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Innovation

HDD shortage to affect Intel's revenue

Chipmaker predicts fourth-quarter revenue to be lower than previous expectations due to shortage of hard-disk drive supply, but expects supplies to recover in first half of 2012.
Written by Liau Yun Qing, Contributor on

Intel has lowered its fourth-quarter revenue outlook from US$14.7 billion to US$13.7 billion, due to the shortage of hard disk drive (HDD) supply which it expects to continue into the first quarter of 2012.

In a blogpost published Monday, Intel said while sales of PCs were expected to grow sequentially in the fourth quarter, the worldwide PC supply chain was reducing inventories and microchip purchases due to HDD supply shortages.

The chipmaker noted that the shortage would continue into the first quarter. However, it expects a restocking of microchip inventories as supplies of HDDs recover during the first half of 2012.

The October floods in Thailand had led to a shortage of HDDs as well as PC units. Prior to the floods, the Asian economy produced 40 percent to 45 percent of the world's HDD supply in the first half of 2011, according to IDC.

While the Thai floods had impacted the supply chain for both consumer and enterprise storage, market observers told ZDNet Asia in a previous report that enterprises would see less serious impact from the floods, compared to consumer storage, as manufacturers placed higher priority on higher margin commercial business.

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