Slide 1: Fiscal First Quarter 2024 Financial Results
Fiscal First Quarter 2024 Financial Results Western Digital October 30, 2023
Slide 2: Forward Looking Statements
2 © 2023 Western Digital Corporation or its affiliates All rights reserved Forward Looking Statements SAFE HARBOR This presentation contains forward-looking statements within the meaning of federal securities laws, including statements regarding expectations for the company's business outlook and fi
Slide 3: Fiscal First Quarter Executive Summary
3 © 2023 WEST ERN DI G I T AL CO RPO RAT I O N O R I T S AF F I L I AT ES AL L RI G HT S RESERVED Fiscal First Quarter Executive Summary Financial Results1 • Revenue of $ 2.75B • Operating cash flow of $ (626)M • Non-GAAP EPS of $ (1.76) • Free cash flow of $ (544)M • Non-GAAP gross margin of 4.1% •
Slide 4: Revenue Trends by End Market
4 © 2023 WEST ERN DI G I T AL CO RPO RAT I O N O R I T S AF F I L I AT ES AL L RI G HT S RESERVED Revenue Trends by End Market Cloud Client Consumer In billions In billions In billions $ 2.0 $ 2.0 $ 2.0 $ 1.6 $ 1.6 $ 1.6 $ 1.2 $ 1.2 $ 1.2 $ 0.8 $ 0.8 $ 0.8 $ 0.4 $ 0.4 $ 0.4 $- $- $- Q1F23 Q2F23 Q3F2
Slide 5: Flash and Hard Drive Metrics
5 © 2023 WEST ERN DI G I T AL CO RPO RAT I O N O R I T S AF F I L I AT ES AL L RI G HT S RESERVED Flash and Hard Drive Metrics Flash Revenue and Gross Margin Hard Drive Revenue and Gross Margin In billions In billions $ 2.0 30% $ 2.0 40% $ 1.6 20% $ 1.6 30% $ 1.2 10% $ 1.2 20% $ 0.8 0% $ 0.8 10% $ 0
Slide 6: Non-GAAP Financial Results
6 © 2023 WEST ERN DI G I T AL CO RPO RAT I O N O R I T S AF F I L I AT ES AL L RI G HT S RESERVED Non-GAAP Financial Results ($ in millions, except for EPS) Q1 2023 Q4 2023 Q1 2024 QoQ YoY Revenue $ 3,736 $ 2,672 $ 2,750 up 3% down 26% Gross Margin % 26.7% 3.9% 4.1% up 0.2 ppt down 22.6 ppt Operatin
Slide 7: Cash Flow Walk
7 © 2023 WEST ERN DI G I T AL CO RPO RAT I O N O R I T S AF F I L I AT ES AL L RI G HT S RESERVED Cash Flow Walk In millions $ 2,023 $ 600 $ 2,032 $ (47) $ 82 $ (626) (1) (2) Q4F23 Operating Cash Cash CapEx Delayed Drawn Other Q1F24 Cash & Cash Flow Term Loan Cash & Cash Equivalents Equivalents ▪ To
Slide 8: Fiscal Second Quarter Guidance
8 © 2023 Western Digital Corporation or its affiliates All rights reserved Fiscal Second Quarter Guidance(1) GAAP Non-GAAP(2) Revenue ($ B) $ 2.85 - $ 3.05 $ 2.85 - $ 3.05 Gross Margin % 9.5% - 11.5% 10.0% - 12.0% Operating Expenses ($ M) $ 650 - $ 670 $ 560 - $ 580 Interest and Other Expense, net (
Slide 9: Joint Venture Operational Framework
9 © 2023 WEST ERN DI G I T AL CO RPO RAT I O N O R I T S AF F I L I AT ES AL L RI G HT S RESERVED Joint Venture Operational Framework For more information on Flash Ventures, please visit investor.wdc.com for a recently published Flash Ventures presentation. Flash Ventures 49.9% Owned by Western Digi
Slide 10: Capital Expenditure Framework
10 © 2023 WEST ERN DI G I T AL CO RPO RAT I O N O R I T S AF F I L I AT ES AL L RI G HT S RESERVED Capital Expenditure Framework 1 2 3 Flash Cash Capital HDD CapEx Non-Fab Flash Ventures (1) Parent Loans(2) Expenditures CapEx 3 4 5 Flash Ventures Capital Flash Ventures Flash Ventures Flash Ventures
Slide 11: Gross Capital Expenditure Trends
11 © 2023 WEST ERN DI G I T AL CO RPO RAT I O N O R I T S AF F I L I AT ES AL L RI G HT S RESERVED Gross Capital Expenditure Trends In billions $ 3.5 $ 3.0 $ 2.5 $ 1.0 $ 1.6 $ 2.0 $ 1.5 $ 1.9 $ 1.5 $ 1.4 $ 1.0 $ 2.0 $ 1.6 ~ $ 1.4 $ 1.2 $ 0.5 $ 0.8 $ 0.8 ~ $ - $ (0.3) $ (0.5) FY18 FY19 FY20 FY21 FY22
