Western Digital Announces Financial Results for Fourth Quarter and Fiscal Year 2019

Western Digital Corp. (NASDAQ: WDC) today reported revenue of $3.6 billion for its fourth fiscal quarter ended June 28, 2019. The operating loss was $381 million with a net loss of $197 million, or ($0.67) per share. Excluding certain non-GAAP adjustments, the company achieved non-GAAP operating income of $158 million and non-GAAP net income of $50 million, or $0.17 per share.

In the year-ago quarter, the company reported revenue of $5.1 billion, operating income of $843 million and net income of $756 million, or $2.46 per share. Non-GAAP operating income in the year-ago quarter was $1.3 billion and non-GAAP net income was $1.1 billion, or $3.61 per share.

The company generated $169 million in cash from operations during the fourth fiscal quarter of 2019, and ended the quarter with $3.5 billion of total cash and cash equivalents. The company returned $146 million to shareholders through dividends. On May 2, 2019, the company declared a cash dividend of $0.50 per share of its common stock, which was paid to shareholders on July 15, 2019.

For fiscal 2019, the company achieved revenue of $16.6 billion, operating income of $87 million and net loss of $754 million, or ($2.58) per share, compared to fiscal 2018 revenue of $20.6 billion, operating income of $3.6 billion and net income of $675 million, or $2.20 per share. On a non-GAAP basis, fiscal 2019 operating income was $2.0 billion and net income was $1.4 billion, or $4.84 per share, compared to fiscal 2018 operating income of $5.4 billion and net income of $4.5 billion, or $14.73 per share. The company generated $1.5 billion in cash from operations during fiscal year 2019 and returned $1.1 billion to shareholders through share repurchases and dividends.

"We ended a challenging fiscal 2019 with leadership positions in capacity enterprise hard drives, 3D flash technology and branded retail products while achieving significant gains in client solid state drives," said Steve Milligan, chief executive officer, Western Digital. "Momentum for our NVMe enterprise solid state drives is picking up, setting the stage for further gains across our portfolio in the new fiscal year and beyond."

Milligan continued, "We are seeing signs of improving conditions in the flash market and believe that it has reached a cyclical trough. With continuing expectations for a positive demand environment, a robust product portfolio and expanding customer engagements, we expect to deliver improving financial results as we move through fiscal 2020."

Investor Communications

The investment community conference call to discuss these results and the company's guidance for the first fiscal quarter of 2020 will be broadcast live online today at 2:30 p.m. Pacific/5:30 p.m. Eastern. The live and archived conference call/webcast and the earnings presentation can be accessed online at investor.wdc.com.

About Western Digital

Western Digital creates environments for data to thrive. The company is driving the innovation needed to help customers capture, preserve, access and transform an ever-increasing diversity of data. Everywhere data lives, from advanced data centers to mobile sensors to personal devices, our industry-leading solutions deliver the possibilities of data. Western Digital data-centric solutions are comprised of the Western Digital®, G-Technology™, SanDisk® and WD® brands. Financial and investor information is available on the company's Investor Relations website at investor.wdc.com.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements concerning the company's preliminary financial results for its fourth fiscal quarter ended June 28, 2019 and fiscal year 2019; the company's financial guidance for the first fiscal quarter of 2020 and expectations for financial results in fiscal year 2020; expectations regarding market conditions; the company's product portfolio; and market positioning. 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. The preliminary financial results for the company's fourth fiscal quarter ended June 28, 2019 and fiscal year 2019, included in this press release represent the most current information available to management. The company's actual results when disclosed in its Form 10-K may differ from these preliminary results as a result of the completion of the company's financial closing procedures; final adjustments; completion of the review and audit by the company's independent registered accounting firm; and other developments that may arise between now and the disclosure of the final results. Other risks and uncertainties that could cause actual results to differ materially from those expressed or implied in the forward-looking statements include: volatility in global economic conditions; business conditions and growth in the storage ecosystem; impact of restructuring activities and cost saving initiatives; impact of competitive products and pricing; market acceptance and cost of commodity materials and specialized product components; actions by competitors; unexpected advances in competing technologies; our development and introduction of products based on new technologies and expansion into new data storage markets; risks associated with acquisitions, mergers and joint ventures; difficulties or delays in manufacturing; the outcome of legal proceedings; and other risks and uncertainties listed in the company's filings with the Securities and Exchange Commission (the "SEC"), including the company's Form 10-Q filed with the SEC on May 7, 2019, to which your attention is directed. You should not 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 new information or events.

Fourth Quarter Fiscal 2019 Press Release with Financial Tables and Guidance Summary

Fourth Quarter Fiscal 2019 Earnings Presentation

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Western Digital, the Western Digital logo, G-Technology, SanDisk and WD are registered trademarks or trademarks of Western Digital Corporation or its affiliates in the US and/or other countries.