Western Digital Fully Recovers by July, HDD Prices Still Up

The hard disk drive market suffered severely from the floods that struck Thailand late last year (2011), but Western Digital, the company most seriously affected, may just recover faster than originally expected.

According to the company's most recent words on the matter, full recovery is expected to happen by the end of June, or thereabouts.

That is to say, Western Digital does not expect its production capacity to be in any way constrained during the July-September, 2012 period.

"We expect to be at 100% of capacity in the September quarter. So yes, exiting the June quarter, we'll have to be getting to that run rate," said John Coyne, chief executive officer of Western Digital, during the most recent conference call with financial analysts.

This is a much more favorable forecast than most of the ones made so far.

At present, WD, Seagate and Toshiba are the only companies with any real stake in the HDD market.

Having bought Hitachi, Western Digital was praised as the clear leader of the segment, until the aforementioned flooding happened.

Out of the remaining trio, Seagate appears to have gotten the better end of the deal by far, even though it expects the overall market to struggle during most of the year.

Ironically, the flood and subsequent jump in unit prices did Seagate a huge favor, increasing its profitability by a great deal.

It helped that it was the only one whose factories weren't directly affected by the waters, and that Nidec, the main supplier of HDD motors, recovered fast.

Going back to Western Digital, the company expects to sell about 58 million drives in the third quarter of 2012. Coincidentally, this is the shipment level attained during the third quarter of 2011, pre-flood as it were. All in all, the level of optimism is higher than it was before.