Connect with us

Hi, what are you looking for?


Seagate (STX) shares down after company agrees to $300 million fine

Seagate Technology (NASDAQ:STX) shares have slipped more than 3% in early morning trading after the data storage company’s revenue miss as reported in its fiscal third-quarter financial results.

STX share price was also down following news that the US Department of Commerce’s Bureau of Industry and Security (BIS), had imposed a $300 million penalty on the computer storage provider over its continued business dealings with Huawei.

Seagate fined $300 million for Huawei supplies

According to BIS, Seagate had sold over $1 billion worth of hard drive disks to the Chinese company, even with full knowledge that the US had blacklisted it over issues of national security.

Documents show that Seagate had become the exclusive provider of HDDs to Huawei, with 7.4 million HDDs shipped to the China-based firm between August 2020 and September 2021. BIS alleged Seagate netted roughly $150 million in profit.

The $300 million fine is the largest ever BIS has imposed on a company and will be payable in $15 million installments every quarter for the next five years. Seagate has agreed to the penalty and the indicated terms, as well as to three audits.

STX stock price – what’s the outlook?

Following the development, Seagate pushed its fiscal third-quarter results from Wednesday 19 April to Thursday, 20 April, with the move contributing to the premarket downside. STX share price was at $61.01, nearly 6% down in the past five days. The shares are however 18% up year-to-date, with a 52-week high of $88.27 and 52-week low of $47.47.

STX has rebounded off the $60 area as support in recent weeks and could be critical again as buyers target a continuation of the YTD momemtum.

Commenting on the fiscal third-quarter results, Seagate CEO Dave Mosley said:

“We are seeing a more elongated customer inventory correction that led to weaker than expected nearline demand among a few large customers late in the quarter. Consequently, our March quarter revenue came in at the low-end of our guidance range, which along with underutilization charges and other factors had a severe impact on our reported margins and profitability.”

According to Mosley, the company expects demand recovery to start spiking later in the year, with the plan being to focus on its product roadmap.

The post Seagate (STX) shares down after company agrees to $300 million fine appeared first on Invezz.

Enter Your Information Below To Receive Free Trading Ideas, Latest News And Articles.

    Your information is secure and your privacy is protected. By opting in you agree to receive emails from us. Remember that you can opt-out any time, we hate spam too!

    You May Also Like

    Latest News

    Rep. Jennifer Wexton (D-Va.) announced on Tuesday that she has been diagnosed with Parkinson’s Disease. “If there’s one thing that Democrats and Republicans can...

    Latest News

    After Dianne Feinstein announced she’d contracted the shingles in early March, her staff said she planned to return to the Senate within a matter...


    A U.S. District Court judge has ruled that Elizabeth Holmes, founder and CEO of the disgraced blood-testing company Theranos, cannot remain free on bail...

    Latest News

    SEOUL, South Korea — When a group of American lawmakers arrived in South Korea for meetings with government and military officials, President Yoon Suk-yeol...

    Disclaimer:, its managers, its employees, and assigns (collectively “The Company”) do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

    Copyright © 2022 All Rights Reserved.