Exhibit 99.1
Company contacts:
Bob Blair
Western Digital Investor Relations
949.672.7834
robert.blair@wdc.com
Steve Shattuck
Western Digital Public Relations
949.672.7817
steve.shattuck@wdc.com
FOR IMMEDIATE RELEASE:
WESTERN DIGITAL® ANNOUNCES Q3 REVENUE OF $3.8 BILLION AND
NON-GAAP NET INCOME OF $514 MILLION, OR $2.10 PER SHARE1
IRVINE, Calif. — Apr. 24, 2013 — Western Digital® Corp. (NASDAQ: WDC) today reported revenue of $3.8 billion, hard-drive shipments of 60.2 million and net income of $391 million, or $1.60 per share for its third fiscal quarter ended Mar. 29, 2013. On a non-GAAP basis, net income was $514 million or $2.10 per share.1 In the year-ago quarter, the company reported revenue of $3.0 billion, net income of $483 million, or $1.96 per share, and shipped 44.2 million hard drives. Non-GAAP net income in the year-ago quarter was $619 million, or $2.52 per share.2
The company generated $727 million in cash from operations during the March quarter, ending with total cash and cash equivalents of $4.1 billion. During the quarter, the company utilized $243 million to buy back 5.2 million shares of common stock. On Feb. 14, the company declared a $0.25 per common share dividend, which was paid on Apr. 15.
“Strong execution by our HGST and WD subsidiaries drove outstanding results in the March quarter as we continue to capitalize on the secular growth of digital data,” said Steve Milligan, president and chief executive officer. “Overall industry demand was in line with our expectations. In our business, we saw strength in enterprise, stable performance in client and consumer electronics, and some anticipated seasonal softness in Branded Products.”
The investment community conference call to discuss these results will be broadcast live over the Internet today at 2 p.m. Pacific/5 p.m. Eastern. The live and archived conference call webcast can be accessed online atinvestor.wdc.com. The telephone replay number is 800-685-1235 in the U.S. or +1-203-369-3419 for international callers.
Western Digital® Announces Q3 Revenue of $3.8 Billion and
Non-GAAP Net Income of $514 Million, or $2.10 Per Share1
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About Western Digital
Western Digital Corp. (NASDAQ: WDC), Irvine, Calif., is a global provider of products and services that empower people to create, manage, experience and preserve digital content. Its subsidiaries design and manufacture storage devices, networking equipment and home entertainment products under the WD®, HGST and G-Technology brands. Visit the Investor section of the company’s website (www.westerndigital.com) to access a variety of financial and investor information.
This press release contains a forward-looking statement within the meaning of the Private Securities Litigation Reform Act of 1995 concerning the growth of digital data. This forward-looking statement is based on management’s current expectations and is subject to risks and uncertainties that could cause actual results to differ materially from those expressed or implied in the forward-looking statement, including the impact of continued uncertainty and volatility in global economic conditions; supply and demand conditions in the hard drive industry; uncertainties concerning the availability and cost of commodity materials and specialized product components; actions by competitors; unexpected advances in competing technologies; uncertainties related to the development and introduction of products based on new technologies and expansion into new data storage markets; business conditions and growth in the various hard drive markets; pricing trends and fluctuations in average selling prices; and other risks and uncertainties listed in the company’s filings with the Securities and Exchange Commission (the “SEC”), including the company’s recent Form 10-Q filed with the SEC on Feb. 1, 2013, to which your attention is directed. Readers are cautioned not to place undue reliance on this forward-looking statement, which speaks only as of the date hereof, and the company undertakes no obligation to update this forward-looking statement to reflect subsequent events or circumstances.
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Western Digital, WD and the WD logo are registered trademarks in the U.S. and other countries. Other marks may be mentioned herein that belong to other companies.
Western Digital® Announces Q3 Revenue of $3.8 Billion and
Non-GAAP Net Income of $514 Million, or $2.10 Per Share1
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| 1 | Non-GAAP net income for the third quarter fiscal 2013 consists of GAAP net income of $391 million plus $49 million of amortization of intangibles related to the acquisition of HGST and $74 million related to employee termination benefits and other unrelated charges. Non-GAAP earnings per share of $2.10 for the third quarter is calculated by using the same 245 million diluted shares as is used for GAAP earnings per share. The tax effect of the aforementioned items was not material. |
| 2 | Non-GAAP net income for the third quarter fiscal 2012 consists of GAAP net income of $483 million plus $103 million for costs recognized upon the sale of inventory that was written-up to fair value and amortization of intangibles related to the acquisition of HGST, $34 million of acquisition-related expenses and $15 million for charges and expenses related to the flooding net of recoveries, less $16 million of tax effects related to the aforementioned items. Non-GAAP earnings per share of $2.52 for the third quarter is calculated by using the same 246 million diluted shares as is used for GAAP earnings per share. |
WESTERN DIGITAL CORPORATION
CONDENSED CONSOLIDATED BALANCE SHEETS
(in millions; unaudited)
| Mar. 29, | Jun. 29, | |||||||
| 2013 | 2012 | |||||||
| ASSETS | ||||||||
Current assets: | ||||||||
Cash and cash equivalents | $ | 4,060 | $ | 3,208 | ||||
Accounts receivable, net | 1,700 | 2,364 | ||||||
Inventories | 1,197 | 1,210 | ||||||
Other | 383 | 359 | ||||||
