DOW JONES NEWSWIRES
Western Digital Corp.'s (WDC) fiscal fourth-quarter profit decreased 40% as the disk-drive maker reported higher research and development expenses and lower margins, although shipments grew.
Western Digital has reported a lower bottom line in each quarter of the latest fiscal year, as aggressive pricing has hurt margins, while top line results have been mixed. There are concerns of Western Digital's long-term business prospects as the industry begins to shift toward the use of flash memory rather than hard disks for storage.
Meanwhile, the impact of an earthquake and tsunami in Japan in March has affected the PC supply chain and constrained supply of hard disk drives due to specific component shortages.
For the quarter ended July 1, Western Digital reported earnings of $158 million, or 67 cents a share, down from $265 million, or $1.13 a share, a year earlier.
Excluding expenses related to the company's planned $4.3 billion acquisition of Hitachi Ltd.'s (HIT, 6501.TO) hard disk drive business, earnings in the latest quarter would have been 81 cents. The prior-year profit would have been $1.24 a share excluding $27 million in litigation expenses.
Revenue inched up 0.9% to $2.4 billion.
In April, the company projected earnings of 60 cents to 65 cents on revenue of $2.2 billion to $2.3 billion.
Gross margin fell to 19.5% from 22.5%.
Hard-drive shipments increased 8.7% to 54 million units.
On Wednesday, peer Seagate Technology Inc. (STX) reported its fiscal fourth-quarter earnings slumped 69% due to weaker gross margins, although shipments of hard-disk drives grew.
Shares rose 0.6% at $35.35 in after-hours trading.
-By John Kell, Dow Jones Newswires; 212-416-2480; firstname.lastname@example.org