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Seagate’s Falling Hard Disk Drive Shipments: Impact on Revenues

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Jul. 26 2016, Published 3:04 p.m. ET

Lower PC shipments negatively impacted HDD demand

According to StorageNewsletter, Seagate Technology (STX) reportedly shipped ~37.5 million HDD (hard disk drive) units in fiscal 4Q16, which ended on June 30, 2016. This represents a significant YoY (year-over-year) decline of approximately 17.5% over units shipped in fiscal 4Q15.

This decline is a concern for Seagate, as it has more than a 37% share in the HDD market. HDDs are used in PCs (personal computers). HDD shipments have been negatively impacted in the past few quarters, driven by declining sales in the PC market.

According to StorageNewsletter, worldwide HDD shipments are expected to be 99.5 million–102.5 million units. That’s a YoY decline of 7.2%–9.9% for fiscal 2Q16.

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HDD Sales have been falling since 2009

Seagate’s HDD sales fell to 469 million units in 2015 compared to 560 million units in 2009. In 2015, this segment saw a YoY decline of 17% over 2014. Seagate’s HDD shipments fell 21.8% YoY in fiscal 3Q16 to 39.2 million units.

The top three players in the HDD segment are Western Digital (WDC), Seagate Technology, and Japan-based (EWJ) (FJP) Toshiba (TOSYY), with market shares of 42%, 37%, and 21%, respectively.

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