0000106040
2008-02-29
0000106040
wdc:KomagMember
2011-04-01
0000106040
us-gaap:ParentCompanyMember
2011-04-01
0000106040
2010-01-01
0000106040
2010-12-31
0000106040
2010-10-01
0000106040
2010-10-02
2010-12-31
0000106040
2010-07-03
2010-10-01
0000106040
us-gaap:AuctionRateSecuritiesMember
us-gaap:FairValueInputsLevel3Member
2011-04-01
0000106040
us-gaap:AuctionRateSecuritiesMember
us-gaap:FairValueInputsLevel2Member
2011-04-01
0000106040
us-gaap:AuctionRateSecuritiesMember
us-gaap:FairValueInputsLevel1Member
2011-04-01
0000106040
us-gaap:AuctionRateSecuritiesMember
2011-04-01
0000106040
us-gaap:ForeignExchangeContractMember
us-gaap:FairValueInputsLevel3Member
2011-04-01
0000106040
us-gaap:ForeignExchangeContractMember
us-gaap:FairValueInputsLevel1Member
2011-04-01
0000106040
us-gaap:ForeignExchangeContractMember
us-gaap:FairValueInputsLevel2Member
2011-04-01
0000106040
us-gaap:ForeignExchangeContractMember
2011-04-01
0000106040
us-gaap:USGovernmentAgenciesDebtSecuritiesMember
us-gaap:FairValueInputsLevel1Member
2011-04-01
0000106040
us-gaap:USGovernmentAgenciesDebtSecuritiesMember
us-gaap:FairValueInputsLevel3Member
2011-04-01
0000106040
us-gaap:USTreasurySecuritiesMember
us-gaap:FairValueInputsLevel1Member
2011-04-01
0000106040
us-gaap:MoneyMarketFundsMember
us-gaap:FairValueInputsLevel1Member
2011-04-01
0000106040
us-gaap:USTreasurySecuritiesMember
us-gaap:FairValueInputsLevel2Member
2011-04-01
0000106040
us-gaap:USGovernmentAgenciesDebtSecuritiesMember
us-gaap:FairValueInputsLevel2Member
2011-04-01
0000106040
us-gaap:MoneyMarketFundsMember
us-gaap:FairValueInputsLevel3Member
2011-04-01
0000106040
us-gaap:USTreasurySecuritiesMember
us-gaap:FairValueInputsLevel3Member
2011-04-01
0000106040
us-gaap:MoneyMarketFundsMember
us-gaap:FairValueInputsLevel2Member
2011-04-01
0000106040
us-gaap:USTreasurySecuritiesMember
2011-04-01
0000106040
us-gaap:USGovernmentAgenciesDebtSecuritiesMember
2011-04-01
0000106040
us-gaap:MoneyMarketFundsMember
2011-04-01
0000106040
us-gaap:FairValueInputsLevel1Member
2011-04-01
0000106040
us-gaap:FairValueInputsLevel2Member
2011-04-01
0000106040
us-gaap:FairValueInputsLevel3Member
2011-04-01
0000106040
us-gaap:ForeignExchangeContractMember
2011-04-01
0000106040
us-gaap:ForeignExchangeContractMember
2010-07-02
0000106040
us-gaap:ForeignExchangeContractMember
2011-01-01
2011-04-01
0000106040
us-gaap:ForeignExchangeContractMember
2010-07-03
2011-04-01
0000106040
us-gaap:ForeignExchangeContractMember
2010-01-02
2010-04-02
0000106040
us-gaap:ForeignExchangeContractMember
2009-07-04
2010-04-02
0000106040
us-gaap:CostOfSalesMember
2011-01-01
2011-04-01
0000106040
us-gaap:CostOfSalesMember
2010-07-03
2011-04-01
0000106040
us-gaap:CostOfSalesMember
2010-01-02
2010-04-02
0000106040
us-gaap:CostOfSalesMember
2009-07-04
2010-04-02
0000106040
us-gaap:ForeignExchangeContractMember
wdc:OtherCurrentAssetsMember
2011-04-01
0000106040
us-gaap:ForeignExchangeContractMember
wdc:OtherCurrentAssetsMember
2010-07-02
0000106040
wdc:TermLoanMember
2010-07-03
2011-04-01
0000106040
wdc:TermLoanMember
2011-04-01
0000106040
wdc:TermLoanMember
2008-02-29
0000106040
2009-07-04
2010-07-02
0000106040
2010-04-02
0000106040
2009-07-03
0000106040
2011-03-07
0000106040
2011-01-01
2011-04-01
0000106040
2010-01-02
2010-04-02
0000106040
2009-07-04
2010-04-02
0000106040
2011-04-01
0000106040
2010-07-02
0000106040
2009-12-31
0000106040
2011-04-20
0000106040
2010-07-03
2011-04-01
xbrli:pure
iso4217:USD
xbrli:shares
xbrli:shares
iso4217:USD
<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" -->
<!-- Begin Block Tagged Note 1 - us-gaap:OrganizationConsolidationAndPresentationOfFinancialStatementsDisclosureTextBlock-->
<!-- xbrl,ns -->
<!-- xbrl,nx -->
<div style="font-family: 'Times New Roman',Times,serif; margin-left: 0in; ">
<div align="center" style="font-size: 10pt; margin-top: 0pt"><b></b>
</div>
<div align="left">
</div>
<div align="center" style="font-size: 10pt"><b></b></div>
<div align="center" style="font-size: 10pt"><b></b></div>
<div align="left" style="font-size: 10pt; margin-top: 10pt"><b>1. Basis of Presentation</b>
</div>
<div align="left" style="font-size: 10pt; margin-top: 10pt; text-indent: 4%">The accounting policies followed by Western Digital Corporation (the “Company”) are set forth
in Part II, Item 8, Note 1 of the Notes to Consolidated Financial Statements included in the
Company’s Annual Report on Form 10-K for the year ended July 2, 2010. In the opinion of management, all adjustments
necessary to fairly state the unaudited 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 unaudited 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 year ended July 2, 2010. The results of operations for interim periods are not
necessarily indicative of results to be expected for the full year.
</div>
<div align="left" style="font-size: 10pt; margin-top: 10pt; text-indent: 4%">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. However, actual
results could differ materially from these estimates.
</div>
</div>
<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" -->
<!-- Begin Block Tagged Note 2 - wdc:SupplementalFinancialStatementDataTextBlock-->
<div style="font-family: 'Times New Roman',Times,serif; margin-left: 0in; ">
<div align="left" style="font-size: 10pt; margin-top: 10pt"><b>2. Supplemental Financial Statement Data</b>
</div>
<div align="left" style="font-size: 10pt; margin-top: 10pt; margin-left: 1%"><i>Inventories</i>
</div>
<div align="center">
<table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<tr valign="bottom">
<td width="72%"> </td>
<td width="3%"> </td>
<td width="1%"> </td>
<td width="9%"> </td>
<td width="1%"> </td>
<td width="3%"> </td>
<td width="1%"> </td>
<td width="9%"> </td>
<td width="1%"> </td>
</tr>
<tr style="font-size: 10pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Apr. 1,</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Jul. 2,</b></td>
<td> </td>
</tr>
<tr style="font-size: 10pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>2011</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>2010</b></td>
<td> </td>
</tr>
<tr style="font-size: 10pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="6"><b>(in millions)</b></td>
<td> </td>
</tr>
<!-- End Table Head -->
<!-- Begin Table Body -->
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px">Raw materials and component parts
</div></td>
<td> </td>
<td align="left"><b>$</b></td>
<td align="right"><b>151</b></td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">159</td>
<td> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:15px; text-indent:-15px">Work-in-process
</div></td>
<td> </td>
<td> </td>
<td align="right"><b>260</b></td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">255</td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px">Finished goods
</div></td>
<td> </td>
<td> </td>
<td align="right"><b>163</b></td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">146</td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:30px; text-indent:-15px">Total inventories
</div></td>
<td> </td>
<td align="left"><b>$</b></td>
<td align="right"><b>574</b></td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">560</td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
</tr>
<!-- End Table Body -->
</table>
</div>
<div align="left" style="font-size: 10pt; margin-top: 10pt; margin-left: 1%"><i>Warranty</i>
</div>
<div align="left" style="font-size: 10pt; margin-top: 10pt; text-indent: 4%">The Company records an accrual for estimated warranty costs when revenue is recognized. The
Company generally warrants its products for a period of one to five years. The warranty provision
considers estimated product failure rates and trends, estimated repair or replacement costs and
estimated costs for customer compensatory claims related to product quality issues, if any. A
statistical warranty tracking model is used to help prepare estimates and assists the Company in
exercising judgment in determining the underlying estimates. The statistical tracking model
captures specific detail on hard drive reliability, such as factory test data, historical field
return rates, and costs to repair by product type. Management’s judgment is subject to a greater
degree of subjectivity with respect to newly introduced products because of limited field
experience with those products upon which to base warranty estimates. Management reviews the
warranty accrual quarterly for products shipped in prior periods and which are still under
warranty. Any changes in the estimates underlying the accrual may materially affect operating
results. Such changes are generally a result of differences between forecasted and actual return
rate experience and costs to repair. If actual product return trends, costs to repair returned
products or costs of customer compensatory claims differ significantly from estimates, future
results of operations could be materially affected. Changes in the warranty accrual were as follows
(in millions):
</div>
<div align="center">
<table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<tr valign="bottom">
<td width="44%"> </td>
<td width="3%"> </td>
<td width="1%"> </td>
<td width="9%"> </td>
<td width="1%"> </td>
<td width="3%"> </td>
<td width="1%"> </td>
<td width="9%"> </td>
<td width="1%"> </td>
<td width="3%"> </td>
<td width="1%"> </td>
<td width="9%"> </td>
<td width="1%"> </td>
<td width="3%"> </td>
<td width="1%"> </td>
<td width="9%"> </td>
<td width="1%"> </td>
</tr>
<tr style="font-size: 10pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="6"><b>Three Months</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="6"><b>Nine Months</b></td>
<td> </td>
</tr>
<tr style="font-size: 10pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="6" style="border-bottom: 1px solid #000000"><b>Ended</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="6" style="border-bottom: 1px solid #000000"><b>Ended</b></td>
<td> </td>
</tr>
<tr style="font-size: 10pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Apr. 1,</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Apr. 2,</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Apr. 1,</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Apr. 2,</b></td>
<td> </td>
</tr>
<tr style="font-size: 10pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>2011</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>2010</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>2011</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>2010</b></td>
<td> </td>
</tr>
<!-- End Table Head -->
<!-- Begin Table Body -->
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px">Warranty accrual, beginning of period
</div></td>
<td> </td>
<td align="left"><b>$</b></td>
<td align="right"><b>176</b></td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">154</td>
<td> </td>
<td> </td>
<td align="left"><b>$</b></td>
<td align="right"><b>170</b></td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">123</td>
<td> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:30px; text-indent:-15px">Charges to operations
</div></td>
<td> </td>
<td> </td>
<td align="right"><b>42</b></td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">49</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right"><b>132</b></td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">137</td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:30px; text-indent:-15px">Utilization
</div></td>
<td> </td>
<td nowrap="nowrap" align="left"> </td>
<td align="right"><b>(41</b></td>
<td nowrap="nowrap"><b>)</b></td>
<td> </td>
<td nowrap="nowrap" align="left"> </td>
<td align="right">(37</td>
<td nowrap="nowrap">)</td>
<td> </td>
<td nowrap="nowrap" align="left"> </td>
<td align="right"><b>(120</b></td>
<td nowrap="nowrap"><b>)</b></td>
<td> </td>
<td nowrap="nowrap" align="left"> </td>
<td align="right">(99</td>
<td nowrap="nowrap">)</td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:30px; text-indent:-15px">Changes in estimate related to pre-existing warranties
</div></td>
<td> </td>
<td nowrap="nowrap" align="left"> </td>
<td align="right"><b>(3</b></td>
<td nowrap="nowrap"><b>)</b></td>
<td> </td>
<td nowrap="nowrap" align="left"> </td>
<td align="right">(2</td>
<td nowrap="nowrap">)</td>
<td> </td>
<td nowrap="nowrap" align="left"> </td>
<td align="right"><b>(8</b></td>
<td nowrap="nowrap"><b>)</b></td>
<td> </td>
<td> </td>
<td align="right">3</td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px">Warranty accrual, end of period
</div></td>
<td> </td>
<td align="left"><b>$</b></td>
<td align="right"><b>174</b></td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">164</td>
<td> </td>
<td> </td>
<td align="left"><b>$</b></td>
<td align="right"><b>174</b></td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">164</td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
</tr>
<!-- End Table Body -->
</table>
</div>
<div align="left" style="font-size: 10pt; margin-top: 10pt; text-indent: 4%">Accrued warranty also includes amounts classified in other liabilities of $40 million at April
1, 2011 and $41 million at July 2, 2010.
