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Western Digital Profit Falls 44%

Western Digital Profit Falls 44%
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Western Digital Corp. (WDC: Quote) said Wednesday after the markets closed that its fourth quarter profit fell 44% from last year, as revenue dropped due to lower hard-drive shipments.

However, the company's quarterly earnings per share, excluding items, came in above analysts' expectations as did its quarterly revenue.

"I am pleased with our performance in fiscal year 2013 and the June quarter, reflecting our expanding participation in the storage market, including the cloud and personal storage as we address the ongoing growth in digital data," said Steve Milligan, president and chief executive officer of Western Digital.

Western Digital shares are currently losing 5.23% in after hours trading after closing the day's regular trading session at $67.53, down 30 cents. The shares trade in a 52-week range of $31.42 to $70.61.

For the fourth quarter ended June 28, 2013, the Irvine, California-based company reported net income of $416 million or $1.71 per share, compared to $745 million, or $2.87 per share for the year-ago quarter.

Excluding items, adjusted net income for the fourth quarter was $477 million or $1.96 per share, compared to $872 million, or $3.35 per share in the prior year quarter.

On average, 22 analysts polled by Thomson Reuters expected the company to earn $1.81 per share for the fourth quarter. Analysts' estimates typically exclude special items.

Revenue for the fourth quarter fell 21.5% to $3.73 billion from $4.75 billion a year ago. Twenty analysts had a consensus revenue estimate of $3.63 billion for the fourth quarter.

The company shipped 59.9 million hard-drives during the fourth quarter quarter, down 16% from 71.0 million units in the prior year quarter.

During the fourth quarter, the company repurchased 4.4 million shares of its common stock for $235 million.

The Court of Appeals of the State of Minnesota has reversed the decision of the District Court of Hennepin County, Minnesota, which had vacated a $630.4 million final arbitration award against Western Digital and ordered a rehearing of certain claims in the arbitration between Western Digital and Seagate Technology, LLC.

Western Digital said Wednesday that it is reviewing the appeals court decision and will make a determination of whether or not to record an accrual in its fourth quarter results after it completes its review.

Earlier Wednesday, rival Seagate Technology plc (STX) reported a 66% drop in fourth quarter profit on sharply lower revenues.

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by RTT Staff Writer

For comments and feedback: editorial@rttnews.com

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