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About Seagate Technology LLC

Seagate Technology is a leading independent maker of storage systems for electronic data. It makes hard disk drives (HDDs), solid state drives (SSDs), and solid state hybrid drives (SSHDs) as well as devices for managing storage. Seagate's drives are used in systems ranging from personal computers and consumer electronics to high-end servers and mainframes. The company sells directly to OEM customers including Dell Technologies and to distributors and retailers. Seagate sells external storage devices in the Seagate Backup Plus and Expansion product line and its consumer brands include LaCie and Maxtor. Seagate generates around 70% of its sales outside the US.

Operations

Seagate’s hard disk drive (HDD) products are designed for applications in enterprise servers and storage systems; portable external storage systems, surveillance systems, network-attached storage (NAS), digital video recorders; gaming consoles; and desktop and mobile computing. Its solid state drive (SSD) product portfolio is composed of Serial Attached SCSI (SAS) and Non-Volatile Memory Express (NVMe) systems for use with enterprise servers and storage systems.

The company's enterprise data solutions (EDS) portfolio includes storage subsystems for enterprises, cloud service providers, scale-out storage servers, and original equipment manufacturers.

Seagate outsources the manufacturing and assembly of certain components and products to third parties contractors.

Geographic Reach

Seagate is based in Dublin, Ireland and has facilities around the world. It has subassembly and component manufacturing operations in Malaysia, China, Northern Ireland, Singapore, Thailand, and the US. Principal product development facilities are in California, Colorado, and Minnesota as well as Singapore. 

Seagate relies on two markets for more than 80% of its revenue. Singapore accounts for about half of the company's revenue and the US supplies about a third. The Netherlands accounts for about 15%, while other countries supply the rest.

Sales and Marketing

Seagate depends on original equipment manufacturers for 70% of its revenue. Distributors and retailers each account for about 15% of Seagate's sales.

Financial Performance

Seagate's revenue has fluctuated in recent years in response to market conditions.

In 2019 (ended June), revenue slid about 7% to about $10.4 billion, down about $800 million from 2018. The company blamed the dip on unfavorable market conditions in the first half of its fiscal year and decreasing prices for its products. The company shipped more memory in 2019, somewhat offsetting the other factors.

Despite lower revenue, Seagate posted a 70% increase in net income, adding more than $770 million to the bottom line to reach $2 billion. The company reduced expenses and had a tax benefit in 2019 compared to 2018.

Seagate's coffers held $2.2 billion in cash and equivalents in 2019 compared to $1.8 billion the previous year. Operations generated $1.7 billion and investing activities provided $846 million, while financing activities used $2.2 billion.

 

Strategy

The world is awash in data and Seagate and its competitors are vying to provide places to store it.

Seagate's HDD business for mature markets, which include mission critical, PC and mobile, DVR, gaming, and consumer applications, provides a steady stream of revenue with little new investment. To get the most out of these mature markets, Seagate is tightly managing its costs.

Money it saves from cost-management has been invested in new markets such as storage for surveillance, network-attached storage (NAS) for small and medium business applications, and cloud computing. Those markets account for about half of Seagate's revenue and a higher percentage of its gross profit. The company believes there's ample room for wider margins in these businesses.

Seagate has ramped up the capacity of its HDDs, shipping 16 terabyte (TB) drives in 2019. The company squeezes more data on a disk with a process called heat-assisted magnetic recording (HAMR), which allows data to be written closer.

Any head start Seagate has with a 16 TB drive might be short-lived. Western Digital is poised to deliver an 18 TB drive and Toshiba is on the verge of releasing its 16 TB technology.

Company Background

Seagate Technology was founded in 1979 by Alan Shugart, an 18-year veteran of IBM who made floppy disks standard on microcomputers; manufacturing expert and longtime technology industry veteran Tom Mitchell; design engineer Douglas Mahon; and Finis Conner. Seagate pioneered the miniaturizing of larger mainframe hard disk drives for PCs.

Seagate Technology LLC

47488 Kato Rd
Fremont, CA 94538-7319
Phone: 1 (800) 732-4283

Firm Stats

Employer Type: Privately Owned
Assistant To Stephen Luczo Chairman and Chief Executive Officer: Georgia Brint
Chief Technology Officer: Henry Fabian
Chairman And Chief Executive Officer: Steve Luczo
Employees (This Location): 3,000
Employees (All Locations): 43,000

Major Office Locations

Fremont, CA

Other Locations

Cupertino, CA
Grass Valley, CA
San Jose, CA
Colorado Springs, CO
Longmont, CO
Shrewsbury, MA
Minneapolis, MN
Shakopee, MN
Oklahoma City, OK
Pittsburgh, PA
Toronto, Canada