Click here to close now.

Welcome!

Big Data Journal Authors: Carmen Gonzalez, Liz McMillan, Greg O'Connor, Elizabeth White, Aria Blog

News Feed Item

Seagate Technology Reports Fiscal Second Quarter 2013 Financial Results

Seagate Technology plc (NASDAQ: STX) (the “Company”) today reported financial results for the quarter ended December 28, 2012. During the fiscal second quarter, the Company reported revenue of approximately $3.7 billion, shipping 58 million units. On a GAAP basis, Seagate reported gross margin of 27.0%, net income of $492 million and diluted earnings per share of $1.30. On a non-GAAP basis, which excludes the net impact of certain items, Seagate reported gross margin of 27.6%, net income of $523 million and diluted earnings per share of $1.38. Cash flow from operations in the quarter was $844 million and the Company returned $1.1 billion to shareholders in dividends and share redemptions. Cash, cash equivalents, restricted cash, and short-term investments totaled approximately $2.0 billion at the end of the fiscal second quarter.

“Seagate is executing well in an environment where customer demand forecasting is challenging,” said Steve Luczo, Seagate’s chairman, president and chief executive officer. “Looking ahead, we will continue to manage our business conservatively to the demand environment, focus on profitability and effectively invest for market leadership in storage for mobility, cloud and open source. Creating value for shareholders remains a top priority, and in the first half of fiscal 2013, we returned over 95% of operating cash flows through share redemptions and dividends.”

For a detailed reconciliation of GAAP to non-GAAP results, see accompanying financial tables.

Seagate has issued a Supplemental Commentary document. The Supplemental Commentary will not be read during today's call, but rather it is available in the investors section of seagate.com.

Quarterly Cash Dividend

The Board of Directors approved an increase in our quarterly cash dividend to $0.38 per share which was paid on December 28, 2012, rather than in the March 2013 quarter. 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.

Investor Communications

Seagate management will hold a public webcast today at 2:00 p.m. Pacific Time that can be accessed on its Investor Relations website at www.seagate.com/investors. During today's webcast, the Company will provide an outlook for its third fiscal quarter of 2013 including key underlying assumptions.

Replay

A replay will be available beginning today at approximately 6:00 p.m. Pacific Time at www.seagate.com/investors.

About Seagate

Seagate is a world leader in hard disk drives and storage solutions. Learn more at www.seagate.com.

Cautionary Note Regarding Forward-Looking Statements

This press release contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934, each as amended, including, in particular, statements about our plans, strategies and prospects and estimates of industry growth for the fiscal quarter ending March 29, 2013 and beyond. These statements identify prospective information and include words such as “expects,” “plans,” “anticipates,” “believes,” “estimates,” “predicts,” “projects” and similar expressions. These forward-looking statements are based on information available to the Company as of the date of this press release and are based on management's current views and assumptions. These forward-looking statements are conditioned upon and also involve a number of known and unknown risks, uncertainties, and other factors that could cause actual results, performance or events to differ materially from those anticipated by these forward-looking statements. Such risks, uncertainties, and other factors may be beyond the Company’s control and may pose a risk to the Company’s operating and financial condition. Such risks and uncertainties include, but are not limited to: the uncertainty in global economic conditions, as consumers and businesses may defer purchases in response to tighter credit and financial news; the impact of the variable demand and adverse pricing environment for disk drives, particularly in view of current business and economic conditions; dependence on the Company’s ability to successfully qualify, manufacture and sell its disk drive products in increasing volumes on a cost-effective basis and with acceptable quality, particularly the new disk drive products with lower cost structures; the impact of competitive product announcements; possible excess industry supply with respect to particular disk drive products; and the Company’s ability to achieve projected cost savings in connection with restructuring plans. Information concerning additional factors that could cause results to differ materially from those projected in the forward-looking statements are contained in the Company's Annual Report on Form 10-K as filed with the SEC on August 8, 2012 and Quarterly Report on Form 10-Q as filed with the SEC on October 31, 2012, which statements are incorporated into this press release by reference. These forward-looking statements should not be relied upon as representing the Company’s views as of any subsequent date and the Company undertakes no obligation to update forward-looking statements to reflect events or circumstances after the date they were made.

