Seagate cuts its Q4 revenue guidance on weaker-than-estimated demand

Seagate Technology (NASDAQ:STX), a computer storage device maker, cut its revenue guidance for the most recent quarter on weaker-than-expected demand.

For the period ended July 3, the Cupertino, California-based company said it expects to post revenue of roughly $2.9 billion, compared with its previous estimate of $3.2 billion to $3.3 billion.

20 analysts on average had been modeling revenue of $3.2 billion, according to Capital IQ data.

It also lowered its outlook for fourth-quarter gross margin, pointing to lower than expected intra-quarter demand.

Seagate has been aiming to diversify its offerings in a shifting marketplace. During April, the company reported that its earnings fell 26 percent for the quarter ended in March, citing poor economic conditions.

Further, the company expects adjusted operating expenses for the fourth quarter of about $530 million, below its previous forecast for adjusted operating expenses of about $555 million.

Seagate expects to report unit shipments for the fiscal fourth quarter of approximately 45 million, maintaining approximately 40 percent market share and reflecting approximately 52 exabytes. 

Seagate will report its fiscal fourth quarter and year-end 2015 financial results before the market opens on July 31. 

Shares were trading at $46.25, up 0.7 percent, at 1:59 p.m. in Toronto, reversing an earlier loss to a 52-week low of $44.46. The stock has lost 30 percent so far this year.

In a separate statement, Seagate said it is extending its relationship with International Business Machines 

Seagate is integrating IBM Spectrum Scale software with its ClusterStor High Performance Computing or HPC storage to deliver a new software defined storage appliance. The company noted that the new product will yield productivity and efficiency gains for rapidly expanding data intensive markets.

The new appliance will help users manage the demands of data-intensive workloads, such as genomic research, computer aided design, digital media, data analytics, financial model analysis and electronic design simulations.

Seagate expect its new software defined storage appliance to be available from its sales partners late in 2015.