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Western Digital reveals Thai floods cost $199m to clean up

Shipped 24 million fewer hard drives
Tue Jan 24 2012, 15:30

STORAGE VENDOR Western Digital announced it had shipped 28.5 million hard drives in the second quarter ending 30 December 2011, raking in $2bn.

Western Digital was hit hard by the devastating floods in Thailand, with the firm citing costs of $199m due to the natural disaster. To put the firm's troubles in perspective, it shipped close to 24m more hard drives in the same quarter in 2010, with its $2bn revenue representing a 20 per cent decline from the same quarter a year previously.

As it tries to recover the company was keen to point out that production was ramping back up in its Thai factories. It said that it expects its plant capacity to be back to pre-flood levels during its fourth quarter, between July and September 2012.

John Coyne, president and CEO of Western Digital said, "While much work remains to be done over the next several quarters to reach our pre-flood manufacturing capabilities, the progress thus far is significantly ahead of our original expectations and is a tribute to the dedicated and effective actions of our employees, contractors and Thai government agencies, the efforts of our supply partners and the support of our customers."

Western Digital also reaffirmed its plan to complete the purchase of Hitachi's hard drive business by March 2012.

Hard drive prices are still significantly higher than six months ago, although with production restarting some retailers are easing limits on the number of units that can be bought in a single order. Although Western Digital believes production capacity will be back to normal by September, clearing the backlog of hard drive demand might take longer. µ


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