Western Digital Q2 Results Top Estimates, Guides Q3 EPS In Line

(RTTNews) - Hard-disk drive maker Western Digital Corp. (WDC) reported Tuesday a profit for the second quarter that increased seven percent from last year, despite revenue growth, reflecting lower costs and expenses.

Adjusted earnings per share and quarterly revenues topped analysts' expectations. The company also provided earnings guidance for the third quarter, in line with Street view.

"We delivered strong financial results in the December quarter, with better-than-anticipated revenues, gross margins, and earnings," President and CEO Steve Milligan said in a statement.

The Irvine, California-based company reported net income of $460 million or $1.93 per share for the second quarter, higher than $430 million or $1.77 per share for the prior-year quarter.

Excluding items, adjusted net income for the quarter was $539 million or $2.26 per share, compared to $532 million or $2.19 per share in the year-ago quarter.

On average, analysts polled by Thomson Reuters expected the company to report earnings of $2.10 per share for the quarter. Analysts' estimates typically exclude special items.

Net revenue for the quarter decreased to $3.89 billion from $3.97 billion in the same quarter last year, but topped nineteen Wall Street analysts' consensus estimates of $3.84 billion.

Total operating expenses totaled $644 million, down from $678 million in the year-ago quarter.

During a conference call with analysts, the company said it expects adjusted earnings for the third quarter in a range of $1.90 to $2.00 per share, on projected revenues between $3.6 billion and $3.7 billion. Street is currently looking for earnings of $1.99 per share on revenues of $3.73 billion for the quarter.

"The diversified nature of our business and solid execution by our HGST and WD® subsidiaries are enabling us to consistently deliver strong financial performance. Also, I am encouraged by the market's response to our strategic growth initiatives, which we believe position the company to thrive in the evolving data storage ecosystem," Milligan added.

Western Digital's Dublin, Ireland-based rival Seagate Technology plc (STX) on Monday reported a profit for the second quarter that more than doubled from last year, reflecting higher revenues and a one-time gain, in addition to lower expenses.

WDC closed Tuesday's regular trading session at $97.63, down $3.35 or 3.32% on a volume of 3.31 million shares. However, the stock gained $3.37 or 3.45% in after-hours trading.