The company doesn't appear to be satisfied with good results anymore

Jul 6, 2012 06:42 GMT  ·  By

By now, we've resigned ourselves to the idea that a large part of the HDD “crisis” concerns were overblown and that prices won't get back to pre-flood levels. Curiously, though, even record HDD sales don't seem to have met Seagate's hopes.

The HDD crisis passed a while ago, regardless of what storage product makers have been saying. It is hard for us to believe shortages exist when HDD makers, in this case Seagate, report record shipments.

Granted, Seagate wasn't directly hit by the floods that struck Thailand in late 2011, but it did have to cope with component providers' inventory reductions.

This only makes everything strange, however, as Seagate and WD made record amounts of money because of the “crisis.”

Now, the prices of hard disks are going down at last, and Seagate isn't precisely enthused about it. It was just less than half a day ago that it published its preliminary financial results for the fourth fiscal quarter of 2012, ended on June 29, 2012.

Apparently, despite a “record amount” of shipments, it did not make as much money as it had hoped, nor did it increase its market share by much.

The supply chain, it seems, recovered from the disruption faster than predicted. It didn't help that Seagate suffered an “isolated” issue with one of its enterprise product lines.

For those who want the numbers, Seagate estimates 66 million drive shipments, 42% market share and revenue of $4.5 billion / 3.63 billion Euro (which is still “record revenue,” but not as high a record as Seagate rooted for).

“Seagate expects to report another record quarter of revenue in the June quarter, however we did not meet our expected revenue and margin plan,” said Steve Luczo, Seagate chairman and chief executive officer.

“[The] product issue impacted enterprise product unit shipments by approximately 1.5 million units and drove our non-GAAP gross margin below our targeted plan. While this disruption to our business was disappointing, we acted quickly and conservatively by suspending shipments of the affected products.”

The final report will be given on July 30. As for the following quarter, the corporation thinks its shipments and revenue will stay flat.