Western Digital Expects Lower Quarterly Profit : Business: The computer firm, blaming a slowing economy and soft demand, also confirms a layoff of 60 employees.
A Western Digital Corp. official said Thursday that its profits will be lower than expected for the quarter that ends Dec. 31, and confirmed that 60 people have been laid off at its corporate offices.
Robert J. Blair, a Western Digital spokesman, said in an interview that the Irvine computer-products company’s second-quarter earnings will be lower than previously anticipated, attributing the decline to a slowing economy and continuing soft demand for the company’s board-level products. He declined to say how much lower the earnings are expected to be.
Blair said the layoffs resulted from an ongoing corporate reorganization in which the company’s two operating divisions are being consolidated into a single unit headed by Kathryn A. Braun, executive vice president.
Braun, who formerly headed the company’s storage-products division, was promoted to executive vice president in July and put in charge of Western Digital’s microcomputer-products division as well.
Robert N. Stephens, senior vice president in charge of the microcomputer-products division, resigned recently to take a job as chief executive and president of Emulex Corp., a Costa Mesa computer firm.
Blair said additional layoffs are possible as the reorganization proceeds, but he declined to be more specific.
The company employed 7,300 people before the layoff, including 1,900 in Irvine.
The layoffs affected employees in the company’s marketing, human resources and financial departments, Blair said. As the company combines the two divisions, he said, some jobs were duplicated.
In addition, Blair said, soft demand for the company’s storage controller boards, video controller boards, and certain microchip sets will hurt profits for the quarter.
Western Digital informed Wall Street analysts of the expected shortfall last week, Blair said.
He said the company expects to have a better second half as it begins to ship new disk-drive products in high volumes.
Western Digital stock closed unchanged Thursday at $5.25 per share in American Stock Exchange trading.
Staff writer Cristina Lee contributed to this report.
