Click here to close now.




















Welcome!

@CloudExpo Authors: Cloud Best Practices Network, Dana Gardner, Eric Aarrestad, Liz McMillan, Adrian Bridgwater

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.

@CloudExpo Stories
With SaaS use rampant across organizations, how can IT departments track company data and maintain security? More and more departments are commissioning their own solutions and bypassing IT. A cloud environment is amorphous and powerful, allowing you to set up solutions for all of your user needs: document sharing and collaboration, mobile access, e-mail, even industry-specific applications. In his session at 16th Cloud Expo, Shawn Mills, President and a founder of Green House Data, discussed h...
The Software Defined Data Center (SDDC), which enables organizations to seamlessly run in a hybrid cloud model (public + private cloud), is here to stay. IDC estimates that the software-defined networking market will be valued at $3.7 billion by 2016. Security is a key component and benefit of the SDDC, and offers an opportunity to build security 'from the ground up' and weave it into the environment from day one. In his session at 16th Cloud Expo, Reuven Harrison, CTO and Co-Founder of Tufin,...
SYS-CON Events announced today that MobiDev, a software development company, will exhibit at the 17th International Cloud Expo®, which will take place November 3–5, 2015, at the Santa Clara Convention Center in Santa Clara, CA. MobiDev is a software development company with representative offices in Atlanta (US), Sheffield (UK) and Würzburg (Germany); and development centers in Ukraine. Since 2009 it has grown from a small group of passionate engineers and business managers to a full-scale mobi...
There are many considerations when moving applications from on-premise to cloud. It is critical to understand the benefits and also challenges of this migration. A successful migration will result in lower Total Cost of Ownership, yet offer the same or higher level of robustness. In his session at 15th Cloud Expo, Michael Meiner, an Engineering Director at Oracle, Corporation, analyzed a range of cloud offerings (IaaS, PaaS, SaaS) and discussed the benefits/challenges of migrating to each offe...
Chuck Piluso presented a study of cloud adoption trends and the power and flexibility of IBM Power and Pureflex cloud solutions. Prior to Secure Infrastructure and Services, Mr. Piluso founded North American Telecommunication Corporation, a facilities-based Competitive Local Exchange Carrier licensed by the Public Service Commission in 10 states, serving as the company's chairman and president from 1997 to 2000. Between 1990 and 1997, Mr. Piluso served as chairman & founder of International Te...
Mobile, social, Big Data, and cloud have fundamentally changed the way we live. “Anytime, anywhere” access to data and information is no longer a luxury; it’s a requirement, in both our personal and professional lives. For IT organizations, this means pressure has never been greater to deliver meaningful services to the business and customers.
In their session at 17th Cloud Expo, Hal Schwartz, CEO of Secure Infrastructure & Services (SIAS), and Chuck Paolillo, CTO of Secure Infrastructure & Services (SIAS), provide a study of cloud adoption trends and the power and flexibility of IBM Power and Pureflex cloud solutions. In his role as CEO of Secure Infrastructure & Services (SIAS), Hal Schwartz provides leadership and direction for the company.
Container technology is sending shock waves through the world of cloud computing. Heralded as the 'next big thing,' containers provide software owners a consistent way to package their software and dependencies while infrastructure operators benefit from a standard way to deploy and run them. Containers present new challenges for tracking usage due to their dynamic nature. They can also be deployed to bare metal, virtual machines and various cloud platforms. How do software owners track the usag...
Explosive growth in connected devices. Enormous amounts of data for collection and analysis. Critical use of data for split-second decision making and actionable information. All three are factors in making the Internet of Things a reality. Yet, any one factor would have an IT organization pondering its infrastructure strategy. How should your organization enhance its IT framework to enable an Internet of Things implementation? In his session at @ThingsExpo, James Kirkland, Red Hat's Chief Arch...
Malicious agents are moving faster than the speed of business. Even more worrisome, most companies are relying on legacy approaches to security that are no longer capable of meeting current threats. In the modern cloud, threat diversity is rapidly expanding, necessitating more sophisticated security protocols than those used in the past or in desktop environments. Yet companies are falling for cloud security myths that were truths at one time but have evolved out of existence.
