Hard-disk drive maker Western Digital Corp. (WDC) reported Tuesday a profit for the first quarter that declined 15 percent from last year, despite improved gross margins and revenue growth, reflecting higher operating expenses.
However, adjusted earnings per share and quarterly revenues topped analysts' expectations. The company also provided earnings and revenue guidance for the second quarter, below Street view.
"We achieved solid revenue, gross margins and EPS in the September quarter, along with continued strong cash flow generation, as the company continued its crisp execution and consistent financial performance," President and CEO Steve Milligan said in a statement.
The Irvine, California-based company reported net income of $423 million or $1.76 per share for the first quarter, lower than $495 million or $2.05 per share for the prior-year quarter.
Excluding items, adjusted net income for the quarter was $504 million or $2.10 per share, compared to $514 million or $2.12 per share in the year-ago quarter.
On average, analysts polled by Thomson Reuters expected the company to report earnings of $2.03 per share for the quarter. Analysts' estimates typically exclude special items.
Net revenue for the quarter increased to $3.94 billion from $3.80 billion in the same quarter last year, and topped twenty Wall Street analysts' consensus estimates of $3.89 billion.
Gross margin for the quarter improved 20 basis points to 29.1 percent from last year's 28.9 percent. Total operating expenses totaled $680 million, up from $542 million in the year-ago quarter.
"We were pleased to see strength and momentum in our capacity enterprise hard drive and flash platform solutions businesses. Our client and branded products businesses were seasonally strong as expected and our performance enterprise business was steady. Overall, we believe industry dynamics are stable in terms of supply and demand and inventory levels," Milligan added.
During a conference call with analysts, the company said it expects adjusted earnings for the second quarter in a range of $2.00 to $2.10 per share, on projected revenues between $3.75 billion to $3.85 billion. Street is currently looking for earnings of $2.20 per share on revenues of $3.90 billion for the quarter.
Western Digital's Dublin, Ireland-based rival Seagate Technology plc (STX) on Monday reported a profit for the first quarter that declined from last year, despite revenue growth amid improved shipments, reflecting lower gross margin and higher operating expenses.
WDC closed Tuesday's regular trading session at $93.08, up $0.13 or 0.14% on a volume of 2.70 million shares. However, the stock gained $1.22 or 1.31% in after-hours trading.
For comments and feedback contact: editorial@rttnews.com
Business News