</div>
<!-- Folio -->
<!-- /Folio -->
</div>
<!-- PAGEBREAK -->
<div style="font-family: 'Times New Roman',Times,serif; margin-left: 0in; ">
</div>
<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" -->
<!-- Begin Block Tagged Note 3 - us-gaap:EarningsPerShareTextBlock-->
<div style="font-family: 'Times New Roman',Times,serif; margin-left: 0in; ">
<div align="left" style="font-size: 10pt; margin-top: 10pt"><b>3. Income per Common Share</b>
</div>
<div align="left" style="font-size: 10pt; margin-top: 10pt; text-indent: 4%">The Company computes basic income per common share using net income and the weighted average
number of common shares outstanding during the period. Diluted income per common share is computed
using net income and the weighted average number of common shares and potentially dilutive common
shares outstanding during the period. Potentially dilutive common shares include certain dilutive
outstanding employee stock options, rights to purchase shares of common stock under the Company’s
Employee Stock Purchase Plan (“ESPP”) and restricted stock unit awards.
</div>
<div align="left" style="font-size: 10pt; margin-top: 10pt; text-indent: 4%">The following table illustrates the computation of basic and diluted income per common share
(in millions, except per share data):
</div>
<div align="center">
<table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<tr valign="bottom">
<td width="44%"> </td>
<td width="3%"> </td>
<td width="1%"> </td>
<td width="9%"> </td>
<td width="1%"> </td>
<td width="3%"> </td>
<td width="1%"> </td>
<td width="9%"> </td>
<td width="1%"> </td>
<td width="3%"> </td>
<td width="1%"> </td>
<td width="9%"> </td>
<td width="1%"> </td>
<td width="3%"> </td>
<td width="1%"> </td>
<td width="9%"> </td>
<td width="1%"> </td>
</tr>
<tr style="font-size: 10pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="6"><b>Three Months</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="6"><b>Nine Months</b></td>
<td> </td>
</tr>
<tr style="font-size: 10pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="6" style="border-bottom: 1px solid #000000"><b>Ended</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="6" style="border-bottom: 1px solid #000000"><b>Ended</b></td>
<td> </td>
</tr>
<tr style="font-size: 10pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Apr. 1,</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Apr. 2,</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Apr. 1,</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Apr. 2,</b></td>
<td> </td>
</tr>
<tr style="font-size: 10pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>2011</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>2010</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>2011</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>2010</b></td>
<td> </td>
</tr>
<!-- End Table Head -->
<!-- Begin Table Body -->
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px">Net income
</div></td>
<td> </td>
<td align="left"><b>$</b></td>
<td align="right"><b>146</b></td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">400</td>
<td> </td>
<td> </td>
<td align="left"><b>$</b></td>
<td align="right"><b>568</b></td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">1,118</td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:15px; text-indent:-15px">Weighted average shares outstanding:
</div></td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:30px; text-indent:-15px">Basic
</div></td>
<td> </td>
<td> </td>
<td align="right"><b>232</b></td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">229</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right"><b>231</b></td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">227</td>
<td> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:30px; text-indent:-15px">Employee stock options and other
</div></td>
<td> </td>
<td> </td>
<td align="right"><b>4</b></td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">5</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right"><b>4</b></td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">5</td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:30px; text-indent:-15px">Diluted
</div></td>
<td> </td>
<td> </td>
<td align="right"><b>236</b></td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">234</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right"><b>235</b></td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">232</td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:15px; text-indent:-15px">Income per common share:
</div></td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:30px; text-indent:-15px">Basic
</div></td>
<td> </td>
<td align="left"><b>$</b></td>
<td align="right"><b>0.63</b></td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">1.75</td>
<td> </td>
<td> </td>
<td align="left"><b>$</b></td>
<td align="right"><b>2.46</b></td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">4.93</td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:30px; text-indent:-15px">Diluted
</div></td>
<td> </td>
<td align="left"><b>$</b></td>
<td align="right"><b>0.62</b></td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">1.71</td>
<td> </td>
<td> </td>
<td align="left"><b>$</b></td>
<td align="right"><b>2.42</b></td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">4.82</td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px">Anti-dilutive potential common shares excluded*
</div></td>
<td> </td>
<td> </td>
<td align="right"><b>4</b></td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">1</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right"><b>4</b></td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">1</td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
</tr>
<!-- End Table Body -->
</table>
</div>
<div align="left">
<div style="font-size: 3pt; margin-top: 10pt; width: 18%; border-top: 1px solid #000000"> 
</div>
</div>
<table width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; text-align: left">
<tr style="font-size: 6pt">
<td width="3%"> </td>
<td width="1%"> </td>
<td width="96%"> </td>
</tr>
<tr valign="top">
<td nowrap="nowrap" align="left">*</td>
<td> </td>
<td>
<div style="text-align: left">For purposes of computing diluted income per common share, certain
potentially dilutive securities have been excluded from the
calculation because their effect would have been anti-dilutive.
</div></td>
</tr>
</table>
</div>
<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" -->
<!-- Begin Block Tagged Note 4 - us-gaap:DebtDisclosureTextBlock-->
<div style="font-family: 'Times New Roman',Times,serif; margin-left: 0in; ">
<div align="left" style="font-size: 10pt; margin-top: 10pt"><b>4. Debt</b>
</div>
<div align="left" style="font-size: 10pt; margin-top: 10pt; text-indent: 4%">In February 2008, Western Digital Technologies, Inc. (“WDTI”), a wholly-owned subsidiary of
the Company, entered into a five-year credit agreement that provided for a $500 million term loan
facility. As of April 1, 2011, the term loan facility had a variable interest rate of 1.56% and a
remaining balance of $325 million, which requires principal payments totaling $31 million through
the remainder of 2011, $144 million in 2012 and $150 million in 2013. The term loan facility has a
maturity date of February 11, 2013. As of April 1, 2011, WDTI was in compliance with all covenants.
</div>
<div align="left" style="font-size: 10pt; margin-top: 10pt; text-indent: 4%">See Note 10 for additional disclosures related to the
Company’s new credit facility to be entered into in connection with the closing of the planned acquisition of Viviti Technologies Ltd., until recently
known as Hitachi Global Storage Technologies Pte. Ltd.
</div>
</div>
<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" -->
<!-- Begin Block Tagged Note 5 - wdc:LegalProceedingsTextBlock-->
<div style="font-family: 'Times New Roman',Times,serif; margin-left: 0in; ">
<div align="left" style="font-size: 10pt; margin-top: 10pt"><b>5. Legal Proceedings</b>
</div>
<div align="left" style="font-size: 10pt; margin-top: 10pt; text-indent: 4%">The Company discloses material loss contingencies deemed to be reasonably possible and accrues
for loss contingencies when, in consultation with the Company’s legal advisors, the Company
concludes that a loss is probable and reasonably estimable. Except as otherwise indicated, the
possible losses relating to the matters described below are not reasonably estimable. The ability
to predict the ultimate outcome of such matters involves
judgments, estimates and inherent uncertainties. The actual outcome of such matters could
differ materially from management’s estimates.
</div>
<div align="left" style="font-size: 10pt; margin-top: 10pt; margin-left: 1%"><i>Intellectual Property Litigation</i>
</div>
<div align="left" style="font-size: 10pt; margin-top: 10pt; text-indent: 4%">On June 20, 2008, plaintiff Convolve, Inc. (“Convolve”) filed a complaint in the Eastern
District of Texas against the Company and two other companies alleging infringement of U.S. Patent
Nos. 6,314,473 and 4,916,635. Convolve is seeking unspecified monetary damages and injunctive
relief. On October 10, 2008, Convolve amended its complaint to allege infringement of only the ‘473
patent. The ‘473 patent allegedly relates to interface technology to select between certain modes
of a disk drive’s operations relating to speed and noise. A trial in the matter is scheduled to
begin on July 5, 2011. The Company intends to defend itself vigorously in this matter.
</div>
<!-- Folio -->
<!-- /Folio -->
</div>
<!-- PAGEBREAK -->
<div style="font-family: 'Times New Roman',Times,serif; margin-left: 0in; ">
<div align="left" style="font-size: 10pt; margin-top: 10pt; text-indent: 4%">On July 15, 2009, plaintiffs Carl B. Collins and Farzin Davanloo filed a complaint in the
Eastern District of Texas against the Company and ten other companies alleging infringement of U.S.
Patent Nos. 5,411,797 and 5,478,650. Plaintiffs are seeking injunctive relief and unspecified
monetary damages, fees and costs. The asserted patents allegedly relate to nanophase diamond
films. The Company intends to defend itself vigorously in this matter.
</div>
<div align="left" style="font-size: 10pt; margin-top: 10pt; text-indent: 4%">On December 7, 2009, plaintiff Nazomi Communications filed a complaint in the Eastern District
of Texas against the Company and seven other companies alleging infringement of U.S. Patent Nos.
7,080,362 and 7,225,436. Plaintiffs are seeking injunctive relief and unspecified monetary damages,
fees and costs. The asserted patents allegedly relate to processor cores capable of Java hardware
acceleration. The Company intends to defend itself vigorously in this matter.
</div>
<div align="left" style="font-size: 10pt; margin-top: 10pt; text-indent: 4%">On January 5, 2010, plaintiff Enova Technology Corporation filed a complaint in the District
of Delaware against the Company and Initio Corporation alleging infringement of U.S. Patent Nos.
7,136,995 and 7,386,734. Plaintiff is seeking injunctive relief and unspecified monetary damages,
fees and costs. The asserted patents allegedly relate to real time full disk encryption
application specific integrated circuits, or ASICs. The Company intends to defend itself vigorously
in this matter.
</div>
<div align="left" style="font-size: 10pt; margin-top: 10pt; text-indent: 4%">On November 10, 2010, plaintiff Rembrandt Data Storage filed a complaint in the Western
District of Wisconsin against the Company alleging infringement of U.S. Patent Nos. 5,995,342 and
6,195,232. Plaintiff is seeking injunctive relief and unspecified monetary damages, fees and costs.
The asserted patents allegedly relate to specific thin film heads having solenoid coils. The
Company intends to defend itself vigorously in this matter.
</div>
<div align="left" style="font-size: 10pt; margin-top: 10pt; text-indent: 4%">On October 4, 2006, plaintiff Seagate Technology LLC (“Seagate”) filed a complaint against the
Company and one of its employees formerly employed by Seagate in the Minnesota Fourth Judicial
District Court. The complaint alleges claims based on supposed misappropriation of trade secrets
and seeks injunctive relief and unspecified monetary damages, fees and costs. On June 19, 2007, the
Company’s employee filed a demand for arbitration with the American Arbitration Association. A
motion to stay the litigation as against all defendants and to compel arbitration of all Seagate’s
claims was granted on September 19, 2007. The parties are engaged in arbitration, and discovery in
the arbitration proceeding is ongoing. On September 23, 2010, Seagate filed a motion to amend its
claims and add allegations based on the supposed misappropriation of additional confidential
information. The arbitrator granted Seagate’s motion, and the plenary hearing in the arbitration is
now set to begin in May 2011. The Company intends to continue to defend itself vigorously in this
matter.
</div>
<div align="left" style="font-size: 10pt; margin-top: 10pt; margin-left: 1%"><i>Employment Litigation</i>
</div>
<div align="left" style="font-size: 10pt; margin-top: 10pt; text-indent: 4%">On March 20, 2009, plaintiff Ghazala H. Durrani, a former employee of the Company, filed a
putative class action complaint in the Alameda County (California) Superior Court. The complaint
alleged that certain of the Company’s engineers had been misclassified as exempt employees under
California state law and were, therefore, due unspecified amounts for unpaid hourly overtime wages
and other amounts, as well as penalties for allegedly missed meal and rest periods. By court order
dated April 24, 2009, the case was transferred to the Orange County (California) Superior Court. On
or about June 16, 2009, the Company was dismissed from the case without prejudice by stipulation,
leaving WDTI as the sole remaining defendant. On or about June 4, 2009, WDTI filed its answer to
the complaint, denying the substantive allegations thereof and raising several affirmative
defenses. The parties participated in a mediation of the case on June 3, 2010, which led to a
proposed settlement of the case. The proposed settlement, which was ultimately approved by the
court, resolved the case on a class-wide basis for an immaterial amount that was accrued by the
Company in the fourth quarter of fiscal 2010. The court granted final approval of the settlement
and entered judgment on February 7, 2011. At the Final Accounting Hearing scheduled for July 11,
2011, the court is expected to confirm that the settlement amount was fully paid in accordance with
the settlement agreement. After that hearing, the lawsuit will be formally concluded and dismissed.
