Seagate sparkar 6500 personer
Moments ago computer-memory specialist Seagate, in a preliminary financial report, announced that its Q4 revenue would be $2.65 billion, beating expectations of $2.34 billion, and up from the $2.3 billion guidance given previously. The company also reported gross margin of 25% and non-GAAP gross margin of approximately 25.8% for the fiscal fourth quarter 2016, up from the previous 23% forecast.
Good news, and the stock is up 12% after hours as a result.
The only problem is that when companies preannounce good news up front, there is usually some not so good news hidden toward the back. And sure enough, for a company which is guiding higher, the narrative promptly fell apart when we read that for STX management the future is so bright that it just had to lay off 14% of it workforce, or some 6,500 people. This too was a “beat” to expectations: in late June, the company announced it planned to cut “only” 1,600 jobs as a cost-saving measure.