Storage outfit Seagate is having a bad quarter and thinks it will miss its profit targets.

At the heart of the problem is a quality issue in its enterprise disk drive unit which saw sales fall. The company, which competes with Western Digital Corp, said shipments fell by about 1.5 million units to about 66 million for the June quarter, squeezing gross margins.

Seagate expects an adjusted gross margin of 33.6 percent. The company expects to report revenue of $4.5 billion which is down from the $5 billion. Wall Street thought that the company would make $4.88 billion and shares fell six percent on the news.