Seagate Technology (NASDAQ:STX) plunged on Thursday, stretching this year’s losses, after the data storage company said that its revenue and gross profit margin will probably trail market expectations for its latest quarter.
The shares fell 13% to $41.42 at 1:32 p.m. in New York, after touching $40.52, the lowest intraday price since May 2013. The stock had lost 28% this year through Wednesday.
The Cupertino, California-based company said in a statement on Thursday that its gross margin would be lower than expected due to weak demand for two nearline storage products.
Seagate said it anticipated new products introduced in September to help it become fully competitive in the nearline market by its third fiscal quarter.
“We are disappointed we did not execute a product portfolio that fully addressed the demand in the nearline market,” Seagate’s chief executive officer, Steve Luczo, said in the statement.
For the three months ended October 2, Seagate said it expects to post revenue of about $2.9bn, below the $3.03bn forecast by analysts polled by Capital IQ.
The results reflect weak demand for a new line of data storage hardware.
Seagate, which is making flash-based products of its own, has moved to develop disk-based systems, known as nearline storage, that is tailored for long-term storage while retrieving data faster than tape-based systems.
Last month, Seagate said it planned to cut 1,050 jobs, or 2% of its workforce, as part of a restructuring program.
Seagate plans to report results for the quarter on October 30.