Seagate to cut production of lower capacity disk drives

Seagate Technology will cut back on production of its lower capacity, 500Mb to 800Mb, desktop disk drives which have seen slow sales recently.

Seagate Technology will cut back on production of its lower capacity, 500Mb to 800Mb, desktop disk drives which have seen slow sales recently, a company spokesman has confirmed.

"With the recent softness of the desktop computer market, Seagate has experienced excess inventory of certain of our lower capacity disk drives for desktop computers," says Woody Monroy.

"We've adjusted our production schedules accordingly to de-emphasise these lower capacity disk drives and we're focusing on our desktop models at higher capacity points," such as 1Gb to 4Gb, he says. Seagate expects to get rid of the excess stock during the next few months, according to Monroy.

As a result of the slow sales, revenues were lower than expected, he says. For the fourth quarter which ended June 28, earnings were US$101 million on revenues of US$2.01 billion, compared to earnings of US$113 million on revenues of US$2.7 billion for the quarter a year ago.

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