 

SEAGATE TECHNOLOGY PLC

CONDENSED CONSOLIDATED BALANCE SHEETS

(In millions)

(Unaudited)

   
December 28,
2012

    June 29,    
2012

ASSETS
Current assets:
Cash and cash equivalents $ 1,383 $ 1,707
Short-term investments 489 411
Restricted cash and investments 98 93
Accounts receivable, net 1,648 2,319
Inventories 800 909
Deferred income taxes 112 104
Other current assets 487   767
Total current assets 5,017 6,310
Property, equipment and leasehold improvements, net 2,228 2,284
Goodwill 476 463
Other intangible assets, net 480 506
Deferred income taxes 409 396
Other assets, net 132   147
Total Assets $ 8,742   $ 10,106
LIABILITIES AND EQUITY
Current liabilities:
Accounts payable $ 1,685 $ 2,286
Accrued employee compensation 287 344
Accrued warranty 195 235
Accrued expenses 473 531
Current portion of long-term debt 3  
Total current liabilities 2,643 3,396
Long-term accrued warranty 135 128
Long-term accrued income taxes 84 84
Other non-current liabilities 140 138
Long-term debt, less current portion 2,815   2,863
Total Liabilities 5,817 6,609
 
Equity:
Total Equity 2,925   3,497
Total Liabilities and Equity $ 8,742   $ 10,106

The information as of June 29, 2012 was derived from the Company’s audited Consolidated Balance Sheet as of June 29, 2012.

   

SEAGATE TECHNOLOGY PLC

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(In millions, except per share data)

(Unaudited)

 
For the Three Months Ended For the Six Months Ended
December 28,
2012
  December 30,
2011
December 28,
2012
  December 30,
2011
Revenue $ 3,668 $ 3,195 $ 7,400 $ 6,007
 
Cost of revenue 2,676 2,185 5,347 4,448
Product development 277 259 545 467
Marketing and administrative 139 141 289 245
Amortization of intangibles 20 2 39 3
Restructuring and other, net 1   3   1   3  
Total operating expenses 3,113   2,590   6,221   5,166  
 
Income from operations 555 605 1,179 841
 
Interest income 2 2 4 3
Interest expense (55 ) (58 ) (111 ) (127 )
Other, net (3 ) 9   27   (8 )
Other expense, net (56 ) (47 ) (80 ) (132 )
 
Income before income taxes 499 558 1,099 709
Provision for (benefit from) income taxes 7   (5 ) 25   6  
Net income 492 563 1,074 703
Less: Net income attributable to noncontrolling interest        
Net income attributable to Seagate Technology plc $ 492   $ 563   $ 1,074   $ 703  
 
Net income per share attributable to Seagate Technology plc ordinary shareholders:
Basic $ 1.33 $ 1.32 $ 2.81 $ 1.66
Diluted 1.30 1.28 2.73 1.61
Number of shares used in per share calculations:
Basic 369 427 382 424
Diluted 379 439 394 436
 
Cash dividends declared per Seagate Technology plc ordinary share $ 0.70 $ 0.18 $ 1.02 $ 0.36
 

SEAGATE TECHNOLOGY PLC

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In millions)

(Unaudited)

 
For the Six Months Ended
December 28,
2012
  December 30,
2011
OPERATING ACTIVITIES
Net income $ 1,074 $ 703
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization 430 373
Share-based compensation 36 26
Deferred income taxes (11 ) (4 )
Gain on sale of strategic investments (33 )
Gain on sale of property and equipment (8 ) (14 )
Loss on redemption of debt 6 5
Other non-cash operating activities, net 5 10
Changes in operating assets and liabilities:
Accounts receivable, net 683 (130 )
Inventories 156 181
Accounts payable (496 ) (500 )
Accrued employee compensation (62 ) 56
Accrued expenses, income taxes and warranty (97 ) (34 )
Other assets and liabilities 293   207  
Net cash provided by operating activities 1,976   879  
 
INVESTING ACTIVITIES
Acquisition of property, equipment and leasehold improvements (427 ) (361 )
Proceeds from the sale of property and equipment 4 9
Purchases of short-term investments (168 ) (309 )
Sales of short-term investments 125 260
Maturities of short-term investments 21 115
Proceeds from the sale of strategic investments 42 (5 )
Cash used in acquisition of LaCie S.A., net of cash acquired (36 )
Cash used in acquisition of Samsung HDD assets and liabilities (561 )
Other investing activities, net (14 ) 9  
Net cash used in investing activities (453 ) (843 )
 
