Hitachi, Ltd. · TSE:6501

Hitachi — Corporate Update (April 2010)

17 slides from Hitachi's corporate update, Apr 22, 2010

  1. Slide 1: Steve Milligan, President & Chief Executive Officer

    Steve Milligan President & Chief Executive Officer April 22, 2010

  2. Slide 2: Cautionary Statement

    Cautionary Statement Certain statements found in this document may constitute “forward-looking statements” as defined in the U.S. Private Securities Litigation Reform Act of 1995. Such “forward-looking statements” reflect management’s current views with respect to certain future events and financial

  3. Slide 3: Hitachi GST Global Operations

    Hitachi GST Global Operations  2009 Revenue: US$4.8B  35,000 Employees  US Headquarters: San Jose, CA  One of the industry’s largest patent portfolios US Headquarters  San Jose, CA Sales offices & technical support located WW Manufacturing  Laguna, Philippines  Odawara, Japan  Prachinburi, T

  4. Slide 4: Complete Product Portfolio

    Complete Product Portfolio Personal Storage Endurastar Solid State CinemaStar Drives (SSD) Mobile Desktop Enterprise 2.5-inch 3.5-inch 2.5/3.5-inch SimpleDRIVE, SimpleTOUGH and G-Technology Travelstar series Deskstar series Ultrastar series 4

  5. Slide 5: Recent Key Milestones

    Recent Key Milestones Recruit leadership team Focus on profitable execution Accelerate growth  SSD partnership with Intel  Branded products acquisition  Substrate manufacturing acquisition 5

  6. Slide 6: Improving Financial Performance

    Improving Financial Performance $B Revenue Gross Margin 6 20% 5 $5.6 $5.6 18.3% 17.8% $4.8 4 15% 3 2 10% 1 8.9% 0 5% 2007 2008 2009 2007 2008 2009 $M Operating Income / Margin % $M Free Cash Flow * 300 500 200 $400 $393 3.7% 250 100 2.2% 0 0 (100) (250) (200) (5.1%) ($461) (300) (500) 2007 2008 2009

  7. Slide 7: Vertically Integrated Competitive Overview

    Competitive Overview Hitachi GST Segment Share Overall 15.6% Mobile 20.3% Desktop 10.5% Enterprise 22.5% Source: IDC 4Q09 WW HDD Shipments Segments Personal Mobile Desktop Enterprise Competitors Storage Integrated Vertically Seagate Western Digital Samsung Toshiba 7

  8. Slide 8: Competitive Financial Trends

    Competitive Financial Trends Hitachi has the Opportunity to Profitably Expand its Market Presence While Building Long-Term Value Revenue Gross B$ 1Q Results Margin % 8

  9. Slide 9: Evolving Storage Markets – Threats & Opportunities

    Evolving Storage Markets – Threats & Opportunities Storage continues to undergo a long-term transformation Data Volume Connectivity Isolated PC & Cloud Network Storage IP Networks & SANs Computing 1980 1990 2000 2010 Change  Mobility and netbooks  Digital photography & HD video  Social networking

  10. Slide 10: HDD Market Outlook

    HDD Market Outlook B$ M Units Industry Revenue Growth 40 800 (2009-2012 % CAGR) IDC Forecast Update, Feb. 2010 700  Enterprise (SSD) 59.3% 33.9 30 600  Personal Storage 27.7 500  Mobile 10.5 20 400  Consumer Electronics 7.2 300  Enterprise (HDD) (1.5) 10 200  Desktop (7.8) 100 0 0 Total 7.4% 2

  11. Slide 11: Strategic Focus Areas: 2010 and Beyond

    Strategic Focus Areas: 2010 and Beyond Optimize long-term performance of the core HDD business  Optimize supply chain  Improve asset utilization  Realize profitable growth Pursue new storage market opportunities for long-term revenue and earnings growth  Personal Storage  Solid State Drives (SS

  12. Slide 12: Optimizing the Core – Key Elements

    Optimizing the Core – Key Elements Hitachi GST Focus Areas Market & Product Technology  Market driven product planning Planning  Technology competitiveness  Predictable and repeatable development process Go To Product Market Development  Flexible and responsive manufacturing  Supply Chain Manag

  13. Slide 13: Focus on Profitable Execution

    Focus on Profitable Execution Disciplined Approach Improving Gross to Managing Capital Investments Margin and Cost Operating Expense for Profitable Growth Efficiencies  Improving operational  Targeted investments for execution to drive scale  Product mix optimization capacity and technology  Sel

  14. Slide 14: Long-Term Financial Models

    Long-Term Financial Models Financial Metrics Western Seagate Digital Gross Margin 22% - 26% 18% - 23% Operating Expense 10% - 12% 9% - 10% % to Sales Operating Margin 10% - 14% 10% - 14% Capital Expense 6% - 8% 7% % to Sales Source: Seagate: NASDAQ Investor Conference (12/1/09) WD: F2Q10 Earnings Ca

  15. Slide 15: Hitachi GST 1Q10 Results

    Hitachi GST 1Q10 Results Financial Metrics 1Q10* 1Q09* $1.46B Revenue $1.03B +42% YoY $422M $118M Gross Margin 28.9% 11.5% Operating Profit $217M ($57M) Operating Margin 14.9% (5.6%) * Quarterly results are unaudited Strong Financial Results and Ongoing Profitable Execution 15

  16. Slide 16: Integrated Value Creation Model

    Integrated Value Creation Model Value Creation Growth Opportunities Core Optimization Expand Beyond HDD For Revenue Core Improvements Growth & Build IP and Increased GM Software 2009 2010 2011 2012 2013 2014 Portfolio Disciplined Investment in Next Generation Technology Optimized Improve Balance She

  17. Slide 17: Summary

    Summary  Hitachi GST has a highly competitive, vertically-integrated business model  Company transformation continues with improving trends in sustained profitability and cash flow  Focused on responsible and profitable growth  Improving scalability with disciplined cost management  Optimizing

Hitachi — Corporate Update (April 2010) on 6ix