</div>
<!-- Folio -->
<!-- /Folio -->
</div>
<!-- PAGEBREAK -->
<div style="font-family: 'Times New Roman',Times,serif; margin-left: 0in; ">
<div align="left" style="font-size: 10pt; margin-top: 10pt; text-indent: 4%">On February 26, 2010, and as thereafter amended on August 23, 2010 and December 22, 2010,
plaintiff Tarriq Sadaat, a former employee of the Company, filed a putative class action complaint
in the Orange County (California) Superior Court against the Company; WDTI; Kelly Services, Inc., a
Delaware corporation (“Kelly Services”); and certain other unnamed individuals. The named plaintiff
seeks to represent certain hourly employees who were assigned to work at certain of the Company’s
facilities by Kelly Services, a temporary staffing agency. In this regard, the complaint alleges
that the hourly employees are due unspecified sums for unpaid overtime wages and other amounts, as
well as penalties for allegedly missed meal and rest periods. The complaint seeks unspecified
damages including lost wages, penalties under the California Labor Code and other statutes,
compensatory and punitive damages, declaratory relief, injunctive relief, interest, attorneys’ fees
and costs. The Company’s response to the complaint was filed and served in January 2011. The
Company denies the allegations and intends to defend itself vigorously.
</div>
<div align="left" style="font-size: 10pt; margin-top: 10pt; margin-left: 1%"><i>Other Matters</i>
</div>
<div align="left" style="font-size: 10pt; margin-top: 10pt; text-indent: 4%">In the normal course of business, the Company is subject to other 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 and is
therefore not predictable with assurance, management believes that any monetary liability or
financial impact to the Company from these other matters, individually and in the aggregate, would
not be material to the Company’s financial condition, results of operations or cash flows. However,
there can be no assurance with respect to such result, and monetary liability or financial impact
to the Company from these other matters could differ materially from those projected.
</div>
</div>
<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" -->
<!-- Begin Block Tagged Note 6 - us-gaap:IncomeTaxDisclosureTextBlock-->
<div style="font-family: 'Times New Roman',Times,serif; margin-left: 0in; ">
<div align="left" style="font-size: 10pt; margin-top: 10pt"><b>6. Income Taxes</b>
</div>
<div align="left" style="font-size: 10pt; margin-top: 10pt; text-indent: 4%">The Company’s income tax provision for the three months ended April 1, 2011 was $13 million as
compared to $40 million in the prior-year period. The Company’s income tax provision for the nine
months ended April 1, 2011 was $41 million as compared to $110 million in the prior-year period.
The tax provision for the three and nine months ended April 1, 2011 reflects the retroactive
extension of the research and development tax credit that was signed into law in December 2010. The
differences between the effective tax rate and the U.S. Federal statutory rate are primarily due to
tax holidays in Malaysia and Thailand that expire at various dates through 2023 and the current
year generation of income tax credits.
</div>
<div align="left" style="font-size: 10pt; margin-top: 10pt; text-indent: 4%">In the three months ended April 1, 2011, the Company recognized a net increase of $6 million
in its liability for unrecognized tax benefits. As of April 1, 2011, the Company had a recorded liability
for unrecognized tax benefits of approximately $246 million. Interest and penalties recognized on
such amounts were not material.
</div>
<div align="left" style="font-size: 10pt; margin-top: 10pt; text-indent: 4%">The United States Internal Revenue Service (“IRS”) is currently examining fiscal years 2006
and 2007 for the Company and calendar years 2005 and 2006 for Komag, Incorporated (“Komag”), which
was acquired by the Company on September 5, 2007. The IRS has completed its field work and proposed
certain adjustments. Certain issues have been agreed upon by the Company and the IRS and certain
issues remain unresolved. The Company has received Revenue Agent Reports (“RARs”) for the agreed
issues. The Company has also received RARs from the IRS for the unresolved issues which seek
adjustments to income before income taxes of approximately $970 million for the Company and $380
million for Komag. The issues in dispute relate primarily to transfer pricing and certain other
intercompany transactions. The Company strongly disagrees with the proposed adjustments and is
contesting them.
</div>
<div align="left" style="font-size: 10pt; margin-top: 10pt; text-indent: 4%">The Company believes that adequate provision has been made for any adjustments that may result
from tax examinations. However, the outcome of tax audits cannot be predicted with certainty. If
any issues addressed in the Company’s tax audits 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 April 1, 2011, it is not possible to estimate the
amount of change, if any, in the unrecognized tax benefits that is reasonably possible within the
next twelve months.
</div>
</div>
<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" -->
<!-- Begin Block Tagged Note 7 - us-gaap:FairValueDisclosuresTextBlock-->
<div style="font-family: 'Times New Roman',Times,serif; margin-left: 0in; ">
<div align="left" style="font-size: 10pt; margin-top: 10pt"><b>7. Fair Value Measurements</b>
</div>
<div align="left" style="font-size: 10pt; margin-top: 10pt; text-indent: 4%">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:
</div>
<div style="margin-top: 10pt">
<table width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; text-align: left">
<tr valign="top" style="font-size: 10pt; color: #000000; background: transparent">
<td width="3%" nowrap="nowrap" align="left"><i> </i></td>
<td width="1%"><i> </i></td>
<td><i>Level 1. </i>Quoted prices in active markets for identical assets or liabilities.</td>
</tr>
</table>
</div>
<!-- Folio -->
<!-- /Folio -->
</div>
<!-- PAGEBREAK -->
<div style="font-family: 'Times New Roman',Times,serif; margin-left: 0in; ">
<div style="margin-top: 10pt">
</div>
<div style="margin-top: 10pt">
<table width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; text-align: left">
<tr valign="top" style="font-size: 10pt; color: #000000; background: transparent">
<td width="3%" nowrap="nowrap" align="left"><i> </i></td>
<td width="1%"><i> </i></td>
<td><i>Level 2. </i>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.</td>
</tr>
</table>
</div>
<div style="margin-top: 10pt">
<table width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; text-align: left">
<tr valign="top" style="font-size: 10pt; color: #000000; background: transparent">
<td width="3%" nowrap="nowrap" align="left"><i> </i></td>
<td width="1%"><i> </i></td>
<td><i>Level 3. </i>Inputs that are unobservable for the asset or liability and that are significant to the
fair value of the assets or liabilities.</td>
</tr>
</table>
</div>
<div align="left" style="font-size: 10pt; margin-top: 10pt; text-indent: 4%">The following table presents information about the Company’s financial assets that are
measured at fair value on a recurring basis as of April 1, 2011, and indicates the fair value
hierarchy of the valuation techniques utilized to determine such value (in millions):
</div>
<div align="center">
<table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<tr valign="bottom">
<td width="44%"> </td>
<td width="3%"> </td>
<td width="1%"> </td>
<td width="9%"> </td>
<td width="1%"> </td>
<td width="3%"> </td>
<td width="1%"> </td>
<td width="9%"> </td>
<td width="1%"> </td>
<td width="3%"> </td>
<td width="1%"> </td>
<td width="9%"> </td>
<td width="1%"> </td>
<td width="3%"> </td>
<td width="1%"> </td>
<td width="9%"> </td>
<td width="1%"> </td>
</tr>
<tr style="font-size: 10pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="14"><b>Fair Value Measurements at</b></td>
<td> </td>
</tr>
<tr style="font-size: 10pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="14" style="border-bottom: 1px solid #000000"><b>Reporting Date Using</b></td>
<td> </td>
</tr>
<tr style="font-size: 10pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Quoted Prices</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"> </td>
<td> </td>
</tr>
<tr style="font-size: 10pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>in Active</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Significant</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"> </td>
<td> </td>
</tr>
<tr style="font-size: 10pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Markets for</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Other</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Significant</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"> </td>
<td> </td>
</tr>
<tr style="font-size: 10pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Identical</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Observable</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Unobservable</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"> </td>
<td> </td>
</tr>
<tr style="font-size: 10pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Assets</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Inputs</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Inputs</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"> </td>
<td> </td>
</tr>
<tr style="font-size: 10pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>(Level 1)</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>(Level 2)</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>(Level 3)</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>Total</b></td>
<td> </td>
</tr>
<tr style="font-size:10pt">
<td> </td>
</tr>
<!-- End Table Head -->
<!-- Begin Table Body -->
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px">Cash equivalents
</div></td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:30px; text-indent:-15px">Money market funds
</div></td>
<td> </td>
<td align="left">$</td>
<td align="right">1,080</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">—</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">—</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">1,080</td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:30px; text-indent:-15px">U.S. Treasury securities
</div></td>
<td> </td>
<td> </td>
<td align="right">—</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">101</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">—</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">101</td>
<td> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:30px; text-indent:-15px">U.S. Government agency securities
</div></td>
<td> </td>
<td> </td>
<td align="right">—</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">118</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">—</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">118</td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:45px; text-indent:-15px">Total cash equivalents
</div></td>
<td> </td>
<td> </td>
<td align="right">1,080</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">219</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">—</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">1,299</td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:15px; text-indent:-15px">Auction-rate securities
</div></td>
<td> </td>
<td> </td>
<td align="right">—</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">—</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">15</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">15</td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px">Foreign exchange contracts
</div></td>
<td> </td>
<td> </td>
<td align="right">—</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">13</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">—</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">13</td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:45px; text-indent:-15px">Total assets at fair value
</div></td>
<td> </td>
<td align="left">$</td>
<td align="right">1,080</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">232</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">15</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">1,327</td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
</tr>
<!-- End Table Body -->
</table>
</div>
<div align="left" style="font-size: 10pt; margin-top: 10pt; text-indent: 4%"><i>Money Market Funds. </i>The Company’s money market funds are funds that invest in U.S. Treasury
securities and are recorded within cash and cash equivalents in the condensed consolidated balance
sheets. Money market funds are valued based on quoted market prices.
</div>
<div align="left" style="font-size: 10pt; margin-top: 10pt; text-indent: 4%"><i>U.S. Treasury Securities. </i>The Company’s U.S. Treasury securities are investments in Treasury
bills with original maturities of three months or less, are held in custody by a third party and
are recorded within cash and cash equivalents in the condensed consolidated balance sheets. U.S.
Treasury securities are valued using a market approach which is based on observable inputs
including market interest rates from multiple pricing sources.
</div>
<div align="left" style="font-size: 10pt; margin-top: 10pt; text-indent: 4%"><i>U.S. Government Agency Securities. </i>The Company’s U.S. Government agency securities are
investments in fixed income securities sponsored by the U.S. Government with original maturities of
three months or less, are held in custody by a third party and are recorded within cash and cash
equivalents in the condensed consolidated balance sheets. U.S. Government agency securities are
valued using a market approach which is based on observable inputs including market interest rates
from multiple pricing sources.
</div>
<div align="left" style="font-size: 10pt; margin-top: 10pt; text-indent: 4%"><i>Auction-Rate Securities. </i>The Company’s auction-rate securities have maturity dates through
2050, are primarily backed by insurance products and are accounted for as available-for-sale
securities. These investments are expected to be held until secondary markets become available and
as a result, are classified as long-term investments and recorded within other non-current assets
in the condensed consolidated balance sheets. Auction-rate securities are valued using an income
approach which is based on a discounted cash flow model or a credit default model. The inputs to
the discounted cash flow model include market interest rates and a discount factor to reflect the
illiquidity of the investments. The inputs to the credit default model include market interest
rates, yields of similar securities, and probability-weighted assumptions related to the
creditworthiness of the underlying assets.
</div>
<div align="left" style="font-size: 10pt; margin-top: 10pt; text-indent: 4%"><i>Foreign Exchange Contracts. </i>The Company’s foreign exchange contracts are short-term contracts
to hedge the Company’s foreign currency risk related to the Thai Baht, Malaysian Ringgit, Euro and
British Pound Sterling. Foreign exchange contracts are classified within other current assets in
the condensed consolidated balance sheets. Foreign exchange contracts are valued using an income
approach which is based on a present value of future cash flows model. The market-based observable
inputs for the model include forward rates and credit default swap rates.
