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

Western Digital Corporation

(Exact Name of Registrant as Specified in its Charter)

Delaware (State or Other Jurisdiction of Incorporation or Organization)		001-08703 (Commission File Number)		33-0956711 (I.R.S. Employer Identification No.)

20511 Lake Forest Drive Lake Forest, California (Address of Principal Executive Offices)		92630 (Zip Code)

(949) 672-7000
(Registrant’s Telephone Number, Including Area Code)

Not applicable
(Former name or former address, if changed since last report.)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

o     Written communications pursuant to Rule 425 under the Securities Act (17 CFR 240.425)

o     Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o     Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o     Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

 

Item 2.02 Results of Operations and Financial Condition.

     On April 24, 2008, Western Digital Corporation (“Western Digital”) announced financial results for the third fiscal quarter ended March 28, 2008. A copy of the press release making this announcement is attached hereto as Exhibit 99.1 and is incorporated herein by reference. A copy of Western Digital’s Investor Information Summary for the fiscal quarter ended March 28, 2008 is attached hereto as Exhibit 99.2 and is incorporated herein by reference.

     In Western Digital’s press release attached as Exhibit 99.1 hereto and in its conference call scheduled for 2:00 p.m. PDT/5:00 p.m. EDT today, Western Digital plans to report certain financial information, including net income and earnings per share for the nine months ended March 28, 2008, on both a GAAP and a non-GAAP basis. Western Digital believes that the non-GAAP measures presented in the press release and during the conference call are useful to investors as they provide an alternative method for measuring Western Digital’s operating performance and comparing it against prior periods’ performance, excluding first quarter non-recurring charges for in-process research and development and taxes.

     In accordance with General Instruction B.2 of Form 8-K, the information in this Item 2.02, including Exhibit 99.1 and Exhibit 99.2, shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, and shall not be incorporated by reference into any registration statement or other document filed under the Securities Act of 1933, as amended (the “Securities Act”), or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits

	99.1		Press Release issued by Western Digital Corporation on April 24, 2008 announcing financial results for the third fiscal quarter ended March 28, 2008.
	99.2		Third Quarter Fiscal Year 2008 Western Digital Corporation Investor Information Summary.

SIGNATURE

     Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

Exhibit Index

Exhibit Number		Description
99.1		Press Release issued by Western Digital Corporation on April 24, 2008 announcing financial results for the third fiscal quarter ended March 28, 2008.
99.2		Third Quarter Fiscal Year 2008 Western Digital Corporation Investor Information Summary.

Exhibit 99.1

Company contacts:
Bob Blair
Investor Relations
949.672.7834
robert.blair@wdc.com

Steve Shattuck
Public Relations
949.672.7817
steve.shattuck@wdc.com

FOR IMMEDIATE RELEASE:

WD^Ò ANNOUNCES STRONG Q3 YEAR-ON-YEAR PERFORMANCE:
REVENUE OF $2.1 BILLION UP 50 PERCENT,
EARNINGS PER SHARE OF $1.23 UP 132 PERCENT

Hard Drive Revenue Grows 43 Percent, Drive Shipments Up 41 Percent

LAKE FOREST, Calif. — Apr. 24, 2008 — Western Digital Corp. (NYSE: WDC) today reported revenue of $2.1 billion, comprised of $2.022 billion of hard drive revenue and $89 million of revenue from media and substrate sales for the third fiscal quarter ending Mar. 28, 2008. Hard drive revenue grew by 43 percent over the prior-year comparative period on shipments of approximately 34.5 million units, a year-on-year increase of 41 percent in unit volume. Net income was $280 million, or $1.23 per share. Earnings per share grew 132 percent over the prior year. In the year-ago quarter, the company reported revenue of $1.4 billion, unit shipments of 24.5 million and net income of $121 million, or $.53 per share.

     The company generated $431 million in cash from operations during the March quarter, ending with total cash, cash equivalents and short-term investments of $949 million. During the quarter, the company repaid $260 million of debt and repurchased $44 million of common stock.

WD Announces Strong Q3 Year-On-Year Performance
Page 2

The company recently announced an additional authorization to repurchase $500 million of its shares in the next five years.

     “The hard drive market continued to demonstrate strong year-on-year unit growth of 16.2 percent in the March quarter, while exhibiting an expected seasonal decline of 8.6 percent from the exceptionally strong December quarter, as anticipated in our guidance for the quarter issued on January 23,” said John Coyne, WD president and chief executive officer. “Our March quarter revenues demonstrate strong customer preference for the WD value proposition of quality and reliability, a compelling product portfolio and responsive and timely availability, supported by a demonstrated willingness and capability to invest in the future. Our earnings performance is a result of healthy market demand, disciplined financial management, a competitive cost structure, and a committed team with a passion to succeed. We remain very enthusiastic about our opportunities in the fast-growing hard drive industry in the years ahead.”

