While the impact of the Japanese tragedy remains uncertain, “our work suggests some haircut to PC demand, with the disk drive impact less clear; our work suggests PC demand has begun slowing a bit in Asia (as well as in Japan) as some are taking a ‘wait and see' approach to the potential repercussions from the Japanese tragedy; obviously in Japan itself there is less business being conducted,” Brean Murray reports.
“Our best estimate right now is for Mar Q PC shipments of ~85M or down 10% Q/Q (and flat Y/Y) vs. our last ‘official' estimate of 87.2M PC's. On drives, our work hasn't yet shown any change from our previous ~157M Mar Q unit expectation; but we believe the potential to see this move lower commensurate with PC demand exists (a 3% haircut to drives would place units in the low‐150M unit range for the Mar Q.
“If Mar Q drive demand ends up being in the low‐150M units range, we believe CY11 units could end up in the 675M – 680M range, or 3%‐4% Y/Y unit growth (vs. our current 685M forecast, or 5% growth).”
Brean Murray also said that Western Digital Corp. WDC will benefit substantively from acquiring Hitachi, adding that “we expect Seagate Technology PLC STX to gain meaningful PC share as a result.”
Western Digital closed Friday at $33.89; Seagate closed at $13.19.
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