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Related Parties and Related Commitments and Contingencies (Tables)

6 Months Ended

12 Months Ended

Dec. 27, 2024

Jun. 28, 2024

The following table presents the notes receivable from, and equity investments in, Flash Ventures for the periods presented:


	December 27, 2024		June 28, 2024
	(in millions)
Notes receivable, Flash Partners	$	72	$	1
Notes receivable, Flash Alliance		35		5
Notes receivable, Flash Forward		476		485
Investment in Flash Partners		41		148
Investment in Flash Alliance		118		219
Investment in Flash Forward		129		143

Total notes receivable and investments in Flash Ventures	$	871	$	1,001

The following presents a summary of the outstanding borrowings between the Company and subsidiaries of WDC for the periods presented, inclusive of any associated interest payable or interest receivable:


	Interest Rate	December 27, 2024		June 28, 2024
		(in millions)
Notes due from Parent
Revolving Credit Agreement due from Parent $101M - Oct. 3, 2019	AFR Rate (USD) or TIBOR + .35% (YEN)	$	—	$	(102	)

Total Notes due from Parent			—		(102	)

Notes due to Parent
Revolving Credit Agreement due to Parent $1B - Sep. 27, 2024	SOFR + 1.6%		553		—
Notes due to Parent $500M - Nov. 25, 2014	1-year swap + 2%		—		475


	Interest Rate	December 27, 2024		June 28, 2024
		(in millions)
Notes Due to Parent $42B Yen - Apr. 29, 2014	TIBOR + .35%		—		262
Revolving Credit Agreement due to Parent $100M - Aug. 20, 2021	LIBOR Rate + 150 basis points		—		77

Total Notes due to Parent			553		814

	Total Notes due to Parent, net	$	553	$	712

The following presents interest expense and interest income on notes due to (from) Parent, which have been recorded within Interest expense and Interest income in the Condensed Combined Statements of Operations for the periods presented:


	Six Months Ended
	December 27, 2024			December 29, 2023
	(in millions)
Interest expense on notes due to Parent	$	4		$	20
Interest income on notes due from Parent	$	(1	)	$	(3	)

The table below summarizes the impact of expense allocations from WDC within the Condensed Combined Statements of Operations for the periods presented:


	Six Months Ended
	December 27, 2024		December 29, 2023
	(in millions)
Research and development	$	189	$	330
Selling general, and administrative		148		219
Business separation costs		41		34
Employee termination and other charges		5		(46	)

Total allocation of Corporate Expenses	$	383	$	537

A reconciliation of Net transfers from (to) Parent on the Condensed Combined Statements of Changes in Parent Company Net Investment to the corresponding amounts on the Condensed Combined Statements of Cash Flows is as follows:


	Six Months Ended
	December 27, 2024			December 29, 2023
	(in millions)
Net transfers from Parent per Condensed Combined Statements of Changes in Parent Company Net Investment	$	491		$	171
Liability for unrecognized tax benefits transferred from Parent		14			—
Accumulated other comprehensive loss transferred from Parent		6			—
Strategic investments transferred from Parent		(7	)		—
Other assets and liabilities, net transferred from Parent		(37	)		—
Property, plant and equipment, net transferred from Parent		(25	)		(2	)
Notes due to Parent transferred from Parent		(673	)		—
Notes due from Parent transferred to Parent		—			113
Deferred taxes, net transferred from Parent		—			(8	)

Net transfers from (to) Parent per Condensed Combined Statements of Cash Flows	$	(231	)	$	274

Schedule of Variable Interest Entities

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 27, 2024, 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.