     For the nine-months ended Mar. 28, 2008, WD reported revenues of $6.1 billion and hard drive shipments of 98.1 million, for increases of 48 percent and 37 percent, respectively, over the comparable prior-year period revenue of $4.1 billion and unit shipments of 71.7 million. GAAP net income for the nine-months was $654 million, or $2.89 per share. Excluding $49 million of non-recurring charges for acquired in-process research and development and $60 million of non-recurring tax charges in the first quarter, non-GAAP net income for the current nine-month period was $763 million, or $3.38 per share. These current-period non-GAAP earnings reflect an approximately 117 percent increase over the prior-year nine-month net income and earnings per share amounts of $352 million and $1.56, respectively. There were no non-recurring items in the prior-year nine-month period and therefore there is no comparable non-GAAP measure for the prior year.

WD Announces Strong Q3 Year-On-Year Performance
Page 3

     The investment community conference call to discuss these results and the company’s outlook will be broadcast live over the Internet today at 2 p.m. PDT/5 p.m. EDT. The call will be accessible live and on an archived basis via the link below:

		Audio Webcast:		www.westerndigital.com/investor
				Click on “Conference Calls”
		Telephone Replay:		800-294-3089 (toll-free)
				+1-402-220-9768 (international)

About WD

     WD, 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 produces reliable, high-performance hard drives that keep users’ data accessible and secure from loss. WD applies its storage expertise to consumer products for external, portable and shared storage applications.

     WD was founded in 1970. The company’s storage products are marketed to leading systems manufacturers, selected resellers and retailers under the Western Digital and WD brand names. Visit the Investor section of the company’s Web site (www.westerndigital.com) to access a variety of financial and investor information.

     This press release contains forward-looking statements concerning customer preference for WD’s brand and value proposition, WD’s opportunities in the hard drive industry and the growth of the hard drive industry. These forward-looking statements are based on WD’s current expectations and are subject to risks and uncertainties that could cause actual results to differ materially from those expressed in the forward-looking statements, including: supply and demand conditions in the hard drive industry; actions by competitors; unexpected advances in competing technologies; uncertainties related to the development and introduction of products

WD Announces Strong Q3 Year-On-Year Performance
Page 4

based on new technologies and expansion into new hard drive markets; business conditions and growth in the desktop, mobile PC, enterprise, consumer electronics and external hard drive markets; pricing trends and fluctuations in average selling prices; failure to continue to effectively integrate WD’s media and head technologies; changes in the availability and cost of commodity materials and specialized product components that WD does not make internally; negative impacts of the conditions in the global credit markets on our current investment portfolio; and other risks and uncertainties listed in WD’s recent Form 10-Q filed with the SEC on February 5, 2008, 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 WD 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 of Western Digital Technologies, Inc. in the U.S. and other countries.

WESTERN DIGITAL CORPORATION

CONDENSED CONSOLIDATED BALANCE SHEETS

(in millions; unaudited)

		Mar. 28,				Jun. 29,
		2008				2007
ASSETS
Current assets:
Cash and cash equivalents		$	917			$	700
Short-term investments			32				207
Accounts receivable, net			1,014				697
Inventories			455				259
Other			211				166
Total current assets			2,629				2,029
Property and equipment, net			1,529				741
Goodwill and other intangible assets, net			187				4
Other assets			198				127
Total assets		$	4,543			$	2,901
LIABILITIES AND SHAREHOLDERS’ EQUITY
Current liabilities:
Accounts payable		$	1,144			$	882
Customer advances			28				—
Accrued expenses			226				163
Accrued warranty			85				73
Current portion of long-term debt			11				12
Total current liabilities			1,494				1,130
Long-term debt			503				10
Other liabilities			129				45
Total liabilities			2,126				1,185
Shareholders’ equity			2,417				1,716
Total liabilities and shareholders’ equity		$	4,543			$	2,901

WESTERN DIGITAL CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(in millions, except per share amounts)
(unaudited)

