Seagate chops revenue guidance on weak demand

The hard drive maker now expects to post revenue of roughly $2.9 billion, down from its previous estimate of $3.2 billion to $3.3 billion.

Hard-disk drive storage provider Seagate on Monday lowered its revenue and margin guidance ahead of the release of its fourth quarter earnings report later this month.

The Cupertino, California-based company now expects revenue of roughly $2.9 billion, down from its previously forecasted range of $3.2 billion to $3.3 billion. Analysts were expecting revenues of $3.19 billion for the fourth-quarter.

Seagate also cut its outlook for margins, from the original estimate of 28.5 percent down to around 27 percent.

Seagate blames the decreased forecasts on lower than expected demand during the quarter. The company says it now expects fourth quarter unit shipments of approximately 45 million.

The cuts come as Seagate attempts to diversify its service portfolio. The company launched a rebranding campaign earlier this year in an effort to convey that its expertise are not just in storage, but also in recovery services, cloud services and fully integrated cloud systems. It's an effort that many consider necessary as the demand for hard drives continues to dwindle.

Also see: The Evolution of Enterprise Storage