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Document and Entity Information - shares	9 Months Ended
Document and Entity Information - shares	Mar. 29, 2019	Apr. 30, 2019
Document And Entity Information [Abstract]
Entity Registrant Name	WESTERN DIGITAL CORP
Entity Central Index Key	0000106040
Current Fiscal Year End Date	--06-28
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Document Type	10-Q
Document Period End Date	Mar. 29, 2019
Document Fiscal Year Focus	2019
Document Fiscal Period Focus	Q3
Amendment Flag	false
Entity Common Stock, Shares Outstanding (in shares)		292,997,704
Entity Current Reporting Status	Yes

Condensed Consolidated Balance Sheets - USD ($) $ in Millions	Mar. 29, 2019	Jun. 29, 2018
Current assets:
Cash and cash equivalents	$ 3,682	$ 5,005
Accounts receivable, net	1,223	2,197
Inventories	3,440	2,944
Other current assets	557	492
Total current assets	8,902	10,638
Non-current assets:
Property, plant and equipment, net	3,031	3,095
Notes receivable and investments in Flash Ventures	2,403	2,105
Goodwill	10,075	10,075
Other intangible assets, net	1,918	2,680
Other non-current assets	584	642
Total assets	26,913	29,235
Current liabilities:
Accounts payable	1,577	2,265
Accounts payable to related parties	312	259
Accrued expenses	1,645	1,274
Accrued compensation	402	479
Current portion of long-term debt	276	179
Total current liabilities	4,212	4,456
Non-current liabilities:
Long-term debt	10,309	10,993
Other liabilities	2,178	2,255
Total liabilities	16,699	17,704
Commitments and contingencies (Notes 7, 9, 11 and 14)
Shareholders’ equity:
Preferred stock, $0.01 par value; authorized — 5 shares; issued and outstanding — none	0	0
Common stock, $0.01 par value; authorized — 450 shares; issued — 312 shares; outstanding — 293 shares and 296 shares, respectively	3	3
Additional paid-in capital	3,891	4,254
Accumulated other comprehensive loss	(55)	(39)
Retained earnings	7,799	8,757
Treasury stock — common shares at cost; 19 shares and 16 shares, respectively	(1,424)	(1,444)
Total shareholders’ equity	10,214	11,531
Total liabilities and shareholders’ equity	$ 26,913	$ 29,235

Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares	Mar. 29, 2019	Jun. 29, 2018
Statement of Financial Position [Abstract]
Preferred stock, par value (in USD per share)	$ 0.01	$ 0.01
Preferred stock, authorized (in shares)	5,000,000	5,000,000
Preferred stock, issued (in shares)	0	0
Preferred stock, outstanding (in shares)	0	0
Common stock, par value (in USD per share)	$ 0.01	$ 0.01
Common stock, authorized (in shares)	450,000,000	450,000,000
Common stock, issued (in shares)	312,000,000	312,000,000
Common stock, outstanding (in shares)	293,000,000	296,000,000
Treasury stock (in shares)	19,000,000	16,000,000

Condensed Consolidated Statements of Operations - USD ($) shares in Millions, $ in Millions	3 Months Ended		9 Months Ended
	Mar. 29, 2019	Mar. 30, 2018	Mar. 29, 2019	Mar. 30, 2018
Income Statement [Abstract]
Revenue, net	$ 3,674	$ 5,013	$ 12,935	$ 15,530
Cost of revenue	3,095	3,086	9,648	9,677
Gross profit	579	1,927	3,287	5,853
Operating expenses:
Research and development	544	602	1,659	1,823
Selling, general and administrative	353	376	1,018	1,121
Employee termination, asset impairment, and other charges	76	35	142	135
Total operating expenses	973	1,013	2,819	3,079
Operating income (loss)	(394)	914	468	2,774
Interest and other income (expense):
Interest income	13	16	43	46
Interest expense	(118)	(160)	(352)	(562)
Other income (expense), net	22	(898)	28	(902)
Total interest and other expense, net	(83)	(1,042)	(281)	(1,418)
Income (loss) before taxes	(477)	(128)	187	1,356
Income tax expense (benefit)	104	(189)	744	1,437
Net income (loss)	$ (581)	$ 61	$ (557)	$ (81)
Income (loss) per common share
Basic (in dollars per share)	$ (1.99)	$ 0.20	$ (1.91)	$ (0.27)
Diluted (in dollars per share)	$ (1.99)	$ 0.20	$ (1.91)	$ (0.27)
Weighted average shares outstanding:
Basic (in shares)	292	298	291	296
Diluted (in shares)	292	308	291	296
Cash dividends declared per share (in USD per share)	$ 0.50	$ 0.50	$ 1.50	$ 1.50

Condensed Consolidated Statements of Comprehensive Income - USD ($) $ in Millions	3 Months Ended						9 Months Ended
	Mar. 29, 2019	Dec. 28, 2018	Sep. 28, 2018	Mar. 30, 2018	Dec. 29, 2017	Sep. 29, 2017	Mar. 29, 2019	Mar. 30, 2018
Statement of Comprehensive Income [Abstract]
Net income (loss)	$ (581)	$ (487)	$ 511	$ 61	$ (823)	$ 681	$ (557)	$ (81)
Other comprehensive income (loss), before tax:
Actuarial pension gain	0			1			1	1
Foreign currency translation adjustment	(2)			76			(8)	78
Net unrealized gain (loss) on derivative contracts and available-for-sale securities	(24)			18			(18)	31
Total other comprehensive income (loss), before tax	(26)			95			(25)	110
Income tax benefit (expense) related to items of other comprehensive income (loss), before tax	6			(3)			9	(6)
Other comprehensive income (loss), net of tax	(20)			92			(16)	104
Total comprehensive income (loss)	$ (601)			$ 153			$ (573)	$ 23

Condensed Consolidated Statements of Cash Flows - USD ($) $ in Millions	9 Months Ended
	Mar. 29, 2019	Mar. 30, 2018
Cash flows from operating activities
Net income (loss)	$ (557)	$ (81)
Adjustments to reconcile net loss to net cash provided by operations:
Depreciation and amortization	1,396	1,567
Stock-based compensation	242	299
Deferred income taxes	253	(336)
Loss on disposal of assets	4	16
Write-off of issuance costs and amortization of debt discounts	28	208
Cash premium on extinguishment of debt	0	(720)
Non-cash portion of employee termination, asset impairment and other charges	0	16
Other non-cash operating activities, net	19	(15)
Changes in:
Accounts receivable, net	975	(58)
Inventories	(496)	(324)
Accounts payable	(549)	(41)
Accounts payable to related parties	53	76
Accrued expenses	373	(89)
Accrued compensation	(78)	2
Other assets and liabilities, net	(285)	1,382
Net cash provided by operating activities	1,378	3,342
Cash flows from investing activities
Purchases of property, plant and equipment	(722)	(643)
Proceeds from the sale of property, plant and equipment	3	24
Acquisitions, net of cash acquired	0	(99)
Purchases of investments	(69)	(66)
Proceeds from sale of investments	49	39
Proceeds from maturities of investments	7	16
Notes receivable issuances to Flash Ventures	(858)	(1,015)
Notes receivable proceeds from Flash Ventures	570	308
Strategic investments and other, net	(22)	30
Net cash used in investing activities	(1,042)	(1,406)
Cash flows from financing activities
Issuance of stock under employee stock plans	66	146
Taxes paid on vested stock awards under employee stock plans	(109)	(164)
Repurchases of common stock	(563)	(155)
Dividends paid to shareholders	(438)	(443)
Settlement of debt hedge contracts	0	28
Proceeds from (repayment of) revolving credit facility	(500)	500
Repayment of debt	(113)	(14,581)
Proceeds from debt	0	11,384
Debt issuance costs	0	(52)
Net cash used in financing activities	(1,657)	(3,337)
Effect of exchange rate changes on cash	(2)	10
Net decrease in cash and cash equivalents	(1,323)	(1,391)
Cash and cash equivalents, end of period	5,005	6,354
Cash and cash equivalents, beginning of year	3,682	4,963
Supplemental disclosure of cash flow information:
Cash paid for income taxes	323	177
Cash paid for interest	$ 355	$ 633

