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Seagate's latest earnings missed Wall Street expectations for revenue and earnings per share.
October 26, 2022
Seagate announced layoffs impacting 3,000 workers, or 8% of its worldwide workforce. And Cybereason has cut 200 workers, or 17% of its workforce.
During its quarterly earnings announcement on Wednesday, Seagate unveiled a restructuring plan. Its earnings missed Wall Street expectations for revenue and earnings per share.
Dave Mosley is Seagate’s CEO.
Seagate’s David Mosley
“Global economic uncertainties and broad-based customer inventory corrections worsened in the latter stages of the September quarter,” he said. “And these dynamics are reflected in both near-term industry demand and Seagate’s financial performance. We have taken quick and decisive actions to respond to current market conditions and enhance long-term profitability, including adjusting our production output and annual capital expenditure plans, and announcing a restructuring plan that will deliver meaningful cost savings while maintaining investments in the mass capacity solutions driving our future growth.”
Keep up with our telecom-IT layoff tracker to see which companies are cutting jobs and the ensuing channel impact.
Seagate aims to reduce its cost structure to better align its operational needs to current economic conditions while continuing to support the long-term business strategy. The plan includes the layoffs along with other cost-saving measures
Seagate should complete its restructuring by the end of its fiscal second quarter. It should result in total pre-tax charges between $60 million and $70 million. Seagate expects the charges to be primarily cash-based, and consist of employee severance and other one-time termination benefits.
This is the second time Cybereason has cut workers in the past several months.
“This was an extremely difficult step as it impacts colleagues who supported our mission and played a part in making us a market leader,” a Cybereason spokesperson said. “While painful, we believe prioritizing profitability over growth will provide financial resilience to withstand current economic conditions.”
In June, Cybereason announced layoffs impacting 10% of its workforce in Israel, the United States and Europe, citing a closed tech initial public offering (IPO) market. Those layoffs affected about 100 workers, including dozens at its Israel headquarters, and the rest working at its offices in the United States and Europe.
In the meantime, Cybereason reportedly has ditched its IPO plans and instead is looking for a buyer. According to The Information, citing a person with direct knowledge of the matter, the company has hired JP Morgan Chase to find a buyer.
Early this year, Cybereason reportedly filed for an IPO at a valuation of $5 billion. It reportedly finalized underwriters for its IPO and expected a launch during the second half of this year.
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