Hard Drive Makers Will Enjoy Prosperous Q4 2010

By Chris Preimesberger  |  Posted 2010-12-15 Print this article Print

iSuppli reports a late-year boost during the holiday season as companies and consumers dig into their pocketbooks to buy more storage.

Hard disk drive manufacturers, despite constant pressure from the growing solid-state sector, are expected to compile some sales numbers this quarter that will bring smiles at the end of 2010.

Industry analyst iSuppli reported Dec. 15 that the industry is seeing a late-year boost during the holiday season as companies and consumers dig into their pocketbooks to buy more storage.

The rise in HDD shipments in the fourth quarter will mark the second straight window of growth following a down move in the second quarter. HDD shipments will reach an estimated 169.2 million units during the last three months of the year, which is up 2.2 percent from 165.5 million units in the third quarter.

iSuppli projects industry revenue in the fourth quarter to climb 2.1 percent, amounting to $8.9 billion in sales worldwide.

"The fourth-quarter increases in HDD shipments and revenue reflect positive developments on several fronts, including the stabilization of prices, strong demand from the enterprise segment and a return to normal inventory levels," said Fang Zhang, analyst for storage systems at iSuppli.

The expected growth for the fourth quarter represents a smaller increase than in the third quarter, when shipments climbed 3.4 percent and revenue rose 3.1 percent. Nonetheless, the performance of the second half of 2010 is a major improvement from the first half, iSuppli said. Shipments in the second quarter declined 3.0 percent and revenue fell 7.7 percent from the first quarter.

Western Digital continued as the industry leader, having overtaken Seagate earlier this year at No. 1. WD is expected to ship 51.5 million HDD units in the fourth quarter, up 1.7 percent from 50.7 million units in the third quarter. In comparison, Seagate is expected to ship 49.5 million HDDs, up a smaller 0.6 percent from 49.2 million units during the same period.

On the revenue side, the rankings are reversed, as Seagate is predicted to maintain its lead in the fourth quarter with sales of $2.8 billion, which is up 3.7 percent from $2.7 billion in the third quarter. Western Digital, which sells products in the consumer segment at high volumes but at lower prices, is expected to remain at No. 2 with revenue of $2.4 billion, up a scant 0.2 percent from $2.39 billion in the third quarter.

Chris Preimesberger Chris Preimesberger was named Editor-in-Chief of Features & Analysis at eWEEK in November 2011. Previously he served eWEEK as Senior Writer, covering a range of IT sectors that include data center systems, cloud computing, storage, virtualization, green IT, e-discovery and IT governance. His blog, Storage Station, is considered a go-to information source. Chris won a national Folio Award for magazine writing in November 2011 for a cover story on Salesforce.com and CEO-founder Marc Benioff, and he has served as a judge for the SIIA Codie Awards since 2005. In previous IT journalism, Chris was a founding editor of both IT Manager's Journal and DevX.com and was managing editor of Software Development magazine. His diverse resume also includes: sportswriter for the Los Angeles Daily News, covering NCAA and NBA basketball, television critic for the Palo Alto Times Tribune, and Sports Information Director at Stanford University. He has served as a correspondent for The Associated Press, covering Stanford and NCAA tournament basketball, since 1983. He has covered a number of major events, including the 1984 Democratic National Convention, a Presidential press conference at the White House in 1993, the Emmy Awards (three times), two Rose Bowls, the Fiesta Bowl, several NCAA men's and women's basketball tournaments, a Formula One Grand Prix auto race, a heavyweight boxing championship bout (Ali vs. Spinks, 1978), and the 1985 Super Bowl. A 1975 graduate of Pepperdine University in Malibu, Calif., Chris has won more than a dozen regional and national awards for his work. He and his wife, Rebecca, have four children and reside in Redwood City, Calif.Follow on Twitter: editingwhiz

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