	December 27, 2024
	(in millions)
Notes receivable	$	583
Equity investments		288
Operating lease guarantees		1,343
Inventory and prepayments		1,393

Maximum estimable loss exposure	$	3,607

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 27, 2024:


	Lease Amounts
	(Japanese yen, in billions)		(U.S. dollar, in millions)
Total guarantee obligations	¥	212	$	1,343

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, in U.S. dollars, based upon the Japanese yen to U.S. dollar exchange rate as of December 27, 2024:


Annual Installments	Payment of Principal Amortization		Purchase Option Exercise Price at Final Lease Terms		Guarantee Amount
	(in millions)
Remaining six months of 2025	$	201	$	49	$	250
2026		406		113		519
2027		198		97		295
2028		83		93		176
2029		25		50		75
2030		4		24		28

Total guarantee obligations	$	917	$	426	$	1,343

The Flash Business of Western Digital Corporation [Member]

Loss Contingencies [Line Items]

Schedule of notes receivable from, and equity investments

The following table presents the notes receivable from, and equity investments in, Flash Ventures for the periods presented:


	June 28, 2024		June 30, 2023
	(in millions)
Notes receivable, Flash Partners	$	1	$	37
Notes receivable, Flash Alliance		5		48
Notes receivable, Flash Forward		485		709
Investment in Flash Partners		148		160
Investment in Flash Alliance		219		274
Investment in Flash Forward		143		183

Total notes receivable and investments in Flash Ventures	$	1,001	$	1,411

A reconciliation of Net transfers from (to) Parent on the Combined Statements of Changes in Parent Company Net Investment to the corresponding amounts on the Combined Statements of Cash Flows is as follows:


	Years Ended
	June 28, 2024			June 30, 2023			July 1, 2022
	(in millions)
Net transfers from (to) Parent per Combined Statement of Changes in Parent Company Net Investment	$	275		$	376		$	(922	)
Property, plant and equipment, net transferred from Parent		(11	)		(18	)		(13	)
Deferred taxes, net transferred to Parent		17			2			2
Notes due from Parent transferred to Parent		113			316			—

Net transfers from (to) Parent per Combined Statements of Cash Flows	$	394		$	676		$	(933	)

The table below summarizes the impact of expense allocations from WDC within the Combined Statements of Operations for the periods presented:


	Years Ended
	June 28, 2024			June 30, 2023		July 1, 2022
	(in millions)
Research and development	$	723		$	750	$	884
Selling, general and administrative		418			452		470
Employee termination, asset impairment and other		(40	)		61		(2	)
Business separation costs		64			—		—

Total allocation of Corporate expenses	$	1,165		$	1,263	$	1,352

The following presents interest expense and interest income on notes due to (from) Parent, which have been recorded within interest expense and interest income in the Combined Statements of Operations for the periods presented:


	Years Ended
	June 28, 2024			June 30, 2023			July 1, 2022
	(in millions)
Interest income on notes due from Parent	$	6		$	16		$	3
Interest expense on notes due to Parent	$	(37	)	$	(29	)	$	(13	)

Schedule of Related Party Transactions

The following presents a summary of the outstanding borrowings between the Business and subsidiaries of the Parent for the periods presented, inclusive of any associated interest receivable or interest payable:


Notes due to (from) Parent	Interest Rate	June 28, 2024			June 30, 2023
Notes due from Parent			(in millions)
Revolving Credit Agreement due from Parent $101M - Oct. 3, 2019	AFR Rate (USD) or TIBOR + .35% (YEN)	$	(102	)	$	—
Notes due from Parent $40M - Dec. 19, 2018	.15% through Dec. 2021, .33% through Dec. 2022 and 4.55% through Maturity Date		—			(40	)
Notes due from Parent $10M - Mar. 29, 2019	1.5% through Mar 2022, .97% through Mar. 2023, and 4.5% through Maturity Date		—			(10	)
Notes due from Parent $8M - Jul. 25, 2019	.18% through Jul 2021, .12% through July 2022, and 2.37% through Maturity Date		—			(8	)
Revolving Credit Agreement due from Parent $1B - Dec. 20, 2019	AFR Rate (USD) or TIBOR + .35% (YEN)		—			(4	)
Revolving Credit Agreement due from Parent $100M October 27, 2021	LIBOR Rate + 150 basis points		—			(1	)