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Total current assets | 7,340 | 7,141 | ||||||
Property, plant and equipment, net | 3,803 | 4,067 | ||||||
Goodwill | 1,954 | 1,975 | ||||||
Other intangible assets, net | 656 | 799 | ||||||
Other assets | 174 | 224 | ||||||
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Total assets | $ | 13,927 | $ | 14,206 | ||||
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| LIABILITIES AND SHAREHOLDERS’ EQUITY | ||||||||
Current liabilities: | ||||||||
Accounts payable | $ | 2,037 | $ | 2,773 | ||||
Accrued expenses | 837 | 858 | ||||||
Accrued warranty | 122 | 171 | ||||||
Current portion of long-term debt | 230 | 230 | ||||||
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Total current liabilities | 3,226 | 4,032 | ||||||
Long-term debt | 1,783 | 1,955 | ||||||
Other liabilities | 495 | 550 | ||||||
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Total liabilities | 5,504 | 6,537 | ||||||
Total shareholders’ equity | 8,423 | 7,669 | ||||||
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Total liabilities and shareholders’ equity | $ | 13,927 | $ | 14,206 | ||||
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WESTERN DIGITAL CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(in millions, except per share amounts)
(unaudited)
| Three Months Ended | Nine Months Ended | |||||||||||||||
| Mar. 29, | Mar. 30, | Mar. 29, | Mar. 30, | |||||||||||||
| 2013 | 2012 | 2013 | 2012 | |||||||||||||
Revenue, net | $ | 3,764 | $ | 3,035 | $ | 11,623 | $ | 7,724 | ||||||||
Cost of revenue | 2,703 | 2,058 | 8,310 | 5,558 | ||||||||||||
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Gross profit | 1,061 | 977 | 3,313 | 2,166 | ||||||||||||
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Operating expenses: | ||||||||||||||||
Research and development | 396 | 265 | 1,170 | 649 | ||||||||||||
Selling, general and administrative | 185 | 155 | 526 | 340 | ||||||||||||
Employee termination benefits and other charges | 63 | — | 130 | — | ||||||||||||
Charges related to flooding, net | — | 15 | — | 214 | ||||||||||||
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Total operating expenses | 644 | 435 | 1,826 | 1,203 | ||||||||||||
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Operating income | 417 | 542 | 1,487 | 963 | ||||||||||||
Net interest and other | (11 | ) | (4 | ) | (35 | ) | (8 | ) | ||||||||
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Income before income taxes | 406 | 538 | 1,452 | 955 | ||||||||||||
Income tax provision | 15 | 55 | 207 | 88 | ||||||||||||
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Net income | $ | 391 | $ | 483 | $ | 1,245 | $ | 867 | ||||||||
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Income per common share: | ||||||||||||||||
Basic | $ | 1.64 | $ | 2.00 | $ | 5.14 | $ | 3.67 | ||||||||
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Diluted | $ | 1.60 | $ | 1.96 | $ | 5.02 | $ | 3.61 | ||||||||
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Weighted average shares outstanding: | ||||||||||||||||
Basic | 239 | 241 | 242 | 236 | ||||||||||||
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Diluted | 245 | 246 | 248 | 240 | ||||||||||||
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WESTERN DIGITAL CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in millions; unaudited)
| Three Months Ended | Nine Months Ended | |||||||||||||||
| Mar. 29, | Mar. 30, | Mar. 29, | Mar. 30, | |||||||||||||
| 2013 | 2012 | 2013 | 2012 | |||||||||||||
Cash flows from operating activities | ||||||||||||||||
Net income | $ | 391 | $ | 483 | $ | 1,245 | $ | 867 | ||||||||
Adjustments to reconcile net income to net cash provided by operations: | ||||||||||||||||
Depreciation and amortization | 309 | 188 | 931 | 486 | ||||||||||||
Stock-based compensation | 36 | 20 | 107 | 61 | ||||||||||||
Deferred income taxes | (9 | ) | 24 | 59 | 42 | |||||||||||
Non-cash portion of employee termination benefits and other charges | 1 | — | 16 | — | ||||||||||||
Non-cash portion of charges related to flooding | — | 10 | — | 119 | ||||||||||||
Changes in operating assets and liabilities, net | (1 | ) | 483 | 77 | 363 | |||||||||||
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Net cash provided by operating activities | 727 | 1,208 | 2,435 | 1,938 | ||||||||||||
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Cash flows from investing activities | ||||||||||||||||
Purchases of property, plant and equipment | (188 | ) | (139 | ) | (816 | ) | (393 | ) | ||||||||
Acquisitions, net | 26 | (3,541 | ) | (1 | ) | (3,541 | ) | |||||||||
Purchase of investments | (2 | ) | — | (17 | ) | — | ||||||||||
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Net cash used in investing activities | (164 | ) | (3,680 | ) | (834 | ) | (3,934 | ) | ||||||||
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Cash flows from financing activities | ||||||||||||||||
Employee stock plans, net | 39 | 29 | 152 | 49 | ||||||||||||
Repurchases of common stock | (243 | ) | — | (607 | ) | — | ||||||||||
Dividends to shareholders | — | — | (121 | ) | — | |||||||||||
Proceeds from debt, net of issuance costs | — | 2,775 | — | 2,775 | ||||||||||||
Repayment of assumed debt | — | (585 | ) | — | (585 | ) | ||||||||||
Repayment of debt | (115 | ) | (288 | ) | (173 | ) | (350 | ) | ||||||||
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Net cash provided by (used in) financing activities | (319 | ) | 1,931 | (749 | ) | 1,889 | ||||||||||
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Effect of exchange rate changes on cash | — | (6 | ) | — | (6 | ) | ||||||||||
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Net increase (decrease) in cash and cash equivalents | 244 | (547 | ) | 852 | (113 | ) | ||||||||||
Cash and cash equivalents, beginning of period | 3,816 | 3,924 | 3,208 | 3,490 | ||||||||||||
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Cash and cash equivalents, end of period | $ | 4,060 | $ | 3,377 | $ | 4,060 | $ | 3,377 | ||||||||
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