Hutchinson Technology Incorporated researches, designs, develops, manufactures, and supplies suspension assemblies for hard disk drives in Thailand, Hong Kong, the Philippines, Malaysia, the United States, and internationally. The company manufactures its suspension assemblies with proprietary technology and processes with very low part-to-part variation. These processes require manufacturing to precise specifications that are critical to maintaining the necessary microscopic clearance between the head and disk and the electrical connectivity between the head and the drive circuitry. The company categorizes its products as either suspension assemblies or other revenue, which consists primarily of revenue outside of the disk drive industry for precision component manufacturing, tool design, tool build and metrology, suspension assembly components, reimbursement for disk drive industry-related engineering services and specific disk drive program capacity and biomeasurement products. During 2015, the company shipped 415 million suspension assemblies. The company shipped suspension assemblies incorporating its internally produced flexures, as well as suspensions using purchased flexures. Customers and Marketing The company’s disk drive products are sold principally operating primarily from its headquarters in Hutchinson, Minnesota. The company sells its suspension assemblies to original equipment manufacturers for use in their products and to a subassembler who sells to original equipment manufacturers. Its customers include Western Digital Corporation; Seagate Technology, LLC; and SAE Magnetics, Ltd./TDK Corporation. Research and Development The company’s research and development efforts are directed at continuing to develop suspension assembly capabilities and features that enable its products to meet performance criteria desired by its customers for specific drive applications. The company’s research and development expenses were $22,100,000 in 2015. Intellectual Property As of September 27, 2015, the company held 219 United States patents and 16 foreign patents, and it had 26 patent applications pending in the United States and 30 patent applications pending in other countries. Seasonality Historically, the disk drive industry has experienced seasonal demand, with higher levels of demand in the second half of the calendar year driven by consumer spending. Seasonal demand for the company’s suspension assemblies generally tracks that of the disk drive industry and also might be delayed or accelerated by existing inventory levels in the supply chain. Competition The company’s principal competitors are Nihon Hatsujo Kabusikigaisha; Magnecomp Precision Technology Public Company Limited, a subsidiary of TDK Corporation; and NAT Peripheral (H.K.) Co., Ltd., (a joint venture of NHK and TDK Corporation). Its principal competitors in producing suspension flexures are Nitto Denko Corporation and Dai Nippon Corporation. History Hutchinson Technology Incorporated was founded in 1965. The company was incorporated in Minnesota in 1965.
(HTCH:Consolidated Issue Listed on NASDAQ Global Select )
40 West Highland Park Drive NE
Hutchinson, MN 55350
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