Consolidated Statements of Shareholders' Equity - USD ($) shares in Millions, $ in Millions	Total	Common Stock	Treasury Stock	Additional Paid-In Capital	Accumulated Other Comprehensive Income (Loss)	Retained Earnings
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Adoption of New Accounting Standards	$ 51			$ (19)		$ 70
Beginning balance at Jun. 30, 2017	11,418	$ 3	$ (1,666)	4,506	$ (58)	8,633
Beginning balance (in shares) at Jun. 30, 2017		(312)	(18)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income (loss)	681					681
Employee stock plans	(41)		$ 156	(197)
Employee stock plans (in shares)			1
Stock-based compensation	97			97
Dividends to shareholders	(146)			9		(155)
Foreign currency translation adjustment	(4)				(4)
Net unrealized gain on derivative contracts	3				3
Ending balance at Sep. 29, 2017	12,059	$ 3	$ (1,510)	4,396	(59)	9,229
Ending balance (in shares) at Sep. 29, 2017		(312)	(17)
Beginning balance at Jun. 30, 2017	11,418	$ 3	$ (1,666)	4,506	(58)	8,633
Beginning balance (in shares) at Jun. 30, 2017		(312)	(18)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income (loss)	(81)
Ending balance at Mar. 30, 2018	11,300	$ 3	$ (1,181)	4,277	46	8,155
Ending balance (in shares) at Mar. 30, 2018		(312)	(13)
Beginning balance at Sep. 29, 2017	12,059	$ 3	$ (1,510)	4,396	(59)	9,229
Beginning balance (in shares) at Sep. 29, 2017		(312)	(17)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income (loss)	(823)					(823)
Employee stock plans	73		$ 165	(92)
Employee stock plans (in shares)			2
Stock-based compensation	99			99
Dividends to shareholders	(149)			7		(156)
Foreign currency translation adjustment	6				6
Net unrealized gain on derivative contracts	7				7
Ending balance at Dec. 29, 2017	11,272	$ 3	$ (1,345)	4,410	(46)	8,250
Ending balance (in shares) at Dec. 29, 2017		(312)	(15)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income (loss)	61					61
Employee stock plans	(50)		$ 319	(369)
Employee stock plans (in shares)			4
Stock-based compensation	103			103
Equity value of convertible debt issuance, net of deferred taxes	125			125
Repurchases of common stock	(155)		$ (155)
Repurchases of common stock, shares			(2)
Dividends to shareholders	(148)			8		(156)
Actuarial pension gain	1				1
Foreign currency translation adjustment	74				74
Net unrealized gain on derivative contracts	17				17
Ending balance at Mar. 30, 2018	11,300	$ 3	$ (1,181)	4,277	46	8,155
Ending balance (in shares) at Mar. 30, 2018		(312)	(13)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Adoption of New Accounting Standards	56					56
Beginning balance at Jun. 29, 2018	11,531	$ 3	$ (1,444)	4,254	(39)	8,757
Beginning balance (in shares) at Jun. 29, 2018		(312)	(16)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income (loss)	511					511
Employee stock plans	(58)		$ 198	(256)
Employee stock plans (in shares)			1
Stock-based compensation	79			79
Repurchases of common stock	(563)		$ (563)
Repurchases of common stock, shares			(8)
Dividends to shareholders	(144)			8		(152)
Foreign currency translation adjustment	(37)				(37)
Ending balance at Sep. 28, 2018	11,375	$ 3	$ (1,809)	4,085	(76)	9,172
Ending balance (in shares) at Sep. 28, 2018		(312)	(23)
Beginning balance at Jun. 29, 2018	11,531	$ 3	$ (1,444)	4,254	(39)	8,757
Beginning balance (in shares) at Jun. 29, 2018		(312)	(16)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income (loss)	(557)
Ending balance at Mar. 29, 2019	10,214	$ 3	$ (1,424)	3,891	(55)	7,799
Ending balance (in shares) at Mar. 29, 2019		(312)	(19)
Beginning balance at Sep. 28, 2018	11,375	$ 3	$ (1,809)	4,085	(76)	9,172
Beginning balance (in shares) at Sep. 28, 2018		(312)	(23)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income (loss)	(487)					(487)
Employee stock plans	50		$ 159	(109)
Employee stock plans (in shares)			2
Stock-based compensation	79			79
Dividends to shareholders	(146)			7		(153)
Actuarial pension gain	1				1
Foreign currency translation adjustment	29				29
Net unrealized gain on derivative contracts	11				11
Ending balance at Dec. 28, 2018	10,912	$ 3	$ (1,650)	4,062	(35)	8,532
Ending balance (in shares) at Dec. 28, 2018		(312)	(21)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net income (loss)	(581)					(581)
Employee stock plans	(35)		$ 226	(261)
Employee stock plans (in shares)			2
Stock-based compensation	84			84
Dividends to shareholders	(146)			6		(152)
Foreign currency translation adjustment	(1)				(1)
Net unrealized gain on derivative contracts	(19)				(19)
Ending balance at Mar. 29, 2019	$ 10,214	$ 3	$ (1,424)	$ 3,891	$ (55)	$ 7,799
Ending balance (in shares) at Mar. 29, 2019		(312)	(19)

Organization and Basis of Presentation (Notes)	9 Months Ended
Organization and Basis of Presentation (Notes)	Mar. 29, 2019
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Organization and Basis of Presentation	Organization and Basis of Presentation Western Digital Corporation (“Western Digital” or “the Company”) is a leading developer, manufacturer and provider of data storage devices and solutions that address the evolving needs of the information technology industry and the infrastructure that enables the proliferation of data in virtually every other industry. The Company’s broad portfolio of technology and products address the following key markets: Client Devices; Data Center Devices and Solutions; and Client Solutions. The Company also generates license and royalty revenue related to its intellectual property (“IP”), which is included in each of these three categories. The accounting policies followed by the Company are set forth in Part II, Item 8, Note 1, Organization and Basis of Presentation, of the Notes to Consolidated Financial Statements included in the Company’s Annual Report on Form 10‑K for the fiscal year ended June 29, 2018. In the opinion of management, all adjustments necessary to fairly state the Condensed Consolidated Financial Statements have been made. All such adjustments are of a normal, recurring nature. Certain information and footnote disclosures normally included in the Consolidated Financial Statements prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”) have been condensed or omitted pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). These Condensed Consolidated Financial Statements should be read in conjunction with the Consolidated Financial Statements and the notes thereto included in the Company’s Annual Report on Form 10‑K for the fiscal year ended June 29, 2018. The results of operations for interim periods are not necessarily indicative of results to be expected for the full year. Fiscal Year The Company’s fiscal year ends on the Friday nearest to June 30 and typically consists of 52 weeks. Fiscal years 2019, which ends on June 28, 2019, and 2018, which ended on June 29, 2018, are each comprised of 52 weeks, with all quarters presented consisting of 13 weeks. Fiscal year 2020, which ends on July 3, 2020, will be comprised of 53 weeks, with the first quarter consisting of 14 weeks and the remaining quarters consisting of 13 weeks each. Use of Estimates Company management has made estimates and assumptions relating to the reporting of certain assets and liabilities in conformity with U.S. GAAP. These estimates and assumptions have been applied using methodologies that are consistent throughout the periods presented. However, actual results could differ materially from these estimates.

