(Reuters) – Western Digital Corp forecast first-quarter revenue below Wall Street estimates on Wednesday, signaling a slower-than-expected recovery in the company’s data storage products.
The AI boom has helped some memory chipmakers such as Micron technology in the middle of a steep industry downturn, but the demand for chips used in conventional data centers continues to fall, hurting memory chip companies like WDC.
Shares of the company were down 4.2% in extended trading.
The data storage products maker expects first-quarter revenue in the range $4 billion to $4.20 billion, compared with analysts’ estimates of $4.22 billion, according to LSEG data.
It sees adjusted earnings per share in the range of $1.55 to $1.85, compared with estimates of $1.74.
Western Digital’s fourth-quarter revenue stood at $3.76 billion beating analysts’ average expectations of $3.74 billion.
The adjusted profit per share came in at 88 cents, compared with estimates of $1.17.
Revenue of the company’s flash memory business which is expected to operate separately from its traditional hard disk drive unit by the second half of 2024, rose nearly 28% to $1.76 billion.
Rival Seagate Technology forecast upbeat revenue for its first quarter last week, driven by increased demand for memory chips from personal computing and data center clients.
(Reporting by Juby Babu in Mexico City and Priyanka.G; Editing by Mohammed Safi Shamsi)
