Seagate 2009 Annual Report Download - page 23

Table of Contents
Volatility of Quarterly Results—Our quarterly results of operations fluctuate, sometimes significantly, from period to period, and may cause
our share price to decline.
In the past, our quarterly revenue and results of operations have fluctuated, sometimes significantly, from period to period. These
fluctuations, which we expect to continue, may be occasioned by a variety of factors, including:
• current uncertainty in global economic conditions may pose a risk to the overall economy;
•
adverse changes in the level of economic activity in the major regions in which we do business, for example Europe in the June
2010 quarter;
• competitive pressures resulting in lower selling prices by our competitors targeted to encourage shifting of customer demand;
•
delays or problems in our introduction of new products, particularly new disk drives with lower cost structures, the inability to
achieve high production yields or delays in customer qualification or initial product quality issues;
• changes in purchasing patterns by our distributor customers;
•
increased costs or adverse changes in availability of supplies of raw materials or components, especially in light of recent
consolidation among component suppliers, building inflationary pressure and the relative volatility of the U.S. dollar as compared
to other currencies;
•
the impact of corporate restructuring activities that we have and may continue to engage in;
•
changes in the demand for the computer systems, storage subsystems and consumer electronics that contain our disk drives, due to
seasonality, economic conditions and other factors;
• changes in purchases from period to period by our primary customers, particularly as our competitors are able to introduce and
produce in volume competing disk drive solutions or alternative storage technology solutions, such as flash memory or SSDs;
• shifting trends in customer demand which, when combined with overproduction of particular products, particularly when the
industry is served by multiple suppliers, results in unfavorable supply/demand imbalances;
•
our high proportion of fixed costs, including research and development expenses; and
• announcements of new products, services or technological innovations by us or our competitors.
As a result, we believe that quarter-to-quarter comparisons of our revenue and results of operations may not be meaningful, and that these
comparisons may not be an accurate indicator of our future performance. Our results of operations in one or more future quarters may fail to
meet the expectations of investment research analysts or investors, which could cause an immediate and significant decline in the trading price of
our ordinary shares.
New Product Offerings
—Market acceptance of new product introductions cannot be accurately predicted, and our results of operations will
suffer if there is less demand for our new products than is anticipated.
We are continually developing new products with the goal that we will be able to introduce technologically advanced and lower cost disk
drives into the marketplace ahead of our competitors.
The success of our new product introductions is dependent on a number of factors, including market acceptance, our ability to manage the
risks associated with product transitions, the effective management of inventory levels in line with anticipated product demand and the risk that
our new products will have quality problems or other defects in the early stages of introduction that were not anticipated in the design
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