Recently Adopted Accounting Pronouncements	9 Months Ended
Recently Adopted Accounting Pronouncements	Mar. 29, 2019
Accounting Changes and Error Corrections [Abstract]
Recent Accounting Pronouncements	Recent Accounting Pronouncements Accounting Pronouncements Recently Adopted On August 29, 2018, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2018-15, “Customer’s Accounting for Implementation Costs Incurred in a Cloud Computing Arrangement That Is a Service Contract” (“ASU 2018-15”), to reduce diversity in practice in accounting for the costs of implementing cloud computing arrangements that are service contracts. ASU 2018-15 allows entities to apply the guidance in the FASB Accounting Standards Codification (“ASC”) 350-40 to determine which implementation costs are eligible to be capitalized as assets in a cloud computing arrangement that is considered a service contract. The Company adopted this standard on a prospective basis effective June 30, 2018, the beginning of fiscal year 2019, as allowed by the standard. The adoption of this standard and the costs capitalized for the nine months ended March 29, 2019 were not material to the Company’s Condensed Consolidated Financial Statements. In February 2018, the FASB issued ASU No. 2018-02, “Income Statement-Reporting Comprehensive Income (Topic 220): Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income” (“ASU 2018-02”). ASU 2018-02 allows a reclassification from accumulated other comprehensive income to retained earnings for stranded tax effects resulting from the Tax Cuts and Jobs Act enacted on December 22, 2017 (the “2017 Act”). Consequently, the amendments eliminate the stranded tax effects resulting from the 2017 Act and will improve the usefulness of information reported to financial statement users. Because the amendments only relate to the reclassification of the income tax effects of the 2017 Act, the underlying guidance that requires that the effect of a change in tax laws or rates be included in income from continuing operations is not affected. For tax effects that are unrelated to the 2017 Act, the Company’s policy to release these from Accumulated other comprehensive loss on an individual item basis rather than a portfolio basis remains unchanged. The Company early adopted this standard effective June 30, 2018 and elected to reclassify stranded tax effects resulting from the 2017 Act from Accumulated other comprehensive loss to Retained earnings. The adoption of this standard did not have a material impact on the Company’s Condensed Consolidated Financial Statements. In August 2017, the FASB issued ASU No. 2017-12, “Derivatives and Hedging (Topic 815): Targeted Improvements to Accounting for Hedging Activities” (“ASU 2017-12”). ASU 2017-12 simplifies hedge accounting through changes to both designation and measurement requirements. For hedges that qualify as highly effective, the new standard eliminates the requirement to separately measure and record hedge ineffectiveness with the entire change in fair value of designated hedge reported in the results of operations in the same line item as the hedged item. The Company early adopted this standard effective June 30, 2018, using the modified retrospective approach. The adoption of this standard did not have a material impact on the Company’s Condensed Consolidated Financial Statements. In May 2017, the FASB issued ASU No. 2017-09, “Compensation-Stock Compensation (Topic 718): Scope of Modification Accounting” (“ASU 2017-09”). ASU 2017-09 provides clarification when a change to the terms or conditions of a share-based payment award must be accounted for as a modification. The new guidance requires modification accounting if the fair value, vesting condition or the classification of the award is not the same immediately before and after a change to the terms and conditions of the award. The Company adopted this standard on a prospective basis effective June 30, 2018. The adoption of this standard did not have a material impact on the Company’s Condensed Consolidated Financial Statements. In March 2017, the FASB issued ASU No. 2017-07, “Compensation-Retirement Benefits (Topic 715): Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost” (“ASU 2017-07”). ASU 2017-07 requires that the Company report the service cost component in the same line item or items as other compensation costs arising from services rendered by the pertinent employees during the period. In addition, the other components of net benefit cost are now presented in Other income (expense), net in the Condensed Consolidated Statements of Operations. The Company adopted this standard effective June 30, 2018. The adoption of this standard did not have a material impact on the Company’s Condensed Consolidated Financial Statements. In January 2017, the FASB issued ASU No. 2017-01, “Business Combinations (Topic 805): Clarifying the Definition of a Business” (“ASU 2017-01”). ASU 2017-01 narrows the definition of a “business.” This standard provides guidance to assist entities with evaluating when a set of transferred assets and activities is a business. The Company adopted this standard effective June 30, 2018 and will apply it prospectively to transactions occurring thereafter. The adoption of this standard did not have a material impact on the Company’s Condensed Consolidated Financial Statements. In October 2016, the FASB issued ASU No. 2016-16, “Income Taxes (Topic 740): Intra-Entity Transfers of Assets Other Than Inventory” (“ASU 2016-16”). ASU 2016-16 removes the prohibition in the FASB ASC Topic 740 against the immediate recognition of the current and deferred income tax effects of intra-entity transfers of assets other than inventory. The new standard is intended to reduce the complexity and diversity in practice related to the tax consequences of certain types of intra-entity asset transfers, particularly those involving intellectual property (“IP”). The Company adopted this standard effective June 30, 2018. The adoption of this standard did not have a material impact on the Company’s Condensed Consolidated Financial Statements. In January 2016, the FASB issued ASU No. 2016-01, “Financial Instruments — Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities” (“ASU 2016-01”). ASU 2016-01 provides guidance related to accounting for equity investments, financial liabilities under the fair value option and the presentation and disclosure requirements for financial instruments. Marketable equity securities previously classified as available-for-sale equity investments are now measured and recorded at fair value with changes in fair value recorded within Other income (expense), net in the Condensed Consolidated Statements of Operations rather than as a component of Other comprehensive income as in prior years. In addition, the FASB clarified guidance related to the valuation allowance assessment when recognizing deferred tax assets resulting from unrealized losses on available-for-sale debt securities. The Company adopted this standard effective June 30, 2018. The adoption of this standard did not have a material impact on the Company’s Condensed Consolidated Financial Statements. In May 2014, the FASB issued ASU No. 2014-09, “Revenue from Contracts with Customers (Topic 606),” which superseded the requirements in ASC 605 “Revenue Recognition” (Topic 605). Topic 606 outlines a comprehensive five-step revenue recognition model based on the principle that an entity should recognize revenue when control of the promised goods or services is transferred to customers at an amount that reflects the consideration to which the Company expects to be entitled in exchange for those goods or services. Topic 606 also requires more detailed disclosures to enable users of financial statements to understand the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers. The Company adopted Topic 606 effective June 30, 2018, using the modified retrospective method to all contracts that were not completed contracts as of the beginning of the fiscal year. Results for reporting periods beginning with fiscal year 2019 are presented under Topic 606, while prior period information presented on the financial statements or elsewhere in this Quarterly Report on Form 10-Q is reported under the Company’s historic accounting policies under Topic 605 in effect for that period and is not adjusted to reflect the retrospective effect of the adoption of Topic 606. The cumulative effect of adopting Topic 606 was a post-tax increase to the opening retained earnings of $56 million as of June 30, 2018, which was primarily related to our license and royalty revenue arrangements. These arrangements had no remaining performance obligations but were previously recognized under Topic 605 when they were reported to the Company by its licensees, which was generally one quarter in arrears from the licensees’ sales of the licensed products. Adoption of the standard did not have a material impact on the Company’s financial position, results of operations, and cash flows, as of or for the three and nine months ended March 29, 2019, and the Company expects that the impact of the adoption of the new standard will not be material to its results of operations prospectively. See Note 3, Revenues, for additional disclosures related to this standard. Recently Issued Accounting Pronouncements Not Yet Adopted In November 2018, the FASB issued ASU No. 2018-18, “Collaborative Arrangements (Topic 808): Clarifying the Interaction between Topic 808 and Topic 606” (“ASU 2018-18”). ASU 2018-18 clarifies that certain transactions between collaborative arrangement participants should be accounted for as revenue when the collaborative arrangement participant is a customer in the context of a unit of account and precludes recognizing as revenue consideration received from a collaborative arrangement participant if the participant is not a customer. This ASU requires retrospective adoption to the date the Company adopted ASC 606 by recognizing a cumulative-effect adjustment to the opening balance of retained earnings of the earliest annual period presented. The amendments are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019, which for the Company is the first quarter of fiscal 2021. The Company does not expect this update to have a material impact on its Consolidated Financial Statements. In October 2018, the FASB issued ASU No. 2018-16, “Derivatives and Hedging (Topic 815): Inclusion of the Secured Overnight Financing Rate (SOFR) Overnight Index Swap (OIS) Rate as a Benchmark Interest Rate for Hedge Accounting Purposes” (“ASU 2018-16”). ASU 2018-16 allows for the use of the OIS rate based on the SOFR as a U.S. benchmark interest rate for hedge accounting purposes under Topic 815, Derivatives and Hedging. For public entities who have adopted ASU 2017-12, the amendments are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2018, which for the Company is the first quarter of fiscal 2020. The Company does not expect this update to have a material impact on its Consolidated Financial Statements. In June 2016, the FASB issued ASU No. 2016-13, “Financial Instruments-Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments” (“ASU 2016-13”). ASU 2016-13 seeks to provide financial statement users with more decision-useful information about the expected credit losses on financial instruments, including trade receivables, and other commitments to extend credit held by a reporting entity at each reporting date. The amendments require an entity to replace the incurred loss impairment methodology in current U.S. GAAP with a methodology that reflects current expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates. The amendments are effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2019, which for the Company is the first quarter of fiscal 2021. The Company is currently evaluating the impact this update will have on its Consolidated Financial Statements. In February 2016, the FASB issued ASU No. 2016-02, “Leases (Topic 842)” (“ASU 2016-02”). ASU 2016-02 supersedes ASC 840 “Leases”. The amendments in this update require, among other things, that lessees recognize the following for all leases (unless a policy election is made by class of underlying asset to exclude short-term leases) at the commencement date: (1) a lease liability, which is a lessee’s obligation to make lease payments arising from a lease, measured on a discounted basis; and (2) a right-of-use asset, which is an asset that represents the lessee’s right to use, or the direct use of, a specified asset for the lease term. The FASB issued ASU 2018-11 on July 30, 2018, which allows entities to apply the provisions of ASC 842 at the effective date without adjusting comparative periods. The standard is effective for interim and annual reporting periods beginning after December 15, 2018, with early adoption permitted, and provides optional practical expedients to simplify transition. The Company’s cross-functional project management team continues to identify and evaluate the impact of the amended guidance on the Company's Consolidated Financial Statements and related disclosures, business processes, internal controls, and information systems. The Company has identified its leases and selected a third-party lease accounting software solution. The Company is in the process of implementing its lease accounting software solution and changes to its processes and internal controls to address the new lease standard. The Company’s implementation efforts are progressing as planned. The Company expects to adopt this standard in the first quarter of fiscal 2020 and elect the transition method provided in ASU 2018-11 to apply Topic 842 as of the date of adoption without adjusting comparative periods. The Company also expects to elect the package of practical expedients and not reassess prior conclusions including (a) whether its contracts are or contain a lease, (b) lease classification and (c) capitalization of initial direct costs. The Company continues to evaluate the impact ASU 2016-02 will have on its Consolidated Financial Statements.

