Western Digital Corp. (NYSE: WDC) announced Thursday fourth quarter losses are expected to be in the range of 90 cents a share to 98 cents a share. Wall Street was expecting a loss of 51 cents a share.
Western Digital makes disk drives and is getting creamed amid tough competition. It closed yesterday at $6.88 a share, down from a 52-week high of $21.43.
"The competitive pricing environment has been much more aggressive than we expected this quarter," said Chuck Haggerty, Western Digital chairman, president and chief executive officer, in a press release.
Western Digital indicated pricing pressures were particularly tough in the desktop drive product line, which accounts for nearly 90 percent of its revenue.
The estimate excludes a previously announced restructuring charge of $20 million associated with the sale of its media business. A decision was also made to reduce production of desktop drives this quarter to avoid excess inventory, making expected shipments 5.5 million units, compared with March quarter shipments of 5.1 million units.
Western Digital competes with other disk drive manufacturing stocks such as Seagate (NYSE: SEG), Quantum (Nasdaq: QNTM), and Komag Inc. (Nasdaq: KMAG), which have been under pressure (chart).