Storage maker Seagate Technology
posted weak gains across the board for the quarter as expected,
but still missed expectations thanks to legal costs and restructuring charges.
Seagate stock closed at 39 1/16,
up from yesterday's close of 37-3/4. The
company announced earnings after the markets closed.
Seagate issued two earnings warnings this quarter, citing slow demand for
its higher-end products. Seagate reported a net income of $59.3 million, or
23 cents a share, compared to a net income of $101 million, or 46 cents a
share last year.
Wall Street analysts were expecting 66 cents a share, according to First Call. Analysts originally were
expecting profits of 94 cents a share, but they revised estimates after the
company warned last month of lower revenues.
During the quarter, Seagate incurred one-time charges of $153 million as a
result of legal costs associated with a case brought by Amstrad PLC, which charged that the Scotts Valley, California, company sold it faulty disk drives,
almost ruining its business. The
company also took a $2.5 million charge in relation to the restructuring of
the company's Seagate Software subsidiary.
Without these charges, and their related taxes, the fully diluted income
per share for the quarter would have been 61 cents a share, still missing
Revenue also shrunk to $1.98 billion for its fourth quarter, down from $2
billion recorded for the same period a year ago.