Seagate earns $US856m in operating cashflow in Q2

Seagate earns $US856m in operating cashflow in Q2

Storage vendor record revenue of $US3.53bn, with net income at $US428m

Storage vendor, Seagate, finished the second quarter of the 2014 fiscal year (ended December 27) with revenue of $US3.53 billion, with a gross margin of 28 per cent, net income of $US428 million, and diluted earnings per share of $US1.24.

On a non-GAAP basis, the vendor reported gross margin of 28.5 per cent, net income of $US455m and diluted earnings per share of $1.32.

The quarter saw Seagate generate around $US856m in operating cash flow and paid cash dividends of $US142m. It also repurchased 33 million ordinary shares for around $US1.5bn. There were 328m ordinary shares issued and outstanding as of the end of the quarter.

Cash, cash equivalents, restricted cash and short-term investments totalled approximately $US2.3bn during the same period.

According to Seagate chairman and chief executive officer (CEO), Steve Luczo, the results reflect discipline in the management of profitability and strong operational executive.

“We continue to invest in our product portfolio and enhances our vertically-integrated manufacturing capabilities to effectively capitalise on the Cloud, mobile, and open source storage trends that are being fuelled by data growth.

“Our cash flow was very strong this quarter, and combined with the execution of our capital allocation strategy, we are on track to meet our goal of returning 70 per cent of our operating cash flow to shareholders this fiscal year.”

The Seagate board has approved a quarterly cash dividend of $0.43 per share, payable on February 24, 2014, to shareholders of record as of the close of business on February 10.

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