Seagate forecasts third-quarter revenue above estimates

(Reuters) - Hard-disk drive maker Seagate Technology Plc forecast current-quarter revenue above estimates, buoyed by strong demand for its cloud-based storage products.

Shares of the company, which also posted higher-than-expected second quarter profit and revenue, soared 13.7 percent to $42.56 in after-market trading on Tuesday.

Seagate has been focusing on cloud-based products as businesses cut spending on traditional storage systems.

"From a macro perspective, we remain cautiously optimistic about the current macroeconomic environment and IT spending trends," Chief Executive Officer Steve Luczo said on a post-earnings conference call.

The company forecast third quarter revenue of about $2.7 billion, above estimates of $2.61 billion, according to Thomson Reuters I/B/E/S.

Seagate also said it expects to achieve revenue growth this year with a profit of at least $4.50 per share.

The company said in July it would cut about 6,500 jobs, or 14 percent of its workforce, by the end of fiscal 2017, as part of a major restructuring.

Seagate also said earlier this month that it plans to shut its Suzhou factory in China.

The company's net income rose to $297 million, or $1 per share, in the second quarter ended Dec. 30, from $165 million, or 55 cents per share.

Excluding items, the company earned $1.38 per share, beating the average analysts' estimate of $1.08 per share, according to Thomson Reuters I/B/E/S.

Revenue fell 3.1 percent to $2.89 billion, but beat the average estimate of $2.82 billion.

Rival Western Digital Corp will report its second-quarter results on Wednesday.

(Reporting by Anya George Tharakan and Rishika Sadam in Bengaluru; Editing by Saumyadeb Chakrabarty and Shounak Dasgupta)

You May Also Be Interested In

• Netflix Q1 earnings top estimates on blowout subscriber growth
• Marten Transport (MRTN) Misses Q1 EPS by 2c
• Community West Bancshares (CWBC) Tops Q1 EPS by 7c