Total Notes due from Parent			(102	)		(63	)
Notes due to Parent
Notes due to Parent $500M - Nov. 25, 2014	1-year swap + 2%		475			467
Notes Due to Parent $42B Yen - April 29, 2014	TIBOR + .35%		262			291
Revolving Credit Agreement due to Parent $100M - Aug. 20, 2021	LIBOR Rate + 150 basis points		77			77
Revolving Credit Agreement due to Parent $1B - Dec. 20, 2019	AFR Rate (USD) or TIBOR + .35% (YEN)		—			29
Revolving Credit Agreement due to Parent - $1B - Dec. 20, 2019	AFR Rate (USD) or TIBOR + .35% (YEN)		—			24
Notes Due to Parent $60M - Feb. 22 2023	Safe Notice Rate - 6.698%		—			31

Total Notes due to Parent			814			919

	Total Notes due to Parent, net	$712			$856

Schedule of Variable Interest Entities

The Business’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 June 28, 2024, 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.


		June 28, 2024
		(in millions)
Notes receivable	$	491
Equity investments		510
Operating lease guarantees		1,299
Inventory and prepayments		1,069

Maximum estimable loss exposure	$	3,369

Schedule of Guarantor Obligations

The following table presents the Business’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:


	June 28, 2024 Lease Amounts
	(Japanese yen, in billions)		(U.S. dollar, in millions)
Total guarantee obligations	¥	208	$	1,299

The following table details the breakdown of the Business’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 June 28, 2024, in U.S. dollars, based upon the Japanese yen to U.S. dollar exchange rate as of June 28, 2024:


Annual Installments	Payment of Principal Amortization		Purchase Option Exercise Price at Final Lease Terms		Guarantee Amount
	(in millions)
2025	$	285	$	74	$	359
2026		359		111		470
2027		164		95		259
2028		58		92		150
2029		11		50		61

Total guarantee obligations	$	877	$	422	$	1,299

- Definition

Line items represent financial concepts included in a table. These concepts are used to disclose reportable information associated with domain members defined in one or many axes to the table.

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- Definition

Tabular disclosure of the significant judgments and assumptions made in determining whether a variable interest (as defined) held by the entity requires the variable interest entity (VIE) (as defined) to be consolidated and (or) disclose information about its involvement with the VIE, individually or in aggregate (as applicable); the nature of restrictions, if any, on the consolidated VIE's assets and on the settlement of its liabilities reported by an entity in its statement of financial position, including the carrying amounts of such assets and liabilities; the nature of, and changes in, the risks associated with involvement in the VIE; how involvement with the VIE affects the entity's financial position, financial performance, and cash flows; the lack of recourse if creditors (or beneficial interest holders) of the consolidated VIE have no recourse to the general credit of the primary beneficiary (if applicable); the terms of arrangements, giving consideration to both explicit arrangements and implicit variable interests, if any, that could require the entity to provide financial support to the VIE, including events or circumstances that could expose the entity to a loss; the methodology used by the entity for determining whether or not it is the primary beneficiary of the variable interest entity; the significant factors considered and judgments made in determining that the power to direct the activities of a VIE that most significantly impact the VIE's economic performance are shared (as defined); the carrying amounts and classification of assets and liabilities of the VIE included in the statement of financial position; the entity's maximum exposure to loss, if any, as a result of its involvement with the VIE, including how the maximum exposure is determined and significant sources of the entity's exposure to the VIE; a comparison of the carrying amounts of the assets and liabilities and the entity's maximum exposure to loss; information about any liquidity arrangements, guarantees, and (or) other commitments by third parties that may affect the fair value or risk of the entity's variable interest in the VIE; whether or not the entity has provided financial support or other support (explicitly or implicitly) to the VIE that it was not previously contractually required to provide or whether the entity intends to provide that support, including the type and amount of the support and the primary reasons for providing the support; and supplemental information the entity determines necessary to provide.

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