EX-99.1 2 a54904exv99w1.htm EX-99.1 exv99w1
Exhibit 99.1
     
Company contacts:
   
Steve Shattuck
  Bob Blair
Public Relations
  Investor Relations
949.672.7817
  949.672.7834
steve.shattuck@wdc.com
  robert.blair@wdc.com
FOR IMMEDIATE RELEASE:
WD® ANNOUNCES FISCAL Q2 REVENUE OF $2.6 BILLION WITH
NET INCOME OF $429 MILLION, OR $1.85 PER SHARE
Revenue Up 44 Percent, Hard Drive Shipments Up 39 Percent,
From Year-ago Quarter
LAKE FOREST, Calif. — Jan. 21, 2010 — Western Digital Corp. (NYSE: WDC) today reported revenue of $2.6 billion, hard drive shipments of 49.5 million units and net income of $429 million, or $1.85 per share, for its second fiscal quarter ended Jan. 1, 2010. In the year-ago quarter, the company reported revenue of $1.8 billion, hard drive shipments of 35.5 million units, and net income of $14 million. The year-ago net income included $113 million of restructuring charges.
     The company generated a record $557 million in cash from operations during the second quarter, ending with total cash and cash equivalents of $2.4 billion.
     “We are very pleased with WD’s strong financial performance in our second fiscal quarter,” said John Coyne, president and chief executive officer. “For the third consecutive quarter, we increased output in a supply constrained environment, providing strong support of our customers’ growth opportunities, primarily in the consumer segment but, notably, with some emerging strength in the commercial sector. Continued customer preference for WD products, our timely investments in capital, the support of our supply partners and outstanding execution

 


 

WD Announces Fiscal Q2 Revenue of $2.6 Billion With
Net Income of $429 Million, or $1.85 Per Share
Page 2
by the WD team generated record revenue and profits. A moderate pricing environment, combined with our passionate focus on cost and efficiency, enabled gross margins of 26.2 percent—well above the high end of our model range.”
     The investment community conference call to discuss these results will be broadcast live over the Internet today at 2 p.m. Pacific/5 p.m. Eastern. The call will be accessible live and on an archived basis via the link below:
     
Audio Webcast:
  www.westerndigital.com/investor
 
  Click on “Conference Calls”
 
Telephone Replay:
  800-925-0904 (toll-free)
 
  +1-203-369-3093 (international)
About WD
     WD, one of the storage industry’s pioneers and long-time leaders, provides products and services for people and organizations that collect, manage and use digital information. The company designs and produces reliable, high-performance hard drives and solid state drives that keep users’ data accessible and secure from loss. Its advanced technologies are configured into applications for client and enterprise computing, embedded systems and consumer electronics, as well as its own consumer storage and media products.
     WD was founded in 1970. The company’s storage products are marketed to leading OEMs, systems manufacturers, selected resellers and retailers under the Western Digital® and WD brand names. Visit the Investor section of the company’s Web site (www.westerndigital.com) to access a variety of financial and investor information.

###

Western Digital, WD, and the WD logo are registered trademarks of Western Digital Technologies, Inc. All other trademarks mentioned herein belong to their respective owners.


 

WESTERN DIGITAL CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(in millions; unaudited)
                 
    Jan. 1,     Jul. 3,  
    2010     2009  
ASSETS
Current assets:
               
Cash and cash equivalents
  $ 2,435     $ 1,794  
Accounts receivable, net
    1,365       926  
Inventories
    453       376  
Other
    163       134  
 
           
Total current assets
    4,416       3,230  
Property and equipment, net
    1,696       1,584  
Goodwill
    139       139  
Other intangible assets, net
    83       89  
Other assets
    251       249  
 
           
Total assets
  $ 6,585     $ 5,291  
 
           
 
               
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
               
Accounts payable
  $ 1,507     $ 1,101  
Accrued expenses
    288       247  
Accrued warranty
    118       95  
Current portion of long-term debt
    94       82  
 
           
Total current liabilities
    2,007       1,525  
Long-term debt
    350       400  
Other liabilities
    237       174  
 
           
Total liabilities
    2,594       2,099  
Shareholders’ equity
    3,991       3,192  
 
           
Total liabilities and shareholders’ equity
  $ 6,585     $ 5,291  
 
           

 


 

WESTERN DIGITAL CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(in millions, except per share amounts)
(unaudited)
                                 
    Three Months Ended     Six Months Ended  
    Jan. 1,     Dec. 26,     Jan. 1,     Dec. 26,  
    2010     2008     2010     2008  
Revenue, net
  $ 2,619     $ 1,823     $ 4,827     $ 3,933  
Cost of revenue
    1,932       1,533       3,626       3,219  
 
                       
Gross margin
    687       290       1,201       714  
 
                       
Operating expenses:
                               
Research and development
    154       119       296       252  
Selling, general and administrative
    60       42       113       99  
Restructuring
          113             113  
 
                       
Total operating expenses
    214       274       409       464  
 
                       
Operating income
    473       16       792       250  
Net interest and other
    (2 )     (9 )     (4 )     (13 )
 
                       
Income before income taxes
    471       7       788       237  
Income tax provision (benefit)
    42       (7 )     71       12  
 
                       
Net income
  $ 429     $ 14     $ 717     $ 225  
 
                       
 
                               
Income per common share:
                               
 
                               
Basic
  $ 1.89     $ 0.06     $ 3.17     $ 1.01  
 
                       
Diluted
  $ 1.85     $ 0.06     $ 3.10     $ 1.00  
 
                       
 
                               
Common shares used in computing per share amounts:
                               
 
                               
Basic
    227       222       226       222  
 
                       
 
                               
Diluted
    232       224       231       225  
 
                       

 


 

WESTERN DIGITAL CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in millions; unaudited)
                                 
    Three Months Ended     Six Months Ended  
    Jan. 1,     Dec. 26,     Jan. 1,     Dec. 26,  
    2010     2008     2010     2008  
Cash flows from operating activities
                               
Net income
  $ 429     $ 14     $ 717     $ 225  
Adjustments to reconcile net income to net cash provided by operations:
                               
Depreciation and amortization
    126       122       247       239  
Stock-based compensation
    13       11       27       21  
Deferred income taxes
    (5 )     (7 )     (5 )     (7 )
Loss on investments
          6             9  
Non-cash portion of restructuring
          80             80  
Changes in operating assets and liabilities
    (6 )     74       5       34  
 
                       
Net cash provided by operating activities
    557       300       991       601  
 
                       
Cash flows from investing activities
                               
Purchases of property and equipment
    (199 )     (140 )     (375 )     (302 )
Sales and maturities of investments
    3             3       1  
 
                       
Net cash used in investing activities
    (196 )     (140 )     (372 )     (301 )
 
                       
Cash flows from financing activities
                               
Issuance of stock under employee stock plans, net
    26       10       40       9  
Increase (decrease) in excess tax benefits from employee stock plans
    11       (4 )     20       4  
Repurchases of common stock
                      (36 )
Repayment of long-term debt
    (19 )     (3 )     (38 )     (5 )
 
                       
Net cash provided by (used in) financing activities
    18       3       22       (28 )
 
                       
Net increase in cash and cash equivalents
    379       163       641       272  
Cash and cash equivalents, beginning of period
    2,056       1,213       1,794       1,104  
 
                       
Cash and cash equivalents, end of period
  $ 2,435     $ 1,376     $ 2,435     $ 1,376