SAN FRANCISCO (AP) -- Hard-drive maker Seagate Technology's third-quarter profit jumped 62 percent from a year ago, but the company missed revenue forecasts and acknowledged weakness in sales of drives used in notebook computers.
In the quarter ending March 28, Seagate earned $344 million, or 65 cents per share, compared with $212 million, or 37 cents a share, in the same period a year ago. Revenue grew 10 percent to $3.1 billion from $2.8 billion last year.
Excluding one-time items, the company earned $369 million, or 70 cents per share. On that basis, analysts surveyed by Thomson Financial were expecting the company to post a profit of 69 cents per share on revenue of $3.25 billion.
Seagate Chief Executive Bill Watkins said the results were driven by strong global demand for storage, but the company fell short in the notebook and retail market.
Watkins said in an interview with The Associated Press that the company decided to sacrifice volume for higher margins.
"We did not want to do deals that would lower our overall price going into June," Watkins said. "We had our choice: We could have shipped a lot more products, lowered prices and done deals. We decided not to do that. We decided to focus on high profit, keep our prices up. I'll take the revenue hit."
The company sold 43 million disk drives in the third quarter, up 9 percent from the 39.4 million the world's largest hard drive maker shipped in the same quarter a year ago.
Seagate shares were down 31 cents, or 1.5 percent, to $19.86, in after-hours trading on Tuesday.
Shebly Seyrafi, an analyst at Caris and Co., said Seagate is feeling the sting of its late start shipping high-capacity notebook drives compared to rival Western Digital Corp.
Western Digital offered 250-gigabyte notebook drives before Seagate and began shipping 320-gigabyte drives last quarter, while Seagate won't start until this quarter.
"Seagate is feeling the effects of more aggressive pricing, along with some sheer loss (of market share) to Western Digital," Seyrafi said.
The company is also behind Western Digital in retail sales of external drives, Seyrafi said.
For the current quarter, which ends in June, Seagate expects revenue between $2.85 billion and $3 billion, and it forecast earnings per share of 37 cents to 41 cents. Excluding one-time charges, the company expects net income per share in the range of 41 cents to 45 cents in the fourth quarter.
Seagate sued solid-state computer drive maker Stec Inc. Monday in federal court in California claiming it violated four Seagate patents registered between 2002 and 2006.
The market for solid-state drives, which use chips to store information, is growing with the popularity of music players and other portable devices.
Stec said in a statement issued Tuesday that it was among the first companies to build solid-state drives and shipped its first product in 1994, "long before any of the suggested patents were issued to Seagate."
"Stec believes that Seagate's lawsuit is completely without merit and primarily motivated by competitive concerns rather than a desire to protect its intellectual property," it said.
Watkins said Tuesday the suit is meant to protect $7 billion the company has spent on developing its technology.
Seagate, which is based in the Cayman Islands but operates out of Scotts Valley, raised its profit outlook in March, saying it sold more high-end hard drives than it had expected.
Seagate nearly tripled its profit over the year before as shipments jumped 20 percent amid strong demand for storage from both consumers and businesses.