Seagate noted that the familiar issue of “weakening global economic conditions” led to a disappointing revenue forecast of $2.35 billion for the period, compared with analysts’ estimates of $3 billion. Meanwhile, profit is expected to be about $1.40 per share, well below the average estimate of $2.27.

Seagate said it is scaling back its production schedule due to reduced demand, thus avoiding a situation where the company is sitting on a surplus of components it can’t move. Consumer PC hardware is said to be one area that is particularly affected by capacity.

Seagate CEO Dave Mosley said, “In this environment, we are reducing our production schedule to maintain supply discipline as our customers manage macro uncertainty and ongoing shortages of non-drive components now that the world’s consumers have decided to spend their money elsewhere.”

Bloomberg noted that reducing production is a strategy commonly adopted by tech companies machines. Elsewhere, AMD, Apple and NVIDIA are said to be reducing their 5nm orders from TSMC because of low demand from money-sensitive consumers. This is one reason why the RTX 4090 may be the only Lovelace card we see this year.

There is also some positive news with the growing demand for online storage devices and data centers continuing to generate significant revenue for the company. He also believes that consumer demand will start to improve in about two quarters. That didn’t stop Seagate shares from falling 11 percent in after-hours trading.

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