0000106040-20-000061 | 10-Q | XBRL Viewer

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Cover Page - shares	3 Months Ended
Cover Page - shares	Oct. 02, 2020	Oct. 30, 2020
Cover [Abstract]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Oct. 02, 2020
Document Transition Report	false
Entity File Number	1-8703
Entity Registrant Name	WESTERN DIGITAL CORPORATION
Entity Incorporation, State or Country Code	DE
Entity Tax Identification Number	33-0956711
Entity Address, Address Line One	5601 Great Oaks Parkway
Entity Address, City or Town	San Jose,
Entity Address, State or Province	CA
Entity Address, Postal Zip Code	95119
City Area Code	408
Local Phone Number	717-6000
Title of 12(b) Security	Common Stock, $.01 Par Value Per Share
Trading Symbol	WDC
Security Exchange Name	NASDAQ
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding (in shares)		304,245,045
Entity Central Index Key	0000106040
Current Fiscal Year End Date	--07-02
Document Fiscal Year Focus	2021
Document Fiscal Period Focus	Q1
Amendment Flag	false

Condensed Consolidated Balance Sheets - USD ($) $ in Millions	Oct. 02, 2020	Jul. 03, 2020
Current assets:
Cash and cash equivalents	$ 2,995	$ 3,048
Accounts receivable, net	2,097	2,379
Inventories	3,355	3,070
Other current assets	558	551
Total current assets	9,005	9,048
Non-current assets:
Property, plant and equipment, net	2,897	2,854
Notes receivable and investments in Flash Ventures	1,746	1,875
Goodwill	10,069	10,067
Other intangible assets, net	758	941
Other non-current assets	927	877
Total assets	25,402	25,662
Current liabilities:
Accounts payable	1,949	1,945
Accounts payable to related parties	404	407
Accrued expenses	1,293	1,296
Accrued compensation	497	472
Current portion of long-term debt	286	286
Total current liabilities	4,429	4,406
Non-current liabilities:
Long-term debt	9,086	9,289
Other liabilities	2,311	2,416
Total liabilities	15,826	16,111
Commitments and contingencies (Notes 9, 10, 12 and 15)
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 — 304 shares and 302 shares, respectively	3	3
Additional paid-in capital	3,537	3,717
Accumulated other comprehensive income (loss)	(101)	(157)
Retained earnings	6,658	6,725
Treasury stock — common shares at cost; 8 shares and 10 shares, respectively	(521)	(737)
Total shareholders’ equity	9,576	9,551
Total liabilities and shareholders’ equity	$ 25,402	$ 25,662

Condensed Consolidated Balance Sheets (Parenthetical) - $ / shares	Oct. 02, 2020	Jul. 03, 2020
Statement of Financial Position [Abstract]
Preferred stock, par value (USD per share)	$ 0.01	$ 0.01
Preferred stock shares authorized	5,000,000	5,000,000
Preferred stock shares issued	0	0
Preferred stock shares outstanding	0	0
Common stock, par value (USD per share)	$ 0.01	$ 0.01
Common stock shares authorized	450,000,000	450,000,000
Common stock shares issued	312,000,000	312,000,000
Common stock shares outstanding	304,000,000	302,000,000
Treasury stock shares	8,000,000	10,000,000

Condensed Consolidated Statements of Operations - USD ($) shares in Millions, $ in Millions	3 Months Ended
	Oct. 02, 2020	Oct. 04, 2019
Income Statement [Abstract]
Revenue, net	$ 3,922	$ 4,040
Cost of revenue	3,018	3,282
Gross profit	904	758
Operating expenses:
Research and development	555	574
Selling, general and administrative	256	305
Employee termination, asset impairment, and other charges	23	8
Total operating expenses	834	887
Operating income (loss)	70	(129)
Interest and other income (expense):
Interest income	2	12
Interest expense	(84)	(122)
Other income, net	9	2
Total interest and other expense, net	(73)	(108)
Loss before taxes	(3)	(237)
Income tax expense	57	39
Net loss	$ (60)	$ (276)
Loss per common share
Loss per common share, basic and diluted (USD per share)	$ (0.20)	$ (0.93)
Weighted average shares outstanding:
Weighted average shares outstanding, basic and diluted (in shares)	303	296
Cash dividends declared per share (in USD per share)	$ 0	$ 0.50

