Seagate Technology 3Q net income jumps on sales

Seagate Technology shares climb as 3Q net income rises sharply, sales almost double

Associated Press

CUPERTINO, Calif. (AP) -- Shares of Seagate Technology PLC jumped in after-hours trading Tuesday after the hard-drive maker reported that its fiscal third-quarter profit surged and revenue almost doubled.

The company said that during the quarter ended March 30 it earned net income of $1.14 billion, or $2.48 per share. That's up from $93 million, or 21 cents per share, in the same quarter a year ago. Revenue was $4.45 billion, compared to $2.70 billion in the year-ago period.

Seagate's adjusted net income, excluding one-time items like stock-based compensation, was $2.64 per share.

Analysts expected adjusted net income of $2.10 per share on revenue of $4.37 billion, according to FactSet.

CEO Steve Luczo said the company benefited from a general recovery in the market for hard drives. But Seagate also shifted its product line to "industry-leading products" across all of its markets, he said in a statement.

Even as its revenue soared, costs rose more slowly. That widened the company's profit margins. Seagate's cost of revenue was $2.8 billion in the quarter, up 27 percent from to $2.2 billion in the prior year period.

During the quarter, the company bought back $1.1 billion of its shares. Seagate also said that its board approved a quarterly dividend of 25 cents per share, which the company will pay on May 17 to shareholders of record on May 2.

Share rose $1.02, or 3.7 percent, to $28.91 in aftermarket trading. The stock had fallen 62 cents, or 2 percent, to close at $27.89 during the regular session. Shares have traded between $9.05 and $29 in the past 52 weeks.

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