Digital Transformation is the ultimate goal of cloud computing and related initiatives. The phrase is certainly not a precise one, and as subject to hand-waving and distortion as any high-falutin' terminology in the world of information technology. Yet it is an excellent choice of words to describe what enterprise IT—and by extension, organizations in general—should be working to achieve. Digital Transformation means: handling all the data types being found and created in the organizat...
Public Cloud IaaS started its life in the developer and startup communities and has grown rapidly to a $20B+ industry, but it still pales in comparison to how much is spent worldwide on IT: $3.6 trillion. In fact, there are 8.6 million data centers worldwide, the reality is many small and medium sized business have server closets and colocation footprints filled with servers and storage gear. While on-premise environment virtualization may have peaked at 75%, the Public Cloud has lagged in adop...
SYS-CON Events announced today that HPM Networks will exhibit at the 17th International Cloud Expo®, which will take place on November 3–5, 2015, at the Santa Clara Convention Center in Santa Clara, CA. For 20 years, HPM Networks has been integrating technology solutions that solve complex business challenges. HPM Networks has designed solutions for both SMB and enterprise customers throughout the San Francisco Bay Area.
The time is ripe for high speed resilient software defined storage solutions with unlimited scalability. ISS has been working with the leading open source projects and developed a commercial high performance solution that is able to grow forever without performance limitations. In his session at Cloud Expo, Alex Gorbachev, President of Intelligent Systems Services Inc., shared foundation principles of Ceph architecture, as well as the design to deliver this storage to traditional SAN storage co...
MuleSoft has announced the findings of its 2015 Connectivity Benchmark Report on the adoption and business impact of APIs. The findings suggest traditional businesses are quickly evolving into "composable enterprises" built out of hundreds of connected software services, applications and devices. Most are embracing the Internet of Things (IoT) and microservices technologies like Docker. A majority are integrating wearables, like smart watches, and more than half plan to generate revenue with ...
The Cloud industry has moved from being more than just being able to provide infrastructure and management services on the Cloud. Enter a new era of Cloud computing where monetization’s services through the Cloud are an essential piece of strategy to feed your organizations bottom-line, your revenue and Profitability. In their session at 16th Cloud Expo, Ermanno Bonifazi, CEO & Founder of Solgenia, and Ian Khan, Global Strategic Positioning & Brand Manager at Solgenia, discussed how to easily o...
The Internet of Everything (IoE) brings together people, process, data and things to make networked connections more relevant and valuable than ever before – transforming information into knowledge and knowledge into wisdom. IoE creates new capabilities, richer experiences, and unprecedented opportunities to improve business and government operations, decision making and mission support capabilities.
Growth hacking is common for startups to make unheard-of progress in building their business. Career Hacks can help Geek Girls and those who support them (yes, that's you too, Dad!) to excel in this typically male-dominated world. Get ready to learn the facts: Is there a bias against women in the tech / developer communities? Why are women 50% of the workforce, but hold only 24% of the STEM or IT positions? Some beginnings of what to do about it! In her Opening Keynote at 16th Cloud Expo, S...
The speed of software changes in growing and large scale rapid-paced DevOps environments presents a challenge for continuous testing. Many organizations struggle to get this right. Practices that work for small scale continuous testing may not be sufficient as the requirements grow. In his session at DevOps Summit, Marc Hornbeek, Sr. Solutions Architect of DevOps continuous test solutions at Spirent Communications, explained the best practices of continuous testing at high scale, which is rele...
"Alert Logic is a managed security service provider that basically deploys technologies, but we support those technologies with the people and process behind it," stated Stephen Coty, Chief Security Evangelist at Alert Logic, in this SYS-CON.tv interview at 16th Cloud Expo, held June 9-11, 2015, at the Javits Center in New York City.