Revenues

9 Months Ended

Mar. 29, 2019

Revenue from Contract with Customer [Abstract]

Revenues

The Company offers a broad range of data storage products that include Client Devices, Data Center Devices and Solutions, and Client Solutions. Client Devices consist of hard disk drives (“HDDs”) and solid state drives (“SSDs”) for computing devices; flash-based embedded storage products; and flash-based memory wafers. Data Center Devices and Solutions consist of high-capacity enterprise HDDs and high-performance enterprise SSDs, data center software and system solutions. Client Solutions consist of HDDs and SSDs embedded into external storage products and removable flash-based products. The Company also generates license and royalty revenues related to its IP patent licenses which are not material.

The Company recognizes revenue when it satisfies a performance obligation by transferring control over a product or service to the customer. The transaction price to be recognized as revenue is adjusted for variable consideration, such as sales incentives, and excludes amounts collected on behalf of third parties, including taxes imposed by governmental authorities. The Company’s performance obligations are typically not constrained based on the Company’s history with similar transactions and that uncertainties are resolved in a fairly short period of time.

Substantially all of the Company’s revenue is from the sale of tangible products for which the performance obligations are satisfied at a point in time, generally upon delivery. The Company’s services revenue mainly includes post contract customer support, warranty as a service and maintenance contracts. The performance obligations for the Company’s services are generally satisfied ratably over the service period based on the nature of the service provided and contract terms. Similarly, revenue from patent licensing arrangements is recognized based on whether the arrangement provides the customer a right to use or right to access the IP. Revenue for a right to use arrangement is recognized at the time the control of the license is transferred to the customer. Revenue for a right to access arrangement is recognized over the contract period using the time lapse method. For the sales-based royalty arrangements, the Company estimates and recognizes revenue in the period in which customers’ licensable sales occur.

The Company’s customer payment terms are typically less than three months from the date control over the product or service is transferred to the customer. The Company uses the practical expedient and does not recognize a significant financing component for payment considerations of less than one year. The financing components of contracts with payment terms were not material.

The Company provides distributors and retailers (collectively referred to as “resellers”) with limited price protection for inventories held by resellers at the time of published list price reductions and/or a right of return. The Company also provides resellers and original equipment manufacturers (“OEMs”) with other sales incentive programs. The Company uses judgment in its assessment of variable consideration in contracts to be included in the transaction price. The Company uses the expected value method to arrive at the amount of variable consideration. The Company believes the estimate of variable consideration is not constrained and that the expected value method is the appropriate estimate of the amount of variable consideration based on the fact that the Company has a large number of contracts with similar characteristics. The Company’s methodology for the estimates is based on several factors, including anticipated price decreases during the reseller holding period, resellers’ sell-through and inventory levels, estimated amounts to be reimbursed to qualifying customers, historical pricing information, historical and anticipated returns information and customer claim processing. The Company also has programs under which it reimburses qualified distributors and retailers for certain marketing expenditures, which are typically recorded as a reduction of the transaction price and, therefore, of revenue.

An immaterial amount of the Company’s revenue arrangements include more than one performance obligation, which are typically comprised of tangible products, software and support services for multiple distinct licenses. For these multiple-element arrangements, the Company evaluates whether each deliverable is a distinct promise and should be accounted for as a separate performance obligation. If a promised good or service is not distinct in accordance with the revenue guidance, the Company combines that good or service with the other promised goods or services in the arrangement until a distinct bundle of goods is identified. The Company allocates the transaction price to the performance obligations of each distinct product or service, or distinct bundle, based on their relative standalone selling prices. Where a separate standalone selling price is not available, the transaction price is based on the Company’s best estimate of the selling price. The Company uses one or a combination of more than one of the following methods to estimate the standalone selling price: the adjusted market assessment approach, the expected cost plus a margin approach, or another suitable method based on the facts and circumstances.

Contract assets represent the Company’s rights to consideration where performance obligations are completed but the customer payments are not due until another performance obligation is satisfied. The Company did not have any contract assets as of either March 29, 2019 or the date of adoption of Topic 606.

