Seagate Technology provided an update of its expected results for the fiscal first quarter 2008 which ends September 28, 2007. The company now expects revenue of $3.15 – $3.25 billion, GAAP diluted earnings per share of $0.57 – $0.61 and non-GAAP diluted earnings per share, which excludes $27 million of purchased intangibles amortization and other charges associated with the Maxtor and EVault acquisitions, of $0.62 – $0.66.
The company’s original outlook for the first fiscal quarter was for revenue of $2.9 – $3.0, GAAP diluted earnings per share of $0.35 – $0.39 and non-GAAP diluted earnings per share, which excludes $27 million of purchased intangibles amortization and other charges associated with the Maxtor and EVault acquisitions, of $0.40 – $0.44.
The primary factors leading to the improved outlook for the first fiscal quarter are  industry unit demand at the high-end of the predicted range;  favorable pricing thus far in the quarter reflecting a more balanced supply and demand environment, and  a better product mix.
Gross margin is expected to expand to approximately 24% due to the demand, pricing and product mix factors referenced above. Operating expenses (R&D and SG&A) are expected to increase above the company’s previous outlook due to higher variable compensation costs. The revised outlook assumes a 6% tax rate and diluted shares outstanding of 555 million.
Given the typical shipment profile for a September quarter and the dynamic nature of the demand and pricing environment, actual results during the balance of the quarter will heavily influence the company’s financial performance for the quarter.