Maxtor today announced its financial results for the fourth quarter ended December 27, 2003. Revenue for the quarter was US$ 1.171 billion. “We are very pleased with Maxtor’s fourth quarter financial results,” said Paul Tufano, president and chief executive officer. “During the quarter, the Company achieved record quarterly unit shipments, revenue and net income. We shipped 15.8 million hard disk drives, reflecting good demand for desktop PCs and Intel-based servers, as well as emerging applications including consumer electronics and midline and nearline enterprise storage.” Desktop drive shipments in the fourth quarter totaled 14.9 million. During the quarter, Maxtor added two major consumer electronics OEM customers and shipped 1,641,000 drives to CE OEMs. Shipments of SCSI drives increased in the fourth quarter to 854,000 compared with 709,000 in the third quarter of 2003.

Maxtor Corporation (NYSE: MXO) today announced its financial
results for the fourth quarter ended December 27, 2003. Revenue for the quarter
was US$ 1.171 billion. The Company reported net income on a GAAP basis of US$ 38.8
million, or US $ 0.15 per diluted share. Included in GAAP net income was a charge
of US US $ 23.6 million for the amortization of intangible assets and US $ 0.2
million in stock-based compensation expense. GAAP net income also included
income from discontinued operations of US $ 2.2 million, or US $ 0.01 per diluted
share. On a non-GAAP basis, excluding these charges, Maxtor reported income from
continuing operations of US $ 60.4 million, or US $ 0.24 per diluted share. In the
fourth quarter of 2002, revenue was US US US $ 1.038 billion. Net income on a
GAAP basis was US $ 3.6 million, or US $ 0.01 per diluted share. The GAAP net
income in the fourth quarter of 2002 included a charge for the amortization of
intangible assets, stock-based compensation expense and severance expense
related to a reduction in force, totaling US $ 33.7 million. On a non-GAAP basis,
excluding these charges, net income in the fourth quarter of 2002 was US $ 37.3
million, or US $ 0.15 per diluted share.

"We are very pleased with Maxtor’s fourth quarter financial
results," said Paul Tufano, president and chief executive officer. "During the
quarter, the Company achieved record quarterly unit shipments, revenue and net
income. We shipped 15.8 million hard disk drives, reflecting good demand for
desktop PCs and Intel-based servers, as well as emerging applications including
consumer electronics and midline and nearline enterprise storage."

Desktop drive shipments in the fourth quarter totaled 14.9
million. During the quarter, Maxtor added two major consumer electronics OEM
customers and shipped 1,641,000 drives to CE OEMs. Shipments of SCSI drives
increased in the fourth quarter to 854,000 compared with 709,000 in the third
quarter of 2003.

"Looking ahead, we believe that 2004 will be a year of
significant opportunity for the hard drive industry and for Maxtor," continued
Mr. Tufano. "Demand in our core desktop and server markets remains strong. There
is growing momentum for the use of hard drives in emerging applications where
Maxtor has a leadership position. We are committed to improving our operating
leverage throughout the year, by enhancing manufacturing efficiencies, driving
economies through the supply chain, and maintaining a strong focus on expense
control."

Fiscal Year 2003 Financial Results

For the fiscal year 2003, revenue was US $ 4.086 billion. Net
income on a GAAP basis was US $ 102.3 million, or $ 0.41 per diluted share.
Included in the GAAP net income was a charge of US $ 85.3 million for the
amortization of intangible assets and US $ 0.8 million in stock-based
compensation expense. GAAP net income also included income from discontinued
operations of US $ 2.2 million, or US $ 0.01 per diluted share. On a non-GAAP
basis, excluding these charges, income from continuing operations was US $ 186.2
million, or US $ 0.74 per diluted share. In 2002, Maxtor reported revenue of US
$ 3.780 billion and a net loss on a GAAP basis of US $ 334.1 million, or US
$ (1.40) per share. The GAAP loss included charges for the amortization of
intangible assets, restructuring, stock-based compensation expense and
severance, totaling US $ 112.5 million. There was also a loss from discontinued
operations of US $ 73.5 million, or US $ (0.31) per share. On a non-GAAP basis,
excluding these charges, the loss from continuing operations in 2002 was US
$ 149.6 million, or US $ (0.63) per share.