</div>
<!-- Folio -->
<!-- /Folio -->
</div>
<!-- PAGEBREAK -->
<div style="font-family: 'Times New Roman',Times,serif; margin-left: 0in; ">
<div align="left" style="font-size: 10pt; margin-top: 10pt; text-indent: 4%">In the nine months ended April 1, 2011, there were no changes in Level 3 financial assets
measured on a recurring basis. The Company had no liabilities that were re-measured and reported at
fair value on a recurring basis at April 1, 2011.
</div>
<div align="left" style="font-size: 10pt; margin-top: 10pt; text-indent: 4%">The carrying amounts of cash, accounts receivable, accounts payable and accrued expenses
approximate fair value for all periods presented because of the short-term maturity of these assets
and liabilities. The carrying amount of debt approximates fair value because of its variable
interest rate.
</div>
</div>
<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" -->
<!-- Begin Block Tagged Note 8 - us-gaap:DerivativeInstrumentsAndHedgingActivitiesDisclosureTextBlock-->
<div style="font-family: 'Times New Roman',Times,serif; margin-left: 0in; ">
<div align="left" style="font-size: 10pt; margin-top: 10pt"><b>8. Foreign Exchange Contracts</b>
</div>
<div align="left" style="font-size: 10pt; margin-top: 10pt; text-indent: 4%">Although the majority of the Company’s transactions are in U.S. dollars, some transactions are
based in various foreign currencies. The Company purchases short-term, foreign exchange contracts
to hedge the impact of foreign currency exchange fluctuations on certain underlying assets,
revenue, liabilities and commitments for operating expenses and product costs denominated in
foreign currencies. The purpose of entering into these hedging transactions is to minimize the
impact of foreign currency fluctuations on the Company’s results of operations. These contract
maturity dates do not exceed 12 months. All foreign exchange contracts are for risk management
purposes only. The Company does not purchase foreign exchange contracts for trading purposes. As of
April 1, 2011, the Company had outstanding foreign exchange contracts with commercial banks for
Thai Baht, Malaysian Ringgit, Euro and British Pound Sterling. Malaysian Ringgit contracts are
designated as cash flow hedges. Euro and British Pound Sterling contracts are designated as fair
value hedges. Thai Baht contracts are designated as either cash flow or fair value hedges.
</div>
<div align="left" style="font-size: 10pt; margin-top: 10pt; text-indent: 4%">If the derivative is designated as a cash flow hedge, the effective portion of the change in
fair value of the derivative is initially deferred in other comprehensive income (loss), net of
tax. These amounts are subsequently recognized into earnings when the underlying cash flow being
hedged is recognized into earnings. Recognized gains and losses on foreign exchange contracts
entered into for manufacturing-related activities are reported in cost of revenue. Hedge
effectiveness is measured by comparing the hedging instrument’s cumulative change in fair value
from inception to maturity to the underlying exposure’s terminal value. As of April 1, 2011, the
net amount of existing gains expected to be reclassified into earnings within the next 12 months
was $8 million. The Company determined the ineffectiveness associated with its cash flow hedges to
be immaterial.
</div>
<div align="left" style="font-size: 10pt; margin-top: 10pt; text-indent: 4%">A change in the fair value of fair value hedges is recognized in earnings in the period
incurred and is reported as a component of operating expenses. All fair value hedges were
determined to be effective. The fair value and the changes in fair value on these contracts were
not material to the condensed consolidated financial statements.
</div>
<div align="left" style="font-size: 10pt; margin-top: 10pt; text-indent: 4%">As of April 1, 2011, the Company did not have any foreign exchange contracts with
credit-risk-related contingent features. The Company opened $728 million and $2.7 billion, and
closed $810 million and $2.4 billion, in foreign exchange contracts in the three and nine months
ended April 1, 2011, respectively. The fair value and balance sheet location of such contracts were
as follows (in millions):
</div>
<div align="center">
<table style="font-size: 8pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<tr valign="bottom">
<td width="20%"> </td>
<td width="3%"> </td>
<td width="7%"> </td>
<td width="3%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="3%"> </td>
<td width="7%"> </td>
<td width="3%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="3%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="3%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="3%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="3%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
</tr>
<tr style="font-size: 8pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="10" style="border-bottom: 1px solid #000000"><b>Asset Derivatives</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="14" style="border-bottom: 1px solid #000000"><b>Liability Derivatives</b></td>
<td> </td>
</tr>
<tr style="font-size: 8pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="4" style="border-bottom: 1px solid #000000"><b>Apr. 1, 2011</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="4" style="border-bottom: 1px solid #000000"><b>Jul. 2, 2010</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="6" style="border-bottom: 1px solid #000000"><b>Apr. 1, 2011</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="6" style="border-bottom: 1px solid #000000"><b>Jul. 2, 2010</b></td>
<td> </td>
</tr>
<tr style="font-size: 8pt" valign="bottom">
<td nowrap="nowrap" align="left"><b>Derivatives Designated as</b></td>
<td> </td>
<td nowrap="nowrap" align="center"><b>Balance Sheet</b></td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Fair</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center"><b>Balance Sheet</b></td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Fair</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Balance Sheet</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Fair</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Balance Sheet</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Fair</b></td>
<td> </td>
</tr>
<tr style="font-size: 8pt" valign="bottom">
<td nowrap="nowrap" align="left" style="border-bottom: 1px solid #000000"><b>Hedging Instruments</b></td>
<td> </td>
<td nowrap="nowrap" align="center" style="border-bottom: 1px solid #000000"><b>Location</b></td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>Value</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" style="border-bottom: 1px solid #000000"><b>Location</b></td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>Value</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>Location</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>Value</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>Location</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>Value</b></td>
<td> </td>
</tr>
<!-- End Table Head -->
<!-- Begin Table Body -->
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px">Foreign exchange
contracts
</div></td>
<td> </td>
<td align="left" valign="top">Other current assets</td>
<td> </td>
<td align="left">$</td>
<td align="right">13</td>
<td> </td>
<td> </td>
<td align="left" valign="top">Other current assets</td>
<td> </td>
<td align="left">$</td>
<td align="right">17</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">—</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">—</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">—</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">—</td>
<td> </td>
</tr>
<!-- End Table Body -->
</table>
</div>
<div align="left" style="font-size: 10pt; margin-top: 10pt; text-indent: 4%">The impact on the condensed consolidated financial statements was as follows (in
millions):
</div>
<div align="center">
<table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<tr valign="bottom">
<td width="19%"> </td>
<td width="3%"> </td>
<td width="1%"> </td>
<td width="4%"> </td>
<td width="1%"> </td>
<td width="3%"> </td>
<td width="1%"> </td>
<td width="4%"> </td>
<td width="1%"> </td>
<td width="3%"> </td>
<td width="1%"> </td>
<td width="4%"> </td>
<td width="1%"> </td>
<td width="3%"> </td>
<td width="1%"> </td>
<td width="4%"> </td>
<td width="1%"> </td>
<td width="3%"> </td>
<td width="6%"> </td>
<td width="3%"> </td>
<td width="1%"> </td>
<td width="4%"> </td>
<td width="1%"> </td>
<td width="3%"> </td>
<td width="1%"> </td>
<td width="4%"> </td>
<td width="1%"> </td>
<td width="3%"> </td>
<td width="1%"> </td>
<td width="4%"> </td>
<td width="1%"> </td>
<td width="3%"> </td>
<td width="1%"> </td>
<td width="4%"> </td>
<td width="1%"> </td>
</tr>
<tr style="font-size: 8pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="14"><b>Amount of Gain Recognized in</b></td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="14"><b>Amount of Gain Reclassified from</b></td>
<td> </td>
</tr>
<tr style="font-size: 8pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="14" style="border-bottom: 1px solid #000000"><b>Accumulated OCI on Derivatives</b></td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="14" style="border-bottom: 1px solid #000000"><b>Accumulated OCI into Income</b></td>
<td> </td>
</tr>
<tr style="font-size: 8pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Three</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Nine</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Three</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Nine</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center"><b>Location of Gain</b></td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Three</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Nine</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Three</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Nine</b></td>
<td> </td>
</tr>
<tr style="font-size: 8pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Months</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Months</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Months</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Months</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center"><b>Reclassified from</b></td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Months</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Months</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Months</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Months</b></td>
<td> </td>
</tr>
<tr style="font-size: 8pt" valign="bottom">
<td nowrap="nowrap" align="left"><b>Derivatives in Cash</b></td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>Ended</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>Ended</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>Ended</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>Ended</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center"><b>Accumulated</b></td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>Ended</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>Ended</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>Ended</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>Ended</b></td>
<td> </td>
</tr>
<tr style="font-size: 8pt" valign="bottom">
<td nowrap="nowrap" align="left" style="border-bottom: 1px solid #000000"><b>Flow Hedging Relationships</b></td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="6" style="border-bottom: 1px solid #000000"><b>Apr. 1, 2011</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="6" style="border-bottom: 1px solid #000000"><b>Apr. 2, 2010</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" style="border-bottom: 1px solid #000000"><b>OCI into Income</b></td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="6" style="border-bottom: 1px solid #000000"><b>Apr. 1, 2011</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="6" style="border-bottom: 1px solid #000000"><b>Apr. 2, 2010</b></td>
<td> </td>
</tr>
<!-- End Table Head -->
<!-- Begin Table Body -->
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:0px; text-indent:-0px">Foreign exchange contracts
</div></td>
<td> </td>
<td align="left">$</td>
<td align="right">2</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">76</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">31</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">53</td>
<td> </td>
<td> </td>
<td align="left" valign="top">Cost of revenue</td>
<td> </td>
<td align="left" valign="bottom">$</td>
<td align="right" valign="bottom">15</td>
<td valign="top"> </td>
<td> </td>
<td align="left" valign="bottom">$</td>
<td align="right" valign="bottom">79</td>
<td valign="top"> </td>
<td> </td>
<td align="left" valign="bottom">$</td>
<td align="right" valign="bottom">13</td>
<td valign="top"> </td>
<td> </td>
<td align="left" valign="bottom">$</td>
<td align="right" valign="bottom">33</td>
<td valign="top"> </td>
</tr>
<!-- End Table Body -->
</table>
</div>
<div align="left" style="font-size: 10pt; margin-top: 10pt; text-indent: 4%">The total net realized transaction and foreign exchange contract currency gains and
losses were not material to the condensed consolidated financial statements during the three and
nine months ended April 1, 2011 and April 2, 2010.
</div>
<!-- Folio -->
<!-- /Folio -->
</div>
<!-- PAGEBREAK -->
<div style="font-family: 'Times New Roman',Times,serif; margin-left: 0in; ">
</div>
<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" -->
<!-- Begin Block Tagged Note 9 - us-gaap:DisclosureOfCompensationRelatedCostsShareBasedPaymentsTextBlock-->
<div style="font-family: 'Times New Roman',Times,serif; margin-left: 0in; ">
<div align="left" style="font-size: 10pt; margin-top: 10pt"><b>9. Stock-Based Compensation</b>
</div>
<div align="left" style="font-size: 10pt; margin-top: 10pt; text-indent: 4%">The Company granted approximately 0.9 million restricted stock units during the nine months
ended April 1, 2011, which are payable in an equal number of shares of the Company’s common stock
at the time of vesting of the units. The aggregate fair value of the shares underlying the
restricted stock unit awards was $25 million at the date of grant. These amounts are being
recognized as expense over the corresponding vesting periods. For purposes of valuing these awards
for the three and nine months ended April 1, 2011, the Company has assumed forfeiture rates of 2.7%
and 2.1%, respectively, based on a historical analysis indicating forfeitures for these types of
awards.
</div>
<div align="left" style="font-size: 10pt; margin-top: 10pt; text-indent: 4%">For the three and nine months ended April 1, 2011, the Company recognized $8 million and $25
million, respectively, in expense related to the vesting of restricted stock unit awards compared
to $6 million and $16 million in the comparative prior-year periods. During the three and nine
months ended April 1, 2011, the Company recognized $9 million and $29 million, respectively, in
expense related to the vesting of stock options issued under stock option plans and the ESPP,
compared to $10 million and $27 million in the comparative prior-year periods.
</div>
<div align="left" style="font-size: 10pt; margin-top: 10pt; text-indent: 4%">As of April 1, 2011, the aggregate unamortized fair value of all unvested restricted stock
unit awards was $49 million, which will be recognized on a straight-line basis over a weighted
average vesting period of approximately 1.6 years. At April 1, 2011, total compensation cost
related to unvested stock options and ESPP rights issued to employees but not yet recognized was
$67 million and will be amortized on a straight-line basis over a weighted average service period
of approximately 2.3 years.
