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): January 28, 2002 (January 24, 2002) 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)
INFORMATION TO BE INCLUDED IN THE REPORT ITEM 5. OTHER EVENTS. On January 24, 2002, Western Digital Corporation issued a press release announcing its financial results for its second quarter of the 2002 fiscal year. For its second quarter, the Company reported revenues of $575 million and net income of $9.2 million, or $.05 per share, before nonrecurring items. The results include an operating profit of approximately $15.3 million and unit shipments of 7.7 million by the Company's hard drive business. Including non-recurring items, the Company reported net income of $12.6 million, or $.07 per share, for its second quarter. Separately, the Company indicated that its previously announced transaction with Fujitsu (Thailand) Company, Ltd. to purchase a 155,000-square foot hard drive and head stack assembly building near Bangkok, Thailand has been completed. Attached hereto as Exhibit 99.1, 99.2 and 99.3, respectively, are copies of the January 24, 2002 press release, an Investor Information Summary and the Consolidated Statements of Operations with additional financial information for the Company's second quarter of the 2002 fiscal year posted to the Company's website at www.westerndigital.com, all of which are incorporated herein by this reference. ITEM 7. FINANCIAL STATEMENTS, PRO FORMA FINANCIAL INFORMATION AND EXHIBITS. EXHIBIT DESCRIPTION ------- ----------- 99.1 Press Release dated January 24, 2002, announcing the Company's financial results for its second quarter of the 2002 fiscal year. 99.2 Investor Information Summary. 99.3 Consolidated Statements of Operations. 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: January 28, 2002 WESTERN DIGITAL CORPORATION By: /s/ Michael A. Cornelius ----------------------------------------- Michael A. Cornelius Vice President, Law and Administration and Secretary 2
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 REPORTS SECOND QUARTER PROFIT OF $.05 PER SHARE ON REVENUE OF $575 MILLION, 7.7 MILLION UNITS SHIPPED HDD BUSINESS GENERATES $15.3 MILLION OPERATING INCOME ON 43% SEQUENTIAL UNIT GROWTH LAKE FOREST, Calif. - Jan. 24, 2002 - Western Digital Corp. (NYSE: WDC) today reported revenue of $575 million on unit shipments of approximately 7.7 million, and net income before non-recurring items of $9.2 million, or $.05 per share for its second fiscal quarter ending December 28, 2001. The Company's hard drive business generated $15.3 million of operating income in the quarter, compared with $4.0 million in the first fiscal quarter. Revenue and unit volume levels grew 30% and 43%, respectively, on a sequential basis. In the year-ago period, the Company reported revenue of $562 million on unit shipments of approximately 6.1 million, and a net loss before non-recurring items of $7.0 million, or $.04 per share. For the current period, non-recurring items included $3.4 million of net investment gains. For the year-ago period, non-recurring items consisted of $10.6 million of extraordinary gains from bond redemptions. Including these non-recurring items, the Company reported net income -MORE-
Western Digital Reports Second Quarter Profit of $.05 Per Share on Revenue of $575 Million, 7.7 Million Units Shipped Page 2 of $12.6 million, or $.07 per share, for the current period, and $3.6 million, or $.02 per share, for the year-ago period. Matt Massengill, Western Digital chairman and chief executive officer, said: "The second quarter performance marks the fifth consecutive quarter of both profitability and consistently competitive gross margin performance by our hard drive business. We are beginning to meet our goal of growing the business profitably. Our focus, execution and broadened product portfolio enabled us to meet growing demand from all of our PC channels in the December quarter, as well as from the gaming console market for EIDE-class hard drives." Separately, the Company indicated that its previously-announced transaction with Fujitsu (Thailand) Company Ltd. to purchase a 155,000-square foot hard drive and head stack assembly building near Bangkok, Thailand has been completed. It will be operational in the March quarter. 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 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 Cameo Technologies, Keen Personal Media and SageTree meet the increasing demand for innovative information management solutions arising from the proliferation of Internet and broadband services. 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. -MORE-
Western Digital Reports Second Quarter Profit of $.05 Per Share on Revenue of $575 Million, 7.7 Million Units Shipped Page 3 This release contains forward-looking statements, including statements relating to profitable business growth goals and expected operational status of the Thailand building. The forward-looking statements are based on current management expectations, and actual results may differ materially as a result of several factors, including: levels of operating expense and product cost; supply and demand conditions in the hard drive industry; overall economic conditions; changes in product and customer mix; pricing trends; actions by competitors; the pace of development of new markets; successful entry into new markets by the Company; and other factors discussed in our recent SEC filings, including but not limited to our Form 10-Q for the first quarter of fiscal 2002. We undertake no obligation to update or alter our forward-looking statements to reflect new information or events or for any other reason. Western Digital is a registered trademark of Western Digital Technologies, Inc. Keen Personal Media and TV4me are trademarks of Keen Personal Media, Inc. SageTree is a registered trademark of SageTree, Inc. Cameo is a registered trademark of Cameo Technologies, Inc. All other brand and product names mentioned herein are the property of their respective companies. ###
Exhibit 99.2 WESTERN DIGITAL CORPORATION INVESTOR INFORMATION SUMMARY Q2 FY2002 (ALL $ AMOUNTS IN MILLIONS) - ----------------------------------------------------------------------------------------------- Q2 FY01 Q3 FY01 Q4 FY01 Q1 FY02 Q2 FY02 - ----------------------------------------------------------------------------------------------- REVENUE: $562 $512 $456 $441 $575 - ----------------------------------------------------------------------------------------------- REVENUE BY CHANNEL: OEM 58% 55% 54% 62% 62% RESELLER 42% 45% 46% 38% 38% - ----------------------------------------------------------------------------------------------- REVENUE BY GEOGRAPHY: NORTH AMERICA 57% 60% 60% 56% 54% EUROPE 31% 26% 25% 30% 38% ASIA 12% 14% 15% 14% 8% - ----------------------------------------------------------------------------------------------- REVENUE CONCENTRATION: 10 LARGEST CUSTOMERS 57% 62% 60% 55% 60% - ----------------------------------------------------------------------------------------------- HARD DRIVES UNITS (MILLIONS): 6.1 5.8 5.3 5.4 7.7 - ----------------------------------------------------------------------------------------------- WORLDWIDE HEADCOUNT: 8,200 8,005 7,909 7,852 7,819 - ----------------------------------------------------------------------------------------------- ASSET MANAGEMENT DSOs--AVERAGE 28 23 26 44 35 - ----------------------------------------------------------------------------------------------- INVENTORY DETAIL: TOTAL RAW $8 $8 $22 $10 $4 WIP $14 $12 $9 $27 $13 FINISHED GOODS $58 $66 $48 $40 $79 ----- ----- ----- ----- ----- TOTAL INVENTORY, NET $80 $85 $79 $76 $96 - ----------------------------------------------------------------------------------------------- INVENTORY TURNS 25 21 21 20 21 - ----------------------------------------------------------------------------------------------- Note: The prior year results have been restated to reflect the adoption of SAB 101 and the reclassification of Connex and SANavigator results as discontinued operations.
