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Seagate Tech Stalls

The hard-drive maker guides below Street estimates, but revenue rises.
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Updated from 5:18 p.m. EDT

Seagate Technology

(STX) - Get Free Report

on Tuesday guided current, or fourth-quarter earnings and sales substantially below consensus.

Income for the quarter ended March 30 fell to $212 million, or 37 cents a share, from $274 million, or 53 cents a share, a year ago.

Revenue, which came in at $2.83 billion, rose roughly 24% year over year, edging out the consensus of $2.8 billion.

Excluding approximately $62 million in charges associated with recent acquisitions, the company, which makes computer hard drives, earned 47 cents in the third quarter, short of First Call analysts' expectations of 51 cents.

Shares slumped 5.9%, or $1.25, to $20.90 in recent after-hours trading.

For the current quarter, excluding items, Seagate sees EPS of 34 cents to 38 cents vs. a consensus of 52 cents. Sales are expected to range between $2.65 billion and $2.75 billion, short of analyst forecasts of $2.81 billion.

According to CEO Bill Watkins, the company "clearly miscalculated the market, and in this unusually challenging environment failed to deliver the projected results. However, it is worth noting that the fundamentals of our business and that of the industry remain solid."

Shares closed regular trading off 39 cents to $22.15.