Tuesday, hard disk drive maker Seagate Technology (STX) revised its shipment and revenue outlook for the first quarter of fiscal 2010 as overall demand for products showed strengthening.
Grand Cayman, the Cayman Islands-based Seagate now expects revenue to be at or slightly above the high end of its original guidance of $2.4 - $2.6 billion.
Analysts polled by Thomson Reuters currently expect the company to post revenues of $2.54 billion for the quarter.
The company noted that overall industry demand for hard disk drives continues to strengthen and as a result, the total available market, or TAM, for the September quarter is anticipated to be greater than the 135-140 million units originally expected. TAM for the December quarter is now projected to be 145-155 million units.
The company also said that in the event OEM demand is stronger than it anticipates during the last two weeks of the quarter, as occurred last quarter, revenue for the first fiscal quarter could be greater than the revised guidance.
Gross margin as a percent of revenue is now expected to be about 23% - 24% as a result of the company's rapid transition to notebook and desktop products, as well as improving factory efficiencies and utilization.
Seagate said it believes that disk drive inventory in all channels continues to be at appropriate levels, with supply in balance with demand.
The demand and pricing environment during the remaining weeks of the quarter will be key factors in determining the operating results for the first quarter, Seagate added.
STX closed Tuesday's regular trading on the Nasdaq at $15.68, up $0.23 or 1.49%.
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