Seagate Technology Holdings PLC announced this week that they are laying off 8 percent of its workforce. Moreover, the hard drive maker company came up with restructuring plans amid loss in revenue and diminishing demand for its products.

Reduction in expected revenue

Seagate is the world’s largest producer of hard drives. The company reported its quarterly earnings for the first quarter of this fiscal year and missed the revenue targets. Moreover, the Seagate’s shares fell more than 7% during last week. In addition, the company’s share witnessed a downward trend in 2022 and has fallen over 55% during the year. The demand of Seagate’s products has also decreased significantly in recent amid economic uncertainty. Hence, the hard drives producer has announced a restructuring plan at the firm. The restructuring will lead to laying off 3,000 workers globally.

“Global economic uncertainties and broad-based customer inventory corrections worsened in the latter stages of the September quarter, and these dynamics are reflected in both near-term industry demand and Seagate’s financial performance. We have taken quick and decisive actions to respond to current market conditions and enhance long-term profitability, including adjusting our production output and annual capital expenditure plans and announcing a restructuring plan that will deliver meaningful cost savings while maintaining investments in the mass capacity solutions driving our future growth. In addition to adjusting our production output, to drive supply discipline and pricing stability, we are implementing a restructuring plan to sustainably lower costs, including reduction in our global workforce.” Seagate CEO Dave Mosley said in a statement.

Layoffs across tech manufacturers

Seagate makes hard drives and other parts often used in PCs and cloud servers. The demand for these products have lost significant demand after a boom of two years during the pandemic period.  Moreover, Seagate’s decision of layoff its workers is a sign that demand for PCs and cloud servers is deteriorating. Many other tech companies have initiated layoffs in recent times due to reduction in profits.

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