Growth has returned to the disk drive business if Seagate's latest quarterly results are anything to go by.
The raw numbers paint the picture perfectly. First quarter fiscal 2015 revenues were $3.8bn, nine per cent up on an annual compare and 15 per cent higher than the previous quarter. Seagate shipped 59.5 million drives, up from the 55.7 million shipped a year ago and the 52.5 million shipped last quarter. No wonder the firm has increased its dividend for shareholders.
Stifel Nicolaus MD Aaron Rakers thinks Seagate's total capacity ship growth is accelerating to +22.5 per cent year-on-year. Delving into the numbers he estimates "that HDD-only revenue totalled ~$3.6bn, or up 2 per cent y-o-y and +13 per cent sequentially. This would leave other (i.e., Xyratex + Flash) revenue at ~$210m, solidly ahead of our $150m estimate."
He's looking for the earnings call to show where the revenue bump has come from, which accroding to the analyst is: "PC/client demand, an enterprise uptick, [and/or] the company’s higher expectations for Xyratex contributions."
SSDs sure don't seem to be cramping Seagate's business much if at all yet.
There is an implication here that storage array vendors could see a revenue uptick too. Some of Seagate's disks must be going into their arrays. Western Digital reports tomorrow and these Seagate numbers must increase expectations of growth in its business too. Good news all round, really. ®