</div>
<div align="left" style="font-size: 10pt; margin-top: 10pt; margin-left: 1%"><i>Stock Option Activity</i>
</div>
<div align="left" style="font-size: 10pt; margin-top: 10pt; text-indent: 4%">The following table summarizes activity under the Company’s stock option plans (in millions,
except per share amounts and remaining contractual lives):
</div>
<div align="center">
<table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<tr valign="bottom">
<td width="44%"> </td>
<td width="3%"> </td>
<td width="1%"> </td>
<td width="9%"> </td>
<td width="1%"> </td>
<td width="3%"> </td>
<td width="1%"> </td>
<td width="9%"> </td>
<td width="1%"> </td>
<td width="3%"> </td>
<td width="1%"> </td>
<td width="9%"> </td>
<td width="1%"> </td>
<td width="3%"> </td>
<td width="1%"> </td>
<td width="9%"> </td>
<td width="1%"> </td>
</tr>
<tr style="font-size: 10pt" valign="bottom">
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Weighted Average</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"> </td>
<td> </td>
</tr>
<tr style="font-size: 10pt" valign="bottom">
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Weighted Average</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Remaining</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Aggregate</b></td>
<td> </td>
</tr>
<tr style="font-size: 10pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Number</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Exercise Price</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Contractual Life</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Intrinsic</b></td>
<td> </td>
</tr>
<tr style="font-size: 10pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>of Shares</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>Per Share</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>(in years)</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>Value</b></td>
<td> </td>
</tr>
<!-- End Table Head -->
<!-- Begin Table Body -->
<tr valign="bottom"><!-- Blank Space -->
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px"><b>Options outstanding at July 2, 2010</b>
</div></td>
<td> </td>
<td> </td>
<td align="right">9.4</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">20.61</td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:30px; text-indent:-15px">Granted
</div></td>
<td> </td>
<td> </td>
<td align="right">2.4</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">26.14</td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:30px; text-indent:-15px">Exercised
</div></td>
<td> </td>
<td nowrap="nowrap" align="left"> </td>
<td align="right">(0.1</td>
<td nowrap="nowrap">)</td>
<td> </td>
<td> </td>
<td align="right">12.21</td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:30px; text-indent:-15px">Canceled or expired
</div></td>
<td> </td>
<td nowrap="nowrap" align="left"> </td>
<td align="right">(0.1</td>
<td nowrap="nowrap">)</td>
<td> </td>
<td> </td>
<td align="right">27.04</td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px"><b>Options outstanding at October 1, 2010</b>
</div></td>
<td> </td>
<td> </td>
<td align="right">11.6</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">21.82</td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:30px; text-indent:-15px">Granted
</div></td>
<td> </td>
<td> </td>
<td align="right">0.1</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">33.27</td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:30px; text-indent:-15px">Exercised
</div></td>
<td> </td>
<td nowrap="nowrap" align="left"> </td>
<td align="right">(0.4</td>
<td nowrap="nowrap">)</td>
<td> </td>
<td> </td>
<td align="right">14.04</td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:30px; text-indent:-15px">Canceled or expired
</div></td>
<td> </td>
<td nowrap="nowrap" align="left"> </td>
<td align="right">(0.1</td>
<td nowrap="nowrap">)</td>
<td> </td>
<td> </td>
<td align="right">24.42</td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px"><b>Options outstanding at December 31, 2010</b>
</div></td>
<td> </td>
<td> </td>
<td align="right">11.2</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">22.21</td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:30px; text-indent:-15px">Granted
</div></td>
<td> </td>
<td> </td>
<td align="right">—</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">—</td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:30px; text-indent:-15px">Exercised
</div></td>
<td> </td>
<td> </td>
<td align="right">(0.6</td>
<td nowrap="nowrap">)</td>
<td> </td>
<td> </td>
<td align="right">18.65</td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:30px; text-indent:-15px">Canceled or expired
</div></td>
<td> </td>
<td nowrap="nowrap" align="left"> </td>
<td align="right">(0.1</td>
<td nowrap="nowrap">)</td>
<td> </td>
<td> </td>
<td align="right">28.41</td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px"><b>Options outstanding at April 1, 2011</b>
</div></td>
<td> </td>
<td> </td>
<td align="right">10.5</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">22.35</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">4.8</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">166</td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:15px; text-indent:-15px"><b>Exercisable at April 1, 2011</b>
</div></td>
<td> </td>
<td> </td>
<td align="right">5.3</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">18.96</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">4.0</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">102</td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px"><b>Vested and expected to vest after April
1, 2011</b>
</div></td>
<td> </td>
<td> </td>
<td align="right">10.4</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">22.33</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">4.8</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">164</td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
</tr>
<!-- End Table Body -->
</table>
</div>
<div align="left" style="font-size: 10pt; margin-top: 10pt; text-indent: 4%">The aggregate intrinsic value is calculated based on the difference between the exercise price
of the underlying options and the quoted price of the Company’s common stock for those awards that
have an exercise price below the quoted price on the date the intrinsic value is determined. As of
April 1, 2011, the Company had options outstanding
to purchase an aggregate of 10.4 million shares with an exercise price below the quoted price
of the Company’s stock on that date resulting in an aggregate intrinsic value of $166 million.
During the three and nine months ended April 1, 2011, the aggregate intrinsic value of options
exercised under the Company’s stock option plans was $9 million and $20 million, respectively,
determined as of the date of exercise, compared to $13 million and $63 million in the comparative
prior-year periods.
</div>
<!-- Folio -->
<!-- /Folio -->
</div>
<!-- PAGEBREAK -->
<div style="font-family: 'Times New Roman',Times,serif; margin-left: 0in; ">
<div align="left" style="font-size: 10pt; margin-top: 10pt; margin-left: 1%"><i>Fair Value Disclosure </i>— <i>Stock Options and ESPP</i>
</div>
<div align="left" style="font-size: 10pt; margin-top: 10pt; text-indent: 4%">The fair value of stock options granted is estimated using a binomial option-pricing model.
The binomial model requires the input of highly subjective assumptions including the expected stock
price volatility, the expected price multiple at which employees are likely to exercise stock
options and the expected employee termination rate. The Company uses historical data to estimate
option exercise, employee termination, and expected stock price volatility within the binomial
model. The risk-free rate for periods within the contractual life of the option is based on the
U.S. Treasury yield curve in effect at the time of grant. The fair value of stock options granted
was estimated using the following weighted average assumptions:
</div>
<div align="center">
<table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<tr valign="bottom">
<td width="44%"> </td>
<td width="3%"> </td>
<td width="11%"> </td>
<td width="3%"> </td>
<td width="11%"> </td>
<td width="3%"> </td>
<td width="11%"> </td>
<td width="3%"> </td>
<td width="11%"> </td>
</tr>
<tr style="font-size: 10pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000"><b>Three Months Ended</b></td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000"><b>Nine Months Ended</b></td>
</tr>
<tr style="font-size: 10pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center"><b>Apr. 1,</b></td>
<td> </td>
<td nowrap="nowrap" align="center"><b>Apr. 2,</b></td>
<td> </td>
<td nowrap="nowrap" align="center"><b>Apr. 1,</b></td>
<td> </td>
<td nowrap="nowrap" align="center"><b>Apr. 2,</b></td>
</tr>
<tr style="font-size: 10pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" style="border-bottom: 1px solid #000000"><b>2011</b></td>
<td> </td>
<td nowrap="nowrap" align="center" style="border-bottom: 1px solid #000000"><b>2010</b></td>
<td> </td>
<td nowrap="nowrap" align="center" style="border-bottom: 1px solid #000000"><b>2011</b></td>
<td> </td>
<td nowrap="nowrap" align="center" style="border-bottom: 1px solid #000000"><b>2010</b></td>
</tr>
<!-- End Table Head -->
<!-- Begin Table Body -->
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px">Suboptimal exercise factor
</div></td>
<td> </td>
<td align="center" valign="top"><b>1.81</b></td>
<td> </td>
<td align="center" valign="top">1.79</td>
<td> </td>
<td align="center" valign="top"><b>1.81</b></td>
<td> </td>
<td align="center" valign="top">1.73</td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:15px; text-indent:-15px">Range of risk-free interest rates
</div></td>
<td> </td>
<td align="center" valign="top" nowrap="nowrap"><b>0.27% to 2.90%</b></td>
<td> </td>
<td align="center" valign="top" nowrap="nowrap">0.46% to 3.40%</td>
<td> </td>
<td align="center" valign="top" nowrap="nowrap"><b>0.26% to 2.90%</b></td>
<td> </td>
<td align="center" valign="top" nowrap="nowrap">0.37% to 3.40%</td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px">Range of expected stock price volatility
</div></td>
<td> </td>
<td align="center" valign="top"><b>0.41 to 0.56</b></td>
<td> </td>
<td align="center" valign="top">0.40 to 0.61</td>
<td> </td>
<td align="center" valign="top"><b>0.41 to 0.59</b></td>
<td> </td>
<td align="center" valign="top">0.40 to 0.72</td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:15px; text-indent:-15px">Weighted average expected volatility
</div></td>
<td> </td>
<td align="center" valign="top"><b>0.49</b></td>
<td> </td>
<td align="center" valign="top">0.52</td>
<td> </td>
<td align="center" valign="top"><b>0.52</b></td>
<td> </td>
<td align="center" valign="top">0.57</td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px">Post-vesting termination rate
</div></td>
<td> </td>
<td align="center" valign="top"><b>2.95%</b></td>
<td> </td>
<td align="center" valign="top">2.91%</td>
<td> </td>
<td align="center" valign="top"><b>2.44%</b></td>
<td> </td>
<td align="center" valign="top">3.59%</td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:15px; text-indent:-15px">Dividend yield
</div></td>
<td> </td>
<td align="center" valign="top"><b>—</b></td>
<td> </td>
<td align="center" valign="top">—</td>
<td> </td>
<td align="center" valign="top"><b>—</b></td>
<td> </td>
<td align="center" valign="top">—</td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px">Fair value
</div></td>
<td> </td>
<td align="center" valign="top"><b>$14.71</b></td>
<td> </td>
<td align="center" valign="top">$17.28</td>
<td> </td>
<td align="center" valign="top"><b>$11.39</b></td>
<td> </td>
<td align="center" valign="top">$17.10</td>
</tr>
<!-- End Table Body -->
</table>
</div>
<div align="left" style="font-size: 10pt; margin-top: 10pt; text-indent: 4%">The weighted average expected term of the Company’s stock options granted during the three and
nine months ended April 1, 2011 was 5.0 years and 4.7 years, respectively, compared to 4.8 years
and 4.6 years in the comparative prior-year periods.
</div>
<div align="left" style="font-size: 10pt; margin-top: 10pt; text-indent: 4%">The fair value of ESPP purchase rights issued is estimated at the date of grant of the
purchase rights using the Black-Scholes-Merton option-pricing model. The Black-Scholes-Merton
option-pricing model was developed for use in estimating the fair value of traded options that have
no vesting restrictions and are fully transferable. The Black-Scholes-Merton option-pricing model
requires the input of highly subjective assumptions such as the expected stock price volatility and
the expected period until options are exercised. Purchase rights under the current ESPP provisions
are granted on either June 1 or December 1. ESPP activity was immaterial to the condensed
consolidated financial statements for the three and nine months ended April 1, 2011 and April 2,
2010.
</div>
</div>
<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" -->
<!-- Begin Block Tagged Note 10 - us-gaap:BusinessCombinationDisclosureTextBlock-->
<div style="font-family: 'Times New Roman',Times,serif; margin-left: 0in; ">
<div align="left" style="font-size: 10pt; margin-top: 10pt"><b>10. Planned Acquisition</b>
</div>
<div align="left" style="font-size: 10pt; margin-top: 10pt; text-indent: 4%">On March 7, 2011, the Company entered into a stock purchase agreement (the “Purchase
Agreement”) with Hitachi, Ltd. (“Hitachi”), Viviti Technologies Ltd., until recently known as Hitachi
Global Storage Technologies Holdings Pte. Ltd., a wholly owned subsidiary of Hitachi (“HGST”), and
Western Digital Ireland, Ltd., an indirect wholly owned subsidiary of
the Company (“WDI”). Pursuant
to the Purchase Agreement, WDI agreed to acquire all of the issued and outstanding paid-up share
capital of HGST from Hitachi. The planned acquisition is intended to result in a more efficient and
innovative customer-focused storage company, with significant operating scale, strong global talent
and the industry’s broadest product lineup backed by a rich technology portfolio. The aggregate
purchase price of the planned acquisition is estimated to be approximately $4.3 billion, due at
closing, and will be funded with existing cash, new debt, and 25 million newly issued shares of the
Company’s common stock. The Purchase Agreement contains certain termination rights for both the
Company and Hitachi, including the right to terminate the Purchase Agreement if the planned
acquisition has not closed by March 7, 2012. If the planned acquisition has not closed by March 7,
2012 due to the failure to receive any required antitrust or competition authority's consent, approval or
clearance or any action by any certain governmental entities to prevent the planned acquisition for
antitrust or competition reasons, the Company will, concurrently with such termination, pay Hitachi
a fee of $250 million in cash. The planned acquisition, which is subject to customary closing
conditions, including regulatory approvals, is expected to close in the Company’s first quarter of
fiscal 2012.
