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8-K - FORM 8-K - WESTERN DIGITAL CORPa57603e8vk.htm
EX-99.2 - EX-99.2 - WESTERN DIGITAL CORPa57603exv99w2.htm
         
Exhibit 99.1
Company contacts:
Bob Blair
Investor Relations
949.672.7834
robert.blair@wdc.com
Steve Shattuck
Public Relations
949.672.7817
steve.shattuck@wdc.com
FOR IMMEDIATE RELEASE:
WD ANNOUNCES Q1 REVENUE OF $2.4 BILLION AND
NET INCOME OF $197 MILLION, OR $0.84 PER SHARE
Revenue Up 9 Percent, Hard Drive Shipments Up 15 Percent, From Year-ago Quarter,
$390 Million Cash Generated from Operations
LAKE FOREST, Calif. — Oct. 19, 2010 — Western Digital Corp. (NYSE: WDC) today reported revenue of $2.4 billion, hard-drive unit shipments of 50.7 million and net income of $197 million, or $0.84 per share for its first fiscal quarter ended Oct. 1, 2010. In the year-ago quarter, the company reported revenue of $2.2 billion, shipped 44.1 million hard drives, and reported net income and earnings per share of $288 million and $1.25, respectively.
     “In a quarter characterized by aggressive industry pricing, we remained solidly profitable, grew revenues and unit shipments year-over-year, and generated $390 million in cash from operations,” said John Coyne, president and chief executive officer. “Our low-cost business model and strong balance sheet enable us to weather the seasonality and cycles of the hard drive industry such as we experienced during the last two quarters.
     “We will continue to focus on quality, reliability, availability and profitable growth to maintain our industry leadership,” said Coyne. “We remain excited about the

 


 

WD Announces Q1 Revenue of $2.4 Billion and
Net Income of $197 Million, or $0.84 Per Share
Page 2
significant opportunities being created by the unabated growth in digital content in the home and workplace.”
     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. The company is publishing an expanded investor summary sheet today on the investor relations section of its website. After the conclusion of today’s webcasted conference call, the summary sheet will be updated to reflect the company’s guidance.
     
Audio Webcast:
  www.westerndigital.com/investor
 
  Click on “Conference Calls”
 
   
Telephone Replay:
  800-455-0163 (toll free)
 
  +1-203-369-3804 (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 website (www.westerndigital.com) to access a variety of financial and investor information.

 


 

WD Announces Q1 Revenue of $2.4 Billion and
Net Income of $197 Million, or $0.84 Per Share
Page 3
     This press release contains forward-looking statements concerning WD’s industry leadership and growth opportunities. The foregoing forward-looking statements are based on WD’s current expectations and are subject to risks and uncertainties that could cause actual results to differ materially from those expressed in the forward-looking statements, including: the impact of continued uncertainty and volatility in global economic conditions; supply and demand conditions in the hard drive industry; actions by competitors; unexpected advances in competing technologies; uncertainties related to the development and introduction of products based on new technologies and expansion into new data storage markets; business conditions and growth in the various hard drive markets; pricing trends and fluctuations in average selling prices; changes in the availability and cost of commodity materials and specialized product components that WD does not make internally; and other risks and uncertainties listed in WD’s recent Form 10-K filed with the SEC on Aug. 13, 2010, to which your attention is directed. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date hereof, and WD undertakes no obligation to update these forward-looking statements to reflect subsequent events or circumstances.
###
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)
                 
    Oct. 1,     Jul. 2,  
    2010     2010  
ASSETS
Current assets:
               
Cash and cash equivalents
  $ 2,858     $ 2,734  
Accounts receivable, net
    1,325       1,256  
Inventories
    561       560  
Other
    195       170  
 
           
Total current assets
    4,939       4,720  
Property and equipment, net
    2,245       2,159  
Goodwill
    150       146  
Other intangible assets, net
    83       88  
Other assets
    216       215  
 
           
Total assets
  $ 7,633     $ 7,328  
 
           
 
               
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
               
Accounts payable
  $ 1,703     $ 1,507  
Accrued expenses
    227       281  
Accrued warranty
    131       129  
Current portion of long-term debt
    113       106  
 
           
Total current liabilities
    2,174       2,023  
Long-term debt
    262       294  
Other liabilities
    308       302  
 
           
Total liabilities
    2,744       2,619  
Shareholders’ equity
    4,889       4,709  
 
           
Total liabilities and shareholders’ equity
  $ 7,633     $ 7,328  
 
           

 


 

WESTERN DIGITAL CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(in millions, except per share amounts)
(unaudited)
                 
    Three Months Ended  
    Oct. 1,     Oct. 2,  
    2010     2009  
Revenue, net
  $ 2,396     $ 2,208  
Cost of revenue
    1,959       1,694  
 
           
Gross margin
    437       514  
 
           
Operating expenses:
               
Research and development
    167       142  
Selling, general and administrative
    59       53  
 
           
Total operating expenses
    226       195  
 
           
Operating income
    211       319  
Net interest and other
          (2 )
 
           
Income before income taxes
    211       317  
Income tax provision
    14       29  
 
           
Net income
  $ 197     $ 288  
 
           
 
               
Income per common share:
               
 
               
Basic
  $ 0.86     $ 1.28  
 
           
Diluted
  $ 0.84     $ 1.25  
 
           
 
               
Weighted average shares outstanding:
               
 
Basic
    230       225  
 
           
 
               
Diluted
    234       230  
 
           

 


 

WESTERN DIGITAL CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in millions; unaudited)
                 
    Three Months Ended  
    Oct. 1,     Oct. 2,  
    2010     2009  
Cash flows from operating activities
               
Net income
  $ 197     $ 288  
Adjustments to reconcile net income to net cash provided by operations:
               
Depreciation and amortization
    150       121  
Stock-based compensation
    19       13  
Changes in operating assets and liabilities
    24       12  
 
           
Net cash provided by operating activities
    390       434  
 
           
Cash flows from investing activities
               
Purchases of property and equipment
    (200 )     (176 )
 
           
Net cash used in investing activities
    (200 )     (176 )
 
           
Cash flows from financing activities
               
Employee stock plans, net
    (2 )     14  
Excess tax benefits from employee stock plans
    11       9  
Repurchases of common stock
    (50 )      
Repayment of long-term debt
    (25 )     (19 )
 
           
Net cash provided by (used in) financing activities
    (66 )     4  
 
           
Net change in cash and cash equivalents
    124       262  
Cash and cash equivalents, beginning of period
    2,734       1,794  
 
           
Cash and cash equivalents, end of period
  $ 2,858     $ 2,056