Categories AlphaGraphs, Earnings, LATEST, Technology

Western Digital (WDC) Q1 earnings beat; stock falls on weak guidance, CEO exit

After ending the last fiscal year on a dismal note, data storage company Western Digital Corp. (NASDAQ: WDC) reported first-quarter earnings that declined year-over-year but came in slightly above the estimates. The bottom-line was impacted by a 20% fall in revenues, reflecting the continuing slowdown in the flash memory market.

Earnings Update by AlphaStreet

The company also provided guidance for the second quarter, which fell short of expectations, and announced the retirement of CEO Steve Milligan. The stock fell sharply during Wednesday’s extended trading session, following the announcement.

Earnings Fall

Adjusted earnings of the San Jose, California-based tech firm dropped to $0.34 per share from $3.04 per share in the first quarter of 2019, but slightly exceeded the forecast. On an unadjusted basis, the company reported a net loss of $276 million or $0.93 per share, compared to last year’s net income of $511 million or $1.71 per share.

Related: Western Digital Q4 2019 Earnings Call Transcript

There was a 20% decline in revenues to $4 billion, which is slightly above the consensus estimate.

Guidance

For the second quarter, the management expects adjusted earnings to be in the range of $0.45 per share to $0.65 per share, which is below the analysts’ forecast. The forecast for revenue is between $4.1 billion and $4.3 billion. Gross margin is expected to be between 21% and 22%.

“The overall demand environment remains solid. We continue to believe the flash industry has passed a cyclical trough, with improving trends across our flash product portfolio. With a broad and growing product portfolio, Western Digital remains well positioned to benefit from the long-term drivers of the growth and value of data,” said CEO Steve Milligan.

CEO Exit

A separate statement from the company said that Milligan has decided to retire as the CEO. He will continue in that position until a successor is identified. Milligan will remain a director on Western Digital’s board during the transition period.

Also see: Strong booking growth lifts Zynga’s Q3 earnings

Western Digital shares have made strong gains after falling sharply mid-year. The stock, which rose 61% so far this year, closed Wednesday’s trading lower and lost further during the after-hours session.

Browse through our earnings calendar and get all scheduled earnings announcements, analyst/investor conference and much more!

Most Popular

PEP Earnings: All you need to know about PepsiCo Q1 2021 earnings results

PepsiCo Inc. (NASDAQ: PEP) reported first-quarter 2021 earnings results today. Net revenues increased 6.8% year-over-year to $14.82 billion while organic revenue growth was 2.4%. Net income attributable to PepsiCo was $1.7 billion,

The worst seems to be over for Boston Scientific. Is the stock a buy?

The pandemic has had a mixed impact on the healthcare sector since its outbreak more than a year ago, putting the emergency care department into overdrive while slowing down the

Two areas that provide Pfizer (PFE) with ample opportunity for future growth

Shares of Pfizer Inc. (NYSE: PFE) have gained over 8% in the past one year. Pfizer is at the forefront of the COVID-19 vaccination drive and it has established a

Add Comment
Loading...
Cancel
Viewing Highlight
Loading...
Highlight
Close
Top