History 2004: Hitachi GST Now Profitable

At Hitachi GST, Jun Naruse is a relatively discreet CEO, somewhat reserved, in mark contrast to the jovial, bluff demeanor of most US executive.

Behind his glasses, his eyes burn with intelligence, however, and the man is cultivated, with a penchant for classical literature. At 57, he continues to swim and of course, plays golf. He’s well-versed in both American and Asian cultures.

Above all, he knows the storage industry cold. Hitachi conferred an enormous responsibility upon him, officially initiated in January 2003: regroup Hitachi’s and IBM’s WW HDD drive businesses, both in the red.

Clearly, his work has not been in vain. The company’s operating loss has continued to shrinking for the first 3 quarters of 2003, ending with operating income of $105 million, greater than that of both Maxtor and Western Digital, though half that of Seagate.

For the year, that comes out to total operating loss of $87 million, compared to the forecasted $330 million, with each quarter revenues increased, ending 2003 with annual sales WW of $4.2 billion.

The ultimate objective: $4.7 billion, with yearly profitability in 2004 and a 6% profit margin by 2006.

The company now boasts the industry’s largest product line, from one-inch to high-end enterprise drives.

According to a January 2004 IDC report cited by HGST, the HDD manufacturer moved to 2nd place in full-year revenue among HDD firms and increased 25% revenue from 2002 (IBM plus Hitachi) to 2003.

This article is an abstract of news published on issue 195 on April 2004 from the former paper version of Computer Data Storage Newsletter.