates from Thomson First Call.

In a press release, Seagate characterized demand for the quarter as "modestly weaker than normal seasonal patterns" in general, but noted it was especially hurt by weak sales of hard-disk drives for laptops.

The company said it had been too optimistic in pegging the market for mobile storage products at 14 million to 14.5 million units in the quarter. Instead, the total market likely was closer to 13 million to 13.5 million units. Seagate shipped 1 million mobile storage units, for an 8% share.

Flagging the potential for continuing problems, Seagate said a backlog in the mobile storage market had created a "supply imbalance that may cause further uncertainty into the June quarter."

Sales of personal storage products also declined due to Seagate's decision not to slash prices at the end of the quarter, the company said. It estimated that the market for personal storage products likely stood at about 46 million to 47 million units in the quarter, below the range of 47 million units to 48 million units that it outlined on March 2.

Finally, Seagate said the enterprise storage products market was slightly above its original forecast, at 5.2 million units instead of 5 million units. But it said it was hurt by relatively weak sales into the distribution channel.

Seagate will deliver its earnings report on April 20.