$1 Billion Short: Hard Drive Shortage Impacts Intel's Q4

Intel's stock was down about 4.7 percent as a result of the announcement. According to the company, sales of PCs will be up sequentially for the quarter, but there are not as many sales into the supply chain as chip inventories are reduced due to the supply disruption in the hard drive industry. Intel expects hard drive shortages to persist through the first quarter and continued improvement of supply during the first half of the year.

There is no consistent opinion from analysts when hard drive supply will be catching up with demand again. IDC, for example, expects some impact to last into 2013, while IHS said that currently added emergency production volumes could lead to a hard drive oversupply by the end of 2012 once the normal production volume is available again.

Several other chip companies were dragged down by the announcement as well. AMD fell by about 4.9 percent, Nvidia by 4.0 percent, Micron by 3.3 percent, Broadcom by 3.1 percent and Texas Instruments by 2.8 percent.

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  • seezur
    alidanyea, i believe hdds are the reason, and not ipad and phones over taking a bit of the pc market in a big way, or that people dont need new computers if they have damn near any dual core, and better manufacturing makes parts last longer... i totally believe that anyone who needed a new computer (most sales are from pre built) didnt get one because it cost an extra 20-30$ (the bump that oems have to pay for a hdd price increase)


    I don't think you get it. This has nothing to do with tablet/smartphone penetration into the PC market. The floods have caused HDD's to more than double in price and put a strain on the supply chain. Intel does not make huge amounts of profit off of pre-built systems, they make more money off of servers and corporations.

    I'll give an example. My company needed to purchase a storage device which we ordered w/28 1TB HDD's. Dell sold us the device but basically refused to sell us that many hard drives without "justification" then when the order was approved they couldn't give us a solid ETA they just said around 60 days. What this means is a lot of companies simply will not order until the supply chain is restored.

    So while your point about tablets and phones might be true you can be assured Intel is already aware of this as well and that was probably already accounted for in their projections. What they didn't account for was a natural disaster.
    10
  • Other Comments
  • joey532
    Thats what they get for putting all their eggs in the same basket.
    6
  • alidan
    yea, i believe hdds are the reason, and not ipad and phones over taking a bit of the pc market in a big way, or that people dont need new computers if they have damn near any dual core, and better manufacturing makes parts last longer... i totally believe that anyone who needed a new computer (most sales are from pre built) didnt get one because it cost an extra 20-30$ (the bump that oems have to pay for a hdd price increase)
    -1
  • seezur
    alidanyea, i believe hdds are the reason, and not ipad and phones over taking a bit of the pc market in a big way, or that people dont need new computers if they have damn near any dual core, and better manufacturing makes parts last longer... i totally believe that anyone who needed a new computer (most sales are from pre built) didnt get one because it cost an extra 20-30$ (the bump that oems have to pay for a hdd price increase)


    I don't think you get it. This has nothing to do with tablet/smartphone penetration into the PC market. The floods have caused HDD's to more than double in price and put a strain on the supply chain. Intel does not make huge amounts of profit off of pre-built systems, they make more money off of servers and corporations.

    I'll give an example. My company needed to purchase a storage device which we ordered w/28 1TB HDD's. Dell sold us the device but basically refused to sell us that many hard drives without "justification" then when the order was approved they couldn't give us a solid ETA they just said around 60 days. What this means is a lot of companies simply will not order until the supply chain is restored.

    So while your point about tablets and phones might be true you can be assured Intel is already aware of this as well and that was probably already accounted for in their projections. What they didn't account for was a natural disaster.
    10