The Company incurs sales commissions and other direct incremental costs to obtain sales contracts. The Company has applied the practical expedient to recognize the direct incremental costs of obtaining contracts as an expense when incurred if the amortization period is expected to be one year or less or the amount is not material, with these costs charged to selling, general and administrative expenses. Prior to the adoption of the new revenue standard, the Company’s policy was to expense all contract acquisition costs as incurred. Other direct incremental costs to obtain contracts that have an expected benefit of greater than one year are amortized over the period of expected cash flows from the related contracts, and the amortization expense is recorded as a reduction to revenue. Total capitalized contract costs and the related amortization as of and for the three and nine months ended March 29, 2019 were not material.

Contract liabilities relate to customers’ payments in advance of performance under the contract and primarily relate to remaining performance obligations under support and maintenance contracts. As of March 29, 2019 and the date of adoption of Topic 606, contract liabilities were $46 million and $120 million, respectively, and were reflected in Accrued expenses. Changes in the contract liability balance during the nine months ended March 29, 2019 include $93 million of revenue recognized during the period of which the substantial majority relates to the balance that was deferred at June 29, 2018, partially offset by payments received and billings in advance of satisfying performance obligations.

The Company applies the practical expedients and does not disclose transaction price allocated to the remaining performance obligations for (i) arrangements that have an original expected duration of one year or less, which mainly consist of the support and maintenance contracts, and (ii) variable consideration amounts for sale-based or usage-based royalties for IP license arrangements, which typically range longer than one year. Remaining performance obligations are mainly attributed to right-to-access patent license arrangements and customer support and service contracts which will be recognized over the remaining contract period. The transaction price allocated to the remaining performance obligations as of March 29, 2019 was $204 million, which is mainly attributable to the functional IP license and service arrangements. The Company expects to recognize this amount as revenue as follows: $20 million during the remainder of fiscal 2019, $62 million in fiscal 2020, $47 million in fiscal 2021 and $75 million thereafter.

The Company’s disaggregated revenue information is as follows⁽¹⁾:



	Three Months Ended						Nine Months Ended
	March 29, 2019			March 30, 2018			March 29, 2019			March 30, 2018
	(in millions, except percentages)
Revenue by End Market
Client Devices	$	1,625		$	2,311		$	6,489		$	7,634
Data Center Devices & Solutions	1,245			1,660			3,765			4,463
Client Solutions	804			1,042			2,681			3,433
Total Revenue	$	3,674		$	5,013		$	12,935		$	15,530

Revenue by Form Factor
HDD	$	2,064		$	2,640		$	6,618		$	7,944
Flash-based	1,610			2,373			6,317			7,586
Total Revenue	$	3,674		$	5,013		$	12,935		$	15,530

Revenue by Geography (%)
Americas	29		%	28		%	26		%	27		%
Europe, Middle East and Africa	20			19			19			18
Asia	51			53			55			55


⁽¹⁾	Prior year information is presented in accordance with the accounting guidance in effect during that period and has not been updated for Topic 606. The impact of the adoption of Topic 606 was not material.

The Company’s top 10 customers accounted for 41% and 45% of its net revenue for the three and nine months ended March 29, 2019, respectively, and 44% and 42% of its net revenue for the three and nine months ended March 30, 2018, respectively. For the three and nine months ended March 29, 2019 and March 30, 2018, no single customer accounted for 10% or more of the Company’s net revenue.

Supplemental Financial Statement Data

9 Months Ended

Mar. 29, 2019

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Supplemental Financial Statement Data

Accounts receivable, net

From time to time, in connection with factoring agreements, the Company sells trade accounts receivable without recourse to third party purchasers in exchange for cash. During the nine months ended March 29, 2019, the Company sold trade accounts receivable and received cash proceeds of $702 million. The discounts on the trade accounts receivable sold during the period were not material and were recorded within Other income (expense), net in the Condensed Consolidated Financial Statements. During the nine months ended March 30, 2018, the Company did not sell any trade accounts receivable.

Inventories



	March 29, 2019		June 29, 2018
	(in millions)
Inventories:
Raw materials and component parts	$	1,122	$	1,048
Work-in-process	955		878
Finished goods	1,363		1,018
Total inventories	$	3,440	$	2,944

Property, plant and equipment, net



	March 29, 2019			June 29, 2018
	(in millions)
Property, plant, and equipment:
Land	$	307		$	306
Buildings and improvements	2,012			1,949
Machinery and equipment	7,593			7,209
Computer equipment and software	460			440
Furniture and fixtures	55			48
Construction-in-process	211			234
Property, plant and equipment, gross	10,638			10,186
Accumulated depreciation	(7,607		)	(7,091		)
Property, plant, and equipment, net	$	3,031		$	3,095

Goodwill

The Company tests for impairment, at a minimum, on an annual basis or earlier where certain events or changes in circumstances indicate that goodwill may more likely than not be impaired. The Company has experienced fluctuations in the market price of its stock, which resulted in the Company’s market capitalization decreasing below book value for eleven trading days near the end of the second quarter and beginning of the third quarter of fiscal 2019. The fair value of the Company using a market capitalization approach based on the Company’s share price would include a control premium based on recent transactions that have occurred in the technology industry. This indicative fair value exceeded the Company’s book value; therefore, management did not believe that it was more likely than not that goodwill was impaired as of March 29, 2019.

The Company’s regularly scheduled annual impairment test is performed as of the first day of its fiscal fourth quarter. The Company uses qualitative factors to determine whether goodwill is more likely than not impaired and whether a quantitative test for impairment is considered necessary. If the Company concludes from the qualitative assessment that goodwill is more likely than not impaired, the Company is required to perform a quantitative assessment to determine the amount of impairment. The Company is required to use judgment when applying the goodwill impairment test, including the identification of reporting units, assignment of assets, liabilities and goodwill to reporting units, and determination of the fair value of each reporting unit. In addition, the estimates used to determine the fair value of reporting units may change based on results of operations, macroeconomic conditions or other factors. The Company is in the process of completing its annual impairment test.

If there are significant decreases in the Company’s stock price in the future or other unfavorable factors, the Company may be required to perform a goodwill impairment assessment, which may result in the recognition of a goodwill impairment that could be material to the Consolidated Financial Statements.

Intangible assets



	March 29, 2019			June 29, 2018
	(in millions)
Finite-lived intangible assets	$	5,824		$	5,818
In-process research and development	72			80
Accumulated amortization	(3,978		)	(3,218		)
Intangible assets, net	$	1,918		$	2,680

As part of prior acquisitions, the Company recorded at the time of the acquisition acquired in-process research and development (“IPR&D”) for projects in progress that had not yet reached technological feasibility. IPR&D is initially accounted for as an indefinite-lived intangible asset. Once a project reaches technological feasibility, the Company reclassifies the balance to existing technology and begins to amortize the intangible asset over its estimated useful life. During the three and nine months ended March 29, 2019, the Company reclassified $8 million of acquired IPR&D to existing technology and commenced amortization over its estimated useful life of 2 years.

