SiliconBeat

Disk drive manufacturer Seagate Technology cited favorable demand and pricing for its products Wednesday when it raised its guidance for its fiscal 2009 fourth quarter.

The company, which is headquartered in the Cayman Islands but operates out of Scotts Valley, now expects sales to come in at between $2.2-$2.3 billion, up from the $1.9-$2.2 it had forecast in April, while gross margin is expected to improve as much as 15 percent, higher than the 10-11 percent it had previously estimated for the period.

The company attributed the improved gross margin to “improved operational efficiencies, product management” along with a transition to its new products.

Seagate said its own inventories along with the industry’s as a whole “continue to be below historic levels,” leading it to predict that sales in its fiscal 2010 first quarter will be between $2.35 – $2.50 billion with gross profit margin climbing to 18 percent.