		Three Months Ended												Nine Months Ended
		Mar. 28,				Dec. 28,				Mar. 30,				Mar. 28,				Mar. 30,
		2008				2007				2007				2008				2007
Revenue, net		$	2,111			$	2,204			$	1,410			$	6,081			$	4,101
Cost of revenue			1,634				1,691				1,188				4,767				3,406
Gross margin			477				513				222				1,314				695
Operating expenses:
Research and development			123				122				75				336				227
Selling, general and administrative			56				59				32				164				132
Acquired in-process research and development			—				—				—				49				—
Total operating expenses			179				181				107				549				359
Operating income			298				332				115				765				336
Net interest and other expense			(8	)			(16	)			7				(21	)			20
Income before income taxes			290				316				122				744				356
Income tax provision			10				11				1				90				4
Net income		$	280			$	305			$	121			$	654			$	352
Net income per common share:
Basic		$	1.26			$	1.39			$	.55			$	2.97			$	1.60
Diluted		$	1.23			$	1.35			$	.53			$	2.89			$	1.56
Common shares used in computing per share amounts:
Basic			222				220				220				220				219
Diluted			227				226				226				226				226

WESTERN DIGITAL CORPORATION

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(in millions; unaudited)

		Three Months Ended								Nine Months Ended
		Mar. 28,				Mar. 30,				Mar. 28,				Mar. 30,
		2008				2007				2008				2007
Cash flows from operating activities
Net income		$	280			$	121			$	654			$	352
Adjustments to reconcile net income to net cash provided by operations:
Depreciation and amortization			111				55				300				149
In-process research and development			—				—				49				—
Deferred income taxes			7				2				76				3
Stock-based compensation			10				13				27				34
Loss on short-term investments			3				—				12				—
Changes in operating assets and liabilities			20				(27	)			51				(74	)
Net cash provided by operating activities			431				164				1,169				464
Cash flows from investing activities
Acquisitions, net of cash acquired			(10	)			—				(925	)			—
Capital expenditures			(137	)			(70	)			(469	)			(238	)
Short-term investments, net			15				(16	)			222				(23	)
Net cash used in investing activities			(132	)			(86	)			(1,172	)			(261	)
Cash flows from financing activities
Acquisition-related debt, net			(260	)			—				250				—
Issuance of common stock under employee plans			6				1				38				17
Repurchase of common stock			(44	)			(29	)			(60	)			(29	)
Repayment of long-term debt			(1	)			(22	)			(8	)			(38	)
Net cash provided by (used in) financing activities			(299	)			(50	)			220				(50	)
Net increase in cash and cash equivalents			—				28				217				153
Cash and cash equivalents, beginning of period			917				676				700				551
Cash and cash equivalents, end of period		$	917			$	704			$	917			$	704

Exhibit 99.2

WESTERN DIGITAL CORPORATION
INVESTOR INFORMATION SUMMARY
Q3 FY2008 (All amounts in millions, except ASPs and headcount)

				Q3 FY07					Q4 FY07					Q1 FY08					Q2 FY08					Q3 FY08
	HARD DRIVE UNITS:				24.5					24.9					29.4					34.2					34.5
	REVENUE1:			$	1,410				$	1,367				$	1,766				$	2,204				$	2,111
	HARD DRIVE AVERAGE SELLING PRICE:			$	58				$	55				$	59				$	61				$	59
	GROSS MARGIN %:				15.8	%				15.0	%				18.3	%				23.3	%				22.6	%
	REVENUE BY CHANNEL (HDD ONLY):
	OEM				47	%				47	%				50	%				48	%				50	%
	DISTRIBUTORS				34	%				36	%				31	%				34	%				34	%
	RETAIL				19	%				17	%				19	%				18	%				16	%
	REVENUE BY GEOGRAPHY (HDD ONLY):
	AMERICAS				36	%				40	%				34	%				32	%				28	%
	EUROPE				29	%				26	%				33	%				32	%				31	%
	ASIA				35	%				34	%				33	%				36	%				41	%
	REVENUE CONCENTRATION (HDD ONLY):
	10 LARGEST CUSTOMERS				46	%				48	%				46	%				47	%				48	%
	WORLDWIDE HEADCOUNT:				27,277					29,572					41,263					42,534					41,876
	CASH RELATED INFORMATION:
	CASH FLOW FROM OPERATIONS			$	164				$	154				$	219				$	519				$	431
	CAPITAL EXPENDITURES			$	70				$	85				$	163				$	169				$	137
	DEPRECIATION AND AMORTIZATION			$	55				$	61				$	78				$	111				$	111
	DAYS SALES OUTSTANDING				46					46					51					45					44
	INVENTORY METRICS:
	RAW MATERIALS			$	12				$	12				$	165				$	171				$	153
	WORK IN PROCESS				86					94					145					131					131
	FINISHED GOODS				145					153					151					157					171
	TOTAL INVENTORY, NET			$	243				$	259				$	461				$	459				$	455
	INVENTORY TURNS				20					18					13					15					14