Condensed Consolidated Statements of Comprehensive Loss - USD ($) $ in Millions	3 Months Ended
	Oct. 02, 2020	Oct. 04, 2019
Statement of Comprehensive Income [Abstract]
Net loss	$ (60)	$ (276)
Other comprehensive income (loss), before tax:
Actuarial pension gain	1	1
Foreign currency translation adjustment	32	5
Net unrealized gain (loss) on derivative contracts and available-for-sale securities	30	(33)
Total other comprehensive income (loss), before tax	63	(27)
Income tax benefit (expense) related to items of other comprehensive income (loss), before tax	(7)	5
Net current-period other comprehensive loss	56	(22)
Total comprehensive loss	$ (4)	$ (298)

Condensed Consolidated Statements of Cash Flows - USD ($) $ in Millions	3 Months Ended
	Oct. 02, 2020	Oct. 04, 2019
Cash flows from operating activities
Net loss	$ (60)	$ (276)
Adjustments to reconcile net loss to net cash provided by operations:
Depreciation and amortization	374	406
Stock-based compensation	76	77
Deferred income taxes	11	(27)
Loss on disposal of assets	1	2
Amortization of debt discounts	10	10
Other non-cash operating activities, net	(6)	(21)
Changes in:
Accounts receivable, net	282	(243)
Inventories	(285)	(5)
Accounts payable	99	155
Accounts payable to related parties	(3)	176
Accrued expenses	(23)	100
Accrued compensation	26	75
Other assets and liabilities, net	(139)	(176)
Net cash provided by operating activities	363	253
Cash flows from investing activities
Purchases of property, plant and equipment	(337)	(145)
Proceeds from the sale of property, plant and equipment	7	0
Acquisitions, net of cash acquired	0	(22)
Notes receivable issuances to Flash Ventures	(114)	(171)
Notes receivable proceeds from Flash Ventures	277	357
Strategic investments and other, net	1	15
Net cash provided by (used in) investing activities	(166)	34
Cash flows from financing activities
Issuance of stock under employee stock plans	1	26
Taxes paid on vested stock awards under employee stock plans	(41)	(52)
Dividends paid to shareholders	0	(147)
Repayment of debt	(213)	(319)
Net cash used in financing activities	(253)	(492)
Effect of exchange rate changes on cash	3	(2)
Net decrease in cash and cash equivalents	(53)	(207)
Cash and cash equivalents, beginning of year	3,048	3,455
Cash and cash equivalents, end of period	2,995	3,248
Supplemental disclosure of cash flow information:
Cash paid for income taxes	144	67
Cash paid for interest	$ 104	$ 143

Condensed Consolidated Statements of Shareholders' Equity - USD ($) shares in Thousands, $ in Millions	Total	Cumulative Effect, Period of Adoption, Adjustment	Common Stock	Treasury Stock	Additional Paid-In Capital	Accumulated Other Comprehensive Income (Loss)	Retained Earnings	Retained Earnings Cumulative Effect, Period of Adoption, Adjustment
Beginning balance (in shares) at Jun. 28, 2019			312,000	(17,000)
Beginning balance at Jun. 28, 2019	$ 9,967	$ (5)	$ 3	$ (1,268)	$ 3,851	$ (68)	$ 7,449	$ (5)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net loss	(276)						(276)
Employee stock plans (in shares)				3,000
Employee stock plans	(26)			$ 181	(207)
Stock-based compensation	77				77
Dividends to shareholders	(149)				7		(156)
Actuarial pension gain	1					1
Foreign currency translation adjustment	4					4
Net unrealized loss on derivative contracts	(27)					(27)
Ending balance (in shares) at Oct. 04, 2019			312,000	(14,000)
Ending balance at Oct. 04, 2019	9,566		$ 3	$ (1,087)	3,728	(90)	7,012
Beginning balance (in shares) at Jul. 03, 2020			312,000	(10,000)
Beginning balance at Jul. 03, 2020	9,551	$ (7)	$ 3	$ (737)	3,717	(157)	6,725	$ (7)
Increase (Decrease) in Stockholders' Equity [Roll Forward]
Net loss	(60)						(60)
Employee stock plans (in shares)				2,000
Employee stock plans	(40)			$ 216	(256)
Stock-based compensation	76				76
Actuarial pension gain	1					1
Foreign currency translation adjustment	32					32
Net unrealized loss on derivative contracts	23					23
Ending balance (in shares) at Oct. 02, 2020			312,000	(8,000)
Ending balance at Oct. 02, 2020	$ 9,576		$ 3	$ (521)	$ 3,537	$ (101)	$ 6,658

