Seagate Shares Hit Post-IPO Low After Q4 Revenue Warning; CEO Watkins Says Some Rivals "In Really Bad Shape"
Seagate (STX) CEO Bill Watkins says some of his Asian competitors in the hard disk-drive market are in “really bad shape” and could be forced to team up to stay in business. In particular, he thinks Toshiba, Fujitsu and Samsung are suffering large losses; he thinks Toshiba and Fujitsu make “try to get together.”
Watkins made his remarks in an interview this afternoon with Tech Trader Daily following the company’s announcement of third-quarter results. While the September quarter numbers weren’t bad, the December outlook fell short of Street expectations, and the stock is trading lower after hours.
Watkins says that “bizarre as it sounds,” he feels better about Seagate’s business now then he did in June, noting that the company has made improvements in inventory turns, trimmed operating expenses and sped up the introduction of some new products. He says that business in October “looks pretty good, to be honest,” but that no one knows how things will go for the rest of the December quarter. Watkins says the PC manufacturers are like “deer in the headlights,” after failing to see a back-to-school demand pickup, and aren’t sure what happens in terms of fourth-quarter sales.