772897--12/4/2007--HUTCHINSON_TECHNOLOGY

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Our sales are concentrated in a small customer base. We may not be able to manufacture our products efficiently due to changes in product mix or technology, or other unforeseen events. If the rate of data density improves at a significantly faster rate than the rate of increase in the demand for disk drive storage, demand for suspension assemblies may decrease. A slowdown in demand for computer systems and consumer electronics may cause a decline in demand for suspension assemblies. Our investment in developing new process capabilities to produce suspension assemblies could result in significant increases in our operating expenses and may result in a product that is not acceptable to our customers. Demand for our suspension assemblies will decline if we are unable to qualify our products in disk drive programs. Our operating results are subject to fluctuations. If our customers improve their manufacturing yields, demand for our suspension assemblies may decrease. Competing storage technology may reduce demand for our products. Competing process capabilities may reduce demand for our products. We may have difficulty obtaining an adequate supply of raw materials that meet our strict specifications at reasonable prices. We do not know when, if ever, our BioMeasurement Division will be profitable. We do not know whether our only medical product, the InSpectra StO 2 System, will achieve market acceptance. The long sales cycle for the InSpectra StO 2 System will defer the generation of revenue by our BioMeasurement Division. We currently have limited experience as a company selling, marketing or distributing medical devices, which could impair the BioMeasurement Division s ability to achieve profitability. We may not be able to develop new applications for our product or expand our medical device product line successfully. We have limited experience in manufacturing and assembling the InSpectra StO 2 System, and we may encounter problems at our manufacturing facility or otherwise experience manufacturing delays or warranty claims that could result in lost revenue. We may fail to comply with manufacturing regulations, or be subject to product recalls, which could hurt our ability to sell and distribute our device and could subject us to fines, injunctions and penalties. We face the risk of product liability claims if the InSpectra StO 2 System fails to perform, and we may not be able to obtain adequate insurance. Our business could be adversely impacted if we have deficiencies in our disclosure controls and procedures or internal control over financial reporting. We may have to invest a significant amount of funds over the next several years to achieve our long-term growth objectives. We may not be able to adequately protect our intellectual property.

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772897--12/4/2007--HUTCHINSON_TECHNOLOGY_INC