Investing.com – Western Digital stock (NASDAQ:WDC) plunged 10% Friday after the maker of hard drives and storage systems provided a current quarter outlook that fell short of expectations.
At the most optimistic level, Western Digital estimates its gross margin to remain around the first quarter’s level of 34%. Gross margins could also slip to 32%, according to the company’s forecast as it tries to overcome supply chain issues .
The company pegged its December-quarter revenue to come in at $4.8 billion at midpoint, which would be 23% higher than last year's quarter but lower from the September quarter. Adjusted profit per share is seen at $2.10 at midpoint.
First-quarter revenue rose 29%, to $5.1 billion. Cloud revenue soared 72% and contributed 44% of the total revenue. Client revenue increased 6% and consumer revenue rose 10%.
In the client business, the flash business unit experienced growth – specifically in mobile, gaming, automotive, IOT and industrial applications, the company said.
Supply chain disruptions that have plagued just about every manufacturer, irrespective of the sector, were felt most by the company in its desktop and notebook hard drives business. Supplies were disrupted at its customers’ and also within the company’s own operations.
Revenue from both the flash and hard drive units in the consumer business declined on a sequential basis due to supply disruptions, in addition to uneven geographic demand due to Covid lockdowns, the company said.
Adjusted profit per share was $2.49 against a loss last time.