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Tracking Seagate’s Revenue in Fiscal 2018

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Revenues in fiscal 1Q18

Seagate Technology’s (STX) management stated that it remains “cautiously optimistic” about global macroeconomic conditions as well as enterprise IT (information technology) spending trends.

During Seagate’s fiscal 4Q17 earnings call, CEO (chief executive officer) Steve Luczo stated: “We believe the end to end supply chain issues we identified last quarter will persist at least through the end of the year…We want to exercise more caution than seasonally normal for traditional enterprise spending and other markets affected by higher-than-normal supply chain pricing.”

For fiscal 1Q18 (ended September 2017), Seagate expects revenues between $2.5 billion and $2.6 billion. Its gross margin is expected to be within the firm’s targeted range of 29%–33%.

Seagate reported revenues of $2.8 billion in fiscal 1Q17, with non-GAAP (generally accepted accounting principles) EPS of $0.99.

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Analysts’ expectations in fiscal 1Q18

Analysts expect Seagate’s revenues to fall 9.5% YoY (year-over-year) in fiscal 1Q18 to $2.53 billion and to fall 8.7% YoY to $2.64 billion in fiscal 2Q18. The average EPS estimate is $0.87 in fiscal 1Q18—a fall of 12% YoY.

For fiscal 2018, analysts expect Seagate’s revenues to fall 6.4% YoY to $10.08 billion, while the EPS (earnings per share) expectation includes a fall of 10.4% YoY to $3.69.

Seagate has a market cap of $9 billion. Peer storage companies Western Digital (WDC), Dell Technologies (DVMT), Pure Storage (PSTG), and NetApp (NTAP) have market caps of $26 billion, $15 billion, $3.7 billion, and $10.3 billion, respectively.

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