Rumblings in the Far East suggest that hard drive manufacturers are experiencing a weak third quarter. According to sources cited by DigiTimes, HDD shipments are expected to grow by 3% in the third quarter, up from 165 million units in the previous quarter and slightly less than previously predicted by other firms. Earlier this month, the researchers at iSuppli estimated that HDD shipments would rise 3.4% in the third quarter because of the back-to-school and pre-holiday seasons.
Those positive factors have been partially mitigated by ongoing economic uncertainty in the US and Europe and rising demand for NAND flash-based storage (namely in mobile computing devices). However, the increasing popularity in smartphones, ultrabooks and related devices has also raised interest in cloud computing, which happens to use HDDs behind the scenes. In other words, drive makers can expect some consumer sales to be replaced by enterprise shipments.
DigiTimes also mentioned that OEM sales, which incidentally account for the largest proportion of shipments, have begun to slow because of March's earthquake. The Japanese disaster prompted vendors to stockpile components in an effort to avoid supply shortages in the second quarter. Not only are OEMs purchasing less drives to flush their existing stock, their scramble created a large sequential comparative base for third quarter shipments. Fourth quarter shipments are expected to remain flat sequentially or grow slightly at best.