Lower PC shipments negatively impact HDD demand
Western Digital (WDC) reportedly shipped ~43.1 million HDD (hard disk drive) units in fiscal 3Q16, which ended on March 31, 2016. This represents a significant YoY (year-over-year) fall compared to the company’s 54.5 million units shipped in fiscal 3Q15.
This decline is a concern for Western Digital, as it has a share of over 43.2% in the HDD market in the United States. HDDs are used in personal computers. According to the market research company Gartner, PC shipments in the last quarter are expected to have fallen by 9.6% YoY to 64.8 million units, driven by the increasing dominance of mobile devices.
Sales of HDDs have been falling since 2009
As shown in the above chart, sales of HDDs fell to 469 million units in 2015, as compared to 560 million units in 2009. In 2015, this segment saw a YoY fall of 17% compared to 2014. The CEO of Western Digital (WDC), Stephen Milligan, stated, “We anticipate that hard drive demand in the June quarter will be slightly down from the March quarter given continued softer PC demand and weaker than expected demand in performance enterprise.”