Western Digital® Announces Q2 Revenue Of $3.8 Billion And Non-GAAP Net Income Of $513 Million, Or $2.09 Per Share(1)

Western Digital® Announces Q2 Revenue Of $3.8 Billion And Non-GAAP Net Income
                    Of $513 Million, Or $2.09 Per Share(1)

PR Newswire

IRVINE, Calif., Jan. 23, 2013

IRVINE, Calif., Jan. 23, 2013 /PRNewswire-FirstCall/ -- Western Digital^®
Corp. (NASDAQ: WDC) today reported revenue of $3.8 billion, hard-drive
shipments of 59.2 million and net income of $335 million, or $1.36 per share
for its second fiscal quarter ended Dec. 28, 2012. On a non-GAAP basis, net
income was $513 million or $2.09 per share.^1 In the year-ago quarter, the
company reported revenue of $2.0 billion, net income of $145 million, or $0.61
per share, and shipped 28.5 million hard drives. Non-GAAP net income in the
year-ago quarter was $358 million, or $1.51 per share.^2

The company generated $772 million in cash from operations during the December
quarter, ending with total cash and cash equivalents of $3.8 billion. During
the quarter, the company utilized $146 million to buy back 4.2 million shares
of common stock. On Dec. 3, the company declared a $0.25 per common share
dividend, which was paid on Dec. 26.

"We are pleased with our December quarter results, reflecting outstanding
execution and value creation by our HGST and WD^® teams," said Steve Milligan,
president and chief executive officer. "In an environment marked by continued
macroeconomic uncertainty, soft PC demand and inventory rebalancing by our
customers, we continue to manage our business by focusing on those variables
that we control, allowing us to generate better than expected revenue and
profitability and strong cash generation."

The investment community conference call to discuss these results will be
broadcast live over the Internet today at 3 p.m. Pacific/6 p.m. Eastern. The
live and archived conference call webcast can be accessed online at
investor.wdc.com. The telephone replay number is 888-568-0860 in the U.S. or
+1-402-998-0245 for international callers.

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 forward-looking statements within the meaning of
the Private Securities Litigation Reform Act of 1995. These forward-looking
statements include statements concerning the company's revenue, profitability
and cash generation. These forward-looking statements are based on
management's current expectations and are subject to risks and uncertainties
that could cause actual results to differ materially from those expressed or
implied in the forward-looking statements, including the impact of continued
uncertainty and volatility in global economic conditions; supply and demand
conditions in the hard drive industry; 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 Nov. 2, 2012, to which your attention is directed. Readers are
cautioned not to place undue reliance on these forward-looking statements,
which speak only as of the date hereof, and the company undertakes no
obligation to update these forward-looking statements to reflect subsequent
events or circumstances.

Western Digital, WD and the WD logo are registered trademarks in the U.S. and
other countries. Other marks may be mentioned herein that belong to other
companies.

___________________________
^1Non-GAAP net income for the second quarter fiscal 2013 consists of GAAP net
income of $335 million plus $88 million for a tax-related matter, $49 million
of amortization of intangibles related to the acquisition of HGST and $41
million related to employee termination benefits and other charges. Non-GAAP
earnings per share of $2.09 for the second quarter is calculated by using the
same 246 million diluted shares as is used for GAAP earnings per share. The
tax effect of the employee termination benefits and other charges was not
material.

^2Non-GAAP net income for the second quarter fiscal 2012 consists of GAAP net
income of $145 million plus $199 million for charges and expenses related to
the flooding and $14 million of acquisition-related expenses. Non-GAAP
earnings per share of $1.51 for the second quarter is calculated by using the
same 237 million diluted shares as is used for GAAP earnings per share.

