SNDK Sandisk Corp.

Western Digital Corp. said its earnings fell 81% in the latest quarter as sales and margins weakened.

Shares fell 4.4% to $44.09 in recent after-hours trading as per-share earnings, excluding certain one-time items, and revenue were at the lower end of the company's expectations and fell short of Wall Street estimates.

The Irvine, Calif., disk-drive maker is acquiring rival SanDisk Corp. The companies unveiled their deal in October, promoting the combination of Western Digital's leading position in hard drives and SanDisk's strength in the growing market for flash memory chips needed for smartphones and cloud computing. The tie-up plans came amid a rush of chip makers combining in attempts to boost margins and expand their reach.

In its earnings release Thursday, Western Digital reiterated that it expects the SanDisk acquisition to be completed in the June quarter. Investors likely will be listening on the conference call for more details about the pending combination.

Over all, for the period ended April 1, Western Digital reported a profit of $74 million, or 32 cents a share, down from $384 million, or $1.63 a share, a year earlier. Excluding asset writedowns and other one-time items and other items, adjusted per-share earnings fell to $1.21 from $1.87. Revenue decreased 21% to $2.82 billion.

The company had projected per-share profit of $1.20 to $1.30 and revenue of $2.8 billion to $2.9 billion.

Analysts polled by Thomson Reuters had expected per-share earnings of $1.29 on revenue of $2.86 billion.

Gross margin fell to 26.7% from 29.1%.

SanDisk on Wednesday reported that its first-quarter earnings doubled and easily topped expectations.

Write to Tess Stynes at tess.stynes@wsj.com

(END) Dow Jones Newswires

April 28, 2016 17:45 ET (21:45 GMT)

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