Organization and Basis of Presentation	3 Months Ended
Organization and Basis of Presentation	Oct. 02, 2020
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 (“IT”) industry and the infrastructure that enables the proliferation of data in virtually every other industry. The Company creates environments for data to thrive. The Company is driving the innovation needed to help customers capture, preserve, access and transform an ever-increasing diversity of data. Everywhere data lives, from advanced data centers to mobile sensors to personal devices, the Company’s industry-leading solutions deliver the possibilities of data. The Company’s broad portfolio of technology and products address the following key end markets: Client Devices; Data Center Devices and Solutions; and Client Solutions. The Company also generates license and royalty revenue from its extensive intellectual property (“IP”), which is included in each of these three end market 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 July 3, 2020. 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 July 3, 2020. 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. Approximately every five to six years, the Company reports a 53-week fiscal year to align the fiscal year with the foregoing policy. Fiscal year 2021, which ends on July 2, 2021, will be comprised of 52 weeks, with all quarters presented consisting of 13 weeks. Fiscal year 2020, which ended on July 3, 2020, was 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 with consideration given to the potential impacts of the coronavirus disease 2019 (“COVID-19”) pandemic. However, actual results could differ materially from these estimates and be significantly affected by the severity and duration of the pandemic, the extent of actions to contain or treat COVID-19, how quickly and to what extent normal economic and operating activity can resume, and the severity and duration of the global economic downturn that results from the pandemic. Segment Information The Company manufactures, markets, and sells data storage devices and solutions in the U.S. and in foreign countries through its sales personnel, dealers, distributors, retailers, and subsidiaries. Historically, the Company has managed and reported under a single operating segment. Late in the first quarter of fiscal 2021, the Chief Executive Officer, who is the Company’s Chief Operating Decision Maker (“CODM”), announced a decision to reorganize the Company’s business by forming two separate product business units: flash-based products and hard disk drives (“HDD”). Beginning in the second fiscal quarter, the Company is in the process of transitioning to this new operating model and discrete information has not yet been established to align with the new business structure. Management expects to finalize its assessment of its operating segments when the transition is completed, which is expected to be by the end of fiscal 2021.

Recent Accounting Pronouncements	3 Months Ended
Recent Accounting Pronouncements	Oct. 02, 2020
Accounting Changes and Error Corrections [Abstract]
Recent Accounting Pronouncements	Recent Accounting Pronouncements Accounting Pronouncements Recently Adopted In June 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Updates (“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 adopted this standard effective July 4, 2020 (the beginning of fiscal 2021) with no material impact on its Condensed Consolidated Financial Statements. 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 Accounting Standards Codification (ASC) 606 by recognizing a cumulative-effect adjustment to the opening balance of retained earnings of the earliest annual period presented. The Company adopted this standard effective July 4, 2020 (the beginning of fiscal 2021) with no material impact on its Condensed Consolidated Financial Statements. Recently Issued Accounting Pronouncements Not Yet Adopted In December 2019, the FASB issued ASU No. 2019-12, “Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes” (“ASU 2019-12”). ASU 2019-12 removes certain exceptions for recognizing deferred taxes for investments, performing intraperiod allocation and calculating income taxes in interim periods. The ASU also adds guidance to reduce complexity in certain areas, including recognizing deferred taxes for tax goodwill and allocating taxes to members of a consolidated group. This ASU is effective for fiscal years (and interim periods within those fiscal years) beginning after December 15, 2020, which for the Company is the first quarter of fiscal 2022. Early adoption is permitted. The Company does not expect this update to have a material impact on its Condensed Consolidated Financial Statements.

