Western Digital managed to increase sales of its hard drives by over $539 million last quarter as its total HDD capacity increased by roughly 34% quarter-over-quarter (QoQ). Western Digital's results were driven by the success of its 18TB HDDs among operators of cloud datacenters and enterprises. Furthermore, Chia crypto farmers also played a noticeable role in sales of high-capacity hard drives, though the company says those $200 million in HDD sales destined to Chia miners during the quarter didn't play a pivotal role.
"We saw incremental demand due to the emergence of Chia, our standout performance this quarter was primarily attributable to increasing demand from our cloud customers and the beginning of a recovery in enterprise demand," said David Goeckeler, CEO of Western Digital, during the company's earnings call with investors and financial analysts (as per SeekingAlpha). […] There was also increased demand for hard drives due to proof-of-space crypto currencies such as Chia […]. We believe proof-of-space crypto currency presents a great opportunity for us in the industry, but we are closely monitoring the sustainability of demand.
HDD makers and market observers say that the majority of consumer Chia miners use secondhand hard drives for Chia farming. Meanwhile, those who want to farm cryptocurrency professionally actually buy high-capacity enterprise-grade HDDs, which is why prices of such drives remain high. According to Western Digital, it sold about $200 million worth of HDDs for Chia during the quarter, which is pretty significant as sales of the company's hard drive division totaled $2.501 billion in Q4 FY2021.
"Chia was, maybe one way to think about that, it was hitting us kind of right where we were on the call was, I think the first week of it last quarter, probably a couple $100 million of upside there in the quarter due to Chia," said Goeckeler.
Western Digital sold 25.7 million hard drives in its Q4 FY2021 (which is generally Q2 CY2021), up from 23.2 million in Q3 FY2021 (Q1 2021) and up from 23.1 million in Q4 FY2020 (Q2 2020).
Shipments of HDDs for client PCs decreased to 9 million, supplies of hard drives for non-compute applications, increased to 8.7 million, but what stands out is that unit sales of Western Digital's datacenter drives increased 7.7 million, by 2 million sequentially and by 0.9 million annually. 7.7 million is the highest number of server-grade HDDs that the company has sold in about a year.
The total capacity of Western Digital's enterprise HDDs shipped in Q2 2021 was 104EB (a 49% increase sequentially), which means that their average capacity was about 13.5TB per unit. Western Digital says that 18TB SKUs enabled about half of the enterprise HDD capacity it sold during the quarter.
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Anton Shilov is a Freelance News Writer at Tom’s Hardware US. Over the past couple of decades, he has covered everything from CPUs and GPUs to supercomputers and from modern process technologies and latest fab tools to high-tech industry trends.