</div>
<div align="left" style="font-size: 10pt; margin-top: 10pt; text-indent: 4%">During the three months ended April 1, 2011, the Company incurred $10 million of expenses
related to the planned acquisition of HGST which are included within selling, general, and
administrative expense on the condensed consolidated statements of income.
</div>
<!-- Folio -->
<!-- /Folio -->
</div>
<!-- PAGEBREAK -->
<div style="font-family: 'Times New Roman',Times,serif; margin-left: 0in; ">
<div align="left" style="font-size: 10pt; margin-top: 10pt; text-indent: 4%">On March 7, 2011, in connection with the planned acquisition of HGST, the Company, WDTI and
WDI entered into a commitment letter with Bank of America, N.A. and Merrill Lynch, Pierce, Fenner &
Smith Incorporated regarding a new credit facility for an amount of $2.5 billion, consisting of a $500 million revolving
credit facility and $2.0 billion in term loans, to be entered into in connection with the
closing of the planned acquisition (the “Senior Facility”). Since entering into the commitment
letter, Bank of America N.A. and Merrill Lynch, Pierce, Fenner & Smith Incorporated has led the
effort to syndicate the Senior Facility for an amount of up to $3.0 billion, consisting of a $500
million revolving credit facility and up to $2.5 billion in term loans. As a result of such effort, the
Company, WDTI and WDI have fully negotiated definitive loan documents for the Senior Facility with
the syndicate members and, subject to customary closing conditions including completion of the
acquisition in accordance with its terms, the Company, WDTI and WDI fully expect all of these
syndicate members to be part of the final lender group.
</div>
</div>
<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" -->
<!-- Begin Block Tagged Note 11 - us-gaap:ScheduleOfNewAccountingPronouncementsAndChangesInAccountingPrinciplesTextBlock-->
<div style="font-family: 'Times New Roman',Times,serif; margin-left: 0in; ">
<div align="left" style="font-size: 10pt; margin-top: 10pt"><b>11. Recent Accounting Pronouncements</b>
</div>
<div align="left" style="font-size: 10pt; margin-top: 10pt; text-indent: 4%">In September 2009, the FASB issued Accounting Standards Update (“ASU”) 2009-13,
“Multiple-Deliverable Revenue Arrangements” (“ASU 2009-13”), and ASU 2009-14, “Certain Revenue
Arrangements That Include Software Elements” (“ASU 2009-14”). ASU 2009-13 amends the revenue
guidance under Subtopic 605-25, “Multiple Element Arrangements,” and addresses how to determine
whether an arrangement involving multiple deliverables contains more than one unit of accounting
and how arrangement consideration shall be measured and allocated to the separate units of
accounting in the arrangement. ASU 2009-14 excludes tangible products containing software
components and non-software components that function together to deliver the product’s essential
functionality from the scope of Subtopic 985-605, “Revenue Recognition.” ASU 2009-13 and ASU
2009-14 are effective for fiscal periods beginning on or after June 15, 2010, which for the Company
was the first quarter of fiscal 2011. The Company’s adoption of ASU 2009-13 and ASU 2009-14 had no
impact on its condensed consolidated financial statements.
</div>
</div>
<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" -->
<!-- Begin Block Tagged Accounting Policy: wdc-20110401_note1_accounting_policy_table1 - wdc:EstimatesPolicyTextBlock-->
<div align="left" style="font-size: 10pt; font-family: 'Times New Roman',Times,serif">
<div align="left" style="font-size: 10pt; margin-top: 10pt; text-indent: 4%">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. However, actual
results could differ materially from these estimates.
</div>
</div>
<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" -->
<!-- Begin Block Tagged Note Table: wdc-20110401_note2_table1 - us-gaap:InventoryDisclosureTextBlock-->
<div align="left" style="font-size: 10pt; font-family: 'Times New Roman',Times,serif">
<div align="center">
<table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<tr valign="bottom">
<td width="72%"> </td>
<td width="3%"> </td>
<td width="1%"> </td>
<td width="9%"> </td>
<td width="1%"> </td>
<td width="3%"> </td>
<td width="1%"> </td>
<td width="9%"> </td>
<td width="1%"> </td>
</tr>
<tr style="font-size: 10pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Apr. 1,</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Jul. 2,</b></td>
<td> </td>
</tr>
<tr style="font-size: 10pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>2011</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>2010</b></td>
<td> </td>
</tr>
<tr style="font-size: 10pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="6"><b>(in millions)</b></td>
<td> </td>
</tr>
<!-- End Table Head -->
<!-- Begin Table Body -->
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px">Raw materials and component parts
</div></td>
<td> </td>
<td align="left"><b>$</b></td>
<td align="right"><b>151</b></td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">159</td>
<td> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:15px; text-indent:-15px">Work-in-process
</div></td>
<td> </td>
<td> </td>
<td align="right"><b>260</b></td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">255</td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px">Finished goods
</div></td>
<td> </td>
<td> </td>
<td align="right"><b>163</b></td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">146</td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:30px; text-indent:-15px">Total inventories
</div></td>
<td> </td>
<td align="left"><b>$</b></td>
<td align="right"><b>574</b></td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">560</td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
</tr>
<!-- End Table Body -->
</table>
</div>
</div>
<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" -->
<!-- Begin Block Tagged Note Table: wdc-20110401_note2_table2 - us-gaap:ProductWarrantyDisclosureTextBlock-->
<div align="left" style="font-size: 10pt; font-family: 'Times New Roman',Times,serif">
<div align="center">
<table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<tr valign="bottom">
<td width="44%"> </td>
<td width="3%"> </td>
<td width="1%"> </td>
<td width="9%"> </td>
<td width="1%"> </td>
<td width="3%"> </td>
<td width="1%"> </td>
<td width="9%"> </td>
<td width="1%"> </td>
<td width="3%"> </td>
<td width="1%"> </td>
<td width="9%"> </td>
<td width="1%"> </td>
<td width="3%"> </td>
<td width="1%"> </td>
<td width="9%"> </td>
<td width="1%"> </td>
</tr>
<tr style="font-size: 10pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="6"><b>Three Months</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="6"><b>Nine Months</b></td>
<td> </td>
</tr>
<tr style="font-size: 10pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="6" style="border-bottom: 1px solid #000000"><b>Ended</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="6" style="border-bottom: 1px solid #000000"><b>Ended</b></td>
<td> </td>
</tr>
<tr style="font-size: 10pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Apr. 1,</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Apr. 2,</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Apr. 1,</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Apr. 2,</b></td>
<td> </td>
</tr>
<tr style="font-size: 10pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>2011</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>2010</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>2011</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>2010</b></td>
<td> </td>
</tr>
<!-- End Table Head -->
<!-- Begin Table Body -->
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px">Warranty accrual, beginning of period
</div></td>
<td> </td>
<td align="left"><b>$</b></td>
<td align="right"><b>176</b></td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">154</td>
<td> </td>
<td> </td>
<td align="left"><b>$</b></td>
<td align="right"><b>170</b></td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">123</td>
<td> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:30px; text-indent:-15px">Charges to operations
</div></td>
<td> </td>
<td> </td>
<td align="right"><b>42</b></td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">49</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right"><b>132</b></td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">137</td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:30px; text-indent:-15px">Utilization
</div></td>
<td> </td>
<td nowrap="nowrap" align="left"> </td>
<td align="right"><b>(41</b></td>
<td nowrap="nowrap"><b>)</b></td>
<td> </td>
<td nowrap="nowrap" align="left"> </td>
<td align="right">(37</td>
<td nowrap="nowrap">)</td>
<td> </td>
<td nowrap="nowrap" align="left"> </td>
<td align="right"><b>(120</b></td>
<td nowrap="nowrap"><b>)</b></td>
<td> </td>
<td nowrap="nowrap" align="left"> </td>
<td align="right">(99</td>
<td nowrap="nowrap">)</td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:30px; text-indent:-15px">Changes in estimate related to pre-existing warranties
</div></td>
<td> </td>
<td nowrap="nowrap" align="left"> </td>
<td align="right"><b>(3</b></td>
<td nowrap="nowrap"><b>)</b></td>
<td> </td>
<td nowrap="nowrap" align="left"> </td>
<td align="right">(2</td>
<td nowrap="nowrap">)</td>
<td> </td>
<td nowrap="nowrap" align="left"> </td>
<td align="right"><b>(8</b></td>
<td nowrap="nowrap"><b>)</b></td>
<td> </td>
<td> </td>
<td align="right">3</td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px">Warranty accrual, end of period
</div></td>
<td> </td>
<td align="left"><b>$</b></td>
<td align="right"><b>174</b></td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">164</td>
<td> </td>
<td> </td>
<td align="left"><b>$</b></td>
<td align="right"><b>174</b></td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">164</td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
</tr>
<!-- End Table Body -->
</table>
</div>
</div>
<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" -->
<!-- Begin Block Tagged Note Table: wdc-20110401_note3_table1 - wdc:ComputationOfBasicAndDilutedIncomePerCommonShareTextBlock-->
<div align="left" style="font-size: 10pt; font-family: 'Times New Roman',Times,serif">
<div align="center">
<table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<tr valign="bottom">
<td width="44%"> </td>
<td width="3%"> </td>
<td width="1%"> </td>
<td width="9%"> </td>
<td width="1%"> </td>
<td width="3%"> </td>
<td width="1%"> </td>
<td width="9%"> </td>
<td width="1%"> </td>
<td width="3%"> </td>
<td width="1%"> </td>
<td width="9%"> </td>
<td width="1%"> </td>
<td width="3%"> </td>
<td width="1%"> </td>
<td width="9%"> </td>
<td width="1%"> </td>
</tr>
<tr style="font-size: 10pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="6"><b>Three Months</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="6"><b>Nine Months</b></td>
<td> </td>
</tr>
<tr style="font-size: 10pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="6" style="border-bottom: 1px solid #000000"><b>Ended</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="6" style="border-bottom: 1px solid #000000"><b>Ended</b></td>
<td> </td>
</tr>
<tr style="font-size: 10pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Apr. 1,</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Apr. 2,</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Apr. 1,</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Apr. 2,</b></td>
<td> </td>
</tr>
<tr style="font-size: 10pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>2011</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>2010</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>2011</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>2010</b></td>
<td> </td>
</tr>
<!-- End Table Head -->
<!-- Begin Table Body -->
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px">Net income
</div></td>
<td> </td>
<td align="left"><b>$</b></td>
<td align="right"><b>146</b></td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">400</td>
<td> </td>
<td> </td>
<td align="left"><b>$</b></td>
<td align="right"><b>568</b></td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">1,118</td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:15px; text-indent:-15px">Weighted average shares outstanding:
</div></td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:30px; text-indent:-15px">Basic
</div></td>
<td> </td>
<td> </td>
<td align="right"><b>232</b></td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">229</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right"><b>231</b></td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">227</td>
<td> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:30px; text-indent:-15px">Employee stock options and other
</div></td>
<td> </td>
<td> </td>
<td align="right"><b>4</b></td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">5</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right"><b>4</b></td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">5</td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:30px; text-indent:-15px">Diluted
</div></td>
<td> </td>
<td> </td>
<td align="right"><b>236</b></td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">234</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right"><b>235</b></td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">232</td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:15px; text-indent:-15px">Income per common share:
</div></td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:30px; text-indent:-15px">Basic
</div></td>
<td> </td>
<td align="left"><b>$</b></td>
<td align="right"><b>0.63</b></td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">1.75</td>
<td> </td>
<td> </td>
<td align="left"><b>$</b></td>
<td align="right"><b>2.46</b></td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">4.93</td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:30px; text-indent:-15px">Diluted
</div></td>
<td> </td>
<td align="left"><b>$</b></td>
<td align="right"><b>0.62</b></td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">1.71</td>
<td> </td>
<td> </td>
<td align="left"><b>$</b></td>
<td align="right"><b>2.42</b></td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">4.82</td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px">Anti-dilutive potential common shares excluded*
</div></td>
<td> </td>
<td> </td>
<td align="right"><b>4</b></td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">1</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right"><b>4</b></td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">1</td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
</tr>
<!-- End Table Body -->
</table>
</div>
<div align="left">
<div style="font-size: 3pt; margin-top: 10pt; width: 18%; border-top: 1px solid #000000"> 
</div>
</div>
<table width="100%" border="0" cellpadding="0" cellspacing="0" style="font-size: 10pt; text-align: left">
<tr style="font-size: 6pt">
<td width="3%"> </td>
<td width="1%"> </td>
<td width="96%"> </td>
</tr>
<tr valign="top">
<td nowrap="nowrap" align="left">*</td>
<td> </td>
<td>
<div style="text-align: left">For purposes of computing diluted income per common share, certain
potentially dilutive securities have been excluded from the
calculation because their effect would have been anti-dilutive.