- Definition

The entire disclosure for change in accounting principle. Includes, but is not limited to, nature, reason, and method of adopting amendment to accounting standards or other change in accounting principle.

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+ Details

Revenues

3 Months Ended

Oct. 02, 2020

Revenue from Contract with Customer [Abstract]

Revenues

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 October 2, 2020 or July 3, 2020.

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. 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 as of October 2, 2020 and July 3, 2020 as well as the related amortization for the three months ended October 2, 2020 and October 4, 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 October 2, 2020 and July 3, 2020, contract liabilities were not material.

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 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 October 2, 2020 was $102 million, which is mainly attributable to the functional IP license and service arrangements. The Company expects to recognize this amount as revenue as follows: $31 million during the remainder of fiscal 2021, $40 million in fiscal 2022, and $31 million in fiscal 2023 and thereafter.

The Company’s disaggregated revenue information is as follows:



	Three Months Ended
	October 2, 2020		October 4, 2019
	(in millions)
Revenue by Product
Hard disk drives (“HDD”)	$	1,844	$	2,408
Flash-based	2,078		1,632
Total Revenue	$	3,922	$	4,040

Revenue by End Market
Client Devices	$	1,946	$	1,616
Data Center Devices & Solutions	1,129		1,532
Client Solutions	847		892
Total Revenue	$	3,922	$	4,040

Revenue by Geography
Americas	$	1,079	$	1,313
Europe, Middle East and Africa	629		779
Asia	2,214		1,948
Total Revenue	$	3,922	$	4,040

The Company’s top 10 customers accounted for 44% of its net revenue for the three months ended October 2, 2020, and 43% of its net revenue for the three months ended October 4, 2019. For the three months ended October 2, 2020, no single customer accounted for 10% of the Company’s net revenue, and for the three months ended October 4, 2019, one customer accounted for 11% of the Company’s net revenue.

- Definition

The entire disclosure of revenue from contract with customer to transfer good or service and to transfer nonfinancial asset. Includes, but is not limited to, disaggregation of revenue, credit loss recognized from contract with customer, judgment and change in judgment related to contract with customer, and asset recognized from cost incurred to obtain or fulfill contract with customer. Excludes insurance and lease contracts.

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-SubTopic 10
-Section 50
-Paragraph 9
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Reference 6: http://www.xbrl.org/2003/role/disclosureRef
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Reference 7: http://www.xbrl.org/2003/role/disclosureRef
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Reference 8: http://www.xbrl.org/2003/role/disclosureRef
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-Topic 606
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-Section 50
-Paragraph 12
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Reference 9: http://www.xbrl.org/2003/role/disclosureRef
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-Name Accounting Standards Codification
-Topic 606
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Reference 10: http://www.xbrl.org/2003/role/disclosureRef
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-Name Accounting Standards Codification
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+ Details

Supplemental Financial Statement Data

3 Months Ended

Oct. 02, 2020

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 three months ended October 2, 2020 and October 4, 2019, the Company sold trade accounts receivable and received cash proceeds of $128 million and $85 million, respectively. The discounts on the trade accounts receivable sold during the periods were not material and were recorded within Other income, net in the Condensed Consolidated Statements of Operations. As of October 2, 2020 and July 3, 2020, the amount of factored receivables that remained outstanding was $128 million and $113 million, respectively.

Inventories


	October 2, 2020		July 3, 2020
	(in millions)
Inventories:
Raw materials and component parts	$	1,426	$	1,306
Work-in-process	964		956
Finished goods	965		808
Total inventories	$	3,355	$	3,070

Property, plant and equipment, net


	October 2, 2020		July 3, 2020
	(in millions)
Property, plant and equipment:
Land	$	286	$	294
Buildings and improvements	1,865		1,837
Machinery and equipment	7,514		7,391
Computer equipment and software	430		429
Furniture and fixtures	52		52
Construction-in-process	327		297
Property, plant and equipment, gross	10,474		10,300
Accumulated depreciation	(7,577)		(7,446)
Property, plant and equipment, net	$	2,897	$	2,854

Goodwill


	Carrying Amount
	(in millions)















Balance at July 3, 2020	$	10,067


Foreign currency translation adjustment	2
Balance at October 2, 2020	$	10,069

Intangible assets


	October 2, 2020		July 3, 2020
	(in millions)
Finite-lived intangible assets	$	5,543	$	5,541
In-process research and development	80		80
Accumulated amortization	(4,865)		(4,680)
Intangible assets, net	$	758	$	941

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.

