Storage, recession and you

Shadows on growth as lay-offs hit the storage

By Chris Mellor • Get more from this author

Posted in Storage, 1st November 2008 08:02 GMT

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Drive Array and drives

3PAR has made a quarterly loss and may be seeing a slackening of demand. Privately-held Pillar does not announce its financial results but it has just laid off 30 per cent of its workforce, anticipating a recession lasting through to 2010.

Isilon also made a loss in its latest quarter but a reduced one. It gave no guidance for next quarter or for the whole year. It has quite strong cash reserves and is rebuilding its business which will incline it to be reluctant to lay people off.

Drive supplier Western Digital showed quarterly revenues of $2.1bn, up 19 per cent year on year, and net income up by 33 per cent to $211m. But CEO John Coyne said: "The deterioration in the economy has led to a slowdown in both business and consumer spending... We have seen dampening of demand in the September quarter, and expect conditions of subdued demand to continue into the fourth quarter, the industry's traditionally strongest season." The company expects no revenue growth in the fourth quarter.

According to iSuppli the NAND flash market is expected to show a 14 per cent decline in revenues this year and a 15 per cent one next year, the first annual declines in its history.

Lastly, server adapter and array switching supplier Emulex is surprisingly upbeat. Q1 fy 09 revenues were $111.m, down 5 per cent year-on-year from Q1 fy08's $117.6m, one per cent sequentially. Net income of $7.1m ($0.9/share) was down over 30 per cent from Q1 fy08's $10.2m ($0.12/share). It is expecting flat or slighly increased revenues and net income in its next quarter. That's encouraging in the sense that it doesn't expect the situation to get worse.

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