Seagate to Cut 1,100 Jobs in Cost Cuts

NEW YORK, May 13 (Reuters) - Seagate Technology said on Wednesday it plans to cut about 1,100 jobs from its workforce in a move the computer storage maker expects will reduce costs by about $125 million a year.

The job-cutting move, which affects about 2.5 percent of Seagate's workforce, is aimed at helping the company stay on track toward being cash-flow and earnings positive within its fiscal year 2010.As a result of the plan, Seagate, which competes with storage company Western Digital, expects to take restructuring charges of about $72 million, primarily in the quarter ending in June.

About one month ago, Seagate reported disappointing quarterly gross margins and eliminated its dividend, reflecting weak demand from corporate customers and stronger sales of lower-priced products.

The elimination of the quarterly dividend is expected to trim costs by about $60 million annually, the company said.