</div></td>
</tr>
</table>
</div>
<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" -->
<!-- Begin Block Tagged Note Table: wdc-20110401_note7_table1 - us-gaap:FairValueAssetsMeasuredOnRecurringBasisTextBlock-->
<div align="left" style="font-size: 10pt; font-family: 'Times New Roman',Times,serif">
<div align="center">
<table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<tr valign="bottom">
<td width="44%"> </td>
<td width="3%"> </td>
<td width="1%"> </td>
<td width="9%"> </td>
<td width="1%"> </td>
<td width="3%"> </td>
<td width="1%"> </td>
<td width="9%"> </td>
<td width="1%"> </td>
<td width="3%"> </td>
<td width="1%"> </td>
<td width="9%"> </td>
<td width="1%"> </td>
<td width="3%"> </td>
<td width="1%"> </td>
<td width="9%"> </td>
<td width="1%"> </td>
</tr>
<tr style="font-size: 10pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="14"><b>Fair Value Measurements at</b></td>
<td> </td>
</tr>
<tr style="font-size: 10pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="14" style="border-bottom: 1px solid #000000"><b>Reporting Date Using</b></td>
<td> </td>
</tr>
<tr style="font-size: 10pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Quoted Prices</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"> </td>
<td> </td>
</tr>
<tr style="font-size: 10pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>in Active</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Significant</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"> </td>
<td> </td>
</tr>
<tr style="font-size: 10pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Markets for</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Other</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Significant</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"> </td>
<td> </td>
</tr>
<tr style="font-size: 10pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Identical</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Observable</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Unobservable</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"> </td>
<td> </td>
</tr>
<tr style="font-size: 10pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Assets</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Inputs</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Inputs</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"> </td>
<td> </td>
</tr>
<tr style="font-size: 10pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>(Level 1)</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>(Level 2)</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>(Level 3)</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>Total</b></td>
<td> </td>
</tr>
<tr style="font-size:10pt">
<td> </td>
</tr>
<!-- End Table Head -->
<!-- Begin Table Body -->
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px">Cash equivalents
</div></td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:30px; text-indent:-15px">Money market funds
</div></td>
<td> </td>
<td align="left">$</td>
<td align="right">1,080</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">—</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">—</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">1,080</td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:30px; text-indent:-15px">U.S. Treasury securities
</div></td>
<td> </td>
<td> </td>
<td align="right">—</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">101</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">—</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">101</td>
<td> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:30px; text-indent:-15px">U.S. Government agency securities
</div></td>
<td> </td>
<td> </td>
<td align="right">—</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">118</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">—</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">118</td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:45px; text-indent:-15px">Total cash equivalents
</div></td>
<td> </td>
<td> </td>
<td align="right">1,080</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">219</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">—</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">1,299</td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:15px; text-indent:-15px">Auction-rate securities
</div></td>
<td> </td>
<td> </td>
<td align="right">—</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">—</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">15</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">15</td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px">Foreign exchange contracts
</div></td>
<td> </td>
<td> </td>
<td align="right">—</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">13</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">—</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">13</td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:45px; text-indent:-15px">Total assets at fair value
</div></td>
<td> </td>
<td align="left">$</td>
<td align="right">1,080</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">232</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">15</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">1,327</td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
</tr>
<!-- End Table Body -->
</table>
</div>
</div>
<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" -->
<!-- Begin Block Tagged Note Table: wdc-20110401_note8_table1 - us-gaap:ScheduleOfDerivativeInstrumentsInStatementOfFinancialPositionFairValueTextBlock-->
<div align="left" style="font-size: 10pt; font-family: 'Times New Roman',Times,serif">
<div align="center">
<table style="font-size: 8pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<tr valign="bottom">
<td width="20%"> </td>
<td width="3%"> </td>
<td width="7%"> </td>
<td width="3%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="3%"> </td>
<td width="7%"> </td>
<td width="3%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="3%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="3%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="3%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
<td width="3%"> </td>
<td width="1%"> </td>
<td width="5%"> </td>
<td width="1%"> </td>
</tr>
<tr style="font-size: 8pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="10" style="border-bottom: 1px solid #000000"><b>Asset Derivatives</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="14" style="border-bottom: 1px solid #000000"><b>Liability Derivatives</b></td>
<td> </td>
</tr>
<tr style="font-size: 8pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="4" style="border-bottom: 1px solid #000000"><b>Apr. 1, 2011</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="4" style="border-bottom: 1px solid #000000"><b>Jul. 2, 2010</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="6" style="border-bottom: 1px solid #000000"><b>Apr. 1, 2011</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="6" style="border-bottom: 1px solid #000000"><b>Jul. 2, 2010</b></td>
<td> </td>
</tr>
<tr style="font-size: 8pt" valign="bottom">
<td nowrap="nowrap" align="left"><b>Derivatives Designated as</b></td>
<td> </td>
<td nowrap="nowrap" align="center"><b>Balance Sheet</b></td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Fair</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center"><b>Balance Sheet</b></td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Fair</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Balance Sheet</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Fair</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Balance Sheet</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Fair</b></td>
<td> </td>
</tr>
<tr style="font-size: 8pt" valign="bottom">
<td nowrap="nowrap" align="left" style="border-bottom: 1px solid #000000"><b>Hedging Instruments</b></td>
<td> </td>
<td nowrap="nowrap" align="center" style="border-bottom: 1px solid #000000"><b>Location</b></td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>Value</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" style="border-bottom: 1px solid #000000"><b>Location</b></td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>Value</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>Location</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>Value</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>Location</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>Value</b></td>
<td> </td>
</tr>
<!-- End Table Head -->
<!-- Begin Table Body -->
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px">Foreign exchange
contracts
</div></td>
<td> </td>
<td align="left" valign="top">Other current assets</td>
<td> </td>
<td align="left">$</td>
<td align="right">13</td>
<td> </td>
<td> </td>
<td align="left" valign="top">Other current assets</td>
<td> </td>
<td align="left">$</td>
<td align="right">17</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">—</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">—</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">—</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">—</td>
<td> </td>
</tr>
<!-- End Table Body -->
</table>
</div>
</div>
<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" -->
<!-- Begin Block Tagged Note Table: wdc-20110401_note8_table2 - wdc:ScheduleOfDerivativeInstrumentsGainLossInStatementOfFinancialPerformanceCashFlowHedgingRelationshipsTextBlock-->
<div align="left" style="font-size: 10pt; font-family: 'Times New Roman',Times,serif">
<div align="center">
<table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<tr valign="bottom">
<td width="19%"> </td>
<td width="3%"> </td>
<td width="1%"> </td>
<td width="4%"> </td>
<td width="1%"> </td>
<td width="3%"> </td>
<td width="1%"> </td>
<td width="4%"> </td>
<td width="1%"> </td>
<td width="3%"> </td>
<td width="1%"> </td>
<td width="4%"> </td>
<td width="1%"> </td>
<td width="3%"> </td>
<td width="1%"> </td>
<td width="4%"> </td>
<td width="1%"> </td>
<td width="3%"> </td>
<td width="6%"> </td>
<td width="3%"> </td>
<td width="1%"> </td>
<td width="4%"> </td>
<td width="1%"> </td>
<td width="3%"> </td>
<td width="1%"> </td>
<td width="4%"> </td>
<td width="1%"> </td>
<td width="3%"> </td>
<td width="1%"> </td>
<td width="4%"> </td>
<td width="1%"> </td>
<td width="3%"> </td>
<td width="1%"> </td>
<td width="4%"> </td>
<td width="1%"> </td>
</tr>
<tr style="font-size: 8pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="14"><b>Amount of Gain Recognized in</b></td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="14"><b>Amount of Gain Reclassified from</b></td>
<td> </td>
</tr>
<tr style="font-size: 8pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="14" style="border-bottom: 1px solid #000000"><b>Accumulated OCI on Derivatives</b></td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="14" style="border-bottom: 1px solid #000000"><b>Accumulated OCI into Income</b></td>
<td> </td>
</tr>
<tr style="font-size: 8pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Three</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Nine</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Three</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Nine</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center"><b>Location of Gain</b></td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Three</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Nine</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Three</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Nine</b></td>
<td> </td>
</tr>
<tr style="font-size: 8pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Months</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Months</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Months</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Months</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center"><b>Reclassified from</b></td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Months</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Months</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Months</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Months</b></td>
<td> </td>
</tr>
<tr style="font-size: 8pt" valign="bottom">
<td nowrap="nowrap" align="left"><b>Derivatives in Cash</b></td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>Ended</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>Ended</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>Ended</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>Ended</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center"><b>Accumulated</b></td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>Ended</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>Ended</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>Ended</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>Ended</b></td>
<td> </td>
</tr>
<tr style="font-size: 8pt" valign="bottom">
<td nowrap="nowrap" align="left" style="border-bottom: 1px solid #000000"><b>Flow Hedging Relationships</b></td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="6" style="border-bottom: 1px solid #000000"><b>Apr. 1, 2011</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="6" style="border-bottom: 1px solid #000000"><b>Apr. 2, 2010</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" style="border-bottom: 1px solid #000000"><b>OCI into Income</b></td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="6" style="border-bottom: 1px solid #000000"><b>Apr. 1, 2011</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="6" style="border-bottom: 1px solid #000000"><b>Apr. 2, 2010</b></td>
<td> </td>
</tr>
<!-- End Table Head -->
<!-- Begin Table Body -->
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:0px; text-indent:-0px">Foreign exchange contracts
</div></td>
<td> </td>
<td align="left">$</td>
<td align="right">2</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">76</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">31</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">53</td>
<td> </td>
<td> </td>
<td align="left" valign="top">Cost of revenue</td>
<td> </td>
<td align="left" valign="bottom">$</td>
<td align="right" valign="bottom">15</td>
<td valign="top"> </td>
<td> </td>
