Western Digital Shares Slide on Lower Forecast

It posted higher first-quarter earnings that beat estimates

   

Western Digital (NASDAQ:WDC) announced quarterly results that topped Wall Street estimates, but warned of a weaker-than-expected current quarter, sending it shares tumbling.

The company said it earned $519 million during its fiscal first quarter, more than twice the $239 million it earned in the same period last year. Adjusted EPS came in at $2.36, topping the $2.29 that Wall Street had forecast, Reuters noted. Revenue jumped 50% from last year to $4.04 billion.

12499015 electronic chip on circuit board 200x200 Western Digital Shares Slide on Lower Forecast
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The company projected a current-quarter profit of between $1.65 and $1.85 a share on revenue ranging from $3.55 billion to $3.7 billion. That estimate disappointed analysts, who had expected earnings of $2.40 a share and revenue of $4.08 billion for the second quarter.

Investors were unhappy with the guidance, sending Western Digital shares down more than 3% in Tuesday morning trading.

First-quarter revenue and earnings were boosted by the March acquistion of Hitachi‘s (PINK:HTHIY) data storage business.

Company officials indicated that a sluggish worldwide economy had crimped demand for computer storage products.

Western Digital wasn’t the only tech company expecting a soft current quarter. Computer chipmaker Texas Instruments (NASDAQ:TXN) reported lower third-quarter revenue that beat estimates, but predicted lower-than-expected fourth-quarter sales due to a sluggish economy.


Article printed from InvestorPlace Media, http://investorplace.com/2012/10/western-digital-shares-slide-on-weak-forecast/.

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