We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Seagate (STX) Slashes Q1 Outlook Amid Macroeconomic Weakness
Read MoreHide Full Article
Seagate Technology Holdings plc (STX - Free Report) slashed the outlook for the first quarter of fiscal 2023 amid a deteriorating global macro-economic environment.
Seagate noted that since its last earnings call in July 2022, several Asian countries are facing weaker-than-expected economic trends, leading to increased customer inventory corrections and exacerbated supply chain disruptions. Cautious spending patterns by customers, including global Enterprise, OEMs and certain domestic cloud clients, are likely to affect demand for mass capacity solutions in the near term.
To safeguard itself from the ongoing global economic disturbances, Seagate is focused on lowering production output, cutting costs and streamlining the current year’s capital investment plan.
Seagate Technology Holdings PLC Price and Consensus
The company now expects revenues to be $2.1 billion (+/- $100 million) against previous guidance of revenues of $2.5 billion (+/- $150 million).
Due to lower revenues, less favorable product mix and higher under-utilization charges are expected to result in a quarter-over-quarter margin decline. As a result, non-GAAP earnings per share are now expected to be “meaningfully below” the company’s previous guidance of at least $1.20 per share in the fiscal first quarter.
Despite the myriad economic woes, Seagate added that it expects to witness strong demand for its 20 terabyte products in the long haul. It remains on track for revenue and volume crossover with the 18-terabyte platform in the current quarter.
The company’s transition to higher capacity drives bodes well as it offsets lower business volumes and higher component costs. Continued momentum in demand for mass capacity storage as well as strengthening enterprise and video and image applications (VIA) markets augur well.
In the last reported quarter, Seagate delivered non-GAAP earnings of $1.59 per share, missing the Zacks Consensus Estimate of $1.89. The bottom line declined 21% from the year-ago quarter’s figure and 12% sequentially. Non-GAAP revenues of $2.628 billion missed the Zacks Consensus Estimate by 6.3%. The figure declined 13% on a year-over-year basis and fell 6% sequentially.
At present, Seagate carries a Zacks Rank #5 (Strong Sell). Shares have lost 25.2% compared with the industry’s decline of 62.6% in the past year.
The Zacks Consensus Estimate for CDNS 2022 earnings is pegged at $4.11 per share, rising 5.7% in the past 60 days. The long-term earnings growth rate is anticipated to be 17.7%.
Cadence’s earnings beat the Zacks Consensus Estimate in the last four quarters, the average being 9.8%. Shares of CDNS have jumped 5.1% in the past year.
The Zacks Consensus Estimate for BMI’s 2022 earnings is pegged at $2.30 per share, up 6% in the past 60 days.
Badger Meter’s earnings beat the Zacks Consensus Estimate in three of the preceding four quarters, with the average being 12.6%. Shares of BMI have lost 10.8% of their value in the past year.
The Zacks Consensus Estimate for Arista Network’s 2022 earnings is pegged at $4.04 per share, increasing 9.8% in the past 60 days. The long-term earnings growth rate is anticipated to be 18.6%.
Arista Network’s earnings beat the Zacks Consensus Estimate in the last four quarters, the average being 10.1%. Shares of ANET have increased 31.8% in the past year
Unique Zacks Analysis of Your Chosen Ticker
Pick one free report - opportunity may be withdrawn at any time
Image: Bigstock
Seagate (STX) Slashes Q1 Outlook Amid Macroeconomic Weakness
Seagate Technology Holdings plc (STX - Free Report) slashed the outlook for the first quarter of fiscal 2023 amid a deteriorating global macro-economic environment.
Seagate noted that since its last earnings call in July 2022, several Asian countries are facing weaker-than-expected economic trends, leading to increased customer inventory corrections and exacerbated supply chain disruptions. Cautious spending patterns by customers, including global Enterprise, OEMs and certain domestic cloud clients, are likely to affect demand for mass capacity solutions in the near term.
To safeguard itself from the ongoing global economic disturbances, Seagate is focused on lowering production output, cutting costs and streamlining the current year’s capital investment plan.
Seagate Technology Holdings PLC Price and Consensus
Seagate Technology Holdings PLC price-consensus-chart | Seagate Technology Holdings PLC Quote
The company now expects revenues to be $2.1 billion (+/- $100 million) against previous guidance of revenues of $2.5 billion (+/- $150 million).
Due to lower revenues, less favorable product mix and higher under-utilization charges are expected to result in a quarter-over-quarter margin decline. As a result, non-GAAP earnings per share are now expected to be “meaningfully below” the company’s previous guidance of at least $1.20 per share in the fiscal first quarter.
Despite the myriad economic woes, Seagate added that it expects to witness strong demand for its 20 terabyte products in the long haul. It remains on track for revenue and volume crossover with the 18-terabyte platform in the current quarter.
The company’s transition to higher capacity drives bodes well as it offsets lower business volumes and higher component costs. Continued momentum in demand for mass capacity storage as well as strengthening enterprise and video and image applications (VIA) markets augur well.
In the last reported quarter, Seagate delivered non-GAAP earnings of $1.59 per share, missing the Zacks Consensus Estimate of $1.89. The bottom line declined 21% from the year-ago quarter’s figure and 12% sequentially. Non-GAAP revenues of $2.628 billion missed the Zacks Consensus Estimate by 6.3%. The figure declined 13% on a year-over-year basis and fell 6% sequentially.
At present, Seagate carries a Zacks Rank #5 (Strong Sell). Shares have lost 25.2% compared with the industry’s decline of 62.6% in the past year.
Image Source: Zacks Investment Research
Stocks to Consider
Some better-ranked stocks from the broader technology space are Cadence Design Systems (CDNS - Free Report) , Badger Meter (BMI - Free Report) and Arista Networks (ANET - Free Report) . All stocks sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for CDNS 2022 earnings is pegged at $4.11 per share, rising 5.7% in the past 60 days. The long-term earnings growth rate is anticipated to be 17.7%.
Cadence’s earnings beat the Zacks Consensus Estimate in the last four quarters, the average being 9.8%. Shares of CDNS have jumped 5.1% in the past year.
The Zacks Consensus Estimate for BMI’s 2022 earnings is pegged at $2.30 per share, up 6% in the past 60 days.
Badger Meter’s earnings beat the Zacks Consensus Estimate in three of the preceding four quarters, with the average being 12.6%. Shares of BMI have lost 10.8% of their value in the past year.
The Zacks Consensus Estimate for Arista Network’s 2022 earnings is pegged at $4.04 per share, increasing 9.8% in the past 60 days. The long-term earnings growth rate is anticipated to be 18.6%.
Arista Network’s earnings beat the Zacks Consensus Estimate in the last four quarters, the average being 10.1%. Shares of ANET have increased 31.8% in the past year