Slide 12: Capital Allocation Framework
12 © 2023 WEST ERN DI G I T AL CO RPO RAT I O N O R I T S AF F I L I AT ES AL L RI G HT S RESERVED Capital Allocation Framework Highest Priority Reinvestment in the Strategically reinvest to drive innovation Company Reduce Leverage Target 1.0x – 3.25x Debt-to-EBITDA Shareholder Return Dividend Share
Slide 13: Appendix
13 © 2023 WEST ERN DI G I T AL CO RPO RAT I O N O R I T S AF F I L I AT ES AL L RI G HT S RESERVED Appendix
Slide 14: Quarterly Fact Sheet
14 © 2023 WEST ERN DI G I T AL CO RPO RAT I O N O R I T S AF F I L I AT ES AL L RI G HT S RESERVED Quarterly Fact Sheet In millions, except Average Selling Price (ASP), Q1F23 Q2F23 Q3F23 Q4F23 Q1F24 percentages, and working capital related metrics Revenue by End Market(1) Cloud $ 1,829 $ 1,224 $ 1,2
Slide 15: Quarterly Fact Sheet (continued)
15 © 2023 WEST ERN DI G I T AL CO RPO RAT I O N O R I T S AF F I L I AT ES AL L RI G HT S RESERVED Quarterly Fact Sheet (continued) FOOTNOTES FORMULAS Days Sales Outstanding (DSO) = Accounts Receivable / (Revenue / # of days in quarter) Days Inventory Outstanding (DIO) = Inventories / (Cost of Reven
Slide 16: Debt Capital Structure
16 © 2023 WEST ERN DI G I T AL CO RPO RAT I O N O R I T S AF F I L I AT ES AL L RI G HT S RESERVED Debt Capital Structure Current Cap Table Debt Maturity Profile (in billions) As of All-in September Rate Maturity 29, 2023 Rate1 (in millions) Convertible Debt Due 20242 1.50% 1.50% 2/1/2024 $ 1,100 De
Slide 17: Credit Agreement Defined Leverage Ratio
17 © 2023 WEST ERN DI G I T AL CO RPO RAT I O N O R I T S AF F I L I AT ES AL L RI G HT S RESERVED Credit Agreement Defined Leverage Ratio In millions; unaudited; trailing 12 months Q1F23 Q2F23 Q3F23 Q4F23 Q1F24 Net Income (Loss) $ 917 $ (93) $ (690) $ (1,706) $ (2,418) Income tax expense 586 565 37
Slide 18: GAAP to Non-GAAP Reconciliations
18 © 2023 WEST ERN DI G I T AL CO RPO RAT I O N O R I T S AF F I L I AT ES AL L RI G HT S RESERVED GAAP to Non-GAAP Reconciliations In millions; unaudited Q1F23 Q4F23 Q1F24 GAAP Gross Profit $ 981 $ 92 $ 99 Stock-based compensation expense 14 11 13 Amortization of acquired intangible assets 1 (1) —
Slide 19: GAAP to Non-GAAP Reconciliations (cont'd)
19 © 2023 WEST ERN DI G I T AL CO RPO RAT I O N O R I T S AF F I L I AT ES AL L RI G HT S RESERVED GAAP to Non-GAAP Reconciliations (cont'd) In millions, except per share amounts; unaudited Q1F23 Q4F23 Q1F24 GAAP Net Income (Loss) $ 27 $ (715) $ (685) Stock-based compensation expense 86 72 77 Amorti
Slide 20: Supplemental Operating Segment Results
20 © 2023 WEST ERN DI G I T AL CO RPO RAT I O N O R I T S AF F I L I AT ES AL L RI G HT S RESERVED Supplemental Operating Segment Results In millions, except percentages; unaudited Q1F23 Q2F23 Q3F23 Q4F23 Q1F24 Net Revenue Flash $ 1,722 $ 1,657 $ 1,307 $ 1,377 $ 1,556 HDD 2,014 1,450 1,496 1,295 1,1
Slide 21: GAAP to Non-GAAP Reconciliations
21 © 2023 WEST ERN DI G I T AL CO RPO RAT I O N O R I T S AF F I L I AT ES AL L RI G HT S RESERVED GAAP to Non-GAAP Reconciliations FOOTNOTES This presentation contains the following financial measures that are not in accordance with U.S. generally accepted accounting principles (“GAAP”): Non-GAAP g
Slide 22: Western Digital. Create What's Next
SN. Western Digital. Create What’s Next