FINANCING ACTIVITIES
Repayments of long-term debt and capital lease obligations (58 ) (594 )
Repurchases of ordinary shares (1,510 ) (191 )
Dividends to shareholders (377 ) (154 )
Proceeds from issuance of ordinary shares under employee stock plans 168 51
Escrow deposit for acquisition of noncontrolling shares of LaCie S.A. (72 )  
Net cash used in financing activities (1,849 ) (888 )
Effect of foreign currency exchange rate changes on cash and cash equivalents 2    
Decrease in cash and cash equivalents (324 ) (852 )
Cash and cash equivalents at the beginning of the period 1,707   2,677  
Cash and cash equivalents at the end of the period $ 1,383   $ 1,825  
 

Use of non-GAAP financial information

To supplement the condensed consolidated financial statements presented in accordance with generally accepted accounting principles (GAAP), the Company provides non-GAAP measures of net income, diluted net income per share and gross margin as a percentage of revenue, which are adjusted from results based on GAAP to exclude certain expenses, gains and losses. These non-GAAP financial measures are provided to enhance the user's overall understanding of the Company’s current financial performance and our prospects for the future. Specifically, the Company believes non-GAAP results provide useful information to both management and investors as these non-GAAP results exclude certain expenses, gains and losses that we believe are not indicative of our core operating results and because it is consistent with the financial models and estimates published by financial analysts who follow the Company.

These non-GAAP results are some of the primary measurements management uses to assess the Company’s performance, allocate resources and plan for future periods. Reported non-GAAP results should only be considered as supplemental to results prepared in accordance with GAAP, and not considered as a substitute for, or superior to, GAAP results. These non-GAAP measures may differ from the non-GAAP measures reported by other companies in our industry.

 

SEAGATE TECHNOLOGY PLC

ADJUSTMENTS TO GAAP NET INCOME AND DILUTED NET INCOME PER SHARE

(In millions, except per share amounts)

(Unaudited)

   

For the Three
Months
Ended
December 28,
2012

For the Six
Months
Ended
December 28,
2012

 
GAAP net income $ 492 $ 1,074
Non-GAAP adjustments:
Cost of revenue A 19 39
Product development B 3 7
Marketing and administrative C (17 ) (13 )
Amortization of intangibles D 20 39
Restructuring and other, net D 1 1
Other expense, net E 5   (30 )
Non-GAAP net income $ 523   $ 1,117  
 
Diluted net income per share:
GAAP $ 1.30 $ 2.73
 
Non-GAAP $ 1.38 $ 2.84
 
Shares used in diluted net income per share calculation 379 394
 

A

  For the three months ended December 28, 2012, Cost of revenue on a GAAP basis totaled $2,676 million, while non-GAAP Cost of revenue, which excludes the net impact of certain adjustments, was $2,657 million. For the six months ended December 28, 2012, Cost of revenue on a GAAP basis totaled $5,347 million, while non-GAAP Cost of revenue, which excludes the net impact of certain adjustments, was $5,308 million. The non-GAAP adjustments include amortization of intangibles and other acquisition related expenses associated with the December 2011 acquisition of Samsung Electronics Co., Ltd's hard disk drive business (the "Samsung HDD business") and the August 2012 acquisition of LaCie S.A. ("LaCie").
 

B

For the three and six months ended December 28, 2012, Product development expense has been adjusted on a non-GAAP basis to exclude the net impact of acquisition and integration costs associated with the acquisition of the Samsung HDD business.
 

C

For the three and six months ended December 28, 2012, Marketing and administrative expense has been adjusted on a non-GAAP basis to exclude the net impact of legal cost reimbursements, which were partially offset by acquisition and integration costs associated with the acquisitions of Samsung's HDD business and LaCie.
 

D

For the three and six months ended December 28, 2012, Amortization of intangibles related to our Samsung HDD business and LaCie acquisitions and Restructuring and other, net, primarily related to prior year restructuring plans, have been excluded on a non-GAAP basis.
 

E

For the three months ended December 28, 2012, Other expense has been adjusted on a non-GAAP basis primarily to exclude the net impact of a loss recognized on the redemption of certain of our 7.75% senior notes.
 