Product warranty liability

Changes in the warranty accrual were as follows:



	Three Months Ended						Nine Months Ended
	March 29, 2019			March 30, 2018			March 29, 2019			March 30, 2018
	(in millions)
Warranty accrual, beginning of period	$	337		$	304		$	318		$	311
Charges to operations	38			43			119			133
Utilization	(40		)	(37		)	(108		)	(118		)
Changes in estimate related to pre-existing warranties	(4		)	(5		)	2			(21		)
Warranty accrual, end of period	$	331		$	305		$	331		$	305

The current portion of the warranty accrual is classified in Accrued expenses and the long-term portion is classified in Other liabilities as noted below:



	March 29, 2019		June 29, 2018
	(in millions)
Warranty accrual
Current portion	$	179	$	168
Long-term portion	152		150
Total warranty accrual	$	331	$	318

Other liabilities



	March 29, 2019		June 29, 2018
	(in millions)
Other non-current liabilities:
Non-current net tax payable	$	930	$	1,315
Other non-current liabilities	1,248		940
Total other non-current liabilities	$	2,178	$	2,255

Accumulated other comprehensive income (loss)

Other comprehensive income (loss) (“OCI”), net of tax refers to expenses, gains and losses that are recorded as an element of shareholders’ equity but are excluded from net income. The following table illustrates the changes in the balances of each component of Accumulated other comprehensive income (loss) (“AOCI”):



	Actuarial Pension Gains (Losses)			Foreign Currency Translation Adjustment			Unrealized Gains (Losses) on Derivative Contracts			Total Accumulated Comprehensive Income (Loss)
	(in millions)
Balance at June 29, 2018	$	(19	)	$	(21	)	$	1		$	(39	)
Other comprehensive income (loss) before reclassifications	1			(8		)	(26		)	(33		)
Amounts reclassified from accumulated other comprehensive income	—			—			8			8
Income tax benefit related to items of other comprehensive loss	—			(1		)	10			9
Net current-period other comprehensive loss	1			(9		)	(8		)	(16		)
Balance at March 29, 2019	$	(18	)	$	(30	)	$	(7	)	$	(55	)

During the three and nine months ended March 29, 2019 and March 30, 2018, the amounts reclassified out of AOCI related to derivative contracts were not material and substantially all were charged to Cost of revenue in the Condensed Consolidated Statements of Operations.

Fair Value Measurements and Investments

9 Months Ended

Mar. 29, 2019

Fair Value Disclosures [Abstract]

Fair Value Measurements and Investments

The Company’s total cash, cash equivalents and available-for-sale securities was as follows:



	March 29, 2019		June 29, 2018
	(in millions)
Cash and cash equivalents	$	3,682	$	5,005
Short-term available-for-sale securities (included within Other current assets)	15		23
Long-term available-for-sale securities (included within Other non-current assets)	104		93
Total cash, cash equivalents and available-for-sale securities	$	3,801	$	5,121

Financial Instruments Carried at Fair Value

Financial assets and liabilities that are remeasured and reported at fair value at each reporting period are classified and disclosed in one of the following three levels:


Level 1.	Quoted prices in active markets for identical assets or liabilities.


Level 2.	Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.


Level 3.	Inputs that are unobservable for the asset or liability and that are significant to the fair value of the assets or liabilities.

The following tables present information about the Company’s financial assets and liabilities that are measured at fair value on a recurring basis as of March 29, 2019 and June 29, 2018, and indicate the fair value hierarchy of the valuation techniques utilized to determine such values:



	March 29, 2019
	Level 1		Level 2		Level 3		Total
	(in millions)
Assets:
Cash equivalents:
Money market funds	$	1,508	$	—	$	—	$	1,508
Certificates of deposit	—		6		—		6
Total cash equivalents	1,508		6		—		1,514
Short-term available-for-sale securities:
Corporate notes and bonds	—		2		—		2
Asset-backed securities	—		6		—		6
Municipal notes and bonds			6		—		6
Equity securities	1		—		—		1
Total short-term available-for-sale securities	1		14		—		15
Long-term available-for-sale securities:
U.S. Treasury securities	5		—		—		5
U.S. Government agency securities	—		4		—		4
International government securities	—		6		—		6
Corporate notes and bonds	—		75		—		75
Asset-backed securities	—		7		—		7
Municipal notes and bonds	—		7		—		7
Total long-term available-for-sale securities	5		99		—		104
Foreign exchange contracts	—		17		—		17
Interest rate swap contracts	—		8		—		8
Total assets at fair value	$	1,514	$	144	$	—	$	1,658
Liabilities:
Foreign exchange contracts	$	—	$	15	$	—	$	15
Interest rate swap contract	—		33		—		33
Total liabilities at fair value	$	—	$	48	$	—	$	48



	June 29, 2018
	Level 1		Level 2		Level 3		Total
	(in millions)
Assets:
Cash equivalents:
Money market funds	$	2,554	$	—	$	—	$	2,554
Certificates of deposit	—		4		—		4
Total cash equivalents	2,554		4		—		2,558
Short-term available-for-sale securities:
U.S. Treasury securities	3		—		—		3
Corporate notes and bonds	—		12		—		12
Asset-backed securities	—		4		—		4
Municipal notes and bonds	—		2		—		2
Equity securities	2		—		—		2
Total short-term available-for-sale securities	5		18		—		23
Long-term available-for-sale securities:
U.S. Treasury securities	3		—		—		3
U.S. Government agency securities	—		5		—		5
International government securities	—		1		—		1
Corporate notes and bonds	—		65		—		65
Asset-backed securities	—		8		—		8
Municipal notes and bonds	—		11		—		11
Total long-term available-for-sale securities	3		90		—		93
Foreign exchange contracts	—		51		—		51
Interest rate swap contracts	—		16		—		16
Total assets at fair value	$	2,562	$	179	$	—	$	2,741
Liabilities:
Foreign exchange contracts	$	—	$	28	$	—	$	28
Total liabilities at fair value	$	—	$	28	$	—	$	28

During the three and nine months ended March 29, 2019, the Company had no transfers of financial assets and liabilities between levels.

Available-for-Sale Securities

The cost basis of the Company’s investments classified as available-for-sale securities, individually and in the aggregate, approximated its fair value as of March 29, 2019 and June 29, 2018.

Equity Securities Without a Readily Determinable Fair Value (“RDFV”)

From time to time, the Company enters into certain strategic investments for the promotion of business and strategic objectives. The equity securities of these privately-held companies do not have a RDFV. Under ASU 2016-01, these equity securities are now measured and recorded using the measurement alternative, which is cost minus impairment, if any, plus or minus changes resulting from qualifying observable price changes. In addition, the existing impairment model has been replaced with a new one-step qualitative impairment model. Adjustments resulting from impairments and qualifying observable price changes are recorded in Other income (expense), net in the Condensed Consolidated Statements of Operations. As of March 29, 2019 and June 30, 2018, these investments were not material.

Financial Instruments Not Carried at Fair Value

The carrying value of the Company’s revolving credit facility approximates its fair value given the revolving nature of the balance and the variable market interest rate. For financial instruments where the carrying value (which includes principal adjusted for any unamortized issuance costs, and discounts or premiums) differs from fair value (which is based on quoted market prices), the following table represents the related carrying value and fair value for each of the Company’s outstanding financial instruments. Each of the financial instruments presented below was categorized as Level 2 for all periods presented, based on the frequency of trading immediately prior to the end of the third quarter of 2019 and the fourth quarter of 2018, respectively.



	March 29, 2019				June 29, 2018
	Carrying Value		Fair Value		Carrying Value		Fair Value
	(in millions)
0.50% convertible senior notes due 2020	$	32	$	34	$	31	$	34
Variable interest rate Term Loan A-1 maturing 2023	4,889		4,771		4,982		5,013
Variable interest rate U.S. Term Loan B-4 maturing 2023	2,430		2,381		2,448		2,452
1.50% convertible notes due 2024	952		970		931		1,114
4.750% senior unsecured notes due 2026	2,282		2,199		2,280		2,238
Total	$	10,585	$	10,355	$	10,672	$	10,851

- Definition

The entire disclosure for the fair value of financial instruments (as defined), including financial assets and financial liabilities (collectively, as defined), and the measurements of those instruments as well as disclosures related to the fair value of non-financial assets and liabilities. Such disclosures about the financial instruments, assets, and liabilities would include: (1) the fair value of the required items together with their carrying amounts (as appropriate); (2) for items for which it is not practicable to estimate fair value, disclosure would include: (a) information pertinent to estimating fair value (including, carrying amount, effective interest rate, and maturity, and (b) the reasons why it is not practicable to estimate fair value; (3) significant concentrations of credit risk including: (a) information about the activity, region, or economic characteristics identifying a concentration, (b) the maximum amount of loss the entity is exposed to based on the gross fair value of the related item, (c) policy for requiring collateral or other security and information as to accessing such collateral or security, and (d) the nature and brief description of such collateral or security; (4) quantitative information about market risks and how such risks are managed; (5) for items measured on both a recurring and nonrecurring basis information regarding the inputs used to develop the fair value measurement; and (6) for items presented in the financial statement for which fair value measurement is elected: (a) information necessary to understand the reasons for the election, (b) discussion of the effect of fair value changes on earnings, (c) a description of [similar groups] items for which the election is made and the relation thereof to the balance sheet, the aggregate carrying value of items included in the balance sheet that are not eligible for the election; (7) all other required (as defined) and desired information.

