Seagate misses shipment target due to supplier quality problems

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Revenues miss forecasts by $500 million

Seagate saw shipments drop below expectations due to quality problems in its supply chain.

Shipments fell by 1.5 million units to 66 million during the June quarter, while revenues fell from the expected $5 billion to $4.5 billion.

The drop in production was largely attributed to problems with quality at a supplier servicing its enterprise hard disk unit.

CEO and chairman Steve Luczo said that the supplier quality problem was an “isolated” incident.

“While this disruption to our business was disappointing, we acted quickly and conservatively by suspending shipments of the affected products,” Luczo said in a statement.

He added: “We have resolved the issue and have resumed fulfilling our supply commitments to customers.”

Seagate also highlighted a reduction in shipments as the hard disk drive industry recovered “faster than expected” from ongoing supply chain disrpution.

Seagate was one of the firms affected by last year’s flooding in Thailand, alongside competitors such as Western Digital.



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