Western Digital names President Steve Milligan as next CEO

Western Digital Corp., the largest maker of hard-disk drives, said President Steve Milligan will take the role of chief executive after the retirement of John Coyne on Jan. 2.

Milligan, 49, will retain the job of president and join Western Digital’s board after Coyne steps down, the Irvine company said. Coyne, 63, has spent almost 30 years with the company, the last five as CEO.

Milligan rejoined Western Digital this year as part of the company’s acquisition of Hitachi Global Storage Technologies for more than $4 billion. He had served as CEO of the division since December 2009, and he was Western Digital’s chief financial officer before leaving for Hitachi in 2007.

Richard Kugele, an analyst at Needham & Co., credited Milligan with improving Hitachi’s performance before the acquisition. He is “totally up to the task of running Western Digital, and then some,” Kugele said.

The Hitachi deal helped Western Digital retake the market-share lead in the disk-drive industry this year, according to research firm IHS Inc. Western Digital accounted for 45% of the market last quarter, followed by Seagate Technology at 42%.

Shares of Western Digital fell 1.6% to close at $41.18.

Milligan’s challenge will be navigating Western Digital through a predicted slump in demand for drives, Kugele said. Both Western Digital and Seagate had predicted flat demand for drives in the current quarter, when sales are usually brisk as technology companies gear up for the holiday quarter.

Now, Kugele expects industrywide sales to decline 8% in the quarter, largely because of reduced spending by technology companies in Europe and China.