1 UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 8-K CURRENT REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Date of report (Date of earliest event reported): April 26, 2001 WESTERN DIGITAL CORPORATION (Exact Name of Registrant as Specified in Charter) Delaware 001-08703 33-095-6711 - ---------------------------- ------------ ------------------- (State or Other Jurisdiction (Commission (IRS Employer of Incorporation) File Number) Identification No.) 20511 Lake Forest Drive Lake Forest, California 92630 - ---------------------------------------- ------------------ (Address of Principal Executive Offices) (Zip Code) Registrant's telephone number, including area code: (949) 672-7000 Not Applicable (Former Name or Former Address, if Changed Since Last Report)
2 INFORMATION TO BE INCLUDED IN THE REPORT ITEM 5. OTHER EVENTS. On April 26, 2001, Western Digital Corporation issued a press release announcing its third quarter results and reporting that its revenues were $533.4 million and a net loss of $3.0 million, or $.02 per share, for its third quarter ended March 30, 2001. Attached hereto as Exhibits 99.1 and 99.2 , respectively, are the copies of the April 26, 2001, press release and the Investor Information Sheet which are both incorporated herein by this reference. ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS. Exhibit Description - ------- ----------- 99.1 Press Release dated April 26, 2001, announcing the Company's third quarter results and reporting that its revenues were $533.4 million and a net loss of $3.0 million, or $.02 per share, for its third quarter ended March 30, 2001. 99.2 Investor Information Sheet for Q3 FY2001. SIGNATURE Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. Date: April 27, 2001 WESTERN DIGITAL CORPORATION By: /s/ MICHAEL A. CORNELIUS -------------------------------- Michael A. Cornelius Vice President, Law and Administration and Secretary 2
1 EXHIBIT 99.1 Steve Shattuck Western Digital Public Relations 949.672.7817 steve.shattuck@wdc.com Bob Blair Western Digital Investor Relations 949.672.7834 bob.blair@wdc.com FOR IMMEDIATE RELEASE: WESTERN DIGITAL REPORTS $11.9 MILLION OPERATING PROFIT FROM HARD DRIVE OPERATIONS IN THIRD QUARTER FISCAL 2001 TOTAL THIRD QUARTER REVENUE OF $533.4 REFLECTS SEQUENTIAL AND YEAR-OVER-YEAR GROWTH; AND NET LOSS OF $3.0 MILLION OR $.02 PER SHARE LAKE FOREST, Calif. --April 26, 2001--Western Digital Corp. (NYSE: WDC) today reported revenue of $533.4 million and a net loss of $3.0 million, or $.02 per share, for its third quarter ended March 30, 2001--including an $11.9 million operating profit in its hard drive business. The net loss includes an extraordinary gain of $371,000 relating to bond redemptions. Unit shipments of approximately 6 million desktop hard drives in the third quarter reflect sequential growth of 3.5 percent from the 5.8 million units shipped in the second fiscal quarter and better than 15 percent growth over the year-ago quarter. The Company's industry-leading 7200 RPM drives accounted for more than 50 percent of third quarter revenue, compared with 42 percent in the second fiscal quarter. The third quarter results included operating losses totaling $15 million for the Company's new business ventures, compared with nearly $20 million in the second fiscal quarter. -MORE-
2 In the year-ago period, the Company reported revenues of $516.6 million and a net loss of $70.7 million, or $.53 per share. The net loss for the year-ago period included non-recurring charges totaling $62.8 million related primarily to the Company's exit of the enterprise hard drive market, and also included a $14.7 million gain on the disposition of certain investment securities. Excluding these items, the Company's net loss for the year-ago period was $22.6 million, or $.17 per share. Matt Massengill, Western Digital president and chief executive officer, stated: "The most noteworthy development in the quarter was the hard drive industry's continued improvement in inventory management and better-than-expected pricing dynamics in the face of the PC industry's most challenging quarter in many years. Against this background, our execution and focus enabled us to achieve profitability and sequential growth in our hard drive business for the second consecutive quarter. As a result of our first-to-market leadership in both 5400 RPM and 7200 RPM-class drives, we optimized our