For the six months ended December 28, 2012, Other expense has been adjusted on a non-GAAP basis primarily to exclude the net impact of a gain recognized upon sales of certain strategic investments, partially offset by a loss recognized on the redemption of certain of our 7.75% senior notes.

More Stories By Business Wire

Copyright © 2009 Business Wire. All rights reserved. Republication or redistribution of Business Wire content is expressly prohibited without the prior written consent of Business Wire. Business Wire shall not be liable for any errors or delays in the content, or for any actions taken in reliance thereon.

@BigDataExpo Stories
The world's leading Cloud event, Cloud Expo has launched Microservices Journal on the SYS-CON.com portal, featuring over 19,000 original articles, news stories, features, and blog entries. DevOps Journal is focused on this critical enterprise IT topic in the world of cloud computing. Microservices Journal offers top articles, news stories, and blog posts from the world's well-known experts and guarantees better exposure for its authors than any other publication. Follow new article posts on T...
SYS-CON Events announced today the IoT Bootcamp – Jumpstart Your IoT Strategy, being held June 9–10, 2015, in conjunction with 16th Cloud Expo and Internet of @ThingsExpo at the Javits Center in New York City. This is your chance to jumpstart your IoT strategy. Combined with real-world scenarios and use cases, the IoT Bootcamp is not just based on presentations but includes hands-on demos and walkthroughs. We will introduce you to a variety of Do-It-Yourself IoT platforms including Arduino, Ras...
With the arrival of the Big Data revolution, a data professional is expected to master a broad spectrum of complex domains including data processing, mathematics, programming languages, machine learning techniques, and business knowledge. While this mastery is undoubtedly important, this narrow focus on tool usage has divorced many from the imagination required to solve real-world problems. As the demand for analysis increases, the data science community must transform from tool experts to "data...
SYS-CON Events announced today that Emcien will exhibit at SYS-CON's 16th International Cloud Expo®, which will take place on June 9-11, 2015, at the Javits Center in New York City, NY. Emcien’s vision is to let anyone use data to know the future. Emcien has built an automated, predictive analysis product that improves the lives of real people. Emcien allows people to automate their data analysis so they can build a better future.
Containers and microservices have become topics of intense interest throughout the cloud developer and enterprise IT communities. Accordingly, attendees at the upcoming 16th Cloud Expo at the Javits Center in New York June 9-11 will find fresh new content in a new track called PaaS | Containers & Microservices Containers are not being considered for the first time by the cloud community, but a current era of re-consideration has pushed them to the top of the cloud agenda. With the launch ...
SOA Software has changed its name to Akana. With roots in Web Services and SOA Governance, Akana has established itself as a leader in API Management and is expanding into cloud integration as an alternative to the traditional heavyweight enterprise service bus (ESB). The company recently announced that it achieved more than 90% year-over-year growth. As Akana, the company now addresses the evolution and diversification of SOA, unifying security, management, and DevOps across SOA, APIs, microser...
SYS-CON Events announced today that Creative Business Solutions will exhibit at SYS-CON's 16th International Cloud Expo®, which will take place on June 9-11, 2015, at the Javits Center in New York City, NY. Creative Business Solutions is the top stocking authorized HP Renew Distributor in the U.S. Based out of Long Island, NY, Creative Business Solutions offers a one-stop shop for a diverse range of products including Proliant, Blade and Industry Standard Servers, Networking, Server Options and...
The concept of a cloud facilitating applications is by no means new. Those of us who diagrammed network connectivity around 1993 will recall drawing a big puffy cloud symbol in between two local area networks. The cloud represented the mysterious Internet – that mash-up of routers and other items bouncing our packets back and forth through millions of ports, only to reassemble the bytes on the other end into – hopefully — the same item that was sent. Today, we have dissipated that nebulous clou...
Businesses are looking to empower employees and departments to do more, go faster, and streamline their processes. For all workers – but mobile workers especially – utilizing the cloud to reconnect documents and improve processes without destructing existing workflows can have a dramatic impact on productivity. In his session at 16th Cloud Expo, Mark Grilli, vice president of Acrobat Solutions marketing at Adobe Systems Incorporated, will outline new ways that the cloud is changing the way peo...
