This data is from the C1Q 2024 HDD shipments from the May 2024 Digital Storage Technology Newsletter.
Total HDD shipments in C1Q 2024 were up 3.0% compared with C4Q 2023 (29.7M versus 28.9M). Total exabytes shipped in C1Q 2024 were up about 23.2% from C4Q 2023 (279EB), driven by greater sales of mass storage HDDs, such as nearline drives. HDD revenues ($3.94B) were up about 19% from the prior quarter. This quarter continued the upward trend in unit and exabyte shipments as well as revenues that started last quarter. Other memory and storage products are also recovering.
Seagate said their HDD revenue was $1,477 B in the quarter with Mass Capacity HDDs accounting for 80% of this revenue. 75% of the company’s product was sold directly to OEMs. Total storage capacity shipped was 99.1EB with 88.5EB for Mass Capacity and 71.7TB for Nearline HDDs, the balance of 10.8EB was shipped for legacy applications. The average HDD capacity was 8.7TB with Mass Capacity average capacity at 12.5TB and legacy average capacity at 2.5TB. The company shipped about 11.4M units in the quarter with an ASP of $129.7.
Western Digital reported that their C1Q 2024 total HDD EB shipments increased by 41% from the prior quarter (I estimate this at 144.7EB) and that they had shipped 106.7EB of nearline storage. They also said that they shipped 2.5M client compute units, consumer shipped units were 1.9M and data center (cloud HDD unit shipments) were 7.3M. That means the average capacity of their nearline HDDs was about 14.6TB. The company’s ASP was $145 (up from the prior quarter at $122). Total HDD revenue was $1.752B. Cloud storage was about 45% of the company’s revenue in this quarter (compared to 33% in the prior quarter).
Dave Mosley of said during Seagate’s quarterly investor report, ”Regarding HDD qualifications, “The 24, 28-terabyte PMR drives are in qualification at most of our global cloud and enterprise customers. We have already completed qualification with one major enterprise customer, some global Tier 2 customers, and with our enterprise systems business. We currently expect to begin shipping significant volumes in the first half of fiscal 2025. Relative to HAMR technology, we continue to progress toward completing our first large CSP customer qualification, though we experienced a temporary slowdown in recent weeks.
We determined a mechanical component unrelated to the HAMR recording subsystem and some of our drives was not performing as expected. We identified and rapidly implemented the solution with full support from our customers. Verification tests are underway and these tests should be completed in the June quarter. Every other aspect of the qualification process has gone as expected.”
Seagate said that they expect to ship a few hundred thousand HAMR-based HDDs in the June quarter. In addition to supporting shipments to their lead hyperscale customer this calendar year, the company completed a qualification of HAMR drives with a non-cloud customer a few weeks ago.
As we reported earlier in Apri,l Seagate and collaborators in Japan reported that they had demonstrated 4Tbpsi recording using two-layer HAMR media with different curie Temperatures (Tc). This paves a path to higher storage capacity in future HAMR HDDs.
David Groeckler of WDC said that, “In HDD, Western Digital’s leading ePMR platform and enhanced UltraSMR technology allow us to provide the highest-capacity drives for mass market deployment. We believe this innovative technology and portfolio strategy enable us to offer the best TCO to our cloud customers and outperform our peers throughout the cycle. We are confident that the multi-quarter nearline demand headwinds have subsided as our major cloud customers have reengaged with us. We anticipate our financial outperformance resulting from profitable share gains to become more evident as nearline demand accelerates into the second half of fiscal year 2024 and beyond.
In both the first and second quarters, we shipped approximately 1 million UltraSMR drives per quarter. We forecast UltraSMR hard drive shipments to increase significantly in the fiscal third quarter and SMR drive shipments to continue to outgrow that of CMR drives going forward. Importantly, the adoption of UltraSMR is broadening to our major customers worldwide including a third cloud titan in the U.S. this year, as well as hyperscale and smart video customers in China.”
We saw a 14% average sales price (ASP) increase for HDDs from C4Q 2023 to C1Q 2024. The chart below shows this boost in ASP combined with the ASP in the prior quarter have HDD ASPs at the highest level they have been at since the turn of the century.
The figure below shows the HDD market share to date for 2024. Toshiba market share in C4Q and C1Q 2024 was about 22%. Toshiba has gained about 2% in market share this quarter over average market share in 2023.
The figure below (from earlier this year) shows our adjusted projections for total shipments of HDDs for a high projection, a median projection and a low projection. Total HDD unit shipments will likely continue to decline for the next year or so, due to the continuing decline in legacy HDD applications (such as PCs and consumer devices). However high capacity nearline HDD growth should continue in 2024 and in the future, driven for the demand for lower cost secondary storage in data center to support large amounts of incoming data to support AI training and other applications. This should raise the number annual shipping HDDs by 2027.
Both Seagate and WDC reported that they still had underutilized capacity that can be brought on line to meet demand. However, significant HDD demand growth this year could exceed this excess capacity, and in that case, there could be short term HDD shortages in 2024.
Total HDD unit shipments in C4Q 2023 were up about 3%, marking a second turn-around quarter for HDD demand. Capacity shipments were up 23.2% from the prior quarter and revenues were up about 19%. HAMR HDD introduction had a short delay but should be on track for significant shipments in 2024.
