warned after the bell on Tuesday that March quarter results, hurt by weak shipments of its hard disc drives for notebook computers, will fall far below guidance. The company also said the problems in the mobile market could spill over into the quarter ending in June.
In after hours trading Tuesday, Seagate shares plunged $1.12, or 7.2%, to $14.47. In regular trading on the Big Board, the stock closed down 7 cents to $15.59.
The news follows Seagate's announcement on March 2 that quarterly results would fall at the
low end of previous guidance. At the time Seagate didn't divulge specifics.
Late Tuesday, the company 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 disc 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 was likely 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.