Seagate Q2 solid, 61.3 exabytes shipped

Storage shipments were a highlight for the quarter, as shipments rose 17 percent year-over-year to 61.3 exabytes. However, European instability spurs an outlook chop.

Seagate on Monday reported its second quarter earnings and revenue, and although the results were almost in line with expectations, a shaky outlook took a toll on the company's shares.

Seagate's new logo

The hard-disk drive storage provider reported fourth quarter earnings of $933 million, or $2.78 a share, on revenue of $3.7 billion. Non-GAAP earnings for the quarter were $1.35 a share.

Wall Street was expecting Seagate to report non-GAAP earnings of $1.34 a share on revenue of $3.73 billion.

As for its outlook for the current quarter, Seagate is guiding for revenue of $3.45 billion, below consensus of $3.59 billion.

CEO Steve Luczo said during the company's earnings call that forecasts for the current quarter were tempered by instability in the European business environment:

Europe represents approximately 20 percent of our revenues. And in retail we would have historically experienced an increase of about 5 percent revenue in the December quarter and, in fact, it declined by about 5 percent. While we expect Europe to be challenged economically for most of 2015, it's difficult to assess the degree of impact this will have on revenue and demand.

Seagate also attributes the lowered guidance to seasonal declines in the client and retail markets and supply constraints in the cloud market.

As a result, Seagate's share price dropped more than 10 percent during morning trading hours.

On the bright side, the company's storage shipments during Q2 rose 17 percent year-over-year to 61.3 exabytes.

The Cupertino, California-based company has also been on a bit of a rebranding mission as of late, releasing a revamped logo and a business mantra with the message that data is a "vibrant, living thing that powers human invention." Seagate hopes the rebranding will better convey that its expertise is not just in storage, but also in recovery services, cloud services and fully integrated cloud systems -- an effort that many consider necessary as the demand for hard drives continues to dwindle.