Thread regarding Seagate Technology Inc. layoffs

Executives are doing what is necessary

Actually, the executives are doing what is necessary. HDD technology is mature and hitting natural physical limits, while facing slow replacement by SSD technology. It won't immediately replace HDD in every instance, but the trend is inescapable. Given that Seagate will be facing reduced demand for its products, it is shrinking its size to "rightsize" the company for its market. What the executives haven't demonstrated is a vision for where the company can go from here. They could have gone into SSD earlier but did not, because they chose to appease shareholders with dividends and avoid massive capital investment in a new technology. The soon to be former CEO has a singular talent for buying companies to demonstrate Seagate's investors that he is doing something positive, despite the fact that either the purchases make no sense, or that management does a horrible job of incorporating it into the rest of the company.

In 5-10 years, Seagate will be a four to five billion dollar company that still operates profitably because it has been shrunk to an appropriate size for its market. The chance to branch out into other forms of memory have been squandered. The real problem shows up around 2022-2023, when Seagate either has to pay off or roll over its huge debt. I doubt the market will give Seagate a break on its interest rate to a company that will shrink to half its size.

by
| 2501 views | | 5 replies (last August 10, 2017) | Reply
Post ID: @OP+OHcgczg

5 replies (most recent on top)

Wow, I didn't realize Seagate took on all this debt. Looks like their D/E Ratio is going the wrong way. Compare it to WD who borrowed a massive amount a few years ago for their SanDisk purchase, but their D/E Ratio is headed in the right direction. Thanks for pointing that out. Not only technology wise are they going to struggle in the future but fiscally they are also headed the wrong way.

https://ycharts.com/companies/STX/debt_equity_ratio

https://ycharts.com/companies/WDC/debt_equity_ratio

by
| | Reply
Post ID: @crw+OHcgczg

Seagate have always short changed the bread and butter workers and expect those workers to be grateful towards the company.It will come back and smack them on the face..karmas a b--ch seagate

by
| | Reply
Post ID: @png+OHcgczg

What does MU gain by acquiring STX? Keep in mind STX has failed in extending to cloud hardware/software/service.

by
| | Reply
Post ID: @uyt+OHcgczg

Stop believing Seagate's BS about HDD. They will eventually be sold to Micron I predict.

by
| | Reply
Post ID: @vby+OHcgczg

The Executives put us in the position we are in now. Poor decisions for many years. Failed and overpriced acquisitions. How much did we pay for xyratex? And what's left of them? Significantly overpaid for dot hill. E vault? Remember them? They failed to partner with an SSD maker letting our competition grab them instead. Then they tell us this is actually a good thing. They piss on our backs then tell us it's raining.

Seagate didn't take care of its employees when times were good. Now see how hard we work for you. You can't give the highly rated employees a raise but the History major CEO gets a 25% increase? See how that goes over.

by
| | Reply
Post ID: @xqd+OHcgczg

Post a reply

: