QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) | |||||||||||||||||||
(Address of principal executive offices) | (Zip Code) |
Title of each class | Trading symbol(s) | Name of each exchange on which registered | ||||||
(Nasdaq Global Select Market) |
Accelerated filer | Non-accelerated filer | Smaller reporting company | Emerging growth company | |||||||||||
☒ | ☐ | ☐ |
PAGE NO. | ||||||||
PART I. FINANCIAL INFORMATION | ||||||||
Item 1. | Financial Statements (unaudited) | |||||||
Condensed Consolidated Balance Sheets — As of December 31, 2021 and July 2, 2021 | ||||||||
Condensed Consolidated Statements of Operations — Three and Six Months Ended December 31, 2021 and January 1, 2021 | ||||||||
Condensed Consolidated Statements of Comprehensive Income — Three and Six Months Ended December 31, 2021 and January 1, 2021 | ||||||||
Condensed Consolidated Statements of Cash Flows — Six Months Ended December 31, 2021 and January 1, 2021 | ||||||||
Condensed Consolidated Statements of Shareholders' Equity — Six Months Ended December 31, 2021 and January 1, 2021 | ||||||||
Notes to Condensed Consolidated Financial Statements | ||||||||
Item 2. | Management’s Discussion and Analysis of Financial Condition and Results of Operations | |||||||
Item 3. | Quantitative and Qualitative Disclosures About Market Risk | |||||||
Item 4. | Controls and Procedures | |||||||
PART II. OTHER INFORMATION | ||||||||
Item 1. | Legal Proceedings | |||||||
Item 1A. | Risk Factors | |||||||
Item 5. | Other Information | |||||||
Item 6. | Exhibits |
December 31, 2021 | July 2, 2021 | ||||||||||
ASSETS | |||||||||||
Current assets: | |||||||||||
Cash and cash equivalents | $ | $ | |||||||||
Accounts receivable, net | |||||||||||
Inventories | |||||||||||
Other current assets | |||||||||||
Total current assets | |||||||||||
Property, plant and equipment, net | |||||||||||
Notes receivable and investments in Flash Ventures | |||||||||||
Goodwill | |||||||||||
Other intangible assets, net | |||||||||||
Other non-current assets | |||||||||||
Total assets | $ | $ | |||||||||
LIABILITIES AND SHAREHOLDERS’ EQUITY | |||||||||||
Current liabilities: | |||||||||||
Accounts payable | $ | $ | |||||||||
Accounts payable to related parties | |||||||||||
Accrued expenses | |||||||||||
Accrued compensation | |||||||||||
Current portion of long-term debt | |||||||||||
Total current liabilities | |||||||||||
Long-term debt | |||||||||||
Other liabilities | |||||||||||
Total liabilities | |||||||||||
Commitments and contingencies (Notes 10, 11, 13 and 16) | |||||||||||
Shareholders’ equity: | |||||||||||
Preferred stock, $ | |||||||||||
Common stock, $ | |||||||||||
Additional paid-in capital | |||||||||||
Accumulated other comprehensive loss | ( | ( | |||||||||
Retained earnings | |||||||||||
Treasury stock — common shares at cost; | ( | ||||||||||
Total shareholders’ equity | |||||||||||
Total liabilities and shareholders’ equity | $ | $ |
Three Months Ended | Six Months Ended | ||||||||||||||||||||||
December 31, 2021 | January 1, 2021 | December 31, 2021 | January 1, 2021 | ||||||||||||||||||||
Revenue, net | $ | $ | $ | $ | |||||||||||||||||||
Cost of revenue | |||||||||||||||||||||||
Gross profit | |||||||||||||||||||||||
Operating expenses: | |||||||||||||||||||||||
Research and development | |||||||||||||||||||||||
Selling, general and administrative | |||||||||||||||||||||||
Employee termination, asset impairment, and other charges | |||||||||||||||||||||||
Total operating expenses | |||||||||||||||||||||||
Operating income | |||||||||||||||||||||||
Interest and other income (expense): | |||||||||||||||||||||||
Interest income | |||||||||||||||||||||||
Interest expense | ( | ( | ( | ( | |||||||||||||||||||
Other income (loss), net | ( | ( | |||||||||||||||||||||
Total interest and other expense, net | ( | ( | ( | ( | |||||||||||||||||||
Income before taxes | |||||||||||||||||||||||
Income tax expense | |||||||||||||||||||||||
Net income | $ | $ | $ | $ | |||||||||||||||||||
Income per common share: | |||||||||||||||||||||||
Basic | $ | $ | $ | $ | |||||||||||||||||||
Diluted | $ | $ | $ | $ | |||||||||||||||||||
Weighted average shares outstanding: | |||||||||||||||||||||||
Basic | |||||||||||||||||||||||
Diluted | |||||||||||||||||||||||
Three Months Ended | Six Months Ended | ||||||||||||||||||||||
December 31, 2021 | January 1, 2021 | December 31, 2021 | January 1, 2021 | ||||||||||||||||||||
Net income | $ | $ | $ | $ | |||||||||||||||||||
Other comprehensive income (loss), before tax: | |||||||||||||||||||||||
Actuarial pension gain | |||||||||||||||||||||||
Foreign currency translation adjustment | ( | ( | |||||||||||||||||||||
Net unrealized gain (loss) on derivative contracts and available-for-sale securities | ( | ||||||||||||||||||||||
Total other comprehensive income (loss), before tax | ( | ( | |||||||||||||||||||||
Income tax benefit (expense) related to items of other comprehensive income (loss), before tax | ( | ( | ( | ||||||||||||||||||||
Other comprehensive income (loss), net of tax | ( | ( | |||||||||||||||||||||
Total comprehensive income | $ | $ | $ | $ |
Six Months Ended | |||||||||||
December 31, 2021 | January 1, 2021 | ||||||||||
Cash flows from operating activities | |||||||||||
Net income | $ | $ | |||||||||
Adjustments to reconcile net income to net cash provided by operations: | |||||||||||
Depreciation and amortization | |||||||||||
Stock-based compensation | |||||||||||
Deferred income taxes | ( | ||||||||||
Loss on disposal of assets | |||||||||||
Amortization of debt discounts | |||||||||||
Other non-cash operating activities, net | ( | ||||||||||
Changes in: | |||||||||||
Accounts receivable, net | ( | ||||||||||
Inventories | ( | ( | |||||||||
Accounts payable | |||||||||||
Accounts payable to related parties | ( | ( | |||||||||
Accrued expenses | |||||||||||
Accrued compensation | ( | ||||||||||
Other assets and liabilities, net | ( | ( | |||||||||
Net cash provided by operating activities | |||||||||||
Cash flows from investing activities | |||||||||||
Purchases of property, plant and equipment | ( | ( | |||||||||
Proceeds from the sale of property, plant and equipment | |||||||||||
Notes receivable issuances to Flash Ventures | ( | ( | |||||||||
Notes receivable proceeds from Flash Ventures | |||||||||||
Strategic investments and other, net | ( | ||||||||||
Net cash used in investing activities | ( | ( | |||||||||
Cash flows from financing activities | |||||||||||
Issuance of stock under employee stock plans | |||||||||||
Taxes paid on vested stock awards under employee stock plans | ( | ( | |||||||||
Repayment of debt | ( | ( | |||||||||
Proceeds from debt | |||||||||||
Debt issuance costs | ( | ||||||||||
Other | ( | ||||||||||
Net cash used in financing activities | ( | ( | |||||||||
Effect of exchange rate changes on cash | ( | ||||||||||
Net decrease in cash and cash equivalents | ( | ( | |||||||||
Cash and cash equivalents, beginning of year | |||||||||||
Cash and cash equivalents, end of period | $ | $ | |||||||||
Supplemental disclosure of cash flow information: | |||||||||||
Cash paid for income taxes | $ | $ | |||||||||
Cash paid for interest | $ | $ | |||||||||
Common Stock | Treasury Stock | Additional Paid-In Capital | Accumulated Other Comprehensive Income (Loss) | Retained Earnings | Total Shareholders’ Equity | ||||||||||||||||||||||||||||||||||||||||||
Shares | Amount | Shares | Amount | ||||||||||||||||||||||||||||||||||||||||||||
Balance at July 2, 2021 | $ | ( | $ | ( | $ | $ | ( | $ | $ | ||||||||||||||||||||||||||||||||||||||
Net income | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||
Employee stock plans | — | — | ( | — | — | ( | |||||||||||||||||||||||||||||||||||||||||
Stock-based compensation | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||
Actuarial pension gain | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||
Foreign currency translation adjustment | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||
Net unrealized gain on derivative contracts | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||
Balance at October 1, 2021 | ( | ( | ( | ||||||||||||||||||||||||||||||||||||||||||||
Net income | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||
Employee stock plans | — | — | — | ||||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||
Foreign currency translation adjustment | — | — | — | — | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||||
Net unrealized loss on derivative contracts | — | — | — | — | — | ( | — | ( | |||||||||||||||||||||||||||||||||||||||
Balance at December 31, 2021 | $ | $ | $ | $ | ( | $ | $ | ||||||||||||||||||||||||||||||||||||||||
Common Stock | Treasury Stock | Additional Paid-In Capital | Accumulated Other Comprehensive Income (Loss) | Retained Earnings | Total Shareholders’ Equity | ||||||||||||||||||||||||||||||||||||||||||
Shares | Amount | Shares | Amount | ||||||||||||||||||||||||||||||||||||||||||||
Balance at July 3, 2020 | $ | ( | $ | ( | $ | $ | ( | $ | $ | ||||||||||||||||||||||||||||||||||||||
Net loss | — | — | — | — | — | — | ( | ( | |||||||||||||||||||||||||||||||||||||||
Adoption of new accounting standards | — | — | — | — | — | — | ( | ( | |||||||||||||||||||||||||||||||||||||||
Employee stock plans | — | — | ( | — | — | ( | |||||||||||||||||||||||||||||||||||||||||
Stock-based compensation | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||
Actuarial pension gain | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||
Foreign currency translation adjustment | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||
Net unrealized gain on derivative contracts | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||
Balance at October 2, 2020 | ( | ( | ( | ||||||||||||||||||||||||||||||||||||||||||||
Net income | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||
Employee stock plans | — | — | ( | — | — | ||||||||||||||||||||||||||||||||||||||||||
Stock-based compensation | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||
Actuarial pension gain | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||
Foreign currency translation adjustment | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||
Net unrealized gain on derivative contracts | — | — | — | — | — | — | |||||||||||||||||||||||||||||||||||||||||
Balance at January 1, 2021 | $ | ( | $ | ( | $ | $ | ( | $ | $ |
Three Months Ended | Six Months Ended | ||||||||||||||||||||||
December 31, 2021 | January 1, 2021 | December 31, 2021 | January 1, 2021 | ||||||||||||||||||||
Net revenue: | |||||||||||||||||||||||
HDD | $ | $ | $ | $ | |||||||||||||||||||
Flash | |||||||||||||||||||||||
Total net revenue | $ | $ | $ | $ | |||||||||||||||||||
Gross profit: | |||||||||||||||||||||||
HDD | $ | $ | $ | $ | |||||||||||||||||||
Flash | |||||||||||||||||||||||
Total gross profit for segments | |||||||||||||||||||||||
Unallocated corporate items: | |||||||||||||||||||||||
Amortization of acquired intangible assets | ( | ( | ( | ( | |||||||||||||||||||
Stock-based compensation expense | ( | ( | ( | ( | |||||||||||||||||||
Charges related to a power outage incident and related recovery | |||||||||||||||||||||||
Total unallocated corporate items | ( | ( | ( | ( | |||||||||||||||||||
Consolidated gross profit | $ | $ | $ | $ | |||||||||||||||||||
Gross margin: | |||||||||||||||||||||||
HDD | % | % | % | % | |||||||||||||||||||
Flash | % | % | % | % | |||||||||||||||||||
Consolidated gross margin | % | % | % | % |
Three Months Ended | Six Months Ended | ||||||||||||||||||||||
December 31, 2021 | January 1, 2021 | December 31, 2021 | January 1, 2021 | ||||||||||||||||||||
(in millions) | |||||||||||||||||||||||
Revenue by End Market | |||||||||||||||||||||||
Cloud | $ | $ | $ | $ | |||||||||||||||||||
Client | |||||||||||||||||||||||
Consumer | |||||||||||||||||||||||
Total Revenue | $ | $ | $ | $ | |||||||||||||||||||
Revenue by Geography | |||||||||||||||||||||||
Americas | $ | $ | $ | $ | |||||||||||||||||||
Europe, Middle East and Africa | |||||||||||||||||||||||
Asia | |||||||||||||||||||||||
Total Revenue | $ | $ | $ | $ | |||||||||||||||||||
HDD | Flash | Total | |||||||||||||||
(in millions) | |||||||||||||||||
Balance at July 3, 2021 | $ | $ | $ | ||||||||||||||
Foreign currency translation adjustment | ( | ( | |||||||||||||||
Balance at December 31, 2021 | $ | $ | $ |
December 31, 2021 | July 2, 2021 | ||||||||||
(in millions) | |||||||||||
Inventories: | |||||||||||
Raw materials and component parts | $ | $ | |||||||||
Work-in-process | |||||||||||
Finished goods | |||||||||||
Total inventories | $ | $ |
December 31, 2021 | July 2, 2021 | ||||||||||
(in millions) | |||||||||||
Property, plant and equipment: | |||||||||||
Land | $ | $ | |||||||||
Buildings and improvements | |||||||||||
Machinery and equipment | |||||||||||
Computer equipment and software | |||||||||||
Furniture and fixtures | |||||||||||
Construction-in-process | |||||||||||
Property, plant and equipment, gross | |||||||||||
Accumulated depreciation | ( | ( | |||||||||
Property, plant and equipment, net | $ | $ |
December 31, 2021 | July 2, 2021 | ||||||||||
(in millions) | |||||||||||
Finite-lived intangible assets | $ | $ | |||||||||
In-process research and development | |||||||||||
Accumulated amortization | ( | ( | |||||||||
Intangible assets, net | $ | $ |
Three Months Ended | Six Months Ended | ||||||||||||||||||||||
December 31, 2021 | January 1, 2021 | December 31, 2021 | January 1, 2021 | ||||||||||||||||||||
(in millions) | |||||||||||||||||||||||
Warranty accrual, beginning of period | $ | $ | $ | $ | |||||||||||||||||||
Charges to operations | |||||||||||||||||||||||
Utilization | ( | ( | ( | ( | |||||||||||||||||||
Changes in estimate related to pre-existing warranties | ( | ( | ( | ( | |||||||||||||||||||
Warranty accrual, end of period | $ | $ | $ | $ |
December 31, 2021 | July 2, 2021 | ||||||||||
(in millions) | |||||||||||
Warranty accrual: | |||||||||||
Current portion (included in Accrued expenses) | $ | $ | |||||||||
Long-term portion (included in Other liabilities) | |||||||||||
Total warranty accrual | $ | $ |
December 31, 2021 | July 2, 2021 | ||||||||||
(in millions) | |||||||||||
Other liabilities: | |||||||||||
Non-current net tax payable | $ | $ | |||||||||
Payables related to unrecognized tax benefits | |||||||||||
Other non-current liabilities | |||||||||||
Total other liabilities | $ | $ |
Actuarial Pension Gains (Losses) | Foreign Currency Translation Adjustment | Unrealized Gains (Losses) on Derivative Contracts | Total Accumulated Comprehensive Income (Loss) | ||||||||||||||||||||
(in millions) | |||||||||||||||||||||||
Balance at July 2, 2021 | $ | ( | $ | ( | $ | ( | $ | ( | |||||||||||||||
Other comprehensive income (loss) before reclassifications | ( | ( | ( | ||||||||||||||||||||
Amounts reclassified from accumulated other comprehensive income (loss) | |||||||||||||||||||||||
Income tax expense related to items of other comprehensive income (loss) | ( | ( | |||||||||||||||||||||
Net current-period other comprehensive income (loss) | ( | ( | |||||||||||||||||||||
Balance at December 31, 2021 | $ | ( | $ | ( | $ | ( | $ | ( |
December 31, 2021 | |||||||||||||||||||||||
Level 1 | Level 2 | Level 3 | Total | ||||||||||||||||||||
(in millions) | |||||||||||||||||||||||
Assets: | |||||||||||||||||||||||
Cash equivalents - Money market funds | $ | $ | $ | $ | |||||||||||||||||||
Foreign exchange contracts | |||||||||||||||||||||||
Total assets at fair value | $ | $ | $ | $ | |||||||||||||||||||
Liabilities: | |||||||||||||||||||||||
Foreign exchange contracts | $ | $ | $ | $ | |||||||||||||||||||
Interest rate swap contracts | |||||||||||||||||||||||
Total liabilities at fair value | $ | $ | $ | $ |
July 2, 2021 | |||||||||||||||||||||||
Level 1 | Level 2 | Level 3 | Total | ||||||||||||||||||||
(in millions) | |||||||||||||||||||||||
Assets: | |||||||||||||||||||||||
Cash equivalents - Money market funds | $ | $ | $ | $ | |||||||||||||||||||
Foreign exchange contracts | |||||||||||||||||||||||
Total assets at fair value | $ | $ | $ | $ | |||||||||||||||||||
Liabilities: | |||||||||||||||||||||||
Foreign exchange contracts | $ | $ | $ | $ | |||||||||||||||||||
Interest rate swap contracts | |||||||||||||||||||||||
Total liabilities at fair value | $ | $ | $ | $ |
December 31, 2021 | July 2, 2021 | ||||||||||||||||||||||
Carrying Value | Fair Value | Carrying Value | Fair Value | ||||||||||||||||||||
(in millions) | |||||||||||||||||||||||
Variable interest rate Term Loan A-1 maturing 2023 | $ | $ | $ | $ | |||||||||||||||||||
Variable interest rate Term Loan B-4 maturing 2023 | |||||||||||||||||||||||
Total | $ | $ | $ | $ |
December 31, 2021 | July 2, 2021 | ||||||||||
(in millions) | |||||||||||
Variable interest rate Term Loan A-1 maturing 2023 | $ | $ | |||||||||
Variable interest rate Term Loan B-4 maturing 2023 | |||||||||||
Total debt | |||||||||||
Issuance costs and debt discounts | ( | ( | |||||||||
Subtotal | |||||||||||
Less current portion of long-term debt | ( | ( | |||||||||
Long-term debt | $ | $ |
December 31, 2021 | July 2, 2021 | ||||||||||
(in millions) | |||||||||||
Benefit obligation at end of period | $ | $ | |||||||||
Fair value of plan assets at end of period | |||||||||||
Unfunded status | $ | $ |
December 31, 2021 | July 2, 2021 | ||||||||||
(in millions) | |||||||||||
Current liabilities | $ | $ | |||||||||
Non-current liabilities | |||||||||||
Net amount recognized | $ | $ |
December 31, 2021 | July 2, 2021 | ||||||||||
(in millions) | |||||||||||
Notes receivable, Flash Partners | $ | $ | |||||||||
Notes receivable, Flash Alliance | |||||||||||
Notes receivable, Flash Forward | |||||||||||
Investment in Flash Partners | |||||||||||
Investment in Flash Alliance | |||||||||||
Investment in Flash Forward | |||||||||||
Total notes receivable and investments in Flash Ventures | $ | $ |
December 31, 2021 | |||||
(in millions) | |||||
Notes receivable | $ | ||||
Equity investments | |||||
Operating lease guarantees | |||||
Inventory and prepayments | |||||
Maximum estimable loss exposure | $ |
Lease Amounts | |||||||||||
(Japanese yen, in billions) | (U.S. dollar, in millions) | ||||||||||
Total guarantee obligations | ¥ | $ |
Annual Installments | Payment of Principal Amortization | Purchase Option Exercise Price at Final Lease Terms | Guarantee Amount | |||||||||||||||||
(in millions) | ||||||||||||||||||||
Remaining six months of 2022 | $ | $ | $ | |||||||||||||||||
2023 | ||||||||||||||||||||
2024 | ||||||||||||||||||||
2025 | ||||||||||||||||||||
2026 | ||||||||||||||||||||
Thereafter | ||||||||||||||||||||
Total guarantee obligations | $ | $ | $ |
Lease Amounts | |||||
Minimum lease payments by fiscal year: | ($ in millions) | ||||
Remaining six months of 2022 | $ | ||||
2023 | |||||
2024 | |||||
2025 | |||||
2026 | |||||
Thereafter | |||||
Total future minimum lease payments | |||||
Less: Imputed Interest | |||||
Present value of lease liabilities | |||||
Less: Current portion (included in Accrued expenses) | |||||
Long-term operating lease liabilities (included in Other liabilities) | $ | ||||
Operating lease right-of-use assets (included in Other non-current assets) | $ | ||||
Weighted average remaining lease term in years | |||||
Weighted average discount rate | % |
Three Months Ended | Six Months Ended | ||||||||||||||||||||||
December 31, 2021 | January 1, 2021 | December 31, 2021 | January 1, 2021 | ||||||||||||||||||||
(in millions) | |||||||||||||||||||||||
Cost of operating leases | $ | $ | $ | $ | |||||||||||||||||||
Cash paid for operating leases | |||||||||||||||||||||||
Operating lease assets obtained in exchange for operating lease liabilities |
Long-term commitments | ||||||||
(in millions) | ||||||||
Fiscal year: | ||||||||
Remaining six months of 2022 | $ | |||||||
2023 | ||||||||
2024 | ||||||||
2025 | ||||||||
2026 | ||||||||
Thereafter | ||||||||
Total | $ |
Three Months Ended | Six Months Ended | ||||||||||||||||||||||
December 31, 2021 | January 1, 2021 | December 31, 2021 | January 1, 2021 | ||||||||||||||||||||
(in millions) | |||||||||||||||||||||||
RSUs and PSUs | $ | $ | $ | $ | |||||||||||||||||||
ESPP | |||||||||||||||||||||||
Total | $ | $ | $ | $ | |||||||||||||||||||
Three Months Ended | Six Months Ended | ||||||||||||||||||||||
December 31, 2021 | January 1, 2021 | December 31, 2021 | January 1, 2021 | ||||||||||||||||||||
(in millions) | |||||||||||||||||||||||
Cost of revenue | $ | $ | $ | $ | |||||||||||||||||||
Research and development | |||||||||||||||||||||||
Selling, general and administrative | |||||||||||||||||||||||
Subtotal | |||||||||||||||||||||||
Tax benefit | ( | ( | ( | ( | |||||||||||||||||||
Total | $ | $ | $ | $ |
Unamortized Compensation Costs | Weighted Average Service Period | ||||||||||
(in millions) | (years) | ||||||||||
RSUs and PSUs (1) | $ | ||||||||||
ESPP | |||||||||||
Total unamortized compensation cost | $ |
Number of Shares | Weighted Average Exercise Price Per Share | Weighted Average Remaining Contractual Life | Aggregate Intrinsic Value | ||||||||||||||||||||
(in millions) | (in years) | (in millions) | |||||||||||||||||||||
Options outstanding at July 2, 2021 | $ | $ | |||||||||||||||||||||
Exercised | ( | ||||||||||||||||||||||
Canceled or expired | ( | ||||||||||||||||||||||
Options outstanding at December 31, 2021 | |||||||||||||||||||||||
Number of Shares | Weighted Average Grant Date Fair Value | Aggregate Intrinsic Value at Vest Date | |||||||||||||||
(in millions) | (in millions) | ||||||||||||||||
RSUs and PSUs outstanding at July 2, 2021 | $ | ||||||||||||||||
Granted | |||||||||||||||||
Vested | ( | $ | |||||||||||||||
Forfeited | ( | ||||||||||||||||
RSUs and PSUs outstanding at December 31, 2021 | |||||||||||||||||
Three Months Ended | Six Months Ended | ||||||||||||||||||||||
December 31, 2021 | January 1, 2021 | December 31, 2021 | January 1, 2021 | ||||||||||||||||||||
($ in millions) | |||||||||||||||||||||||
Income before taxes | $ | $ | $ | $ | |||||||||||||||||||
Income tax expense | |||||||||||||||||||||||
Effective tax rate | % | % | % | % |
Three Months Ended | Six Months Ended | ||||||||||||||||||||||
December 31, 2021 | January 1, 2021 | December 31, 2021 | January 1, 2021 | ||||||||||||||||||||
(in millions, except per share data) | |||||||||||||||||||||||
Net income | $ | $ | $ | $ | |||||||||||||||||||
Weighted average shares outstanding: | |||||||||||||||||||||||
Basic | |||||||||||||||||||||||
Employee stock options, RSUs, PSUs and ESPP | |||||||||||||||||||||||
Basic and diluted | |||||||||||||||||||||||
Income per common share: | |||||||||||||||||||||||
Basic | $ | $ | $ | $ | |||||||||||||||||||
Diluted | $ | $ | $ | $ | |||||||||||||||||||
Anti-dilutive potential common shares excluded |
Three Months Ended | Six Months Ended | ||||||||||||||||||||||
December 31, 2021 | January 1, 2021 | December 31, 2021 | January 1, 2021 | ||||||||||||||||||||
(in millions) | |||||||||||||||||||||||
Employee termination benefits | $ | $ | $ | $ | |||||||||||||||||||
Asset impairments and losses (gains) on disposal of assets | ( | ||||||||||||||||||||||
Total employee termination, asset impairment, and other charges | $ | $ | $ | $ |
Employee Termination Benefits | |||||
(in millions) | |||||
Accrual balance at July 2, 2021 | $ | ||||
Charges | |||||
Cash payments | ( | ||||
Accrual balance at December 31, 2021 | $ |
Three Months Ended | |||||||||||||||||||||||||||||||||||
December 31, 2021 | January 1, 2021 | $ Change | % Change | ||||||||||||||||||||||||||||||||
($ in millions) | |||||||||||||||||||||||||||||||||||
Revenue, net | $ | 4,833 | 100.0 | % | $ | 3,943 | 100.0 | % | $ | 890 | 23 | % | |||||||||||||||||||||||
Cost of revenue | 3,250 | 67.2 | 2,983 | 75.7 | 267 | 9 | |||||||||||||||||||||||||||||
Gross profit | 1,583 | 32.8 | 960 | 24.3 | 623 | 65 | |||||||||||||||||||||||||||||
Operating Expenses: | |||||||||||||||||||||||||||||||||||
Research and development | 575 | 11.9 | 535 | 13.6 | 40 | 7 | |||||||||||||||||||||||||||||
Selling, general and administrative | 279 | 5.8 | 265 | 6.7 | 14 | 5 | |||||||||||||||||||||||||||||
Employee termination, asset impairment, and other charges | 2 | — | 2 | 0.1 | — | — | |||||||||||||||||||||||||||||
Total operating expenses | 856 | 17.7 | 802 | 20.3 | 54 | 7 | |||||||||||||||||||||||||||||
Operating income | 727 | 15.0 | 158 | 4.0 | 569 | 360 | |||||||||||||||||||||||||||||
Interest and other income (expense): | |||||||||||||||||||||||||||||||||||
Interest income | 1 | — | 2 | 0.1 | (1) | (50) | |||||||||||||||||||||||||||||
Interest expense | (76) | (1.6) | (81) | (2.1) | 5 | (6) | |||||||||||||||||||||||||||||
Other income (loss), net | (6) | (0.1) | 6 | 0.2 | (12) | (200) | |||||||||||||||||||||||||||||
Total interest and other expense, net | (81) | (1.7) | (73) | (1.9) | (8) | 11 | |||||||||||||||||||||||||||||
Income before taxes | 646 | 13.4 | 85 | 2.2 | 561 | 660 | |||||||||||||||||||||||||||||
Income tax expense | 82 | 1.7 | 23 | 0.6 | 59 | 257 | |||||||||||||||||||||||||||||
Net income | $ | 564 | 11.7 | $ | 62 | 1.6 | 502 | 810 |
Six Months Ended | |||||||||||||||||||||||||||||||||||
December 31, 2021 | January 1, 2021 | $ Change | % Change | ||||||||||||||||||||||||||||||||
($ in millions) | |||||||||||||||||||||||||||||||||||
Revenue, net | $ | 9,884 | 100.0 | % | $ | 7,865 | 100.0 | % | $ | 2,019 | 26 | % | |||||||||||||||||||||||
Cost of revenue | 6,636 | 67.1 | 6,001 | 76.3 | 635 | 11 | |||||||||||||||||||||||||||||
Gross profit | 3,248 | 32.9 | 1,864 | 23.7 | 1,384 | 74 | |||||||||||||||||||||||||||||
Operating Expenses: | |||||||||||||||||||||||||||||||||||
Research and development | 1,153 | 11.7 | 1,090 | 13.9 | 63 | 6 | |||||||||||||||||||||||||||||
Selling, general and administrative | 570 | 5.8 | 521 | 6.6 | 49 | 9 | |||||||||||||||||||||||||||||
Employee termination, asset impairment, and other charges | 20 | 0.2 | 25 | 0.3 | (5) | (20) | |||||||||||||||||||||||||||||
Total operating expenses | 1,743 | 17.6 | 1,636 | 20.8 | 107 | 7 | |||||||||||||||||||||||||||||
Operating income | 1,505 | 15.2 | 228 | 2.9 | 1,277 | 560 | |||||||||||||||||||||||||||||
Interest and other income (expense): | |||||||||||||||||||||||||||||||||||
Interest income | 3 | — | 4 | 0.1 | (1) | (25) | |||||||||||||||||||||||||||||
Interest expense | (154) | (1.6) | (165) | (2.1) | 11 | (7) | |||||||||||||||||||||||||||||
Other income (expense), net | (4) | — | 15 | 0.2 | (19) | (127) | |||||||||||||||||||||||||||||
Total interest and other expense, net | (155) | (1.6) | (146) | (1.9) | (9) | 6 | |||||||||||||||||||||||||||||
Income before taxes | 1,350 | 13.7 | 82 | 1.0 | 1,268 | 1,546 | |||||||||||||||||||||||||||||
Income tax expense | 176 | 1.8 | 80 | 1.0 | 96 | 120 | |||||||||||||||||||||||||||||
Net income | $ | 1,174 | 11.9 | $ | 2 | — | 1,172 | 58,600 |
Three Months Ended | Six Months Ended | ||||||||||||||||||||||
December 31, 2021 | January 1, 2021 | December 31, 2021 | January 1, 2021 | ||||||||||||||||||||
($ in millions) | |||||||||||||||||||||||
Net revenue: | |||||||||||||||||||||||
HDD | $ | 2,213 | $ | 1,909 | $ | 4,774 | $ | 3,753 | |||||||||||||||
Flash | 2,620 | 2,034 | 5,110 | 4,112 | |||||||||||||||||||
Total net revenue | $ | 4,833 | $ | 3,943 | $ | 9,884 | $ | 7,865 | |||||||||||||||
Gross profit: | |||||||||||||||||||||||
HDD | $ | 677 | $ | 488 | $ | 1,469 | $ | 971 | |||||||||||||||
Flash | 946 | 551 | 1,867 | 1,099 | |||||||||||||||||||
Total gross profit for segments | 1,623 | 1,039 | 3,336 | 2,070 | |||||||||||||||||||
Unallocated corporate items: | |||||||||||||||||||||||
Amortization of acquired intangible assets | (26) | (109) | (65) | (254) | |||||||||||||||||||
Stock-based compensation expense | (14) | (15) | (23) | (27) | |||||||||||||||||||
Charges related to cost savings initiatives | — | — | — | — | |||||||||||||||||||
Recovery related to a power outage incident | — | 45 | — | 75 | |||||||||||||||||||
Other | — | — | — | — | |||||||||||||||||||
Total unallocated corporate items | (40) | (79) | (88) | (206) | |||||||||||||||||||
Consolidated gross profit | $ | 1,583 | $ | 960 | $ | 3,248 | $ | 1,864 | |||||||||||||||
Gross margin: | |||||||||||||||||||||||
HDD | 30.6 | % | 25.6 | % | 30.8 | % | 25.9 | % | |||||||||||||||
Flash | 36.1 | % | 27.1 | % | 36.5 | % | 26.7 | % | |||||||||||||||
Consolidated gross margin | 32.8 | % | 24.3 | % | 32.9 | % | 23.7 | % |
Three Months Ended | Six Months Ended | ||||||||||||||||||||||
December 31, 2021 | January 1, 2021 | December 31, 2021 | January 1, 2021 | ||||||||||||||||||||
(in millions) | |||||||||||||||||||||||
Revenue by End Market | |||||||||||||||||||||||
Cloud | $ | 1,920 | $ | 1,014 | $ | 4,145 | $ | 2,305 | |||||||||||||||
Client | 1,854 | 1,869 | 3,707 | 3,619 | |||||||||||||||||||
Consumer | 1,059 | 1,060 | 2,032 | 1,941 | |||||||||||||||||||
Total Revenue | $ | 4,833 | $ | 3,943 | $ | 9,884 | $ | 7,865 | |||||||||||||||
Revenue by Geography | |||||||||||||||||||||||
Americas | $ | 1,407 | $ | 945 | $ | 3,021 | $ | 2,024 | |||||||||||||||
Europe, Middle East and Africa | 816 | 725 | 1,578 | 1,354 | |||||||||||||||||||
Asia | 2,610 | 2,273 | 5,285 | 4,487 | |||||||||||||||||||
Total Revenue | $ | 4,833 | $ | 3,943 | $ | 9,884 | $ | 7,865 | |||||||||||||||
Three Months Ended | Six Months Ended | ||||||||||||||||||||||
December 31, 2021 | January 1, 2021 | December 31, 2021 | January 1, 2021 | ||||||||||||||||||||
($ in millions) | |||||||||||||||||||||||
Income before taxes | $ | 646 | $ | 85 | $ | 1,350 | $ | 82 | |||||||||||||||
Income tax expense | 82 | 23 | 176 | 80 | |||||||||||||||||||
Effective tax rate | 13 | % | 27 | % | 13 | % | 98 | % |
Six Months Ended | |||||||||||
December 31, 2021 | January 1, 2021 | ||||||||||
(in millions) | |||||||||||
Net cash provided by (used in): | |||||||||||
Operating activities | $ | 1,187 | $ | 788 | |||||||
Investing activities | (569) | (436) | |||||||||
Financing activities | (1,456) | (450) | |||||||||
Effect of exchange rate changes on cash | (1) | 6 | |||||||||
Net decrease in cash and cash equivalents | $ | (839) | $ | (92) |
Three Months Ended | |||||||||||
December 31, 2021 | January 1, 2021 | ||||||||||
Days sales outstanding | 52 | 42 | |||||||||
Days in inventory | 102 | 109 | |||||||||
Days payables outstanding | (68) | (71) | |||||||||
Cash conversion cycle | 86 | 80 |
Total | Remaining six months of 2022 | 2023-2024 | 2025-2026 | Beyond 2026 | |||||||||||||||||||||||||
(in millions) | |||||||||||||||||||||||||||||
Long-term debt, including current portion(1) | $ | 7,400 | $ | 126 | $ | 3,974 | $ | 2,300 | $ | 1,000 | |||||||||||||||||||
Interest on debt | 831 | 103 | 376 | 278 | 74 | ||||||||||||||||||||||||
Flash Ventures related commitments(2) | 6,049 | 2,105 | 2,587 | 1,136 | 221 | ||||||||||||||||||||||||
Operating leases | 393 | 27 | 93 | 85 | 188 | ||||||||||||||||||||||||
Purchase obligations and other commitments | 3,770 | 2,215 | 1,217 | 168 | 170 | ||||||||||||||||||||||||
Mandatory Deemed Repatriation Tax | 819 | — | 284 | 535 | — | ||||||||||||||||||||||||
Total | $ | 19,262 | $ | 4,576 | $ | 8,531 | $ | 4,502 | $ | 1,653 |
December 31, 2021 | July 2, 2021 | ||||||||||
(in millions) | |||||||||||
Current assets (excluding net intercompany receivable from non-guarantor subsidiaries) | $ | 2,429 | $ | 2,898 | |||||||
Non-current assets | 1,848 | 1,903 | |||||||||
Net intercompany payable to non-guarantor subsidiaries | 1,110 | 463 | |||||||||
Current liabilities | 2,379 | 2,325 | |||||||||
Non-current liabilities | 8,289 | 9,726 |
Six Months Ended | Year Ended | ||||||||||
December 31, 2021 | July 2, 2021 | ||||||||||
(in millions) | |||||||||||
Net sales | $ | 4,253 | $ | 12,378 | |||||||
Gross profit | 1,124 | 1,861 | |||||||||
Operating income | 77 | 142 | |||||||||
Net income (loss) | (15) | 377 | |||||||||
Intercompany revenue | 1,234 | 5,190 | |||||||||
Net intercompany interest expense (income) | (22) | 23 | |||||||||
Intercompany dividends | 105 | 528 |
December 31, 2021 | ||||||||
2023 | $ | 106 | ||||||
2024 | 178 | |||||||
2025 | 238 | |||||||
2026 | 297 | |||||||
Total | $ | 819 |
Exhibit Number | Description | |||||||
Amended and Restated Certificate of Incorporation of Western Digital Corporation, as amended to date (Filed as Exhibit 3.1 to the Company’s Quarterly Report on Form 10-Q (File No. 1-08703) with the Securities and Exchange Commission on February 8, 2006) | ||||||||
Amended and Restated By-Laws of Western Digital Corporation, as amended effective as of February 10, 2021 (Filed as Exhibit 3.1 to the Company’s Current Report on Form 8-K (File No. 1-08703) with the Securities and Exchange Commission on February 12, 2021) | ||||||||
Indenture, dated as of December 10, 2021, between Western Digital Corporation and U.S. Bank National Association, as trustee (Filed as Exhibit 4.1 to the Company’s Current Report on Form 8-K (File No. 1-08703) with the Securities and Exchange Commission on December 10, 2021) | ||||||||
First Supplemental Indenture (including Form of 2.850% Senior Notes due 2029 and Form of 3.100% Senior Notes due 2032), dated as of December 10, 2021, between Western Digital Corporation and U.S. Bank National Association, as trustee (Filed as Exhibit 4.2 to the Company’s Current Report on Form 8-K (File No. 1-08703) with the Securities and Exchange Commission on December 10, 2021) | ||||||||
Western Digital Corporation 2021 Long-Term Incentive Plan, adopted as of August 18, 2021 (Filed as Exhibit 10.1 to the Company’s Current Report on Form 8-K (File No. 1-08703) with the Securities and Exchange Commission on November 18, 2021)* | ||||||||
Form of Grant Notice for Performance Stock Unit Award (TSR Measure) under the Western Digital Corporation 2021 Long-Term Incentive Plan†* | ||||||||
Form of Grant Notice for Performance Stock Unit Award (Financial Measures) under the Western Digital Corporation 2021 Long-Term Incentive Plan†* | ||||||||
Form of Grant Notice for Restricted Stock Unit Award – Vice President and Above, under the Western Digital Corporation 2021 Long-Term Incentive Plan†* | ||||||||
Western Digital Corporation 2021 Long-Term Incentive Plan Non-Employee Director Restricted Stock Unit Grant Program, as amended November 22, 2021†* | ||||||||
Flash Alliance Master Agreement, dated as of July 7, 2006, by and among SanDisk Corporation, Toshiba Corporation and SanDisk (Ireland) Limited†# | ||||||||
Operating Agreement of Flash Alliance, Ltd., dated as of July 7, 2006, by and between Toshiba Corporation and SanDisk (Ireland) Limited†# | ||||||||
Certification of Principal Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002† | ||||||||
Certification of Principal Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002† | ||||||||
Certification of Chief Executive Officer Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002** | ||||||||
Certification of Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002** | ||||||||
101.INS | XBRL Instance Document - the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document | |||||||
101.SCH | XBRL Taxonomy Extension Schema Document† | |||||||
101.CAL | XBRL Taxonomy Extension Calculation Linkbase Document† | |||||||
101.LAB | XBRL Taxonomy Extension Label Linkbase Document† | |||||||
101.PRE | XBRL Taxonomy Extension Presentation Linkbase Document† | |||||||
101.DEF | XBRL Taxonomy Extension Definition Linkbase Document† | |||||||
104 | Cover Page Interactive Data File - formatted in Inline XBRL and contained in Exhibit 101 |
WESTERN DIGITAL CORPORATION | ||||||||
By: | /s/ Gene Zamiska | |||||||
Gene Zamiska | ||||||||
Senior Vice President, Global Accounting and Chief Accounting Officer | ||||||||
(Principal Accounting Officer) |
Name of Participant: | |||||
Employee ID | |||||
Grant Date: | |||||
Grant Number | |||||
Target Number of PSUs: | |||||
Vesting Schedule: | The vesting date of the PSUs is [________] (the “Vesting Date”). Vesting shall be subject to Participant’s Continuous Service from the Grant Date through the Vesting Date, unless provided otherwise under Section 2 of the Standard Terms and Conditions. | ||||
Measurement Period: | The Measurement Period begins [____________] and ends [__________]. The actual number of PSUs that may become eligible to vest on the Vesting Date based on performance during a Measurement Period may range from [0%] to [200%] of the Target Number of PSUs corresponding to that Measurement Period, subject to forfeiture as provided in the Standard Terms and Conditions. |
Name of Participant: | |||||
Employee ID | |||||
Grant Date: | |||||
Grant Number | |||||
Target Number of PSUs: | |||||
Vesting Schedule: | The vesting date of the PSUs is [________] (the “Vesting Date”). Vesting shall be subject to Participant’s Continuous Service from the Grant Date through the Vesting Date, unless provided otherwise under Section 2 of the Standard Terms and Conditions. | ||||
Measurement Period: | The Measurement Period begins [____________] and ends [__________]. The actual number of PSUs that may become eligible to vest on the Vesting Date based on performance during a Measurement Period may range from [0%] to [200%] of the Target Number of PSUs corresponding to that Measurement Period, subject to forfeiture as provided in the Standard Terms and Conditions. |
Name of Participant: | |||||
Employee ID | |||||
Grant Date: | |||||
Grant Number | |||||
Number of RSUs: | |||||
Vesting Schedule: | The RSUs shall vest in accordance with the following schedule: [ ] Vesting shall be subject to Participant’s Continuous Service from the Grant Date through each applicable vesting date, unless provided otherwise under Section 2 of the Standard Terms and Conditions. |
Table of Contents | Page | ||||||||||
1. | Definitions and Interpretation. | 1 | |||||||||
2. | Closing and Post-Closing Transaction | 4 | |||||||||
3. | Purpose of Flash Alliance | 6 | |||||||||
4. | Representations and Warranties of the Parties | 7 | |||||||||
5. | Covenants | 9 | |||||||||
6. | Covenants concerning NAND Flash Memory Products Business | 11 | |||||||||
7. | Other Agreements | 21 | |||||||||
8. | Termination | 25 | |||||||||
9. | Miscellaneous | 30 |
Term | Defined In | ||||
Acquiring Party | Section 8.1(d) | ||||
Alternative Use | Section 6.5(c)(i) | ||||
Amendment No. 4 to Patent Cross License Agreement | Section 2.1(c)(iii) | ||||
Appointing Party | Section 6.9(b)(i) | ||||
[***] | Section 6.5(c)(ii)(B) | ||||
Closing | Section 2.1(a) | ||||
Committee Representatives | Section 6.9(b)(i) | ||||
Common R&D Agreement | Section 2.1(c)(i) | ||||
Common R&D Development Expenses | Section 6.8(a)(i) | ||||
Costs | Section 6.5(c)(i) | ||||
Cross License Agreement | Section 2.1(c)(iii) | ||||
Defaulting Party | Section 6.12(d) | ||||
EC Party/Excess Capacity Party | Section 6.7(b)(i) | ||||
Embedded NAND Product | Section 6.7(c)(ii) | ||||
Employer | Section 6.10(b)(vii) | ||||
Engineers | Section 6.10 | ||||
Environmental Indemnification Agreement | Section 2.1(b)(vii) | ||||
Equipment | Section 6.5(c)(i) | ||||
Evaluation Wafers | Section 6.8(a)(iii) | ||||
Financing | Section 6.12(b)(iii) | ||||
Flash Alliance | Section 2.1(b) | ||||
FA Foundry Agreement | Section 2.1(b)(iv) | ||||
FA Operating Agreement | Section 2.1(b)(ii) | ||||
FA Operative Documents | Section 2.1(b) | ||||
FA Patent Indemnification Agreement | Section 2.1(b)(vi) | ||||
FA Termination Date | Section 8.1(b) | ||||
FA Shares | Section 4.2(a) | ||||
FP Master Agreement | Recitals | ||||
FP NAND Flash Memory Products | Section 3.3(a) | ||||
FVC Japan Master Agreement | Recitals | ||||
FVC Japan NAND Flash Memory Products | Section 3.3(a) | ||||
Headcount Plan | Section 6.10 | ||||
ICs | Section 3.2 | ||||
Intellectual Property | Section 4.7 | ||||
Investing Party | Section 6.5(c)(i) | ||||
Joint Operative Documents | Section 2.1(c) | ||||
Lease Agreement | Section 2.1(b)(viii) | ||||
Management Committee | Section 6.9 | ||||
Minimum RUP Commitment | Section 6.5(c)(i) | ||||
Master Operative Documents | Section 2.2 |
Term | Defined In | ||||
NAND Flash Memory Integrated Circuits | Section 6.13 | ||||
NAND Flash Memory Products | Section 3.2 | ||||
NAND Process Technology | Section 6.3(a) | ||||
Non-Defaulting Party | Section 6.12(d) | ||||
Non-Investing Party | Section 6.5(c)(i) | ||||
Non-Originating Party | Section 6.7(e) | ||||
Originating Party | Section 6.7(e) | ||||
Parties | Heading | ||||
Product Development Agreement | Section 2.1(c)(ii) | ||||
Proprietary NAND Flash Memory Products | Section 6.7(d) | ||||
Purchase and Supply Agreements | Section 2.1(b)(v) | ||||
Qualification Wafers | Section 6.8(a)(iv) | ||||
Ramp-Up Plan | Section 6.5(b) | ||||
Remaining Y4 Personnel | Section 8.1(j) | ||||
Requesting Party | Section 8.1(d)(i) | ||||
[***] | Section 6.5(c)(ii) | ||||
[***] | Section __ | ||||
SanDisk | Heading | ||||
SanDisk Corporation | Heading | ||||
SanDisk Financing | Section 6.12(b)(iii) | ||||
SanDisk Ireland | Heading | ||||
SanDisk Purchase and Supply Agreement | Section 2.1(b)(v) | ||||
SanDisk Team | Section __ | ||||
SanDisk Termination Capacity | Section 8.1(e)(i) | ||||
Selling Party | Section 8.1(d) | ||||
Share Purchase Agreement | Section 2.1(b)(i) | ||||
Start-Up Costs | Section 6.4 | ||||
Termination Capacity | Section 8.1(d)(i) | ||||
Third Party Sale | Section 6.5(c)(i) | ||||
Toshiba | Heading | ||||
Toshiba Financing | Section 6.12(b)(iii) | ||||
Toshiba Foundry NAND Flash Memory Products | Section 3.3(a) | ||||
Toshiba Purchase and Supply Agreement | Section 2.1(b)(v) | ||||
Toshiba-SanDisk Services Agreement | Section 2.1(b)(ix) | ||||
[***] | Section __ | ||||
Y3 NAND Flash Memory Products | Section 3.3(a) | ||||
Y3 Ramp-Up Plan | Section __ | ||||
Y4 Direct R&D Development Products | Section 6.8(a)(ii) | ||||
Y4 Facility | Section 3.1 | ||||
Y4 Facility Target Capacity | Section 7.3(b) |
Term | Defined In | ||||
Y4 NAND Flash Memory Products | Section 3.3(a) | ||||
Y4 Staff | Section 8.1(j) | ||||
[***] | Section __ |
APPENDICES | ||||||||
Appendix A | – | Definitions, Rules of Construction and General Terms and Conditions |
EXHIBIT | ||||||||
(Flash Alliance Documents) | ||||||||
Exhibit A1 | – | Share Purchase Agreement | ||||||
Exhibit A2 | – | FA Operating Agreement | ||||||
Exhibit A3 | – | FA Foundry Agreement | ||||||
Exhibit A4-1 | – | SanDisk Purchase and Supply Agreement | ||||||
Exhibit A4-2 | – | Toshiba Purchase and Supply Agreement | ||||||
Exhibit A5 | – | FA Patent Indemnification Agreement | ||||||
Exhibit A6 | – | Mutual Environmental Indemnification Agreement | ||||||
Exhibit A7 | – | Lease Agreement | ||||||
Exhibit A8 | – | Toshiba-SanDisk Ireland Services Agreement | ||||||
Exhibit A9 | – | Toshiba-Flash Alliance Services Agreement | ||||||
Exhibit A10 | – | SanDisk Ireland-Flash Alliance Services Agreement |
Exhibit B1 | – | Common R&D and Participation Agreement | ||||||
Exhibit B2 | – | Product Development Agreement | ||||||
Exhibit B3 | – | Amendment No. 4 to Cross License Agreement |
Schedule 4.5 | – | Litigation; Decrees | ||||||
Schedule 4.7 | – | Patents and Proprietary Rights | ||||||
Schedule 4.9 | – | Cross License Payment Obligations | ||||||
Schedule 6.3 | – | Technology Transfer Costs | ||||||
Schedule 6.5(b) | – | Ramp-Up Plan | ||||||
Schedule 8.1(e) | – | Royalty in case of SanDisk Unilateral Termination | ||||||
Schedule 8.1(f) | – | Royalty in case of Deadlock Termination | ||||||
Schedule 8.1(g) | – | Royalty in case of Event of Default Termination |
TABLE OF CONTENTS | |||||||||||
Page | |||||||||||
1. | DEFINITIONS, RULES OF CONSTRUCTION AND DOCUMENTARY CONVENTIONS | 1 | |||||||||
1.1 | Certain Definitions | 1 | |||||||||
1.2 | Additional Definitions | 1 | |||||||||
1.3 | Rules of Construction and Documentary Conventions | 2 | |||||||||
2. | GENERAL PROVISIONS | 2 | |||||||||
2.1 | Ownership of Shares; Capital Increase | 2 | |||||||||
2.2 | Name | 3 | |||||||||
2.3 | Principal Office | 3 | |||||||||
2.4 | Term; Extension | 3 | |||||||||
2.5 | Scope of Activity | 3 | |||||||||
2.6 | Powers | 3 | |||||||||
2.7 | Articles of Incorporation | 3 | |||||||||
2.8 | Company Actions | 3 | |||||||||
3. | BUSINESS OPERATIONS | 3 | |||||||||
3.1 | Business Dealings with the Company | 3 | |||||||||
3.2 | Other Activities | 4 | |||||||||
3.3 | Personnel | 4 | |||||||||
3.4 | Business Plans and Related Matters | 6 | |||||||||
3.5 | Standard of Care | 7 | |||||||||
3.6 | Use of Names | 7 | |||||||||
4. | ACTIONS BY THE SHAREHOLDERS | 7 | |||||||||
4.1 | Matters Requiring the Approval of the Shareholders | 8 | |||||||||
4.2 | General Meetings of Shareholders | 10 | |||||||||
4.3 | Restrictions on Shareholders | 10 | |||||||||
5. | MANAGEMENT AND OPERATIONS OF COMPANY | 11 | |||||||||
5.1 | Meetings of the Directors | 11 | |||||||||
5.2 | Officers; Employees | 16 | |||||||||
5.3 | Y4 Representatives; Y4 Operating Committee | 16 | |||||||||
5.4 | Insurance | 17 | |||||||||
5.5 | Records | 17 | |||||||||
6. | CAPITAL CONTRIBUTIONS; DISTRIBUTIONS | 18 | |||||||||
6.1 | Capital Contributions | 18 | |||||||||
6.2 | Distributions | 18 | |||||||||
6.3 | No Interest. | 19 | |||||||||
6.4 | Return of Capital Contributions | 19 | |||||||||
7. | ADDITIONAL CONTRIBUTIONS | 19 | |||||||||
TABLE OF CONTENTS (continued) | |||||||||||
Page | |||||||||||
8. | ACCOUNTING AND TAXATION | 19 | |||||||||
8.1 | Financial Accounting Conventions | 19 | |||||||||
8.2 | Maintenance of Books of Account | 20 | |||||||||
8.3 | Financial Statements | 20 | |||||||||
8.4 | Other Reports and Inspection | 22 | |||||||||
8.5 | Characterization | 22 | |||||||||
8.6 | Deposit of Funds | 22 | |||||||||
9. | SHARES OF CONTRIBUTION; DISPOSITION OF SHARES | 22 | |||||||||
9.1 | Restrictions on Transfer of Shares | 22 | |||||||||
9.2 | Admission of New Shareholders | 24 | |||||||||
9.3 | Withdrawal Prohibited | 24 | |||||||||
9.4 | Purchase of Additional Interest. | 24 | |||||||||
10. | CERTAIN AGREEMENTS OF THE SHAREHOLDERS | 25 | |||||||||
10.1 | Taxes and Charges; Governmental Rules | 25 | |||||||||
10.2 | Fu1ther Assurances | 25 | |||||||||
10.3 | Dispute Resolution; Deadlock | 25 | |||||||||
10.4 | Remedies Upon Event of Default; Termination on Breach | 27 | |||||||||
10.5 | Mechanics of Sale | 27 | |||||||||
11. | DISSOLUTION | 28 | |||||||||
11.1 | Events of Dissolution | 28 | |||||||||
11.2 | Dissolution by Agreement | 28 | |||||||||
11.3 | Dissolution Upon Event of Default | 28 | |||||||||
11.4 | Dissolution by Unilateral Option | 29 | |||||||||
11.5 | Dissolution upon Notice | 29 | |||||||||
11.6 | Financing Defaults | 29 | |||||||||
11.7 | Winding Up | 30 | |||||||||
11.8 | Liquidation Proceeds | 30 | |||||||||
12. | INDEMNIFICATION AND INSURANCE | 30 | |||||||||
12.1 | Indemnification | 30 | |||||||||
12.2 | Insurance | 31 | |||||||||
12.3 | Indemnification by the Shareholders | 31 | |||||||||
12.4 | Assertion of Claims | ||||||||||
13. | MISCELLANEOUS | 32 | |||||||||
13.1 | Governing Law | 32 | |||||||||
13.2 | Effectiveness | 32 | |||||||||
TABLE OF CONTENTS (continued) | ||||||||
EXHIBITS | ||||||||
Exhibit A | Articles of Incorporation of the Company | |||||||
SCHEDULES | ||||||||
Schedule 2.1(b) | Committed Additional Capital Contributions | |||||||
Schedule 5.3 | Management and Operating Reports | |||||||
Schedule 6.1 | Capital Contributions | |||||||
Schedule 8.3 | Monthly Reports | |||||||
EXECUTION VERSION |
Term | Defined in | ||||
"Appendix A" | Recitals | ||||
"Articles" | Recitals | ||||
"Bankruptcy Event" | Section 11.1(f) | ||||
"Claim" | Section 12.4(a) | ||||
"Company" | Recitals | ||||
"Deadlock" | Section 10.3(c) | ||||
"Deadlock Dissolution Notice" | Section 10.3(e) | ||||
"Defaulting Shareholder'' | Section 10.4 | ||||
"Designated Individuals'' | Section 10.3(b) | ||||
"Director(s)" | Section 3.5(a) | ||||
"Executive Vice President" | Section 5.2(a) | ||||
"General Meeting of Shareholders'' | Section 4.l(b) | ||||
"Indemnified Party" | Section 12.4(a) | ||||
"Indemnifying Party" | Section 12.4(a) | ||||
"Initiating Shareholder" | Section 10.3(e) | ||||
"Losses" | Section 12.l(a) | ||||
"Master Agreement" | Section l.l(a) | ||||
"Nondefaulting Shareholder" | Section 10.4 | ||||
"Notified Patty" | Section 11.5 | ||||
"Notifying Party" | Section 11.5 | ||||
"Permissible Assignee" | Section 9. l(c) | ||||
·"Permissible Assignment Agreement" | Section 9.l(c) | ||||
"President" | Section 5.2(a) | ||||
"Responding Shareholder'' | Section 10.3(e) | ||||
"SanDisk Representative" | Section 5.3(a) | ||||
"Shares" | Recitals | ||||
"Shareholder" | Recitals | ||||
"Termination Date" | Section 11.4 | ||||
"Toshiba Representative" | Section 5.3(a) | ||||
"Y4 Operating Committee" | Section 5.3(a) |
/s/ David V. Goeckeler | |||||
David V. Goeckeler | |||||
Chief Executive Officer |
/s/ Robert K. Eulau | |||||
Robert K. Eulau | |||||
Executive Vice President and Chief Financial Officer (Principal Financial Officer) |
/s/ David V. Goeckeler | |||||
David V. Goeckeler | |||||
Chief Executive Officer |
/s/ Robert K. Eulau | |||||
Robert K. Eulau | |||||
Executive Vice President and Chief Financial Officer (Principal Financial Officer) |
-8HUSG"KP*:O>XK*,;7N<3\>/AK#\8/A+XF\)2
ML$_M*RDB20_P28RC_P# 6P:_G\\8^$=6\!^)M2\/ZY9O8:KI\S03P2#D,/3U
M!Z@]Q7](^T[@<\>E>!_M ?L;?#K]HI1=>(=*DL]<"[(]5L'\JX5?0G!##V8$
M4FFG=#TDK-V/P<^M'/;BOTUU;_@C;!-(QT[XF/:1[N%NM)$S8^JRK_*GZ9_P
M1OLXV7[?\2IKA>-WV;2UBSZXS(U.Y'(_Z9\>?L,G/[67PV!.O21<,
M/P-%%<];X+G5A_XB70_.?]IS]FWX<> ?$,\&@>'!I\(CWA1>W#C./]N0U\J_
M\(KI>?\ CU_\?;_&BBL:,FX)MF^)A&-2R1]E_LI_LN_##Q]-=2:_X7346AY0
M/>W*CMU"R '\:_1#X6_"SPA\-]+^R^%_#6F:%"VW<+*V5"_'5B!EC[DYHHJ*
M3
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares |
Dec. 31, 2021 |
Jul. 02, 2021 |
---|---|---|
Statement of Financial Position [Abstract] | ||
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized (in shares) | 5,000,000 | 5,000,000 |
Preferred stock, shares issued (in shares) | 0 | 0 |
Preferred stock, shares outstanding (in shares) | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 450,000,000 | 450,000,000 |
Common stock, shares issued (in shares) | 313,000,000 | 312,000,000 |
Common stock, shares outstanding (in shares) | 313,000,000 | 308,000,000 |
Treasury stock (in shares) | 0 | 4,000,000 |
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Dec. 31, 2021 |
Jan. 01, 2021 |
Dec. 31, 2021 |
Jan. 01, 2021 |
|
Statement of Comprehensive Income [Abstract] | ||||
Net income | $ 564 | $ 62 | $ 1,174 | $ 2 |
Other comprehensive income (loss), before tax: | ||||
Actuarial pension gain | 0 | 1 | 1 | 2 |
Foreign currency translation adjustment | (45) | 34 | (41) | 66 |
Net unrealized gain (loss) on derivative contracts and available-for-sale securities | (10) | 20 | 23 | 50 |
Total other comprehensive income (loss), before tax | (55) | 55 | (17) | 118 |
Income tax benefit (expense) related to items of other comprehensive income (loss), before tax | 5 | (4) | (3) | (11) |
Other comprehensive income (loss), net of tax | (50) | 51 | (20) | 107 |
Total comprehensive income | $ 514 | $ 113 | $ 1,154 | $ 109 |
Organization and Basis of Presentation |
6 Months Ended |
---|---|
Dec. 31, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Basis of Presentation | Organization and Basis of Presentation Western Digital Corporation (“Western Digital” or the “Company”) is a leading developer, manufacturer, and provider of data storage devices and solutions that address the evolving needs of the information technology (“IT”) industry and the infrastructure that enables the proliferation of data in virtually every other industry. The Company creates environments for data to thrive. The Company is driving the innovation needed to help customers capture, preserve, access and transform an ever-increasing diversity of data. Everywhere data lives, from advanced data centers to mobile sensors to personal devices, the Company’s industry-leading solutions deliver the possibilities of data. The accounting policies followed by the Company are set forth in Part II, Item 8, Note 1, Organization and Basis of Presentation, of the Notes to Consolidated Financial Statements included in the Company’s Annual Report on Form 10‑K for the fiscal year ended July 2, 2021. In the opinion of management, all adjustments necessary to fairly state the Condensed Consolidated Financial Statements have been made. All such adjustments are of a normal, recurring nature. Certain information and footnote disclosures normally included in the Consolidated Financial Statements prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”) have been condensed or omitted pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). These Condensed Consolidated Financial Statements should be read in conjunction with the Consolidated Financial Statements and the notes thereto included in the Company’s Annual Report on Form 10‑K for the fiscal year ended July 2, 2021. The results of operations for interim periods are not necessarily indicative of results to be expected for the full year. Fiscal Year The Company’s fiscal year ends on the Friday nearest to June 30 and typically consists of 52 weeks. Approximately every five to six years, the Company reports a 53-week fiscal year to align the fiscal year with the foregoing policy. Fiscal years 2022, which ends on July 1, 2022, and 2021, which ended on July 2, 2021, are each comprised of 52 weeks, with all quarters presented consisting of 13 weeks. Use of Estimates Company management has made estimates and assumptions relating to the reporting of certain assets and liabilities in conformity with U.S. GAAP. These estimates and assumptions have been applied using methodologies that are consistent throughout the periods presented with consideration given to the potential impacts of the ongoing COVID-19 pandemic. However, actual results could differ materially from these estimates and be significantly affected by the severity and duration of the COVID-19 pandemic, the extent of actions to contain or treat COVID-19, the timing, distribution, efficacy and public acceptance of vaccines around the world, additional surges of COVID-19, including the emergence of more contagious or vaccine-resistant variants, and how quickly and to what extent normal economic and operating activity can resume.
|
Recent Accounting Pronouncements |
6 Months Ended |
---|---|
Dec. 31, 2021 | |
Accounting Changes and Error Corrections [Abstract] | |
Recent Accounting Pronouncements | Recent Accounting Pronouncements Accounting Pronouncements Recently Adopted In December 2019, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2019-12, “Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes” (“ASU 2019-12”). ASU 2019-12 removes certain exceptions for recognizing deferred taxes for investments, performing intraperiod allocation and calculating income taxes in interim periods. The ASU also adds guidance to reduce complexity in certain areas, including recognizing deferred taxes for tax goodwill and allocating taxes to members of a consolidated group. The Company adopted this ASU on July 3, 2021, which is the beginning of fiscal 2022, and its adoption did not have a material impact on the Company’s Condensed Consolidated Financial Statements. Recently Issued Accounting Pronouncements Not Yet Adopted In August 2020, the FASB issued ASU No. 2020-06, “Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity” (“ASU 2020-06”). ASU 2020-06 reduces the number of accounting models for convertible debt instruments and convertible preferred stock and results in fewer instruments with embedded conversion features being separately recognized from the host contract as compared with current standards. Those instruments that do not have a separately recognized embedded conversion feature will no longer recognize a debt issuance discount related to such a conversion feature and would recognize less interest expense on a periodic basis. Additionally, the ASU amends the calculation of the share dilution impact related to a conversion feature and eliminates the treasury method as an option. For instruments that do not have a component mandatorily settled in cash, the change will likely result in a higher amount of share dilution in the calculation of earnings per share. The Company expects to adopt this ASU in the first quarter of fiscal 2023, and is currently assessing the impact of adoption. In November 2021, the FASB issued ASU No. 2021-10, “Government Assistance (Topic 832): Disclosures by Business Entities about Government Assistance” (“ASU 2021-10”). ASU 2021-10 increases the transparency of government assistance received by requiring most business entities to disclose information about government assistance received, including (1) the types of assistance, (2) the entity’s accounting for the assistance, and (3) the effect of the assistance on an entity’s financial statements. This ASU is effective for fiscal years (and interim periods within those fiscal years) beginning after December 15, 2021, which for the Company is the first quarter of fiscal 2023. Early adoption is permitted. The Company is currently assessing the impact and timing of adoption of this ASU.
|
Segment Information |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2021 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Information | Segment Information The Company manufactures, markets, and sells data storage devices and solutions in the U.S. and in foreign countries through its sales personnel, dealers, distributors, retailers, and subsidiaries. Historically, the Company had been managed and reported under a single operating segment. Late in the first quarter of fiscal 2021, the Chief Executive Officer, who is the Company’s Chief Operating Decision Maker (“CODM”), announced a decision to reorganize the Company’s business by forming two separate product business units: hard disk drives (“HDD”) and flash-based products (“Flash”). To align with the new operating model and business structure, the Company made management organizational changes and implemented new reporting modules and processes to provide discrete information to manage the business. Effective July 3, 2021, the Company’s management finalized its assessment of the Company’s operating segments and concluded that the Company now has two reportable segments: HDD and Flash. The CODM evaluates performance of the Company and makes decisions regarding allocation of resources based on each operating segment’s net revenue and gross margin, which are summarized below. Because of the integrated nature of the Company’s production and distribution activities, separate segment asset measures are not available or reviewed by the CODM to evaluate the performance of or to allocate resources to the segments. The following table summarizes the operating performance of the Company’s reportable segments:
Disaggregated Revenue The Company’s broad portfolio of technology and products address multiple end markets. In the fiscal first quarter of 2022, the Company refined the end markets it reports to be Cloud, Client and Consumer. Cloud represents a large and growing end market comprised primarily of products for public or private cloud environments and end customers, which the Company believes it is uniquely positioned to address as the only provider of both hard drive and flash products. Through the Client end market, the Company provides its original equipment manufacturer (“OEM”) and channel customers a broad array of high-performance flash and hard drive solutions across personal computer, mobile, gaming, automotive, virtual reality headsets, at-home entertainment, and industrial spaces. The Consumer end market is highlighted by the Company’s broad range of retail and other end-user products, which capitalize on the strength of the Company’s product brand recognition and vast points of presence around the world. The Company’s disaggregated revenue information is as follows:
The Company’s top 10 customers accounted for 46% and 44% of its net revenue for the three and six months ended December 31, 2021, respectively, and 43% and 41% of its net revenue for the three and six months ended January 1, 2021, respectively. For the three and six months ended December 31, 2021 and January 1, 2021, no single customer accounted for 10% or more of the Company’s net revenue. Goodwill In connection with the Company’s determination of its reportable segments, effective July 3, 2021, the Company allocated its goodwill between its segments based on the estimated relative fair values of the business units. In addition, management performed a goodwill impairment assessment for each segment and concluded there were no impairment indicators as of both the beginning and end of the six months ended December 31, 2021. The following table provides a summary of goodwill activity for the period:
|
Revenues |
6 Months Ended |
---|---|
Dec. 31, 2021 | |
Revenue from Contract with Customer [Abstract] | |
Revenues | Revenues Contract assets represent the Company’s rights to consideration where performance obligations are completed but the customer payments are not due until another performance obligation is satisfied. The Company did not have any contract assets as of either December 31, 2021 or July 2, 2021. The Company incurs sales commissions and other direct incremental costs to obtain sales contracts. The Company has applied the practical expedient to recognize the direct incremental costs of obtaining contracts as an expense when incurred if the amortization period is expected to be one year or less or the amount is not material, with these costs charged to Selling, general and administrative expenses. Other direct incremental costs to obtain contracts that have an expected benefit of greater than one year are amortized over the period of expected cash flows from the related contracts, and the amortization expense is recorded as a reduction to revenue. Total capitalized contract costs as of December 31, 2021 and July 2, 2021 as well as the related amortization for the three and six months ended December 31, 2021 and January 1, 2021 were not material. Contract liabilities relate to customers’ payments in advance of performance under the contract and primarily relate to remaining performance obligations under support and maintenance contracts. As of December 31, 2021 and July 2, 2021, contract liabilities were not material. The Company applies the practical expedients and does not disclose transaction price allocated to the remaining performance obligations for (i) arrangements that have an original expected duration of one year or less, which mainly consist of the support and maintenance contracts, and (ii) variable consideration amounts for sale-based or usage-based royalties for intellectual property (“IP”) license arrangements, which typically range longer than one year. Remaining performance obligations are mainly attributed to right-to-access patent license arrangements and customer support and service contracts, which will be recognized over the remaining contract period. The transaction price allocated to the remaining performance obligations as of December 31, 2021 was $51 million, which is mainly attributable to the functional IP license and service arrangements. The Company expects to recognize this amount as revenue as follows: $20 million during the remainder of fiscal 2022, $30 million in fiscal 2023, and $1 million in fiscal 2024 and thereafter.
|
Supplemental Financial Statement Data |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2021 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Supplemental Financial Statement Data | Supplemental Financial Statement Data Accounts receivable, net From time to time, in connection with factoring agreements, the Company sells trade accounts receivable without recourse to third party purchasers in exchange for cash. The Company did not sell any trade accounts receivable during the six months ended December 31, 2021. During the six months ended January 1, 2021, the Company sold trade accounts receivable for cash proceeds of $173 million. The discounts on the trade accounts receivable sold were not material and were recorded within Other income, net in the Condensed Consolidated Statements of Operations. There were no factored receivables outstanding as of December 31, 2021 and July 2, 2021. Inventories
Property, plant and equipment, net
Intangible assets
As part of prior acquisitions, the Company recorded at the time of the acquisition acquired in-process research and development (“IPR&D”) for projects in progress that had not yet reached technological feasibility. IPR&D is initially accounted for as an indefinite-lived intangible asset. Once a project reaches technological feasibility, the Company reclassifies the balance to existing technology and begins to amortize the intangible asset over its estimated useful life. Product warranty liability Changes in the warranty accrual were as follows:
The current portion of the warranty accrual is classified in Accrued expenses and the long-term portion is classified in Other liabilities as noted below:
Other liabilities
Accumulated other comprehensive income (loss) Accumulated other comprehensive income (loss) (“AOCI”), net of tax refers to expenses, gains and losses that are recorded as an element of shareholders’ equity but are excluded from net income. The following table illustrates the changes in the balances of each component of AOCI:
During the three and six months ended December 31, 2021, the amounts reclassified out of AOCI were losses related to foreign exchange contracts and interest rate swap contracts. Losses reclassified out of AOCI related to foreign exchange contracts were $32 million and $69 million, respectively, and were substantially charged to Cost of revenue in the Condensed Consolidated Statements of Operations. Losses reclassified out of AOCI related to interest rate swap contracts were $12 million and $25 million, respectively, and were charged to Interest expense in the Condensed Consolidated Statements of Operations. As of December 31, 2021, the amount of existing net losses related to cash flow hedges recorded in AOCI included $5 million related to the Company’s interest rate swaps that is expected to be reclassified to earnings after twelve months. In addition, as of December 31, 2021, the Company did not have any foreign exchange forward contracts with credit-risk-related contingent features.
|
Fair Value Measurements and Investments |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2021 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Measurements and Investments | Fair Value Measurements and Investments Financial Instruments Carried at Fair Value Financial assets and liabilities that are remeasured and reported at fair value at each reporting period are classified and disclosed in one of the following three levels: Level 1. Quoted prices in active markets for identical assets or liabilities. Level 2. Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3. Inputs that are unobservable for the asset or liability and that are significant to the fair value of the assets or liabilities. The following tables present information about the Company’s financial assets and liabilities that are measured at fair value on a recurring basis as of December 31, 2021 and July 2, 2021, and indicate the fair value hierarchy of the valuation techniques utilized to determine such values:
During the three and six months ended December 31, 2021 and January 1, 2021, the Company had no transfers of financial assets and liabilities between levels and there were no changes in valuation techniques or the inputs used in the fair value measurement. Financial Instruments Not Carried at Fair Value For financial instruments where the carrying value (which includes principal adjusted for any unamortized issuance costs, and discounts or premiums) differs from fair value (which is based on quoted market prices), the following table represents the related carrying value and fair value for each of the Company’s outstanding financial instruments. Each of the financial instruments presented below was categorized as Level 2 for all periods presented, based on the frequency of trading immediately prior to the end of the second quarter of fiscal 2022 and the fourth quarter of fiscal 2021, respectively.
|
Derivatives Instruments and Hedging Activities |
6 Months Ended |
---|---|
Dec. 31, 2021 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Instruments and Hedging Activities | Derivative Instruments and Hedging Activities As of December 31, 2021, the Company had outstanding foreign exchange forward contracts that were designated as either cash flow hedges or non-designated hedges. Substantially all of the contract maturity dates of these foreign exchange forward contracts do not exceed 12 months. In addition, the Company had outstanding pay-fixed interest rate swaps that were designated as cash flow hedges of variable rate interest payments on a portion of its term loans through February 2023. Changes in fair values of the non-designated foreign exchange contracts are recognized in Other income, net and are largely offset by corresponding changes in the fair values of the foreign currency denominated monetary assets and liabilities. For each of the three and six months ended December 31, 2021 and January 1, 2021, total net realized and unrealized transaction and foreign exchange contract currency gains and losses were not material to the Company’s Condensed Consolidated Financial Statements. Unrealized gains or losses on designated cash flow hedges are recognized in AOCI. For more information regarding cash flow hedges, see Part I, Item1, Note 5. Supplemental Information - Accumulated other comprehensive income (losses), of the Notes to the Condensed Consolidated Financial Statements included in this Quarterly Report on Form 10-Q. Netting Arrangements Under certain provisions and conditions within agreements with counterparties to the Company’s foreign exchange forward contracts, subject to applicable requirements, the Company has the right of offset associated with the Company’s foreign exchange forward contracts and is allowed to net settle transactions of the same currency with a single net amount payable by one party to the other. As of December 31, 2021 and July 2, 2021, the effect of rights of offset was not material and the Company did not offset or net the fair value amounts of derivative instruments in its Condensed Consolidated Balance Sheets.
|
Debt |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2021 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt | Debt Debt consisted of the following as of December 31, 2021 and July 2, 2021:
In December 2021, the Company issued $500 million aggregate principal amount of 2.850% senior unsecured notes due February 1, 2029 (the “2029 Notes”) and issued $500 million aggregate principal amount of 3.100% senior unsecured notes due February 1, 2032 (the “2032 Notes”) pursuant to the terms of an indenture, dated as of December 10, 2021 (the “Base Indenture”) between the Company and U.S. Bank National Association, as trustee (the “Trustee”), as supplemented by the first supplemental indenture dated as of December 10, 2021 (the “First Supplemental Indenture”) between the Company and the Trustee. As used herein, “Indenture” means the Base Indenture, as supplemented by the First Supplemental Indenture. The Indenture contains certain restrictive covenants which are subject to a number of limitations and exceptions. Interest for both the 2029 Notes and 2032 Notes is payable on February 1 and August 1 of each year. The Company is not required to make principal payments on either the 2029 Notes or 2032 Notes prior to their maturity dates. Issuance costs and discounts are amortized to interest expense over their respective terms and as of December 31, 2021, unamortized issuance costs and discounts were $5 million for the 2029 Notes and $6 million for the 2032 Notes. During the six months ended December 31, 2021, the Company voluntarily paid $1.09 billion to prepay the remaining principal balance of its Term Loan B-4 in accordance with its terms. In addition, during the three months ended December 31, 2021, the Company repaid $1.27 billion of the outstanding principal balance on its Term Loan A-1 in accordance with its terms to reduce the remaining outstanding principal balance to $3.0 billion using proceeds from the issuance of the 2029 Notes and the 2032 Notes and using cash on hand. Subsequent to the end of the second quarter of fiscal 2022, on January 7, 2022, the Company entered into a restatement agreement (“Restatement Agreement”) to amend and restate the Loan Agreement, originally dated as of April 29, 2016 (including subsequent amendments and the Restatement Agreement, collectively, the “Loan Agreement”), to provide for, among other things, (i) the issuance of a new $3.0 billion Term Loan A-2 maturing in January 2027 (the “Term Loan A-2”) to replace our previously existing Term Loan A-1; and (ii) the availability of a new $2.25 billion revolving credit facility maturing in January 2027 (the “2027 Revolving Facility”) to replace our previously existing $2.25 billion revolving credit facility and (iii) additional covenant flexibility and other modifications. The obligations under the Loan Agreement will be the senior unsecured obligations of the Company and will not benefit from any collateral or subsidiary guarantees. The Term Loan A-2 Loan bears interest, at the Company’s option, at a per annum rate equal to either (x) the Adjusted Term Secured Overnight Financing Rate (“SOFR”) (as defined in the Loan Agreement) plus an applicable margin varying from 1.125% to 2.000% or (y) a base rate plus an applicable margin varying from 0.125% to 1.000%, in each case depending on the corporate family ratings of the Company from at least two of Standard & Poor’s Ratings Services (“S&P”), Moody’s Investors Service, Inc. (“Moody’s”) and Fitch Ratings, Inc. (“Fitch”), with an initial interest rate of Adjusted Term SOFR plus 1.375%. The Term Loan A-2 will amortize in equal quarterly installments of (i) 0.625% per quarter during the first through the fourth full fiscal quarters following the date of the Restatement Agreement (the “Restatement Effective Date”) and (ii) 1.25% per quarter for the fifth through the nineteenth full fiscal quarters following the Restatement Effective Date, with the remaining balance payable on the date that is five years after the Restatement Effective Date. Loans under the 2027 Revolving Facility bear interest at a per annum rate, at the Company’s option, equal to either (x) the Adjusted Term SOFR Rate (as defined in the Loan Agreement) plus an applicable margin varying from 1.125% to 2.000% or (y) a base rate plus an applicable margin varying from 0.125% to 1.000%, in each case depending on the corporate family ratings of the Company from at least two of S&P, Moody’s and Fitch, with an initial rate of Adjusted Term SOFR plus 1.375%. The Company will also pay an unused commitment fee on the 2027 Revolving Facility ranging from 0.120% to 0.350% based on the corporate family ratings of the Company from at least two of S&P, Moody’s and Fitch, with an initial unused commitment fee of 0.200%. Prior to its restatement on January 7, 2022, the Loan Agreement required the Company to comply with certain financial covenants, consisting of a leverage ratio and an interest coverage ratio. As of December 31, 2021, the Company was in compliance with these financial covenants. Following its restatement on January 7, 2022, the covenants under the Loan Agreement were simplified and the interest coverage ratio requirement was removed.
|
Pensions and Other Post-Retirement Benefit Plans |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2021 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Retirement Benefits [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Pensions and Other Post-Retirement Benefit Plans | Pension and Other Post-Retirement Benefit Plans The Company has pension and other post-retirement benefit plans in various countries. The Company’s principal pension plans are in Japan, Thailand and the Philippines. All pension and other post-retirement benefit plans outside of the Company’s Japan, Thailand and Philippines defined benefit pension plans (the “Pension Plans”) are immaterial to the Condensed Consolidated Financial Statements. The expected long-term rate of return on the Pension Plans assets is 2.5%. Obligations and Funded Status The following table presents the unfunded status of the benefit obligations for the Pension Plans:
The following table presents the unfunded amounts related to the Pension Plans as recognized on the Company’s Condensed Consolidated Balance Sheets: Net periodic benefit costs were not material for the three and six months ended December 31, 2021.
|
Related Parties and Related Commitments and Contingencies |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2021 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Commitments and Contingencies Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Related Parties and Related Commitments and Contingencies | Related Parties and Related Commitments and Contingencies Flash Ventures The Company’s business ventures with Kioxia Corporation (“Kioxia”) consist of three separate legal entities: Flash Partners Ltd. (“Flash Partners”), Flash Alliance Ltd. (“Flash Alliance”), and Flash Forward Ltd. (“Flash Forward”), collectively referred to as “Flash Ventures”. The following table presents the notes receivable from, and equity investments in, Flash Ventures as of December 31, 2021 and July 2, 2021:
During the three and six months ended December 31, 2021 and during the three and six months ended January 1, 2021, the Company made net payments to Flash Ventures of $1.11 billion and $2.30 billion, and $1.21 billion and $2.19 billion, respectively, for purchased flash-based memory wafers and net loans. The Company makes, or will make, loans to Flash Ventures to fund equipment investments for new process technologies and additional wafer capacity. The Company aggregates its Flash Ventures’ notes receivable into one class of financing receivables due to the similar ownership interest and common structure in each Flash Venture entity. For all reporting periods presented, no loans were past due and no loan impairments were recorded. The Company’s notes receivable from each Flash Ventures entity, denominated in Japanese yen, are secured by equipment owned by that Flash Ventures entity. As of December 31, 2021 and July 2, 2021, the Company had Accounts payable balances due to Flash Ventures of $389 million and $398 million, respectively. The Company’s maximum reasonably estimable loss exposure (excluding lost profits) as a result of its involvement with Flash Ventures, based upon the Japanese yen to U.S. dollar exchange rate at December 31, 2021, is presented below. Investments in Flash Ventures are denominated in Japanese yen, and the maximum estimable loss exposure excludes any cumulative translation adjustment due to revaluation from the Japanese yen to the U.S. dollar.
The Company is obligated to pay for variable costs incurred in producing its share of Flash Ventures’ flash-based memory wafer supply, based on its three-month forecast, which generally equals 50% of Flash Ventures’ output. In addition, the Company is obligated to pay for half of Flash Ventures’ fixed costs regardless of the output the Company chooses to purchase. The Company is not able to estimate its total wafer purchase commitment obligation beyond its rolling three-month purchase commitment because the price is determined by reference to the future cost of producing the semiconductor wafers. In addition, the Company is committed to fund 49.9% to 50.0% of each Flash Ventures entity’s capital investments to the extent that each Flash Ventures entity’s operating cash flow is insufficient to fund these investments. In June 2019, an unexpected power outage incident occurred at the flash-based memory manufacturing facilities operated in Yokkaichi, Japan. The power outage incident impacted the facilities and process tools and resulted in damage to flash wafers in production and a reduction in the Company’s flash wafer availability. During the three and six months ended January 1, 2021, the Company recovered $45 million and $75 million, respectively, related to this incident from its insurance carriers, which was recorded in Cost of revenue. Inventory Purchase Commitments with Flash Ventures. Purchase orders placed under Flash Ventures for up to three months are binding and cannot be canceled. Research and Development Activities. The Company participates in common research and development (“R&D”) activities with Kioxia and is contractually committed to a minimum funding level. R&D commitments are immaterial to the Condensed Consolidated Financial Statements. Off-Balance Sheet Liabilities Flash Ventures sells to and leases back from a consortium of financial institutions a portion of its tools and has entered into equipment lease agreements of which the Company guarantees half or all of the outstanding obligations under each lease agreement. The lease agreements are subject to customary covenants and cancellation events related to Flash Ventures and each of the guarantors. The occurrence of a cancellation event could result in an acceleration of Flash Ventures’ obligations and a call on the Company’s guarantees. The following table presents the Company’s portion of the remaining guarantee obligations under the Flash Ventures’ lease facilities in both Japanese yen and U.S. dollar-equivalent, based upon the Japanese yen to U.S. dollar exchange rate as of December 31, 2021.
The following table details the breakdown of the Company’s remaining guarantee obligations between the principal amortization and the purchase option exercise price at the end of the term of the Flash Ventures lease agreements, in annual installments as of December 31, 2021 in U.S. dollars, based upon the Japanese yen to U.S. dollar exchange rate as of December 31, 2021:
The Company and Kioxia have agreed to mutually contribute to, and indemnify each other and Flash Ventures for, environmental remediation costs or liability resulting from Flash Ventures’ manufacturing operations in certain circumstances. The Company has not made any indemnification payments, nor recorded any indemnification receivables, under any such agreements. As of December 31, 2021, no amounts have been accrued in the Condensed Consolidated Financial Statements with respect to these indemnification agreements. Unis Venture The Company has a joint venture with Unisplendour Corporation Limited and Unissoft (Wuxi) Group Co. Ltd. (“Unis”), referred to as the “Unis Venture”, to market and sell the Company’s products in China and to develop data storage systems for the Chinese market in the future. The Unis Venture is 49% owned by the Company and 51% owned by Unis. The Company accounts for its investment in the Unis Venture under the equity method of accounting. Revenue on products distributed by the Unis Venture is recognized upon sell through to third-party customers. For both the three and six months ended December 31, 2021, the Company recognized approximately 4% of its consolidated revenue on products distributed by the Unis Venture. For both the three and six months ended January 1, 2021, the Company recognized approximately 3% of its consolidated revenue on products distributed by the Unis Venture. The outstanding accounts receivable due from the Unis Venture were 7% and 6% of Accounts receivable, net as of December 31, 2021 and July 2, 2021, respectively.
|
Leases and Other Commitments |
6 Months Ended | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2021 | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Leases [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Leases and Other Commitments | Leases and Other Commitments Leases The Company leases certain domestic and international facilities and data center space under long-term, non-cancelable operating leases that expire at various dates through 2034. These leases include no material variable or contingent lease payments. Operating lease assets and liabilities are recognized based on the present value of the remaining lease payments discounted using the Company’s incremental borrowing rate. Operating lease assets also include prepaid lease payments minus any lease incentives. Extension or termination options present in the Company’s lease agreements are included in determining the right-of-use asset and lease liability when it is reasonably certain the Company will exercise those options. Lease expense is recognized on a straight-line basis over the lease term. The following table summarizes supplemental balance sheet information related to operating leases as of December 31, 2021:
The following table summarizes supplemental disclosures of operating cost and cash flow information related to operating leases:
Purchase Agreements and Other Commitments In the normal course of business, the Company enters into purchase orders with suppliers for the purchase of components used to manufacture its products. These purchase orders generally cover forecasted component supplies needed for production during the next quarter, are recorded as a liability upon receipt of the components, and generally may be changed or canceled at any time prior to shipment of the components. The Company also enters into long-term agreements with suppliers that contain fixed future commitments, which are contingent on certain conditions such as performance, quality and technology of the vendor’s components. As of December 31, 2021, the Company had the following minimum long-term commitments:
|
Shareholders' Equity |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2021 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Share-based Payment Arrangement [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Shareholders' Equity | Shareholders’ Equity Stock-based Compensation Expense The following tables present the Company’s stock-based compensation for equity-settled awards by type (i.e., stock options, restricted stock units (“RSUs”), restricted stock unit awards with performance conditions or market conditions (“PSUs”), and rights to purchase shares of common stock under the Company’s Employee Stock Purchase Plan (“ESPP”)) and financial statement line as well as the related tax benefit included in the Company’s Condensed Consolidated Statements of Operations:
Windfall tax benefits and tax deficiencies for shortfalls related to the vesting and exercise of stock-based awards, which are recognized as a component of the Company’s Income tax expense, were not material for the periods presented. Compensation cost related to unvested stock options, RSUs, PSUs, and rights to purchase shares of common stock under the ESPP will generally be amortized on a straight-line basis over the remaining average service period. The following table presents the unamortized compensation cost and weighted average service period of all unvested outstanding awards as of December 31, 2021:
(1) Weighted average service period assumes the performance metrics are met for the PSUs. Plan Activities Stock Options The following table summarizes stock option activity under the Company’s incentive plans. All outstanding options were exercisable at December 31, 2021:
RSUs and PSUs The following table summarizes RSU and PSU activity under the Company’s incentive plans:
RSUs and PSUs are generally settled in an equal number of shares of the Company’s common stock at the time of vesting of the units. Stock Repurchase Program The Company’s Board of Directors has authorized a stock repurchase program for the repurchase of up to $5.00 billion of the Company’s common stock, which authorization is effective through July 25, 2023. The Company did not make any stock repurchases during the six months ended December 31, 2021 and has not repurchased any shares of its common stock pursuant to its stock repurchase program since the first quarter of fiscal 2019. The remaining amount available to be repurchased under the Company’s current stock repurchase program as of December 31, 2021 was $4.50 billion. Repurchases under the stock repurchase program may be made in the open market or in privately negotiated transactions and may be made under a Rule 10b5-1 plan. The Company expects stock repurchases to be funded principally by operating cash flows.
|
Income Tax Expense |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2021 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Income Tax Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Income Tax Expense | Income Tax Expense The Tax Cuts and Jobs Act (the “2017 Act”), enacted on December 22, 2017, includes a broad range of tax reform proposals affecting businesses. The Company completed its accounting for the tax effects of the enactment of the 2017 Act during the second quarter of fiscal 2019. However, the U.S. Treasury and the Internal Revenue Service (“IRS”) have issued tax guidance on certain provisions of the 2017 Act since the enactment date, and the Company anticipates the issuance of additional regulatory and interpretive guidance. The Company applied a reasonable interpretation of the 2017 Act along with the then-available guidance in finalizing its accounting for the tax effects of the 2017 Act. Any additional regulatory or interpretive guidance would constitute new information, which may require further refinements to the Company’s estimates in future periods. The following table presents the Company’s Income tax expense and the effective tax rate:
The primary drivers of the difference between the effective tax rate for the three and six months ended December 31, 2021 and the U.S. Federal statutory rate of 21%, are the relative mix of earnings and losses by jurisdiction, the deduction for foreign derived intangible income, credits, and tax holidays in Malaysia, the Philippines and Thailand that will expire at various dates during fiscal years 2024 through 2031. In addition, the effective tax rate for the three and six months ended December 31, 2021 includes the discrete effect of an increase to unrecognized tax benefits as a result of ongoing discussions with various taxing authorities of $8 million and $25 million, respectively. The primary drivers of the difference between the effective tax rate for the three and six months ended January 1, 2021 and the U.S. Federal statutory rate of 21% are the relative mix of earnings and losses by jurisdiction, the deduction for foreign derived intangible income, credits, and tax holidays in Malaysia, Philippines and Thailand. In addition, the effective tax rate for the six months ended January 1, 2021 includes the discrete effects of net tax deficiencies from shortfalls of $12 million related to the vesting of stock-based awards and additional tax expense of $10 million from the re-measurement of certain deferred tax liabilities due to restructuring activities. The discrete items had no impact on the amount of income taxes paid by the Company. As previously disclosed, the IRS issued statutory notices of deficiency with respect to adjustments relating to transfer pricing with the Company’s foreign subsidiaries and intercompany payable balances for fiscal years 2008 through 2012. The Company filed petitions with the U.S. Tax Court with respect to these notices. Through January 2022, the IRS has filed various Amendments to Answer with the U.S. Tax Court which (i) assert adjustments relating to transfer pricing with the Company’s foreign subsidiaries for fiscal years 2008 through 2012 that would result in additional federal income tax liabilities totaling approximately $1.26 billion for fiscal years 2008 through 2012, and (ii) assert penalties totaling $340 million on the proposed adjustments relating to transfer pricing with respect to fiscal years 2008 through 2012. In addition, the IRS proposed adjustments relating to transfer pricing with the Company’s foreign subsidiaries and intercompany payable balances for fiscal years 2013 through 2015 that, if sustained, would result in additional federal income tax liabilities totaling approximately $343 million for those fiscal years. In March 2021, the IRS asserted penalties totaling $109 million on the proposed adjustments relating to transfer pricing with respect to fiscal years 2013 through 2015. The Company disagrees with the proposed adjustments relating to transfer pricing and related penalties, and continues to believe that its tax positions are properly supported and will vigorously contest the position taken by the IRS. Also in March 2021, the Company and the IRS tentatively reached a basis for resolving the intercompany payable balances matter for all fiscal years at issue and the impact was not material to the Consolidated Financial Statements. The Company believes that adequate provision has been made for any adjustments that may result from tax examinations. However, the outcome of tax examinations cannot be predicted with certainty. If any issues addressed in the Company’s tax examinations are resolved in a manner not consistent with management’s expectations, the Company could be required to adjust its provision for income taxes in the period such resolution occurs. As of December 31, 2021, it was not possible to estimate the amount of change, if any, in the unrecognized tax benefits that is reasonably possible within the next twelve months. Any significant change in the amount of the Company’s liability for unrecognized tax benefits would most likely result from additional information or settlements relating to the examination of the Company’s tax returns. As of December 31, 2021, the liability for unrecognized tax benefits (excluding accrued interest and penalties) was approximately $772 million. Accrued interest and penalties related to unrecognized tax benefits as of December 31, 2021 was approximately $135 million. Of these amounts, approximately $772 million could result in potential cash payments. The Company is not able to provide a reasonable estimate of the timing of future tax payments related to these obligations.
|
Net Income Per Common Share |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2021 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Net Income Per Common Share | Net Income Per Common Share The following table presents the computation of basic and diluted income per common share:
|
Employee Termination, Asset Impairment and Other Charges |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2021 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Postemployment Benefits [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Employee Termination, Asset Impairment and Other Charges | Employee Termination, Asset Impairment, and Other Charges Business Realignment The Company periodically incurs charges as part of the integration process of recent acquisitions and to realign its operations with anticipated market demand, primarily consisting of organization rationalization designed to streamline its business, reduce its cost structure and focus its resources. The Company recorded the following charges related to these actions:
The following table presents an analysis of the components of these activities against the reserve during the six months ended December 31, 2021:
|
Legal Proceedings |
6 Months Ended |
---|---|
Dec. 31, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Legal Proceedings | Legal Proceedings Tax For disclosures regarding statutory notices of deficiency issued by the IRS on June 28, 2018 and December 10, 2018, petitions filed by the Company with the U.S. Tax Court in September 2018 and March 2019, additional penalties asserted by the IRS in March 2021 and a tentative resolution with respect to certain matters, see Note 13, Income Tax Expense. Other Matters In the normal course of business, the Company is subject to legal proceedings, lawsuits and other claims. Although the ultimate aggregate amount of probable monetary liability or financial impact with respect to these other matters is subject to many uncertainties, management believes that any monetary liability or financial impact to the Company from these matters, individually and in the aggregate, would not be material to the Company’s financial condition, results of operations or cash flows. However, any monetary liability and financial impact to the Company from these matters could differ materially from the Company’s expectations.
|
Organization and Basis of Presentation (Policies) |
6 Months Ended |
---|---|
Dec. 31, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Western Digital Corporation (“Western Digital” or the “Company”) is a leading developer, manufacturer, and provider of data storage devices and solutions that address the evolving needs of the information technology (“IT”) industry and the infrastructure that enables the proliferation of data in virtually every other industry. The Company creates environments for data to thrive. The Company is driving the innovation needed to help customers capture, preserve, access and transform an ever-increasing diversity of data. Everywhere data lives, from advanced data centers to mobile sensors to personal devices, the Company’s industry-leading solutions deliver the possibilities of data. The accounting policies followed by the Company are set forth in Part II, Item 8, Note 1, Organization and Basis of Presentation, of the Notes to Consolidated Financial Statements included in the Company’s Annual Report on Form 10‑K for the fiscal year ended July 2, 2021. In the opinion of management, all adjustments necessary to fairly state the Condensed Consolidated Financial Statements have been made. All such adjustments are of a normal, recurring nature. Certain information and footnote disclosures normally included in the Consolidated Financial Statements prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”) have been condensed or omitted pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). These Condensed Consolidated Financial Statements should be read in conjunction with the Consolidated Financial Statements and the notes thereto included in the Company’s Annual Report on Form 10‑K for the fiscal year ended July 2, 2021. The results of operations for interim periods are not necessarily indicative of results to be expected for the full year.
|
Fiscal Year | Fiscal YearThe Company’s fiscal year ends on the Friday nearest to June 30 and typically consists of 52 weeks. Approximately every five to six years, the Company reports a 53-week fiscal year to align the fiscal year with the foregoing policy. Fiscal years 2022, which ends on July 1, 2022, and 2021, which ended on July 2, 2021, are each comprised of 52 weeks, with all quarters presented consisting of 13 weeks. |
Use of Estimates | Use of Estimates Company management has made estimates and assumptions relating to the reporting of certain assets and liabilities in conformity with U.S. GAAP. These estimates and assumptions have been applied using methodologies that are consistent throughout the periods presented with consideration given to the potential impacts of the ongoing COVID-19 pandemic. However, actual results could differ materially from these estimates and be significantly affected by the severity and duration of the COVID-19 pandemic, the extent of actions to contain or treat COVID-19, the timing, distribution, efficacy and public acceptance of vaccines around the world, additional surges of COVID-19, including the emergence of more contagious or vaccine-resistant variants, and how quickly and to what extent normal economic and operating activity can resume.
|
Recent Accounting Pronouncements | Recent Accounting Pronouncements Accounting Pronouncements Recently Adopted In December 2019, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2019-12, “Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes” (“ASU 2019-12”). ASU 2019-12 removes certain exceptions for recognizing deferred taxes for investments, performing intraperiod allocation and calculating income taxes in interim periods. The ASU also adds guidance to reduce complexity in certain areas, including recognizing deferred taxes for tax goodwill and allocating taxes to members of a consolidated group. The Company adopted this ASU on July 3, 2021, which is the beginning of fiscal 2022, and its adoption did not have a material impact on the Company’s Condensed Consolidated Financial Statements. Recently Issued Accounting Pronouncements Not Yet Adopted In August 2020, the FASB issued ASU No. 2020-06, “Debt—Debt with Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging—Contracts in Entity’s Own Equity (Subtopic 815-40): Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity” (“ASU 2020-06”). ASU 2020-06 reduces the number of accounting models for convertible debt instruments and convertible preferred stock and results in fewer instruments with embedded conversion features being separately recognized from the host contract as compared with current standards. Those instruments that do not have a separately recognized embedded conversion feature will no longer recognize a debt issuance discount related to such a conversion feature and would recognize less interest expense on a periodic basis. Additionally, the ASU amends the calculation of the share dilution impact related to a conversion feature and eliminates the treasury method as an option. For instruments that do not have a component mandatorily settled in cash, the change will likely result in a higher amount of share dilution in the calculation of earnings per share. The Company expects to adopt this ASU in the first quarter of fiscal 2023, and is currently assessing the impact of adoption. In November 2021, the FASB issued ASU No. 2021-10, “Government Assistance (Topic 832): Disclosures by Business Entities about Government Assistance” (“ASU 2021-10”). ASU 2021-10 increases the transparency of government assistance received by requiring most business entities to disclose information about government assistance received, including (1) the types of assistance, (2) the entity’s accounting for the assistance, and (3) the effect of the assistance on an entity’s financial statements. This ASU is effective for fiscal years (and interim periods within those fiscal years) beginning after December 15, 2021, which for the Company is the first quarter of fiscal 2023. Early adoption is permitted. The Company is currently assessing the impact and timing of adoption of this ASU.
|
Fair Value Measurements and Investments | Financial assets and liabilities that are remeasured and reported at fair value at each reporting period are classified and disclosed in one of the following three levels: Level 1. Quoted prices in active markets for identical assets or liabilities. Level 2. Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3. Inputs that are unobservable for the asset or liability and that are significant to the fair value of the assets or liabilities.
|
Segment Reporting (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2021 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Segment Reporting [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Segment Reporting Information, by Segment | The following table summarizes the operating performance of the Company’s reportable segments:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Disaggregation of Revenue | The Company’s disaggregated revenue information is as follows:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Goodwill | The following table provides a summary of goodwill activity for the period:
|
Supplemental Financial Statement Data (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2021 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Inventories | Inventories
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Property, Plant and Equipment, Net | Property, plant and equipment, net
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Intangible Assets | Intangible assets
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Product Warranty Liability | Product warranty liability Changes in the warranty accrual were as follows:
The current portion of the warranty accrual is classified in Accrued expenses and the long-term portion is classified in Other liabilities as noted below:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Other Liabilities | Other liabilities
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Accumulated Other Comprehensive Income (Loss) | The following table illustrates the changes in the balances of each component of AOCI:
|
Fair Value Measurements and Investments (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2021 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Financial Assets and Liabilities Measured at Fair Value on Recurring Basis | The following tables present information about the Company’s financial assets and liabilities that are measured at fair value on a recurring basis as of December 31, 2021 and July 2, 2021, and indicate the fair value hierarchy of the valuation techniques utilized to determine such values:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Related Costs And Fair Values Based On Quoted Market Prices | For financial instruments where the carrying value (which includes principal adjusted for any unamortized issuance costs, and discounts or premiums) differs from fair value (which is based on quoted market prices), the following table represents the related carrying value and fair value for each of the Company’s outstanding financial instruments. Each of the financial instruments presented below was categorized as Level 2 for all periods presented, based on the frequency of trading immediately prior to the end of the second quarter of fiscal 2022 and the fourth quarter of fiscal 2021, respectively.
|
Debt (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2021 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Debt | Debt consisted of the following as of December 31, 2021 and July 2, 2021:
|
Pensions and Other Post-Retirement Benefit Plans (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2021 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Retirement Benefits [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Obligations and Funded Status | The following table presents the unfunded status of the benefit obligations for the Pension Plans:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Unfunded Amounts Recognized on Consolidated Balance Sheets | The following table presents the unfunded amounts related to the Pension Plans as recognized on the Company’s Condensed Consolidated Balance Sheets:
|
Related Parties and Related Commitments and Contingencies (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2021 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Commitments and Contingencies Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Notes Receivable and Investments in Related Parties | The following table presents the notes receivable from, and equity investments in, Flash Ventures as of December 31, 2021 and July 2, 2021:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Variable Interest Entity Maximum Loss Exposure | The Company’s maximum reasonably estimable loss exposure (excluding lost profits) as a result of its involvement with Flash Ventures, based upon the Japanese yen to U.S. dollar exchange rate at December 31, 2021, is presented below. Investments in Flash Ventures are denominated in Japanese yen, and the maximum estimable loss exposure excludes any cumulative translation adjustment due to revaluation from the Japanese yen to the U.S. dollar.
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Guarantor Obligations | The following table presents the Company’s portion of the remaining guarantee obligations under the Flash Ventures’ lease facilities in both Japanese yen and U.S. dollar-equivalent, based upon the Japanese yen to U.S. dollar exchange rate as of December 31, 2021.
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Remaining Guarantee Obligations | The following table details the breakdown of the Company’s remaining guarantee obligations between the principal amortization and the purchase option exercise price at the end of the term of the Flash Ventures lease agreements, in annual installments as of December 31, 2021 in U.S. dollars, based upon the Japanese yen to U.S. dollar exchange rate as of December 31, 2021:
|
Leases and Other Commitments (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2021 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Leases [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Supplemental Balance Sheet Disclosures | The following table summarizes supplemental balance sheet information related to operating leases as of December 31, 2021:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
schedule of Supplemental Cash Flow Disclosures | The following table summarizes supplemental disclosures of operating cost and cash flow information related to operating leases:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Long-term Purchase Agreements | As of December 31, 2021, the Company had the following minimum long-term commitments:
|
Shareholders' Equity (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2021 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Share-based Payment Arrangement [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Share-based Compensation Arrangements by Share-based Payment Award | The following tables present the Company’s stock-based compensation for equity-settled awards by type (i.e., stock options, restricted stock units (“RSUs”), restricted stock unit awards with performance conditions or market conditions (“PSUs”), and rights to purchase shares of common stock under the Company’s Employee Stock Purchase Plan (“ESPP”)) and financial statement line as well as the related tax benefit included in the Company’s Condensed Consolidated Statements of Operations:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Employee Service Share-based Compensation, Unrecognized Costs | The following table presents the unamortized compensation cost and weighted average service period of all unvested outstanding awards as of December 31, 2021:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Stock Option Activity | The following table summarizes stock option activity under the Company’s incentive plans. All outstanding options were exercisable at December 31, 2021:
|
||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Restricted Stock Unit | The following table summarizes RSU and PSU activity under the Company’s incentive plans:
|
Income Tax Expense (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2021 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Income Tax Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Effective Income Tax Rate Reconciliation | The following table presents the Company’s Income tax expense and the effective tax rate:
|
Net Income Per Common Share (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2021 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Earnings Per Share, Basic and Diluted | The following table presents the computation of basic and diluted income per common share:
|
Employee Termination, Asset Impairment and Other Charges (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Dec. 31, 2021 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Postemployment Benefits [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Restructuring Reserve by Type of Cost | The Company recorded the following charges related to these actions:
The following table presents an analysis of the components of these activities against the reserve during the six months ended December 31, 2021:
|
Segment Information - Disaggregation of Revenue (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Dec. 31, 2021 |
Jan. 01, 2021 |
Dec. 31, 2021 |
Jan. 01, 2021 |
|
Disaggregation of Revenue [Line Items] | ||||
Revenue, net | $ 4,833 | $ 3,943 | $ 9,884 | $ 7,865 |
Americas | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue, net | 1,407 | 945 | 3,021 | 2,024 |
Europe, Middle East and Africa | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue, net | 816 | 725 | 1,578 | 1,354 |
Asia | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue, net | 2,610 | 2,273 | 5,285 | 4,487 |
Cloud | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue, net | 1,920 | 1,014 | 4,145 | 2,305 |
Client | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue, net | 1,854 | 1,869 | 3,707 | 3,619 |
Consumer | ||||
Disaggregation of Revenue [Line Items] | ||||
Revenue, net | $ 1,059 | $ 1,060 | $ 2,032 | $ 1,941 |
Segment Information - Additional Information (Details) |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Dec. 31, 2021 |
Jan. 01, 2021 |
Dec. 31, 2021 |
Jan. 01, 2021 |
|
Revenue from Contract with Customer | Customer Concentration Risk | Top Ten Customers | ||||
Concentration Risk [Line Items] | ||||
Concentration risk, percentage | 46.00% | 43.00% | 44.00% | 41.00% |
Segment Information - Goodwill Rollforward (Details) $ in Millions |
6 Months Ended |
---|---|
Dec. 31, 2021
USD ($)
| |
Goodwill [Roll Forward] | |
Balance at July 3, 2021 | $ 10,066 |
Foreign currency translation adjustment | (1) |
Balance at December 31, 2021 | 10,065 |
HDD | |
Goodwill [Roll Forward] | |
Balance at July 3, 2021 | 4,328 |
Foreign currency translation adjustment | 0 |
Balance at December 31, 2021 | 4,328 |
Flash | |
Goodwill [Roll Forward] | |
Balance at July 3, 2021 | 5,738 |
Foreign currency translation adjustment | (1) |
Balance at December 31, 2021 | $ 5,737 |
Supplemental Financial Statement Data - Additional Information (Details) - USD ($) |
6 Months Ended | ||
---|---|---|---|
Jan. 01, 2021 |
Dec. 31, 2021 |
Jul. 02, 2021 |
|
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||
Proceeds on sale of trade accounts receivable | $ 173,000,000 | ||
Factored receivables outstanding | $ 0 | $ 0 |
Supplemental Financial Statement Data - Inventory (Details) - USD ($) $ in Millions |
Dec. 31, 2021 |
Jul. 02, 2021 |
---|---|---|
Inventories: | ||
Raw materials and component parts | $ 1,685 | $ 1,623 |
Work-in-process | 1,013 | 1,088 |
Finished goods | 949 | 905 |
Total inventories | $ 3,647 | $ 3,616 |
Supplemental Financial Statement Data - Property, Plant and Equipment (Details) - USD ($) $ in Millions |
Dec. 31, 2021 |
Jul. 02, 2021 |
---|---|---|
Property, plant and equipment: | ||
Property, plant and equipment, gross | $ 11,435 | $ 10,959 |
Accumulated depreciation | (8,068) | (7,771) |
Property, plant and equipment, net | 3,367 | 3,188 |
Land | ||
Property, plant and equipment: | ||
Property, plant and equipment, gross | 273 | 278 |
Buildings and improvements | ||
Property, plant and equipment: | ||
Property, plant and equipment, gross | 1,870 | 1,854 |
Machinery and equipment | ||
Property, plant and equipment: | ||
Property, plant and equipment, gross | 8,287 | 7,860 |
Computer equipment and software | ||
Property, plant and equipment: | ||
Property, plant and equipment, gross | 466 | 440 |
Furniture and fixtures | ||
Property, plant and equipment: | ||
Property, plant and equipment, gross | 53 | 51 |
Construction-in-process | ||
Property, plant and equipment: | ||
Property, plant and equipment, gross | $ 486 | $ 476 |
Supplemental Financial Statement Data - Intangible Assets (Details) - USD ($) $ in Millions |
Dec. 31, 2021 |
Jul. 02, 2021 |
---|---|---|
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Finite-lived intangible assets | $ 5,508 | $ 5,508 |
In-process research and development | 80 | 80 |
Accumulated amortization | (5,288) | (5,146) |
Intangible assets, net | $ 300 | $ 442 |
Supplemental Financial Statement Data - Warranty Accrual Roll Forward (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Dec. 31, 2021 |
Jan. 01, 2021 |
Dec. 31, 2021 |
Jan. 01, 2021 |
|
Movement in Standard Product Warranty Accrual [Roll Forward] | ||||
Warranty accrual, beginning of period | $ 370 | $ 391 | $ 363 | $ 408 |
Charges to operations | 36 | 24 | 76 | 59 |
Utilization | (28) | (24) | (51) | (55) |
Changes in estimate related to pre-existing warranties | (27) | (25) | (37) | (46) |
Warranty accrual, end of period | $ 351 | $ 366 | $ 351 | $ 366 |
Supplemental Financial Statement Data - Total Warranty Accrual (Details) - USD ($) $ in Millions |
Dec. 31, 2021 |
Oct. 01, 2021 |
Jul. 02, 2021 |
Jan. 01, 2021 |
Oct. 02, 2020 |
Jul. 03, 2020 |
---|---|---|---|---|---|---|
Warranty accrual: | ||||||
Current portion (included in Accrued expenses) | $ 166 | $ 175 | ||||
Long-term portion (included in Other liabilities) | 185 | 188 | ||||
Total warranty accrual | $ 351 | $ 370 | $ 363 | $ 366 | $ 391 | $ 408 |
Supplemental Financial Statement Data - Other Liabilities (Details) - USD ($) $ in Millions |
Dec. 31, 2021 |
Jul. 02, 2021 |
---|---|---|
Other liabilities: | ||
Non-current net tax payable | $ 572 | $ 684 |
Payables related to unrecognized tax benefits | 772 | 750 |
Other non-current liabilities | 677 | 633 |
Total other liabilities | $ 2,021 | $ 2,067 |
Derivatives Instruments and Hedging Activities (Details) |
6 Months Ended |
---|---|
Dec. 31, 2021 | |
Foreign Exchange Forward Contracts Designated | |
Derivatives, Fair Value [Line Items] | |
Derivative, term of contract (to not exceed) | 12 months |
Pensions and Other Post-Retirement Benefit Plans - Additional Information (Details) |
6 Months Ended |
---|---|
Dec. 31, 2021 | |
Retirement Benefits [Abstract] | |
Expected long-term rate of return on plan assets | 2.50% |
Pensions and Other Post-Retirement Benefit Plans - Obligations and Funded Status (Details) - USD ($) $ in Millions |
Dec. 31, 2021 |
Jul. 02, 2021 |
---|---|---|
Retirement Benefits [Abstract] | ||
Benefit obligation at end of period | $ 353 | $ 359 |
Fair value of plan assets at end of period | 223 | 227 |
Unfunded status | $ 130 | $ 132 |
Pensions and Other Post-Retirement Benefit Plans - Unfunded Amounts Recognized on Consolidated Balance Sheets (Details) - USD ($) $ in Millions |
Dec. 31, 2021 |
Jul. 02, 2021 |
---|---|---|
Retirement Benefits [Abstract] | ||
Current liabilities | $ 1 | $ 1 |
Non-current liabilities | 129 | 131 |
Net amount recognized | $ 130 | $ 132 |
Related Parties and Related Commitments and Contingencies - Equity Investments (Details) - USD ($) $ in Millions |
Dec. 31, 2021 |
Jul. 02, 2021 |
---|---|---|
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Total notes receivable and investments in Flash Ventures | $ 1,553 | $ 1,586 |
Flash Partners Ltd | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Notes receivable, related parties | 92 | 191 |
Investments | 194 | 199 |
Flash Alliance Ltd | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Notes receivable, related parties | 161 | 213 |
Investments | 284 | 293 |
Flash Forward Ltd | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Notes receivable, related parties | 694 | 561 |
Investments | 128 | 129 |
Flash Ventures | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Total notes receivable and investments in Flash Ventures | $ 1,553 | $ 1,586 |
Related Parties and Related Commitments and Contingencies - Maximum Loss Exposure (Details) - Dec. 31, 2021 - Flash Ventures $ in Millions, ¥ in Billions |
USD ($) |
JPY (¥) |
---|---|---|
Guarantor Obligations [Line Items] | ||
VIE, reporting entity involvement, maximum loss exposure, amount | $ 4,382 | |
Notes receivable | ||
Guarantor Obligations [Line Items] | ||
VIE, reporting entity involvement, maximum loss exposure, amount | 947 | |
Equity investments | ||
Guarantor Obligations [Line Items] | ||
VIE, reporting entity involvement, maximum loss exposure, amount | 606 | |
Operating lease guarantees | ||
Guarantor Obligations [Line Items] | ||
Operating lease guarantees | 1,964 | ¥ 226 |
Inventory and prepayments | ||
Guarantor Obligations [Line Items] | ||
Inventory and prepayments | $ 865 |
Related Parties and Related Commitments and Contingencies - JV Lease Guarantees (Details) - Dec. 31, 2021 $ in Millions, ¥ in Billions |
USD ($) |
JPY (¥) |
---|---|---|
Operating lease guarantees | Flash Ventures | ||
Loss Contingencies [Line Items] | ||
Total guarantee obligations | $ 1,964 | ¥ 226 |
Related Parties and Related Commitments and Contingencies - Joint Venture Lease Amounts (Details) - Flash Ventures $ in Millions |
Dec. 31, 2021
USD ($)
|
---|---|
Guarantor Obligations [Line Items] | |
Remaining six months of 2022 | $ 304 |
2023 | 570 |
2024 | 466 |
2025 | 264 |
2026 | 280 |
Thereafter | 80 |
Total guarantee obligations | 1,964 |
Payment of Principal Amortization | |
Guarantor Obligations [Line Items] | |
Remaining six months of 2022 | 304 |
2023 | 507 |
2024 | 353 |
2025 | 161 |
2026 | 124 |
Thereafter | 15 |
Total guarantee obligations | 1,464 |
Purchase Option Exercise Price at Final Lease Terms | |
Guarantor Obligations [Line Items] | |
Remaining six months of 2022 | 0 |
2023 | 63 |
2024 | 113 |
2025 | 103 |
2026 | 156 |
Thereafter | 65 |
Total guarantee obligations | $ 500 |
Leases and Other Commitments - Supplemental Balance Sheet (Details) $ in Millions |
Dec. 31, 2021
USD ($)
|
---|---|
Minimum lease payments by fiscal year: | |
Remaining six months of 2022 | $ 27 |
2023 | 47 |
2024 | 46 |
2025 | 43 |
2026 | 42 |
Thereafter | 188 |
Total future minimum lease payments | 393 |
Less: Imputed Interest | 58 |
Present value of lease liabilities | 335 |
Less: Current portion (included in Accrued expenses) | 42 |
Long-term operating lease liabilities (included in Other liabilities) | 293 |
Operating lease right-of-use assets (included in Other non-current assets) | $ 318 |
Weighted average remaining lease term in years | 8 years 8 months 12 days |
Weighted average discount rate | 3.40% |
Leases and Other Commitments - Supplemental Cash Flow (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Dec. 31, 2021 |
Jan. 01, 2021 |
Dec. 31, 2021 |
Jan. 01, 2021 |
|
Leases [Abstract] | ||||
Cost of operating leases | $ 14 | $ 12 | $ 27 | $ 25 |
Cash paid for operating leases | 12 | 14 | 24 | 26 |
Operating lease assets obtained in exchange for operating lease liabilities | $ 11 | $ 20 | $ 123 | $ 27 |
Leases and Other Commitments - Long-Term Commitments (Details) $ in Millions |
Dec. 31, 2021
USD ($)
|
---|---|
Fiscal year: | |
Remaining six months of 2022 | $ 343 |
2023 | 550 |
2024 | 296 |
2025 | 148 |
2026 | 20 |
Thereafter | 170 |
Total | $ 1,527 |
Shareholders' Equity - Unrecognized Share-based Compensation (Details) $ in Millions |
6 Months Ended |
---|---|
Dec. 31, 2021
USD ($)
| |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Unamortized Compensation Costs | $ 745 |
RSUs and PSUs | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Unamortized Compensation Costs | $ 664 |
Weighted Average Service Period | 2 years 6 months |
ESPP | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Unamortized Compensation Costs | $ 81 |
Weighted Average Service Period | 1 year 8 months 12 days |
Shareholders' Equity - Stock Option Activity (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions |
6 Months Ended | 12 Months Ended |
---|---|---|
Dec. 31, 2021 |
Jul. 02, 2021 |
|
Number of Shares | ||
Options outstanding, beginning balance (in shares) | 1.5 | |
Exercised (in shares) | (0.1) | |
Canceled or expired (in shares) | (0.4) | |
Options outstanding, ending balance (in shares) | 1.0 | 1.5 |
Weighted Average Exercise Price Per Share | ||
Options outstanding, beginning balance, exercise price (in dollars per share) | $ 72.84 | |
Exercised, exercise price (in dollars per share) | 43.57 | |
Canceled or expired, exercise price (in dollars per share) | 98.85 | |
Options outstanding, ending balance, exercise price (in dollars per share) | $ 66.15 | $ 72.84 |
Options outstanding, weighted average remaining contractual term | 1 year | 1 year 2 months 12 days |
Aggregate Intrinsic Value | ||
Options outstanding, beginning balance, intrinsic value | $ 15 | |
Exercised, intrinsic value | 2 | |
Options outstanding, ending balance, intrinsic value | $ 9 | $ 15 |
Shareholders' Equity - Restricted Stock Units And Performance Share Units (Details) - Restricted Stock Units And Performance Share Units $ / shares in Units, shares in Millions, $ in Millions |
6 Months Ended |
---|---|
Dec. 31, 2021
USD ($)
$ / shares
shares
| |
Number of Shares | |
Outstanding, beginning balance (in shares) | shares | 16.1 |
Granted (in shares) | shares | 5.1 |
Vested (in shares) | shares | (4.6) |
Forfeited (in shares) | shares | (1.2) |
Outstanding, ending balance (in shares) | shares | 15.4 |
Weighted Average Grant Date Fair Value | |
Outstanding, beginning balance, grant date fair value (in dollars per share) | $ / shares | $ 50.12 |
Granted, grant date fair value (in dollars per share) | $ / shares | 63.39 |
Vested, grant date fair value (in dollars per share) | $ / shares | 53.93 |
Forfeited, grant date fair value (in dollars per share) | $ / shares | 51.71 |
Outstanding, ending balance, grant date fair value (in dollars per share) | $ / shares | $ 53.32 |
Aggregate value of restricted stock awards vested | $ | $ 285 |
Shareholders' Equity - Share Repurchase Program (Details) $ in Millions |
Dec. 31, 2021
USD ($)
|
---|---|
Stock Repurchase Program Effective Until July 25, 2023 | |
Equity, Class of Treasury Stock [Line Items] | |
Stock repurchase program, number of shares authorized to be repurchased | $ 5,000 |
Share Repurchase Program | |
Equity, Class of Treasury Stock [Line Items] | |
Stock repurchase program, remaining authorized repurchase, amount | $ 4,500 |
Income Tax Expense - Tax Expense and Effective Tax Rate (Details) - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Dec. 31, 2021 |
Jan. 01, 2021 |
Dec. 31, 2021 |
Jan. 01, 2021 |
|
Income Tax Disclosure [Abstract] | ||||
Income (loss) before taxes | $ 646 | $ 85 | $ 1,350 | $ 82 |
Income tax expense | $ 82 | $ 23 | $ 176 | $ 80 |
Effective tax rate | 13.00% | 27.00% | 13.00% | 98.00% |
Income Tax Expense - Additional Information (Details) - USD ($) $ in Millions |
1 Months Ended | 3 Months Ended | 6 Months Ended | |
---|---|---|---|---|
Mar. 31, 2021 |
Dec. 31, 2021 |
Dec. 31, 2021 |
Jan. 01, 2021 |
|
Income Tax Disclosure [Line Items] | ||||
Increase to unrecognized tax benefits as a result of ongoing discussions with various taxing authorities | $ 8 | $ 25 | ||
Net tax deficiencies | $ 12 | |||
Additional tax expense from re-measurement of deferred tax liabilities | $ 10 | |||
Unrecognized tax benefits | 772 | 772 | ||
Penalties and interest accrued on unrecognized tax benefits | 135 | 135 | ||
Potential payables related to unrecognized tax benefits | 772 | 772 | ||
Tax Years 2008 Through 2012 | ||||
Income Tax Disclosure [Line Items] | ||||
Additional tax | 1,260 | 1,260 | ||
Internal Revenue Service (IRS) | Tax Years 2008 Through 2012 | ||||
Income Tax Disclosure [Line Items] | ||||
Federal tax, subject to interest | 340 | |||
Internal Revenue Service (IRS) | Tax Years 2013 Through 2015 | ||||
Income Tax Disclosure [Line Items] | ||||
Additional tax | $ 343 | $ 343 | ||
Penalties asserted | $ 109 |
Net Income Per Common Share (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions |
3 Months Ended | 6 Months Ended | ||||
---|---|---|---|---|---|---|
Dec. 31, 2021 |
Oct. 01, 2021 |
Jan. 01, 2021 |
Oct. 02, 2020 |
Dec. 31, 2021 |
Jan. 01, 2021 |
|
Earnings Per Share [Abstract] | ||||||
Net income | $ 564 | $ 610 | $ 62 | $ (60) | $ 1,174 | $ 2 |
Weighted average shares outstanding: | ||||||
Basic (in shares) | 312 | 305 | 311 | 304 | ||
Employee stock options, RSUs, PSUs, ESPP (in shares) | 3 | 2 | 4 | 1 | ||
Diluted (in shares) | 315 | 307 | 315 | 305 | ||
Income per common share: | ||||||
Basic (in dollars per share) | $ 1.81 | $ 0.20 | $ 3.77 | $ 0.01 | ||
Diluted (in dollars per share) | $ 1.79 | $ 0.20 | $ 3.73 | $ 0.01 | ||
Anti-dilutive potential common shares excluded (in shares) | 5 | 8 | 3 | 10 |
Employee Termination, Asset Impairment and Other Charges - Expense Recognition (Details) - Business Realignment - USD ($) $ in Millions |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Dec. 31, 2021 |
Jan. 01, 2021 |
Dec. 31, 2021 |
Jan. 01, 2021 |
|
Restructuring Cost and Reserve [Line Items] | ||||
Employee termination and other charges: | $ 3 | $ 2 | $ 18 | $ 25 |
Asset impairments and losses (gains) on disposal of assets | (1) | 0 | 2 | 0 |
Total employee termination, asset impairment, and other charges | $ 2 | $ 2 | $ 20 | $ 25 |
Employee Termination, Asset Impairment and Other Charges - Business Realignment Activities (Details) - Employee Termination Benefits - Business Realignment $ in Millions |
6 Months Ended |
---|---|
Dec. 31, 2021
USD ($)
| |
Restructuring Reserve [Roll Forward] | |
Accrual balance at July 2, 2021 | $ 2 |
Charges | 18 |
Cash payments | (12) |
Accrual balance at December 31, 2021 | $ 8 |
$'FJ=33[8@$,W-BMU ]AZ%BNG<
M-JTR&ZI43FAR'V!$]#$?T &&^#:KE"E9-M;*Y90A_T*3A[H*M&9PE[.'K J<
MD_+$&H8=9 #QK65K;[=I8M%0V(&\'X]%%C)*$ZQH3]2U/8<#=P?0H
M.Q/SKHB^:49BID,]1 35*,VNBH/9R5"8;6FDXPU5]G=%<"OOW\+6/>JC_/^'
M:G]L66!VVS+]E%.+4R(8$":"J8@%_OQ,STYF UMR"T!@=DSC&'Z0/B^9_X 9)6TL?^YE?Z!?8 =[%11NQ^Q+Z?655C;X4Q_>+\/@2^/I/!@05?B:K"A$'6PF@1
MDO))D) _@IE'UYAR2XB(0(44*60D4&!9'VM\#WX(&,H8FE\,JKYSOD^>]T-R
MOT>7:-(W"==&4'5!<#7(0:IHUA/^(/ -RM/:BTK"V$^(%!(8!W1'6#I4A2,X
M]Y2(&O'CO?L[=$56*V6K&&&U*?1'/20T9 4B52R%#1E"NJKQEC]@FZQYDV1I
M:R&KU0GFRK*C>;#W$ZY3'3Q(+?1])4GU!77+\]?$\'.MYW#U3!=WDCBX(%P8Q/M
^L%SKF7T0;G$[>TT\_G%63ZF= [E:W-D"+7W!CE T/R'*GVM2IN^1E
M]])GG%V\?9+D()::*DT2X8*W*,I8S>GH$)2'2:+
MZMXE;(@\ZM'F>O#S>L3+ZIQ>FL/'&^=I02ZD=#TRLA1:&/2<"/2U1TM7&2S%
MNIM2%.52^ ;3MLVU>#>I7D1XYA-@SNBE"ZX\>%Q:!DM\0F/7]R;D=V8OW;_2
M%_EQ>E3/3_PW.(G,D>853,=''T\+