Hard-disk maker Seagate to layoff 1,050 worldwide

Sep 10, 2015, 12:24 PM EDT
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Hard-disk maker Seagate announced on Thursday it will layoff 1,050 worldwide. The company said on Thursday it expected to save about $113 million annually from the restructuring and incur pretax charges of about $53 million, reports Reuters. Seagate, which has about 52,200 employees worldwide, expects to complete the restructuring by the end of the December quarter. The company expects to incur most of the pretax charges in the first quarter, it said. Seagate has reported a fall in sales for the past two quarters, hurt by weak demand from original equipment manufacturers, including PC makers.

Research firm International Data Corp said last month that it expected a bigger drop in 2015 PC shipments than it had anticipated earlier due to a large inventory of notebooks and a strong dollar. To help make up for a declining PC market, Seagate and rival Western Digital Corp are expanding into the growing market for cloud data storage products. Seagate's shares ended at $50.10 on Wednesday. Up to Wednesday's close, the stock had fallen more than 24 percent this year.

The company, on the basis of change in net income from the same quarter one year ago, has significantly underperformed when compared to that of the S&P 500 and the Computers & Peripherals industry, writes The Street. The net income has significantly decreased by 57.2% when compared to the same quarter one year ago, falling from $320.00 million to $137.00 million.