+ References + Details

Derivatives Instruments and Hedging Activities	9 Months Ended
Derivatives Instruments and Hedging Activities	Mar. 29, 2019
Derivative Instruments and Hedging Activities Disclosure [Abstract]
Derivative Instruments and Hedging Activities	Derivative Instruments and Hedging Activities As of March 29, 2019, the Company had outstanding foreign exchange forward contracts that were designated as either cash flow hedges or non-designated hedges. Substantially all of the contract maturity dates of these foreign exchange forward contracts do not exceed 12 months. In addition, the Company had outstanding interest rate swaps that were designated as cash flow hedges. The Company did not have any foreign exchange forward contracts with credit-risk-related contingent features. As of March 29, 2019, the amount of existing net losses related to cash flow hedges recorded in AOCI was not material and the majority is expected to be reclassified to earnings over the next twelve months. Changes in fair values of the non-designated foreign exchange contracts are recognized in Other income (expense), net and are largely offset by corresponding changes in the fair values of the foreign currency denominated monetary assets and liabilities. For each of the three and nine months ended March 29, 2019 and March 30, 2018, total net realized and unrealized transaction and foreign exchange contract currency gains and losses were not material to the Company’s Condensed Consolidated Financial Statements. See Note 5, Fair Value Measurements and Investments, for additional disclosures related to the fair value of the Company’s foreign exchange forward contracts. Netting Arrangements Under certain provisions and conditions within agreements with counterparties to the Company’s foreign exchange forward contracts, subject to applicable requirements, the Company has the right of offset associated with the Company’s foreign exchange forward contracts and is allowed to net settle transactions of the same currency with a single net amount payable by one party to the other. As of March 29, 2019 and June 29, 2018, the effect of rights of offset was not material and the Company did not offset or net the fair value amounts of derivative instruments in its Condensed Consolidated Balance Sheets.

Debt

9 Months Ended

Mar. 29, 2019

Debt Disclosure [Abstract]

Debt

Debt consisted of the following as of March 29, 2019 and June 29, 2018:



	March 29, 2019			June 29, 2018
	(in millions)
0.50% convertible senior notes due 2020	$	35		$	35
Revolving credit facility maturing 2023	—			500
Variable interest rate Term Loan A-1 maturing 2023	4,896			4,991
Variable interest rate U.S. Term Loan B-4 maturing 2023	2,431			2,449
1.50% convertible notes due 2024	1,100			1,100
4.750% senior unsecured notes due 2026	2,300			2,300
Total debt	10,762			11,375
Issuance costs and debt discounts	(177		)	(203		)
Subtotal	10,585			11,172
Less current portion of long-term debt	(276		)	(179		)
Long-term debt	$	10,309		$	10,993

In November 2018, the Company repaid the previously outstanding borrowings under its revolving credit facility. At March 29, 2019, the Company’s borrowing capacity under the revolving credit facility was $2.25 billion.

The credit agreement governing the Company’s revolving credit facility and term loans (as amended, the “Credit Agreement”) requires the Company to comply with certain financial covenants with respect to the revolving credit facility and Term Loan A-1, consisting of a Leverage Ratio and an Interest Coverage Ratio (each as defined below). These covenants are based upon a trailing twelve-month consolidated adjusted EBITDA as defined in the Credit Agreement (“Adjusted EBITDA”). Adjusted EBITDA is defined as net income (loss) plus interest expense, income tax expense (benefit) and depreciation and amortization as well as other contractual adjustments as provided for in the Credit Agreement. As of March 29, 2019, the Company was in compliance with all financial covenants under the Credit Agreement.

In April 2019, the Company amended the Credit Agreement for the purposes of providing additional flexibility by adjusting the leverage ratio maintenance covenant levels applicable to the term A loan and revolving facilities thereunder and amending the definition of Consolidated Adjusted EBITDA under the financial maintenance covenants to include an addback for certain depreciation related payments with respect to the Company’s Flash Ventures. As amended, the Company is now required to maintain a maximum ratio of total funded debt to trailing twelve-month Adjusted EBITDA (“Leverage Ratio”) at the end of each quarter of 4.25 to 1.00 through the quarter ending October 2, 2020, 4.00 to 1.00 through the quarter ending July 2, 2021, 3.75 to 1.00 through the quarter ending December 31, 2021, 3.50 to 1.00 through the quarter ending July 1, 2022, and 3.25 to 1.00 thereafter. In addition, the Company is required to maintain a minimum ratio of Adjusted EBITDA to interest expense (“Interest Coverage Ratio”), both calculated on a trailing twelve-month basis, at the end of each quarter of 3.50 to 1.00.

The Credit Agreement also requires the Company and its subsidiaries to comply with customary covenants that include, among others, limitations on the incurrence of additional debt, liens on property, acquisitions and investments, loans and guarantees, mergers, consolidations, liquidations and dissolutions, asset sales, dividends and other payments in respect of the Company’s capital stock, prepayments of certain debt, transactions with affiliates and certain modifications of organizational documents and certain debt agreements. In addition, the indentures governing the Company’s 2026 Senior Unsecured Notes and the 2024 Convertible Notes contain restrictive covenants that limit the Company’s and its subsidiaries’ ability to, among other things, consolidate, merge or sell all or substantially all of their assets; create liens; and incur, assume or guarantee additional indebtedness.

Pensions and Other Post-retirement Benefit Plans

9 Months Ended

Mar. 29, 2019

Retirement Benefits [Abstract]

Pensions and Other Post-retirement Benefit Plans

Pension and Other Post-Retirement Benefit Plans

The Company has pension and other post-retirement benefit plans in various countries. The Company’s principal pension plans are in Japan. All pension and other post-retirement benefit plans outside of the Company’s Japanese defined benefit pension plan (the “Japanese Plan”) are immaterial to the Condensed Consolidated Financial Statements. The expected long-term rate of return on the Japanese Plan assets is 2.5%.

Obligations and Funded Status

The following table presents the unfunded status of the benefit obligations for the Japanese Plan:



	March 29, 2019		June 29, 2018
	(in millions)
Benefit obligations	$	260	$	260
Fair value of plan assets	205		200
Unfunded status	$	55	$	60

The following table presents the unfunded amounts related to the Japanese Plan as recognized on the Company’s Condensed Consolidated Balance Sheets:



	March 29, 2019		June 29, 2018
	(in millions)
Current liabilities	$	1	$	1
Non-current liabilities	54		59
Net amount recognized	$	55	$	60

Net periodic benefit costs were not material for the three and nine months ended March 29, 2019.

Commitments, Contingencies and Related Parties

9 Months Ended

Mar. 29, 2019

Commitments and Contingencies Disclosure [Abstract]

Commitments, Contingencies and Related Parties

Flash Ventures

The Company’s business ventures with Toshiba Memory Corporation (“TMC”) consist of three separate legal entities: Flash Partners Ltd. (“Flash Partners”), Flash Alliance Ltd. (“Flash Alliance”), and Flash Forward Ltd. (“Flash Forward”), collectively referred to as “Flash Ventures”.

