Seagate: Shortage of Disk Drives to Continue Through 2022 - jamesexther

Seagate Technology said Tuesday that supply of hard phonograph recording drives (HDDs) this year wish carry on to come apart short of demand, superior full-size customers to look for durable-term agreements to ensure supply after devastating floods in Siam.

Shortage of drives by the end of this class is likely to personify about 150 million units, it said.

The forecast by Seagate is more or less in line with those of explore firms like Gartner which said last month that the major impact of the HDD shortage after the floods will be felt in the prototypal half of this year, and flatbottom potentially continue through the year. PC shipment increase could comprise temporarily affected during 2022, Gartner said.

Western Digital, which had its factories inundated in the floods, aforementioned last month that it expects its HDD production capacity to reach pre-flood levels only by the third quarter of this class.

In the December, 2022 quarter, the industry is estimated to have produced 105 to 110 million drives, and shipped 119 million units, which fell short of demand for 175 one thousand thousand units, Seagate said Tuesday while announcing its financial results for the quarter ended Dec. 30.

The society shipped 47 million units in the quarter, down 4 percent from the homophonic twenty-five percent a class sooner, citing component shortages because of the floods. But the ordinary selling price was up by The States$13 from a quarter earlier, even as average building block costs also multiplied by about $2.50 as a result of the floods.

Seagate closed its $1.4 billion acquisition of Samsung's hard disc drive stage business happening Dec. 19. It shipped some 700,000 drives from this social unit in December.

The ship's company's tax income in the quarter was $3.2 billion, up past about 18 percent from the same quarter in the old year. Net in the quarter was $563 million, up from $150 meg a year earlier.

The troupe has forecast at to the lowest degree $20 billion in revenue in this calendar year because of a "relatively benign" pricing environment. In the quarter through March, the company expects revenue of $4.3 billion and to ship leastwise 60 million drives, which is hoped-for to near to at least $5 billion in the close quarter every bit the supply chain recovers.

Although the company's factories were not directly affected past the floods, its component suppliers were hit, and many of them are short of capital to invest in new tooling, manufacturing equipment, and clean room facilities destroyed in the floods, Dave Mosley, Seagate's executive V.P. of operations, said during a conference call. Seagate is assisting suppliers where it can, including funding for capital equipment, he added.

Seven of its top decade suppliers had their factories tainted equally they were in the commercial enterprise Parks 30 miles northwesterly of downtown Bangkok that were severely affected by the floods, and at one point supply of components was totally down for some product lines, Mosley aforementioned.

The low point of industriousness product was not in the middle to of late October, as some industry observers oblige, but closer to the mediate of December, said Steve Luczo, Seagate's Chief operating officer.

Seagate is besides seeing some changes in the industry, including in the way customers are now placing orders, Many full-size customers entered into long-run agreements, sometimes running into a routine of years, which is bran-new to the industry, and represents a structural change in the way the company does business, Luczo said.

The long-term agreements are expected to account for over 60 percent of Seagate's production capacity in the calendar twelvemonth, reported to Luczo.

The company plans to auction about 200,000 drives later this week to gauge exact, and provide customers an additional channel to buy the drives. Seagate plans to comport much auctions sporadically, Luczo said.

John Ribeiro covers outsourcing and general technology breaking news from India for The IDG News Service. Follow Can on Twitter at @Johnribeiro. John's e-mail address is john_ribeiro@idg.com