Per the WDC cc, the TAM was 139. Per HTCH's last cc, the average heads per drive is 3.2. This leads to estimate of 444.8 SAs for last quarter. HTCH forecast it would ship 100 - 110 SAs. If my math is correct (never something to be assumed) 110 would be a 24.7% market share. Even 100 would be a 22.5% market share, which I think is up from previous position for HTCH. So, at least from my perspective, if HTCH can make the low end of guidance, that still is showing movement in the right direction.
I think they will make their quarterly/yearly revenue and earnings numbers. I think they will update us that 50% - 60% of manufacturing now in Thailand. They will not update us on their secret projects unless they are ready to announce a launch date....which I doubt will happen this quarter.
Next years outlook should be the best yearly projection in 5 years (that's not hard to beat). While slow and steady wins the race, the efficiencies, market share increments, **DSA profit margins and increased demand should take us to cash positive 3rd quarter 2014 (or possibly earlier).
I know the analysts gave HTCH room to succeed with their projections for this quarter and year; also, I think the analysts for unknown reasons gave unattainable rev and earnings projection for last quarter, so the 4th quarter looks like it will fire on all cylinders with 2014 providing steady upward price movement.
Management would like to avoid price spikes, so while analysts will try to get them to commit to cash positive by early second half, management will try to tamp this down a bit -- probably mentioning early 4th quarter "depending on volume."
One last thing, the number of shipments will be less an indicator then in previous years because the average suspension count per drive has increased. So unless you factor this in, you will be off in your calculations.
Just my best guess.
Just in case anyone is confused, Hutch's new fiscal year started on October 1st, we are now one month into Q1FY14. The quarter being reported on Thursday is Q4FY13 which ended Sept 30.
I expect that Q4FY13 was cash flow neutral....either a wee bit positive or a wee bit negative. They basically (more or less) said as much at the last cc and investor preso in NY. This quarter, Q1FY14 should be solidly cash flow positive and Q2FY14 should be bottom line net income profitable. I am still astonished at how analyst estimates for EPS have yet to move strongly upward....but analysts typically don't have the retail investor's best interests in mind.
Hutch management is typically guarded and conservative in their guidance. This is necessary in the brutally tough arena in which they play. Product cycles are short, technology is advancing at the speed of light, and information is king and they cannot afford to give anything (info-wise) for free to NHK or Magnecomp.....AND their two customers (Western Dig and Seagate) could get really PO'd if Hutch starts spilling too many beans on programs, quals, ramps, allocations, and volumes.
We'll know a bit more during trick-or-treating time on Halloween.
I sure hope for an improvement over last report . Your guesstimates are encouraging. I hope your close. Historically they have a tendency to disappoint . I certainly hope we've turned the corner here.
I think you're right on the money. I believe things are really going to ramp up in the next several quarters. With Thailand close to 100 percent we should be in for a very good ride into the teens by next spring. Glta