LONDON Ė Intel Corp. has cut its fourth quarter guidance by 6.8 percent referencing a shortage of hard disk drives (HDDs) as the reason. The shortage is due to disruption from flooding in Thailand. Without disk drives manufacturers cannot build computers and so are cutting orders of microprocessors and memories and building from inventory, which impacts Intel.
Intel, the world's largest chip company, now expects its fourth-quarter revenue to be $13.7 billion, plus or minus $300 million, on both a GAAP and non-GAAP basis, lower than the previous expectation of $14.7 billion, plus or minus $500 million. Intel is set to announce its 4Q11 financial results on Jan. 19, 2012.
The company said it expects hard disk drive supply shortages to continue into the first quarter, followed by a rebuilding of microprocessor inventories as supplies of hard disk drives recover during the first half of 2012.
The disk drive industry has been impacted heavily by catastrophic flooding that affected Thailand through most of the second half of 2011.
Many of the world's hard disk drives are assembled in Thailand, particularly 2.5-inch drives aimed at notebook computers. The larger 3.5-inch drives designed to fit in desktop machines are commonly produced in Malaysia or mainland China. Both Western Digital and Seagate have been affected by stopped production at Thai manufacturing sites.
Related links and articles:
ON Semi shutters two flooded Thai sites
Seagate: HDD shortages to last for months
Thai floods to speed up transition to SSDs
Thai flooding could hit supply chain harder than Japan quake