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The Importance of Nearline Storage for Seagate

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Nearline storage

According to Techopedia, nearline storage is a “type of storage medium that is external to a computer and provides quick and scalable access to storage devices/capacity within an IT environment.”

In fiscal 3Q17, US-based (SPY) storage tech (QQQ) firm Seagate’s (STX) nearline revenue rose 9% YoY (year-over-year) and accounted for 24% of total revenues. Hyperscale nearline revenue saw double-digit growth in fiscal 3Q17, while 8TB (terabyte) nearline products continued to be Seagate’s leading revenue SKU (stock keeping unit).

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During Seagate’s fiscal 3Q17 earnings call, COO (chief operating officer) David Morton stated: “We believe our opportunities in the nearline market will continue to span across multiple capacity points as our customers evolve their capacity infrastructure for a growing multiple of enterprise workload applications.”

Seagate’s Nearline product revenue rose 15% YoY in fiscal 2Q17.

Seagate’s nearline products shipped 21.4 exabytes in fiscal 3Q17

In fiscal 3Q17, Seagate’s nearline products shipped 21.4 exabytes, representing a rise of 21% YoY, as compared to the 17.7 exabytes shipped in fiscal 3Q16 and the 14.8 exabytes in fiscal 3Q15. As you can see in the above graph, nearline shipments rose significantly between 2011 and 2016.

Nearline capacity shipments have increased at a CAGR (compound annual growth rate) of 43%, from ~16 exabytes in fiscal 2012 to 69.7 exabytes at the end of fiscal 1Q17.

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