The effect of floods on Western Digital was having a large impact on its hard drive supplies and prices. There was a 45% drop with WD selling 23.7 million fewer hard drives after having a wooping 47 percent increase in the prices to $69 per unit over last year. With some of the profit being attributed to increase in manufacturing costs, most of it went to towards profit, with a gross margin increase to 32.5% over last year’s 19.2%.
According to WD $199 million went in expenses related to the floods and $2 billion in total revenue, about half a billion decrease from last. With the inventory pipelines being replenished in the first half of 2013, the company says its factories in Thailand should be back to pre-flood capacities by September 2012. Returning the prices to 2011 levels, however, seems like a tough task.
