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Western Digital Ships Samples of New 20TB and 18TB HDDs

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Western Digital Corporation (WDC - Free Report) recently announced that it has begun shipping high-capacity HDD samples to enterprise OEMs and hyperscale customers. The samples include 20TB Ultrastar DC HC650 SMR HDDs and 18TB Ultrastar DC HC550 CMR HDDs.

The products are being sampled with nearly a dozen enterprises globally, including Dropbox DBX. Qualification and volume shipments on these HDDs are expected in the first half of 2020.

The products, which were first previewed in June 2019, features the first-ever commercial deployment of energy-assisted magnetic recording technology on a nine-disk platform. The technology enables customers to provision and scale their data center environments with total cost of ownership.

High Capacity HDDs to Support Enterprise Workloads

Alongside a strong track record of innovation, the launch of high-capacity HDDs indicates Western Digital’s commitment to launch SMR-based ecosystem. Notably, such capacity-optimized enterprise HDDs address the demand for high volume data storage across a wide array of applications and enterprise workloads.

Western Digital’s Ultrastar 20TB SMR and 18TB CMR HelioSeal HDDs will aid customers to deploy up to 22% fewer racks and reduce their TCO by up to 11%, compared with the currently used 14TB CMR HDDs. Additionally, the new HDDs reduce power consumption, cooling costs, and data center infrastructure needs.

These drives make use of the industry’s highest areal density performance, through innovative utilization of energy-assisted magnetic recording. The magnetic strip along with the company’s HelioSeal, SMR technologies, triple-stage micro actuation and 9-disk platform play a crucial role in boosting drive capacity.

Moreover, capacity-optimized enterprise HDDs are expected to gain traction owing to growth in OEM storage systems and servers, and petabytes shipped to hyperscale cloud data centers.

The new 20TB and 18TB HDDs will aid Western Digital to cater to customers looking for a transition to higher capacity points for greater storage and energy efficiencies. The products are also likely to aid in cost efficiency and scalable infrastructures in the long run.

Western Digital Corporation Price and Consensus


Wrapping up

Despite the shift to solid state drives, enterprise system computers are still reliant on HDDs for data-heavy workloads and applications. Moreover, HDDs provide the much-needed extra space for data backup.
Moreover, PCs remain the biggest users of HDDs. Per Gartner’s preliminary data, PC shipments in the third quarter inched up 1.1% year over year to 68 million units. An improving trend in PC shipments favors business prospects of Western Digital, which continues to depend substantially on PC sales.

However, the disk drive market is highly competitive and has experienced drastic pricing pressure thanks to supply/demand volatility. Hard disk companies might be exposed to pressure in the near future as customers (such as tablet PC makers) start preferring flash cards for storage purposes instead of the customary hard disks. The situation may compel companies to cut hard disk prices, which may in turn hurt margins.

Apart from Western Digital, Seagate Technology STX and Toshiba are also important players in the HDDs market.

Zacks Rank & Stock to Consider

Western Digital currently carries a Zacks Rank #4 (Sell).

A better-ranked stock from the broader technology sector is Qorvo, Inc. QRVO. It has a Zacks Rank #1 (Strong Buy) and a long-term earnings growth rate of 11.9%. You can see the complete list of today’s Zacks #1 Rank stocks here.

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