 

 

 

 WESTERN DIGITAL CORPORATION 
CONDENSED CONSOLIDATED BALANCE SHEETS 
(in millions; unaudited)
                                               Dec. 28,   Jun. 29,
                                               2012       2012
ASSETS
Current assets:
 Cash and cash equivalents                     $   3,816  $   3,208
 Accounts receivable, net                      1,732      2,364
 Inventories                                   1,204      1,210
 Other                                         423        359
  Total current assets                         7,175      7,141
Property, plant and equipment, net             3,938      4,067
Goodwill                                       1,907      1,975
Other intangible assets, net                   709        799
Other assets                                   200        224
  Total assets                                 $ 13,929   $ 14,206
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
 Accounts payable                              $   2,185  $   2,773
 Accrued expenses                              722        858
 Accrued warranty                              131        171
 Current portion of long-term debt             288        230
  Total current liabilities                    3,326      4,032
Long-term debt                                 1,840      1,955
Other liabilities                              516        550
  Total liabilities                            5,682      6,537
Total shareholders' equity                     8,247      7,669
  Total liabilities and shareholders' equity   $ 13,929   $ 14,206

 

 

     WESTERN DIGITAL CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF INCOME 
     (in millions, except per share amounts)
     (unaudited)
                                          Three Months Ended  Six Months Ended
                                           Dec.       Dec.     Dec.     Dec.
                                          28,        30,      28,      30, 
                                          2012       2011     2012     2011
Revenue, net                              $   3,824  $        $        $  
                                                     1,995    7,859    4,689
Cost of revenue                           2,765      1,347    5,607    3,500
        Gross profit                      1,059      648      2,252    1,189
Operating expenses:
        Research and development          378        191      774      384
        Selling, general and              162        96       341      185
        administrative
        Employee termination benefits and 41          ―       67        ― 
        other charges
        Charges related to flooding        ―         199       ―       199
                     Total operating      581        486      1,182    768
                     expenses
Operating income                          478        162      1,070    421
        Net interest and other            (10)       (2)      (24)     (3)
Income before income taxes                468        160      1,046    418
        Income tax provision              133        15       192      34
Net income                                $          $        $        $      
                                          335        145      854      384
Income per common share:
        Basic                             $          $        $        $    
                                           1.38       0.62     3.50     1.64
        Diluted                           $          $        $        $    
                                           1.36       0.61     3.43     1.62
Weighted average shares outstanding:
        Basic                             242        234      244      234
        Diluted                           246        237      249      237

 

WESTERN DIGITAL CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(in millions; unaudited)
                                        Three Months Ended  Six Months Ended
                                        Dec. 28,  Dec. 30,  Dec. 28,  Dec. 30,
                                        2012      2011      2012      2011
Cash flows from operating activities
Net income                              $ 335     $ 145     $ 854     $ 384
Adjustments to reconcile net income to
net cash provided by operations:
   Depreciation and amortization        309       140       622       298
   Stock-based compensation             32        24        71        41
   Deferred income taxes                80        9         68        18
   Non-cash portion of employee
   termination benefits and other       15        ―         15        ―
   charges
   Non-cash portion of charges related  ―         109       ―         109
   to flooding
   Changes in operating assets and      1         (49)      78        (120)
   liabilities, net
      Net cash provided by operating    772       378       1,708     730
      activities
Cash flows from investing activities
Purchases of property, plant and        (246)     (120)     (628)     (253)
equipment
Acquisitions, net of cash acquired      (18)      ―         (27)      ―
Purchase of investment                  (15)      ―         (15)      ―
      Net cash used in investing        (279)     (120)     (670)     (253)
      activities
Cash flows from financing activities
Employee stock plans, net               53        22        113       20
Repurchases of common stock             (146)     ―         (364)     ―
Dividends to shareholders               (121)     ―         (121)     ―
Repayment of debt                       ―         (31)      (58)      (63)
      Net cash used in financing        (214)     (9)       (430)     (43)
      activities
Net increase in cash and cash           279       249       608       434
equivalents
Cash and cash equivalents, beginning of 3,537     3,675     3,208     3,490
period
Cash and cash equivalents, end of       $ 3,816   $ 3,924   $ 3,816   $ 3,924
period

 

 

(Logo: http://photos.prnewswire.com/prnh/20000711/WDCLOGO)

SOURCE Western Digital Corp.

Website: http://www.westerndigital.com
Contact: Bob Blair, Western Digital Investor Relations, +1-949-672-7834,
robert.blair@wdc.com or Steve Shattuck, Western Digital Public Relations,
+1-949-672-7817, steve.shattuck@wdc.com