NEW DELHI: Seagate Technology today reported an increase of 19.6 per cent in net income to $274 million for the quarter ended March 31, 2006 compared to $229 million reported for the corresponding quarter a year ago.

The company's revenue for the reporting quarter stood at $2.3 billion, up 16.7 per cent from $1.97 billion posted during the same quarter the previous year.

The diluted earnings per share for the quarter ended March 31 this year stood at $0.53, Seagate said. The company added that the results for this year included an expense of $21 million for non-cash stock based compensation and a $7 million one-time investment gain. The year-ago results did not reflect costs associated with non-cash stock based compensation.

For the nine months ended March 31, 2006, Seagate's net income stood at $833 million, up 95 per cent as against $427 posted during the nine months ended April 1, 2005. The revenues of the company for the reporting months also increase 24 per cent to $6.7 billion from $5,4 billion reported during the year-ago period.

The diluted earnings per share of Seagate for the nine months ended March 31, 2006 was reported at $1.63, compared to $0.85 for the nine-month period ended April 1, 2005.

The company has declared a quarterly cash distribution of $0.08 per share to be paid on or before May 19, 2006 to all common shareholders of record as of May 5, 2006.

“Seagate enjoyed significant year-over-year unit and revenue growth, fueled by continued robust demand for our products across all markets, particularly in notebook and consumer electronics applications,” said Bill Watkins, Seagate president and chief executive officer. “Our strong sales of 2.5-inch disc drives during the quarter propelled us to number two in market share in under three years participation in this space. We also just announced the industry's first enterprise drive based on perpendicular recording, allowing us to now deliver the benefits of drives based on perpendicular technology to three of the key markets we serve: consumer, enterprise and mobile computing.

Seagate experienced strong growth in the consumer electronics market in the March quarter, shipping 4.7 million drives, an increase of 12 per cent from the year-ago quarter and 33 per cent sequentially. Shipments into DVR applications grew over 100 per cent year-over-year to 2.5 million units, while shipments into the gaming market increased 39 per cent over the same period, the company said.

In the mobile computing market, Seagate shipped 3.8 million disc drives, representing an increase of 112 per cent from the year-ago quarter and 30 per cent sequentially. Seagate grew overall share in this space for the seventh consecutive quarter.

During the quarter, Seagate began volume shipments of its industry-leading 160GB 2.5-inch disc drive utilizing perpendicular recording technology. Given Seagate's growing strength in the high-capacity portion of this market, the company's shipments of capacity points at 80GB and greater grew sequentially 26 per cent. Also during the quarter, industry average capacity in this space grew to over 60GB, while Seagate's average capacity reached almost 70GB. In the enterprise space, during the quarter Seagate shipped 3.5 million units. The company also shipped 17.5 million desktop drives, an increase of 12 per cent from the year-ago quarter. Channel sales for Seagate desktop products remained healthy throughout the quarter and the company exited the quarter with under five weeks of distribution channel inventory.

The average selling price for all Seagate products, on a blended basis, decreased approximately $2.00 from the December quarter. In aggregate, price decreases on a “like for like” product basis during the March quarter were typical for a March quarter and in line with the company's expectations at the beginning of the quarter.

For the June quarter, Seagate expects to report revenue of $2.1-2.25 billion, and diluted earnings per share of $0.46-0.49, excluding expenses associated with non-cash stock based compensation. Non-cash stock based compensation is expected to be approximately $23 million or $0.04 per share, equating to GAAP earnings per share of $0.42-0.45.

For fiscal year 2006, Seagate expects to report earnings per share in the range of $2.21-$2.24, excluding expenses associated with non-cash stock based compensation. Non-cash stock based compensation is expected to be approximately $80 million or $0.16 per share, equating to GAAP earnings per share of $2.05-$2.08.

Seagate clarified that the outlook for the June quarter and fiscal year 2006 reflects only its financial results and does not include any financial results for Maxtor. If the proposed acquisition of Maxtor is closed during the June quarter, the reported results for the quarter will include the financial results of Maxtor from the date of closure through the end of the quarter and transaction related financial impacts.