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1/22/2004

Seagate reports revenue increase

The Daily Times-Call

SCOTTS VALLEY, Calif. — Seagate Technology on Tuesday announced an increase in revenue and income for the most recent quarter, despite “challenging” conditions.

For the three-month period ended Jan. 2 — its second quarter of fiscal 2004 — the company reported net revenue of $1.76 billion, up from $1.73 billion during the same quarter the previous year.

Net income for the most recent quarter was $205 million, or 41 cents per diluted share, compared with $198 million and 43 cents per diluted share, respectively, for the year-ago quarter.

Despite a slight decrease year-over-year in earnings per share, Steve Luczo, chairman and chief executive officer, said in a conference call with investors that the quarter saw “one of the highest levels of net income in our history,” and that the company shipped a record number of disc drives.

“However, despite a profitable and an overall successful quarter, our financial performance was below our expectations,” Luczo wrote in a press release accompanying the announcement.

The company‚Äôs statement said “aggressive pricing” by some of its competitors led to “unacceptable market prices,” resulting in a shortfall in sales of its hard drives for personal storage devices.

The company still sold 21.7 million disc drives during the quarter and said it saw several positive developments, including increased sales of drives into the consumer electronics market, and a renewed buying cycle for both consumer and commercial computers.

The company reported that shipments of drives for PC desktop computers and notebooks were up 20 percent compared with the same period the previous year.

For the first six months of the fiscal year, Seagate reported net revenue of $3.5 billion; net income of $403 million — a 25 increase from the previous year; and earnings of 81 cents per diluted share.