<td align="left" valign="bottom">$</td>
<td align="right" valign="bottom">79</td>
<td valign="top"> </td>
<td> </td>
<td align="left" valign="bottom">$</td>
<td align="right" valign="bottom">13</td>
<td valign="top"> </td>
<td> </td>
<td align="left" valign="bottom">$</td>
<td align="right" valign="bottom">33</td>
<td valign="top"> </td>
</tr>
<!-- End Table Body -->
</table>
</div>
</div>
<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" -->
<!-- Begin Block Tagged Note Table: wdc-20110401_note9_table1 - wdc:StockOptionPlansTextBlock-->
<div align="left" style="font-size: 10pt; font-family: 'Times New Roman',Times,serif">
<div align="center">
<table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<tr valign="bottom">
<td width="44%"> </td>
<td width="3%"> </td>
<td width="1%"> </td>
<td width="9%"> </td>
<td width="1%"> </td>
<td width="3%"> </td>
<td width="1%"> </td>
<td width="9%"> </td>
<td width="1%"> </td>
<td width="3%"> </td>
<td width="1%"> </td>
<td width="9%"> </td>
<td width="1%"> </td>
<td width="3%"> </td>
<td width="1%"> </td>
<td width="9%"> </td>
<td width="1%"> </td>
</tr>
<tr style="font-size: 10pt" valign="bottom">
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Weighted Average</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"> </td>
<td> </td>
</tr>
<tr style="font-size: 10pt" valign="bottom">
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Weighted Average</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Remaining</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Aggregate</b></td>
<td> </td>
</tr>
<tr style="font-size: 10pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Number</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Exercise Price</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Contractual Life</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2"><b>Intrinsic</b></td>
<td> </td>
</tr>
<tr style="font-size: 10pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>of Shares</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>Per Share</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>(in years)</b></td>
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="2" style="border-bottom: 1px solid #000000"><b>Value</b></td>
<td> </td>
</tr>
<!-- End Table Head -->
<!-- Begin Table Body -->
<tr valign="bottom"><!-- Blank Space -->
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px"><b>Options outstanding at July 2, 2010</b>
</div></td>
<td> </td>
<td> </td>
<td align="right">9.4</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">20.61</td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:30px; text-indent:-15px">Granted
</div></td>
<td> </td>
<td> </td>
<td align="right">2.4</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">26.14</td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:30px; text-indent:-15px">Exercised
</div></td>
<td> </td>
<td nowrap="nowrap" align="left"> </td>
<td align="right">(0.1</td>
<td nowrap="nowrap">)</td>
<td> </td>
<td> </td>
<td align="right">12.21</td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:30px; text-indent:-15px">Canceled or expired
</div></td>
<td> </td>
<td nowrap="nowrap" align="left"> </td>
<td align="right">(0.1</td>
<td nowrap="nowrap">)</td>
<td> </td>
<td> </td>
<td align="right">27.04</td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px"><b>Options outstanding at October 1, 2010</b>
</div></td>
<td> </td>
<td> </td>
<td align="right">11.6</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">21.82</td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:30px; text-indent:-15px">Granted
</div></td>
<td> </td>
<td> </td>
<td align="right">0.1</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">33.27</td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:30px; text-indent:-15px">Exercised
</div></td>
<td> </td>
<td nowrap="nowrap" align="left"> </td>
<td align="right">(0.4</td>
<td nowrap="nowrap">)</td>
<td> </td>
<td> </td>
<td align="right">14.04</td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:30px; text-indent:-15px">Canceled or expired
</div></td>
<td> </td>
<td nowrap="nowrap" align="left"> </td>
<td align="right">(0.1</td>
<td nowrap="nowrap">)</td>
<td> </td>
<td> </td>
<td align="right">24.42</td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px"><b>Options outstanding at December 31, 2010</b>
</div></td>
<td> </td>
<td> </td>
<td align="right">11.2</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">22.21</td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:30px; text-indent:-15px">Granted
</div></td>
<td> </td>
<td> </td>
<td align="right">—</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">—</td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:30px; text-indent:-15px">Exercised
</div></td>
<td> </td>
<td> </td>
<td align="right">(0.6</td>
<td nowrap="nowrap">)</td>
<td> </td>
<td> </td>
<td align="right">18.65</td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:30px; text-indent:-15px">Canceled or expired
</div></td>
<td> </td>
<td nowrap="nowrap" align="left"> </td>
<td align="right">(0.1</td>
<td nowrap="nowrap">)</td>
<td> </td>
<td> </td>
<td align="right">28.41</td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 1px solid #000000"> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px"><b>Options outstanding at April 1, 2011</b>
</div></td>
<td> </td>
<td> </td>
<td align="right">10.5</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">22.35</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">4.8</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">166</td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:15px; text-indent:-15px"><b>Exercisable at April 1, 2011</b>
</div></td>
<td> </td>
<td> </td>
<td align="right">5.3</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">18.96</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">4.0</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">102</td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px"><b>Vested and expected to vest after April
1, 2011</b>
</div></td>
<td> </td>
<td> </td>
<td align="right">10.4</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">22.33</td>
<td> </td>
<td> </td>
<td> </td>
<td align="right">4.8</td>
<td> </td>
<td> </td>
<td align="left">$</td>
<td align="right">164</td>
<td> </td>
</tr>
<tr style="font-size: 1px">
<td>
<div style="margin-left:15px; text-indent:-15px"> 
</div></td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
<td> </td>
<td nowrap="nowrap" colspan="2" align="right" style="border-top: 3px double #000000"> </td>
<td> </td>
</tr>
<!-- End Table Body -->
</table>
</div>
</div>
<!--DOCTYPE html PUBLIC "-//W3C//DTD XHTML 1.0 Transitional//EN" "http://www.w3.org/TR/xhtml1/DTD/xhtml1-transitional.dtd" -->
<!-- Begin Block Tagged Note Table: wdc-20110401_note9_table2 - wdc:FairValueOfStockOptionsGrantedTextBlock-->
<div align="left" style="font-size: 10pt; font-family: 'Times New Roman',Times,serif">
<div align="center">
<table style="font-size: 10pt; text-align: left" cellspacing="0" border="0" cellpadding="0" width="100%">
<!-- Begin Table Head -->
<tr valign="bottom">
<td width="44%"> </td>
<td width="3%"> </td>
<td width="11%"> </td>
<td width="3%"> </td>
<td width="11%"> </td>
<td width="3%"> </td>
<td width="11%"> </td>
<td width="3%"> </td>
<td width="11%"> </td>
</tr>
<tr style="font-size: 10pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000"><b>Three Months Ended</b></td>
<td> </td>
<td nowrap="nowrap" align="center" colspan="3" style="border-bottom: 1px solid #000000"><b>Nine Months Ended</b></td>
</tr>
<tr style="font-size: 10pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center"><b>Apr. 1,</b></td>
<td> </td>
<td nowrap="nowrap" align="center"><b>Apr. 2,</b></td>
<td> </td>
<td nowrap="nowrap" align="center"><b>Apr. 1,</b></td>
<td> </td>
<td nowrap="nowrap" align="center"><b>Apr. 2,</b></td>
</tr>
<tr style="font-size: 10pt" valign="bottom">
<td> </td>
<td> </td>
<td nowrap="nowrap" align="center" style="border-bottom: 1px solid #000000"><b>2011</b></td>
<td> </td>
<td nowrap="nowrap" align="center" style="border-bottom: 1px solid #000000"><b>2010</b></td>
<td> </td>
<td nowrap="nowrap" align="center" style="border-bottom: 1px solid #000000"><b>2011</b></td>
<td> </td>
<td nowrap="nowrap" align="center" style="border-bottom: 1px solid #000000"><b>2010</b></td>
</tr>
<!-- End Table Head -->
<!-- Begin Table Body -->
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px">Suboptimal exercise factor
</div></td>
<td> </td>
<td align="center" valign="top"><b>1.81</b></td>
<td> </td>
<td align="center" valign="top">1.79</td>
<td> </td>
<td align="center" valign="top"><b>1.81</b></td>
<td> </td>
<td align="center" valign="top">1.73</td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:15px; text-indent:-15px">Range of risk-free interest rates
</div></td>
<td> </td>
<td align="center" valign="top" nowrap="nowrap"><b>0.27% to 2.90%</b></td>
<td> </td>
<td align="center" valign="top" nowrap="nowrap">0.46% to 3.40%</td>
<td> </td>
<td align="center" valign="top" nowrap="nowrap"><b>0.26% to 2.90%</b></td>
<td> </td>
<td align="center" valign="top" nowrap="nowrap">0.37% to 3.40%</td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px">Range of expected stock price volatility
</div></td>
<td> </td>
<td align="center" valign="top"><b>0.41 to 0.56</b></td>
<td> </td>
<td align="center" valign="top">0.40 to 0.61</td>
<td> </td>
<td align="center" valign="top"><b>0.41 to 0.59</b></td>
<td> </td>
<td align="center" valign="top">0.40 to 0.72</td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:15px; text-indent:-15px">Weighted average expected volatility
</div></td>
<td> </td>
<td align="center" valign="top"><b>0.49</b></td>
<td> </td>
<td align="center" valign="top">0.52</td>
<td> </td>
<td align="center" valign="top"><b>0.52</b></td>
<td> </td>
<td align="center" valign="top">0.57</td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px">Post-vesting termination rate
</div></td>
<td> </td>
<td align="center" valign="top"><b>2.95%</b></td>
<td> </td>
<td align="center" valign="top">2.91%</td>
<td> </td>
<td align="center" valign="top"><b>2.44%</b></td>
<td> </td>
<td align="center" valign="top">3.59%</td>
</tr>
<tr valign="bottom">
<td>
<div style="margin-left:15px; text-indent:-15px">Dividend yield
</div></td>
<td> </td>
<td align="center" valign="top"><b>—</b></td>
<td> </td>
<td align="center" valign="top">—</td>
<td> </td>
<td align="center" valign="top"><b>—</b></td>
<td> </td>
<td align="center" valign="top">—</td>
</tr>
<tr valign="bottom" style="background: #cceeff">
<td>
<div style="margin-left:15px; text-indent:-15px">Fair value
</div></td>
<td> </td>
<td align="center" valign="top"><b>$14.71</b></td>
<td> </td>
<td align="center" valign="top">$17.28</td>
<td> </td>
<td align="center" valign="top"><b>$11.39</b></td>
<td> </td>
<td align="center" valign="top">$17.10</td>
</tr>
<!-- End Table Body -->
</table>
</div>
</div>
false
--07-01
Q3
2011
2011-04-01
10-Q
0000106040
232401502
Yes
Large Accelerated Filer
10100000000
WESTERN DIGITAL CORP
No
Yes
1507000000
1486000000
1256000000
1171000000
281000000
250000000
11000000
8000000
1022000000
1064000000
1000000
1000000
4000000
4000000
7328000000
7839000000
4720000000
5153000000
4300000000
10000000
1794000000
2826000000
2734000000
3230000000
1032000000
496000000
0.01
0.01
450000000
450000000
231000000
232000000
231000000
232000000
5602000000
1976000000
5801000000
1842000000
500000000
0.0156
2013-02-11
-2000000
4000000
376000000
452000000
17000000
13000000
33000000
13000000
79000000
15000000
53000000
31000000
76000000
2000000
0
0
4.93
1.75
2.46
0.63
4.82
1.71
2.42
0.62
1.6
20000000
11000000
1299000000
0
219000000
1080000000
1080000000
118000000
101000000
0
0
0
118000000
101000000
1080000000
0
0
0
13000000
13000000
0
0
15000000
0
0
15000000
0
8000000
146000000
151000000
1866000000
665000000
1322000000
410000000
1228000000
440000000
609000000
159000000
6000000
10000000
110000000
40000000
41000000
13000000
Through 2023
420000000
71000000
331000000
-86000000
19000000
-26000000
131000000
14000000
-67000000
-13000000
6000000
4000000
146000000
163000000
560000000
574000000
159000000
151000000
255000000
260000000
3000000
1000000
6000000
2000000
2619000000
2523000000
7328000000
7839000000
2023000000
1995000000
325000000
106000000
125000000
150000000
144000000
294000000
200000000
do not exceed 12 months
1000000
-87000000
-548000000
-625000000
1579000000
1208000000
1118000000
400000000
568000000
146000000
-5000000
-1000000
1000000
633000000
224000000
713000000
252000000
1233000000
441000000
609000000
158000000
170000000
178000000
215000000
211000000
302000000
328000000
-4000000
50000000
552000000
625000000
0.01
0.01
5000000
5000000
0
0
0
0
54000000
35000000
2159000000
2249000000
57000000
75000000
456000000
160000000
515000000
179000000
16000000
6000000
25000000
8000000
3674000000
4242000000
7468000000
2641000000
7123000000
2252000000
43000000
54000000
900000
4.6
4.8
4.7
5
5300000
18.96
-100000
-400000
-600000
63000000
13000000
20000000
9000000
-100000
-100000
-100000
27.04
24.42
28.41
2400000
100000
0
17.1
17.28
11.39
14.71
166000000
9400000
11600000
11200000
10500000
20.61
21.82
22.21
22.35
164000000
10400000
22.33
123000000
154000000
164000000
170000000
176000000
174000000
41000000
40000000
-99000000
-37000000
-120000000
-41000000
3000000
-2000000
-8000000
-3000000
137000000
49000000
132000000
42000000
4709000000
5316000000
246000000
6000000
5000000
5000000
4000000
4000000
232000000
234000000
235000000
236000000
227000000
229000000
231000000
232000000
129000000
134000000
500000000
2000000000
2500000000
2000000
2000000
3000000000
970000000
380000000
0
250000000
2400000000
810000000
2700000000
728000000
0.021
0.027
88000000
75000000
-8000000
-2000000
-6000000
-1000000
31000000
25000000
Dates Through 2050
Three months or less
25000000
10400000
P5Y
0
0
500000000
177000000
64000000
198000000
73000000
0.72
0.61
0.59
0.56
0.40
0.4
0.41
0.41
0.034
0.034
0.029
0.029
0.0037
0.0046
0.0026
0.0027
4.8
0.0359
0.0291
0.0244
0.0295
1.73
1.79
1.81
1.81
0.57
0.52
0.52
0.49
102000000
4
12.21
14.04
18.65
26.14
33.27
0
4.8
one to five years
27000000
10000000
29000000
9000000
-16000000
-8000000
2500000000
1327000000
15000000
232000000
1080000000
49000000
67000000
2.3