History 2002: 60/80GB Per Disk Boosts Maxtor

Maxtor simultaneously announced that its financial results for the last quarter of the year would be better than expected, while revealing that it would lay off 500 people.

Sales for the quarter should be around $990 million to $1.03 billion, compared to $820 million in 3FQ02 with proforma earnings from $25 to $35 million.

For Didier Tressaert, European VP, there are several reasons for this improved performance: prices held better than expected, strong improvement in yield for the 60/80GB-per-disk drives, as well as major penetration in SCSI devices and in the retail and external storage market.

Why then the 500 lay-offs (out of a total workforce of around 12,000), which will include 300 in Colorado, 96 in California, 56 in Massachusetts and 10 outside the US?

“More than anything, it’s an internal reorganization, a last round of housecleaning after the Quantum acquisition,” explains Tressaert.

Among those departing are 2 executives, Tex Schenkkan, SVP, and Jean-Dominique Savelli, VP marketing, both for the consumer electronics business group.

Does this mean that Maxtor is pulling out of consumer HDDs in order to concentrate only on more profitable high-end ATA and SCSI units?

“No,” Tressaert assured us. “We’ll just no longer have a specific consumer group, and this business will be integrated within Maxtor’s general organization.”

This article is an abstract of news published on issue 179 on December 2002 from the former paper version of Computer Data Storage Newsletter.