Exhibit 99.3 WESTERN DIGITAL CORPORATION CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (IN THOUSANDS, EXCEPT PER SHARE AMOUNTS) (UNAUDITED) THREE MONTHS ENDED SIX MONTHS ENDED ----------------------------------- -------------------------- DEC. 28, SEP. 28, DEC. 29, DEC. 28, DEC. 29, 2001 2001 2000 2001 2000 --------- --------- --------- ----------- ----------- Revenues, net .................................... $ 574,670 $ 440,943 $ 561,570 $ 1,015,613 $ 985,936 Costs and expenses: Cost of revenues ............................ 504,112 384,936 494,029 889,048 892,459 Research and development .................... 31,293 31,541 33,617 62,834 65,618 Selling, general and administrative ......... 29,675 28,636 31,925 58,311 61,448 --------- --------- --------- ----------- ----------- Total costs and expenses ................ 565,080 445,113 559,571 1,010,193 1,019,525 --------- --------- --------- ----------- ----------- Operating income (loss) .......................... 9,590 (4,170) 1,999 5,420 (33,589) Net interest and other income (expense) .......... 3,105 156 839 3,261 (793) --------- --------- --------- ----------- ----------- Income (loss) from continuing operations ......... 12,695 (4,014) 2,838 8,681 (34,382) Discontinued operations .......................... -- 24,532 (9,827) 24,532 (17,872) Extraordinary gain (loss) from redemption of debentures .................................. (101) -- 10,576 (101) 21,819 Cumulative effect of change in accounting principle ................................... -- -- -- -- (1,504) --------- --------- --------- ----------- ----------- Net income (loss) ................................ $ 12,594 $ 20,518 $ 3,587 $ 33,112 $ (31,939) ========= ========= ========= =========== =========== Diluted income (loss) per common share: Income (loss) from continuing operations ......... $ .07 $ (.02) $ .02 $ .05 $ (.22) Discontinued operations .......................... -- .13 (.06) .12 (.11) Extraordinary gain (loss) ........................ (.00) -- .06 (.00) .14 Cumulative effect of change in accounting principle ................................... -- -- -- -- (.01) --------- --------- --------- ----------- ----------- $ .07 $ .11 $ .02 $ .17 $ (.20) ========= ========= ========= =========== =========== Common shares used in computing per share amounts: Diluted .......................................... 191,624 186,635 173,171 189,381 159,609 ========= ========= ========= =========== ===========
WESTERN DIGITAL CORPORATION CONDENSED CONSOLIDATED BALANCE SHEETS (IN THOUSANDS) (UNAUDITED) DEC. 28, JUN. 29, 2001 2001 ----------- --------- ASSETS Current assets: Cash and cash equivalents ........................... $ 193,317 $ 167,582 Accounts receivable, net ............................ 222,822 127,767 Inventories ......................................... 96,441 78,905 Prepaid expenses and other current assets ........... 6,165 11,455 --------- --------- Total current assets ............................ 518,745 385,709 Property and equipment, net .............................. 111,467 106,166 Other assets, net ........................................ 5,437 15,777 --------- --------- Total assets .................................... $ 635,649 $ 507,652 ========= ========= LIABILITIES AND SHAREHOLDERS' EQUITY Current liabilities: Accounts payable .................................... $ 323,330 $ 224,544 Accrued expenses .................................... 114,585 115,802 --------- --------- Total current liabilities ....................... 437,915 340,346 Other liabilities ........................................ 37,424 38,629 Convertible debentures ................................... 102,404 112,491 Minority interest ........................................ 9,012 9,383 Shareholders' equity: Common stock ........................................ 1,890 1,863 Additional paid-in capital .......................... 595,612 586,660 Accumulated deficit ................................. (548,608) (581,720) --------- --------- Total shareholders' equity ...................... 48,894 6,803 --------- --------- Total liabilities and shareholders' equity ...... $ 635,649 $ 507,652 ========= =========