Disk Drive Sector Discussion Forum Message Board

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Technology Stocks : Disk Drive Sector Discussion Forum

WDC 172.26

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Dec 31 3:59 PM EST

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To: Ted The Technician who wrote (8362)	5/20/2000 4:49:00 PM
From: Mark Madden	Read Replies (1) of 9256

Here is a weekend report on disk drive pricing from a sample of retail distributor drives. The drives include 456 samples from 6 different distributors. The average sample of disk drive prices dropped last week. Weekly average price change: Weighted desktop --- down 1.0% Less than 11gb --- down 0.9% 11gb to 21gb --- down 0.7% Greater than 21gb --- down 1.3% Enterprise --- down 0.5% Monthly average price change: Weighted desktop --- down 2.4% Less than 11gb --- down 2.8% 11gb to 21gb --- down 2.2% Greater than 21gb --- down 2.5% Enterprise --- down 0.7% Quarterly price change (monthly rate): Weighted desktop --- down 2.2% Less than 11gb --- down 2.9% 11gb to 21gb --- down 2.0% Greater than 21gb --- down 2.0% Enterprise --- down 2.3% Last Quarterly price change (monthly rate): Weighted desktop --- down 1.5% Less than 11gb --- down 1.1% 11gb to 21gb --- down 1.3% Greater than 21gb --- down 2.2% Enterprise --- up 0.1% Half way through the quarter, the prices are not as stable as they were last quarter. However, they are far more stable than they were last year. If the prices continue as they have the first half of the quarter, profits for the quarter will be dependent on demand and manufacturing costs. Drive makers predicted demand to follow seasonal patterns and decline this quarter. If the number of units decline but the mix of products increases profits can still increase. Drives with more platters or high rotational speeds still command higher margins. Manufacturing costs will reduce as programs with higher components and lower margins are phased out. This quarter started more profitable than last quarter. If demand and manufacturing cost savings can offset the minor price deterioration, we can get our pleasant surprises at the end of the quarter. Regards, Mark

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