Seagate Plunges After Clocking 35% Revenue Decline In Q1; Misses Consensus; To Axe 3K Jobs

• Seagate Technology Holdings PLC (NASDAQ: STX) reported a first-quarter FY23 revenue decline of 34.7% year-over-year to $2.04 billion, missing the consensus of $2.10 billion.

• Adjusted EPS of $0.48 missed the consensus of $0.76.

• Adjusted gross margin contracted by 650 bps to 24.5%, and adjusted operating margin declined by 1,110 bps to 9%.

• STX generated $112 million in free cash flow and held $761 million in cash and equivalents.

• Dividend: STX declared a quarterly cash dividend of $0.70 per share.

• "Global economic uncertainties and broad-based customer inventory corrections worsened in the latter stages of the September quarter, and these dynamics are reflected in both near-term industry demand and Seagate's financial performance," CEO Dave Mosley said.

• Cost Restructuring: STX plans to reduce its worldwide headcount by 3,000 employees, or 8% of the global workforce, along with other cost-saving measures.

• It expects to realize run-rate savings of $110 million on an annualized basis starting in Q3.

• Q2 Guidance: Seagate sees revenue of $1.70 billion - $2.00 billion, below consensus of $2.21 billion; and Non-GAAP EPS of $(0.05) - $0.35, below consensus of $0.94.

• Price Action: STX shares are trading lower by 8.62% at $53.00 on the last check Wednesday.

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