Investor Relations | IR Events | Performance Briefing

[3rd Quarter of fiscal 2003 Performance Briefing]HDD Head Business Outlook

Mr. Takehiro Kamigama Corporate Officer General Manager Data Storage Components Business Group

Mr. Takehiro Kamigama
Corporate Officer
General Manager
Data Storage Components Business Group

I would like to give a brief explanation of how the HDD head business performed during the third quarter of fiscal 2003. I will look at net sales and outline our fourth-quarter and full-year net sales projections.

Firstly, third-quarter sales were ¥47.8 billion, above our earlier projection of ¥42.5 billion. In the third quarter, we eclipsed our targets in terms of both sales volumes and net sales. For the fourth quarter, we have revised upward our projection of net sales from ¥36.7 billion previously, to ¥47.8 billion. We are thus forecasting net sales for the full year of ¥173.8 billion. This contrasts with our previous forecast of ¥157.3 billion.

Next, I would like to look at aggregate demand for HDD heads and TDK's market share. We have slightly revised upward our previous forecast for HDD demand and the number of heads per HDD. There are several reasons for the upward revision to our projection for HDD demand. One is the emergence of demand for non-PC applications, such as AV products. Another is demand spurred by the replacement of HDDs in old PCs.

Regarding the upward revision to our projections for the number of heads per PC, it goes without saying that this partly reflects the long life span of 40GB/P products. Another reason is that 3 60GB/P heads are needed to meet demand for 80 GB HDDs. And demand is emerging for 200-300 GB HDDs. As a result, we have revised our projection sharply for HGA demand from 514 million to 575 million heads.

Finally, I would like to look at our schedule for obtaining certification of HDD heads. Certification of 80GB/P heads is almost complete and we expect to see 80GB/P heads become the mainstream product in the industry in April this year. Due to delays with 80GB/P heads, we expect some consequential delays in mass production of 120GB/P heads. At this stage, we now expect to begin mass production at the end of this year. Previously, we were predicting a start around August.

That concludes my brief presentation on TDK's HDD head business.