Seagate Technology Holdings plc Q4 FY2020 Earnings Call

· Earnings call transcript and AI-powered summary

Quarter Overview (June Quarter, Fiscal Q4 2020)

  • Revenue: $2.52 billion
    • Up 6% year-over-year
    • Down 7% sequentially
  • Non-GAAP EPS: $1.20
    • Up 26% year-over-year (vs. $0.95)
    • Down 13% sequentially
    • COVID-19 total EPS impact estimated at $0.25–$0.30
  • Non-GAAP Operating Margin: 14.8%
    • Up 160 bps year-over-year
    • Down 70 bps sequentially
  • Free Cash Flow: $274 million (up 5% sequentially)
  • Returned >80% of free cash flow to shareholders via dividends and buybacks

Business Segment Performance

Mass Capacity Storage (Cloud & Hyperscale)
  • Shipments: 91 exabytes; nearline shipments a record 80 exabytes
  • Average capacity per nearline drive: 10.8TB
  • Mass capacity revenue: 58% of total revenue (vs. 49% YoY)
  • Year-over-year mass capacity revenue grew 25%; exabytes +57%
  • Strong demand from cloud and content providers driven by remote work, streaming, gaming
  • 16TB drives remain top revenue contributor; 18TB drives began initial shipments
Video & Image Applications (Surveillance, Smart City)
  • Second consecutive quarterly decline

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Company Representatives: Dave Mosley - Chief Executive Officer Gianluca Romano - Chief Financial Officer Shanye Hudson - SVP, Investor Relations & Treasury Operator: Good afternoon and welcome to the Seagate Technology, Fourth Quarter and Fiscal Year 2020 Financial Results Conference Call. My name is Jason and I will be your coordinator for today. At this time all participants are in a listen-only mode. Following the prepared remarks there will be a question-and-answer session. As a reminder, this conference is being recorded for replay purposes. At this time, I would like to turn the call over to Shanye Hudson, SVP, Investor Relations and Treasury. Please proceed Shanye. Shanye Hudson: Thank you. Good afternoon everyone and welcome to today’s call. Joining me are Dave Mosley, Seagate’s Chief Executive Officer and Gianluca Romano, our Chief Financial Officer. We posted our earnings press release and detailed supplemental information for our June quarter and fiscal 2020 year end on the Investors section of our website. During today’s call we will refer to GAAP and non-GAAP measures. Non-GAAP figures are reconciled to GAAP figures in the earnings press release posted on our website and Form 8-K that was filed with the SEC. We have not reconciled certain non-GAAP outlook measures, because material items that may impact these measures are out of our control and/or cannot be reasonably predicted. Therefore a reconciliation to the corresponding GAAP measures is not available witho

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