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Seagate: Fiscal 1Q15 Financial Results

All figures up sequentially

(in $ million) 1Q14 1Q15
Revenue 3,489 3,785
Growth   8%
Net income (loss) 427 381

Seagate Technology plc reported financial results for the first quarter of fiscal year 2015 ended October 3, 2014.

For the first quarter, the company reported revenue of approximately $3.8 billion, gross margin of 27.8%, net income of $381 million and diluted earnings per share of $1.13. On a non-GAAP basis, which excludes the net impact of certain items, it reported gross margin of 28.1%, net income of $453 million and diluted earnings per share of $1.34.

During the first quarter, the company generated approximately $602 million in operating cash flow, paid cash dividends of $140 million and repurchased approximately 3 million ordinary shares for $183 million. There were 327 million ordinary shares issued and outstanding as of the end of the quarter. Cash, cash equivalents, restricted cash, and short-term investments totaled approximately $2.2 billion at the end of the quarter.

We achieved strong financial results in the first fiscal quarter, driven by consistent execution and better-than-anticipated market demand for our PC and cloud storage products,” said Steve Luczo, Seagate’s chairman and CEO. “We continue to improve our position in the evolving storage market by leveraging and investing in our core storage technology and expanding our product portfolio with cloud systems and solutions and integrated flash technology. We remain confident in our cash flow generation and the opportunities ahead for Seagate as evidenced by our recently announced target annual dividend increase of 26% to $2.16.”

Quarterly Cash Dividend
As previously disclosed on October 22, 2014, the board of directors has approved a quarterly cash dividend of $0.54 per share, which will be payable on November 25, 2014 to shareholders of record as of the close of business on November 11, 2014. The payment of any future quarterly dividends will be at the discretion of the board and will be dependent upon Seagate’s financial position, results of operations, available cash, cash flow, capital requirements and other factors deemed relevant by the board.

Comments

All the figures are better compared to the former quarter: revenue up 15%, net income 19%, total HDDs shipped 13% - including enterprise 19%, desktop 2%, notebook 20%, CE 18% and branded units 19%, - average gigabyte per drive 7%, exabytes shipped 3%. HDD ASP is stable at $60.

To date Seagate has sold 12 million hybrid drives.

As industry estimates are for the market demand to be approximately 145 million units in the October-December period, the company expects to achieve revenue of $3.7 billion next quarter.

To read the earnings call transcript

 Seagate's HDDs From 4FQ12 to 1FQ15
 (units in million)

  Enterprise Desktop Notebook CE Branded Total
HDDs
ASP Exabyte
Shipped*
Average
G
B/Drive
4Q12 8.5 23.9 22.4 7.4 3.9 65.9 $67 45.5 690
1Q13 6.3 20.4 20.3 5.8 5.2 58.0 $63 42.5 731
2Q13 7.3 21.9 17.3 5.6 6.0 58.2 $62 47.9 823
3Q13 7.5 19.6 17.0 5.8 5.7 55.7 $63 47.2 848
4Q13 8.2 18.6 16.1 6.1 4.8 53.9 $63 45.9 852
1Q14 8.1 19.1 17.2 6.2 5.1 55.7 $62 48.9 878
2Q14  7.8  19.2 16.9 6.7 6.2 56.6 $62  52.2 922
3Q14 7.7 19.8 16.4 5.4 5.9 56.2 $61 50.8 920
4Q14 7.4 18.4 16.8 5.1 4.8 52.5 $60 49.6 945
1Q15 8.8 18.7 20.2 6.0 5.7 59.5 $60 50.9 1,007

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