product mix across all of our channels on a worldwide basis." For the nine months ended March 30, 2001, revenue was $1.5 billion and the net loss was $34.8 million, or $.21 per share, including extraordinary gains of $22.2 million. This compares to year-earlier revenues of $1.5 billion and a net loss of $192.2 million, or $1.64 per share, including non-recurring charges of $158.3 million, a $14.7 million gain on disposition of investment securities, and $166.9 million of extraordinary gains relating to bond redemptions. ABOUT WESTERN DIGITAL Western Digital, one of the storage industry's pioneers and long-time leaders, provides products and services for people and organizations that collect, manage and use digital -MORE-
3 information. The Company's core business produces reliable, high-performance hard drives that keep users' data close-at-hand and secure from loss. Applying its data storage core competencies to emerging markets, Western Digital's new ventures meet the increasing demand for innovative information management solutions arising from the proliferation of the Internet and broadband services. Keen Personal Media provides interactive personal video recorder and set-top box software, services and hardware for broadband television content management and commerce. Connex designs Network Attached Storage products that enable IT managers to quickly expand network storage. SANavigator develops and markets software that simplifies the central management of Storage Area Networks. SageTree is a software company providing enterprise manufacturing and supply chain analytic applications. Western Digital was founded in 1970. The Company's storage products are marketed to leading systems manufacturers and selected resellers under the Western Digital brand name. Visit the Investor section of the Company's Web site (www.westerndigital.com) to access a variety of financial and investor information. This release contains forward-looking statements, including statements relating to improving inventory management and pricing dynamics. The forward-looking statements are based on current management expectations, and actual results may differ materially as a result of several factors, including: the Company's ability to execute future production ramps and utilize manufacturing assets efficiently; availability of hard drive components; changes in product and customer mix; pricing trends; actions by competitors; successful entry into new markets by the Company and its subsidiaries; and other factors discussed in the Company's recent SEC filings. -MORE-
4 The Company undertakes no obligation to update forward-looking statements to reflect events or circumstances occurring after the date of such statements. ### Western Digital is a registered trademark of Western Digital Technologies, Inc. Keen Personal Media is a trademark of Keen Personal Media, Inc. Connex is a trademark of Connex, Inc. SageTree is a trademark of SageTree, Inc. SANavigator is a trademark of SANavigator, Inc.
5 WESTERN DIGITAL CORPORATION CONSOLIDATED STATEMENTS OF OPERATIONS (IN THOUSANDS, EXCEPT PER SHARE AMOUNTS) (UNAUDITED) THREE MONTHS ENDED NINE MONTHS ENDED ------------------------------------------- --------------------------- MAR. 30, DEC. 29, MAR. 31, MAR. 30, MAR. 31, 2001 2000 2000 2001 2000 ----------- ----------- ----------- ----------- ----------- Revenues, net .................................... $ 533,369 $ 530,720 $ 516,587 $ 1,504,311 $ 1,483,718 Costs and expenses: Cost of revenues .......................... 468,095 467,209 505,003 1,349,797 1,517,235 Research and development .................. 35,554 37,367 33,770 107,882 127,996 Selling, general and administrative ....... 33,190 35,771 33,970 102,860 116,862 Restructuring charges ..................... -- -- 28,002 -- 85,837 ----------- ----------- ----------- ----------- ----------- Total costs and expenses ............ 536,839 540,347 600,745 1,560,539 1,847,930 ----------- ----------- ----------- ----------- ----------- Operating loss ................................... (3,470) (9,627) (84,158) (56,228) (364,212) Net interest and other income (expense) .......... 52 839 13,489 (741) 5,132 ----------- ----------- ----------- ----------- ----------- Loss before income taxes and extraordinary item ........................ (3,418) (8,788) (70,669) (56,969) (359,080) Income tax benefit ............................... -- -- -- -- -- ----------- ----------- ----------- ----------- ----------- Loss before extraordinary item ................... (3,418) (8,788) (70,669) (56,969) (359,080) Extraordinary gain from redemption of debentures ................................ 371 10,576 -- 22,190 166,899 ----------- ----------- ----------- ----------- ----------- Net income (loss) ................................ $ (3,047) $ 1,788 $ (70,669) $ (34,779) $ (192,181) =========== =========== =========== =========== =========== Basic and diluted income (loss) per common share: Basic before extraordinary item .................. $ (.02) $ (.05) $ (.53) $ (.34) $ (3.07) Extraordinary gain ............................... $ .00 $ .06 $ -- $ .13 $ 1.43 ----------- ----------- ----------- ----------- ----------- Basic ............................................ $ (.02) $ .01 $ (.53) $ (.21) $ (1.64) =========== =========== =========== =========== =========== Diluted .......................................... $ (.02) $ .01 $ (.53) $ (.21) $ (1.64) =========== =========== =========== =========== =========== Common shares used in computing per share amounts: Basic ............................................ 176,250 171,175 133,903 165,156 116,983 =========== =========== =========== =========== =========== Diluted .......................................... 176,250 171,175 133,903 165,156 116,983 =========== =========== =========== =========== ===========
6 WESTERN DIGITAL CORPORATION CONSOLIDATED BALANCE SHEETS (IN THOUSANDS, EXCEPT PER SHARE AMOUNTS) (UNAUDITED) MAR. 30, JUN. 30, 2001 2000 --------- --------- ASSETS Current assets: Cash and cash equivalents ................................ $ 160,869 $ 184,021 Accounts receivable, net ................................. 153,095 149,135 Inventories .............................................. 65,258 84,546 Prepaid expenses and other current assets ................ 18,054 33,693 --------- --------- Total current assets ............................... 397,276 451,395 Property and equipment, net ..................................... 106,795 98,952 Intangible and other assets, net ................................ 41,070 65,227 --------- --------- Total assets ....................................... $ 545,141 $ 615,574 ========= ========= LIABILITIES AND SHAREHOLDERS' EQUITY (DEFICIT) Current liabilities: Accounts payable ......................................... $ 234,851 $ 266,841 Accrued expenses ......................................... 128,989 178,225 --------- --------- Total current liabilities .......................... 363,840 445,066 Other liabilities ............................................... 41,556 44,846 Convertible debentures .......................................... 112,611 225,496 Minority interest ............................................... 8,998 10,000 Shareholders' equity (deficit): Common stock, $.01 par value ............................. 1,768 1,436 Additional paid-in capital ............................... 534,004 371,587 Accumulated deficit ...................................... (517,636) (482,857) --------- --------- Total shareholders' equity (deficit) ............... 18,136 (109,834) --------- --------- Total liabilities and shareholders' equity (deficit) $ 545,141 $ 615,574 ========= =========
1 EXHIBIT 99.2 WESTERN DIGITAL CORPORATION INVESTOR INFORMATION SHEET Q3 FY2001 (ALL $ AMOUNTS IN MILLIONS) Q3 FY00 Q4 FY00 Q1 FY01 Q2 FY01 Q3 FY01 ------- ------- ------- ------- ------- REVENUE: TOTAL $ 517 $ 474 $ 440 $ 531 $ 533 ------ ------ ------ ------ ------ REVENUE BY CHANNEL: OEM 62% 65% 70% 58% 55% RESELLER 38% 35% 30% 42% 45% ------ ------ ------ ------ ------ REVENUE BY GEOGRAPHY: NORTH AMERICA 54% 59% 58% 57% 60% EUROPE 30% 28% 32% 31% 26% ASIA 16% 13% 10% 12% 14% ------ ------ ------ ------ ------ REVENUE CONCENTRATION: 10 LARGEST CUSTOMERS 51% 60% 60% 57% 62% ====== ====== ====== ====== ====== HARD DRIVES UNITS (MILLIONS): 5.3 5.2 5.1 5.8 6.0 ====== ====== ====== ====== ====== WORLDWIDE HEADCOUNT: 8,462 7,321 7,366 8,200 8,000 ====== ====== ====== ====== ====== ASSET MANAGEMENT: DSOs--AVERAGE 31 29 30 30 26 ====== ====== ====== ====== ====== INVENTORY DETAIL: TOTAL RAW $ 13 $ 6 $ 7 $ 8 $ 8 WIP $ 13 $ 11 $ 11 $ 14 $ 12 FINISHED GOODS $ 72 $ 68 $ 42 $ 56 $ 46 ------ ------ ------ ------ ------ TOTAL NET $ 98 $ 85 $ 60 $ 78 $ 65 ====== ====== ====== ====== ====== INVENTORY TURNS 21 21 28 24 29