The list of ‘new paradigm’ technologies that now surrounds us appears to be at an all time high. From cloud computing and Big Data analytics to Bring Your Own Device (BYOD) and the Internet of Things (IoT), today we have to deal with what the industry likes to call ‘paradigm shifts’ at every level of IT. This is disruption; of course, we understand that – change is almost always disruptive.
SYS-CON Events announced today that QTS Realty Trust, one of the nation’s largest and fastest-growing providers of data center facilities and cloud services and a leader in security and compliance, will exhibit at SYS-CON's 16th International Cloud Expo®, which will take place on June 9-11, 2015, at the Javits Center in New York City, NY. QTS Realty Trust, Inc. (NYSE: QTS) is a leading national provider of data center solutions and fully managed services, and a leader in security and compliance...
SYS-CON Events announced today that Solgenia will exhibit at SYS-CON's 16th International Cloud Expo®, which will take place on June 9-11, 2015, at the Javits Center in New York City, NY, and the 17th International Cloud Expo®, which will take place on November 3–5, 2015, at the Santa Clara Convention Center in Santa Clara, CA. Solgenia is the global market leader in Cloud Collaboration and Cloud Infrastructure software solutions. Designed to “Bridge the Gap” between Personal and Professional S...
When it comes to building applications, one database definitely does not fit all. Traditional SQL databases are great for storing highly structured, normalized data and performing analytics and reporting. NoSQL has attracted developers with its awesome flexibility, and JSON-centric document stores like Cloudant make web developers incredibly productive by offering a JavaScript environment from end-to-end. Recent Big Data challenges have driven the need for a distributed approach to analytics e...
SYS-CON Events announced today that SafeLogic has been named “Bag Sponsor” of SYS-CON's 16th International Cloud Expo® New York, which will take place June 9-11, 2015, at the Javits Center in New York City, NY. SafeLogic provides security products for applications in mobile and server/appliance environments. SafeLogic’s flagship product CryptoComply is a FIPS 140-2 validated cryptographic engine designed to secure data on servers, workstations, appliances, mobile devices, and in the Cloud....
After making a doctor’s appointment via your mobile device, you receive a calendar invite. The day of your appointment, you get a reminder with the doctor’s location and contact information. As you enter the doctor’s exam room, the medical team is equipped with the latest tablet containing your medical history – he or she makes real time updates to your medical file. At the end of your visit, you receive an electronic prescription to your preferred pharmacy and can schedule your next appointment...
SYS-CON Events announced today that Cisco, the worldwide leader in IT that transforms how people connect, communicate and collaborate, has been named “Gold Sponsor” of SYS-CON's 16th International Cloud Expo®, which will take place on June 9-11, 2015, at the Javits Center in New York City, NY. Cisco makes amazing things happen by connecting the unconnected. Cisco has shaped the future of the Internet by becoming the worldwide leader in transforming how people connect, communicate and collaborat...
Docker is an excellent platform for organizations interested in running microservices. It offers portability and consistency between development and production environments, quick provisioning times, and a simple way to isolate services. In his session at DevOps Summit at 16th Cloud Expo, Shannon Williams, co-founder of Rancher Labs, will walk through these and other benefits of using Docker to run microservices, and provide an overview of RancherOS, a minimalist distribution of Linux designed...
SYS-CON Events announced today that Vitria Technology, Inc. will exhibit at SYS-CON’s @ThingsExpo, which will take place on June 9-11, 2015, at the Javits Center in New York City, NY. Vitria will showcase the company’s new IoT Analytics Platform through live demonstrations at booth #330. Vitria’s IoT Analytics Platform, fully integrated and powered by an operational intelligence engine, enables customers to rapidly build and operationalize advanced analytics to deliver timely business outcomes ...
Are your applications getting in the way of your business strategy? It’s time to rethink your IT approach. In his session at 16th Cloud Expo, Madhukar Kumar, Vice President, Product Management at Liaison Technologies, will discuss a new data-centric approach to IT that allows your data, not applications, to inform business strategy. By moving away from an application-centric IT model where data integration and analysis are subservient to the constraints of applications, your organization will b...
SYS-CON Events announced today that Liaison Technologies, a leading provider of data management and integration cloud services and solutions, has been named "Silver Sponsor" of SYS-CON's 16th International Cloud Expo®, which will take place on June 9-11, 2015, at the Javits Center in New York, NY. Liaison Technologies is a recognized market leader in providing cloud-enabled data integration and data management solutions to break down complex information barriers, enabling enterprises to make sm...