Months after announcing plans for a new CEO as well as the axing of nearly 3,000 jobs, disk vendor Seagate Technology LLC has revealed it expects to post a first-quarter profit above Wall Street expectations.
For the first quarter of fiscal 2005 ending October 1, Seagate expects quarterly earnings of $0.06 to $0.08 per share, excluding any restructuring charges, on revenue of $1.48 billion to $1.52 billion. Analysts had expected the company’s earnings to be $0.03 per share on revenue of $1.47 billion.
According to the Scotts Valley, California-based company, demand for disk drives appears stronger than in the previous quarter. The company said its guidance includes a gain of about $18 million from the discontinuation of a post-retirement medical plan.
However, Seagate warned that desktop product sales are running flat, which is uncharacteristic for the quarter. The company also expects average unit prices for its products to fall by three to four percent for the quarter based on declines in mobile computing storage product prices and moderation in lower prices for enterprise storage products.
In June, Seagate announced plans to cut its workforce by seven percent, or almost 3,000 jobs, in a move designed to cut costs by $150 million a year. The company also appointed Bill Watkins as CEO and president.