The following table presents the notes receivable from, and equity investments in, Flash Ventures as of March 29, 2019 and June 29, 2018:



	March 29, 2019		June 29, 2018
	(in millions)
Notes receivable, Flash Partners	$	620	$	767
Notes receivable, Flash Alliance	599		48
Notes receivable, Flash Forward	584		700
Investment in Flash Partners	194		191
Investment in Flash Alliance	287		283
Investment in Flash Forward	119		116
Total notes receivable and investments in Flash Ventures	$	2,403	$	2,105

During the three and nine months ended March 29, 2019, the Company made net payments to Flash Ventures of $1.0 billion and $2.9 billion, respectively, for purchased flash-based memory wafers and net loans and investments.

The Company makes, or will make, loans to Flash Ventures to fund equipment investments for new process technologies and additional wafer capacity. The Company aggregates its Flash Ventures’ notes receivable into one class of financing receivables due to the similar ownership interest and common structure in each Flash Venture entity. For all reporting periods presented, no loans were past due and no loan impairments were recorded. The Company’s notes receivable from each Flash Ventures entity, denominated in Japanese yen, are secured by equipment owned by that Flash Ventures entity.

The Company assesses financing receivable credit quality through financial and operational reviews of the borrower and creditworthiness, including credit rating agency ratings, of significant investors of the borrower, where material or known. There were no impairments in the three and nine months ended March 29, 2019 or March 30, 2018.

As of March 29, 2019 and June 29, 2018, the Company had accounts payable balances due to Flash Ventures of $312 million and $259 million, respectively.

The Company’s maximum reasonably estimable loss exposure (excluding lost profits) as a result of its involvement with Flash Ventures, based upon the Japanese yen to U.S. dollar exchange rate at March 29, 2019, is presented below. Investments in Flash Ventures are denominated in Japanese yen, and the maximum estimable loss exposure excludes any cumulative translation adjustment due to revaluation from the Japanese yen to the U.S. dollar.



	March 29, 2019

Notes receivable	$	1,803
Equity investments	600
Operating lease guarantees	1,421
Inventory	274
Maximum estimable loss exposure	$	4,098

The Company is committed to purchase its provided three-month forecast of Flash Ventures’ flash-based wafer supply, which generally equals 50% of Flash Ventures’ output. In addition, the Company is obligated to pay for half of Flash Ventures’ fixed costs regardless of the output the Company chooses to purchase. The Company is not able to estimate its total wafer purchase commitment obligation beyond its rolling three-month purchase commitment because the price is determined by reference to the future cost of producing the semiconductor wafers. In addition, the Company is committed to fund 49.9% to 50.0% of each Flash Ventures entity’s capital investments to the extent that each Flash Ventures entity’s operating cash flow is insufficient to fund these investments.

Flash Ventures has historically operated near 100% of its manufacturing capacity. As a result of current supply/demand imbalance for flash-based products, the Company temporarily reduced its utilization of its share of Flash Ventures’ manufacturing capacity to an abnormally low level to more closely align the Company’s flash-based wafer supply with the projected demand. The Company incurred costs of $148 million and $197 million associated with the reduction in utilization which was recorded as a charge to cost of revenue in the three and nine months ended March 29, 2019, respectively.

Off-Balance Sheet Liabilities

Flash Ventures sells to and leases back from a consortium of financial institutions a portion of its tools and has entered into equipment lease agreements of which the Company guarantees half or all of the outstanding obligations under each lease agreement. The lease agreements contain customary covenants for Japanese lease facilities. In addition to containing customary events of default related to Flash Ventures that could result in an acceleration of Flash Ventures’ obligations, the lease agreements contain acceleration clauses for certain events of default related to the guarantors, including the Company.

The following table presents the Company’s portion of the remaining guarantee obligations under the Flash Ventures’ lease facilities in both Japanese yen and U.S. dollar-equivalent, based upon the Japanese yen to U.S. dollar exchange rate as of March 29, 2019.



	Lease Amounts
	(Japanese yen, in billions)		(U.S. dollar, in millions)
Total guarantee obligations	¥	157	$	1,421

The following table details the breakdown of the Company’s remaining guarantee obligations between the principal amortization and the purchase option exercise price at the end of the term of the Flash Ventures lease agreements, in annual installments as of March 29, 2019 in U.S. dollars, based upon the Japanese yen to U.S. dollar exchange rate as of March 29, 2019:



Annual Installments	Payment of Principal Amortization		Purchase Option Exercise Price at Final Lease Terms		Guarantee Amount
	(in millions)
Remaining three months of 2019	$	106	$	9	$	115
2020	360		64		424
2021	271		106		377
2022	185		48		233
2023	81		28		109
Thereafter	45		118		163
Total guarantee obligations	$	1,048	$	373	$	1,421

The Company and TMC have agreed to mutually contribute to, and indemnify each other and Flash Ventures for, environmental remediation costs or liability resulting from Flash Ventures’ manufacturing operations in certain circumstances. The Company has not made any indemnification payments, nor recorded any indemnification receivables, under any such agreements. As of March 29, 2019, no amounts have been accrued in the Condensed Consolidated Financial Statements with respect to these indemnification agreements.

Unis Venture

The Company has a joint venture with Unisplendour Corporation Limited and Unissoft (Wuxi) Group Co. Ltd. (“Unis”), referred to as the “Unis Venture”, to market and sell the Company’s products in China and to develop data storage systems for the Chinese market in the future. The Unis Venture is 49% owned by the Company and 51% owned by Unis. The Company accounts for its investment in the Unis Venture under the equity method of accounting. Revenue on products distributed by the Unis Venture is recognized upon sell through to third-party customers. For the three and nine months ended March 29, 2019 and March 30, 2018, the Company recognized less than 1% of its consolidated revenue on products distributed by the Unis Venture. The outstanding accounts receivable due from and investment in the Unis Venture were not material to the Condensed Consolidated Financial Statements as of March 29, 2019 or June 29, 2018.

Purchase Agreements

In the normal course of business, the Company enters into purchase orders with suppliers for the purchase of components used to manufacture its products. These purchase orders generally cover forecasted component supplies needed for production during the next quarter, are recorded as a liability upon receipt of the components, and generally may be changed or canceled at any time prior to shipment of the components. The Company also enters into long-term purchase agreements with various component suppliers that carry fixed volumes and pricing, which obligates the Company to make certain future purchases, contingent on certain conditions of performance, quality and technology of the vendor’s components. As of March 29, 2019, the Company had the following minimum long-term purchase commitments:



	Long-term purchase commitments
	(in millions)
Fiscal year
Remaining three months of 2019	$	15
2020	192
2021	208
2022	227
2023 and thereafter	250
Total	$	892

Shareholders' Equity

9 Months Ended

Mar. 29, 2019

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Shareholders' Equity

Shareholders’ Equity

Stock-based Compensation Expense

The following tables present the Company’s stock-based compensation for equity-settled awards by type and financial statement line as well as the related tax benefit included in the Company’s Condensed Consolidated Statements of Operations:



	Three Months Ended						Nine Months Ended
	March 29, 2019			March 30, 2018			March 29, 2019			March 30, 2018
	(in millions)
Options	$	3		$	6		$	12		$	19
Restricted and performance stock units	71			89			208			260
Employee stock purchase plan	10			8			22			20
Subtotal	84			103			242			299
Tax benefit	(14		)	(17		)	(39		)	(51		)
Total	$	70		$	86		$	203		$	248



	Three Months Ended				Nine Months Ended
	March 29, 2019		March 30, 2018		March 29, 2019		March 30, 2018
	(in millions)
Cost of revenue	$	13	$	11	$	37	$	37
Research and development	41		45		122		134
Selling, general and administrative	30		46		83		127
Employee termination, asset impairment, and other charges	—		1		—		1
Subtotal	<