Product warranty liability

Changes in the warranty accrual were as follows:


	Three Months Ended
	October 2, 2020		October 4, 2019
	(in millions)
Warranty accrual, beginning of period	$	408	$	350

Charges to operations	35		49
Utilization	(31)		(48)
Changes in estimate related to pre-existing warranties	(21)		6
Warranty accrual, end of period	$	391	$	357

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:


	October 2, 2020		July 3, 2020
	(in millions)
Warranty accrual
Current portion (included in Accrued expenses)	$	191	$	205
Long-term portion (included in Other liabilities)	200		203
Total warranty accrual	$	391	$	408

Other liabilities


	October 2, 2020		July 3, 2020
	(in millions)
Other liabilities:
Non-current net tax payable	$	711	$	815
Payables related to unrecognized tax benefits	715		720
Other non-current liabilities	885		881
Total other liabilities	$	2,311	$	2,416

Accumulated other comprehensive income (loss)

Accumulated other comprehensive income (loss) (“AOCI”), 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 AOCI:


	Actuarial Pension Gains (Losses)		Foreign Currency Translation Adjustment		Unrealized Gains (Losses) on Derivative Contracts		Total Accumulated Comprehensive Income (Loss)
	(in millions)










Balance at July 3, 2020	$	(58)	$	(2)	$	(97)	$	(157)
Other comprehensive loss before reclassifications	1		32		18		51
Amounts reclassified from accumulated other comprehensive loss	—		—		12		12
Income tax benefit (expense) related to items of other comprehensive loss	—		—		(7)		(7)
Net current-period other comprehensive loss	1		32		23		56
Balance at October 2, 2020	$	(57)	$	30	$	(74)	$	(101)

During the three months ended October 2, 2020 and October 4, 2019, the amounts reclassified out of AOCI related to derivative contracts were substantially all charged to Cost of revenue in the Condensed Consolidated Statements of Operations.

Fair Value Measurements and Investments

3 Months Ended

Oct. 02, 2020

Fair Value Disclosures [Abstract]

Fair Value Measurements and Investments

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 October 2, 2020 and July 3, 2020, and indicate the fair value hierarchy of the valuation techniques utilized to determine such values:


	October 2, 2020
	Level 1		Level 2		Level 3		Total
	(in millions)
Assets:

Cash equivalents - Money market funds	$	861	$	—	$	—	$	861


















Foreign exchange contracts	—		24		—		24


Total assets at fair value	$	861	$	24	$	—	$	885
Liabilities:
Foreign exchange contracts	$	—	$	10	$	—	$	10
Interest rate swap contract	—		120		—		120

Total liabilities at fair value	$	—	$	130	$	—	$	130


	July 3, 2020
	Level 1		Level 2		Level 3		Total
	(in millions)
Assets:

Cash equivalents - Money market funds	$	1,079	$	—	$	—	$	1,079


















Foreign exchange contracts	—		28		—		28


Total assets at fair value	$	1,079	$	28	$	—	$	1,107
Liabilities:
Foreign exchange contracts	$	—	$	9	$	—	$	9
Interest rate swap contract	—		133		—		133

Total liabilities at fair value	$	—	$	142	$	—	$	142

During the three months ended October 2, 2020 and October 4, 2019, the Company had no transfers of financial assets and liabilities between levels and there were no changes in valuation techniques and the inputs used in the fair value measurement.

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 first quarter of 2021 and the fourth quarter of 2020, respectively.


	October 2, 2020				July 3, 2020
	Carrying Value		Fair Value		Carrying Value		Fair Value
	(in millions)
0.50% convertible senior notes due 2020	$	35	$	34	$	34	$	30

Variable interest rate Term Loan A-1 maturing 2023	4,514		4,427		4,576		4,474


Variable interest rate Term Loan B-4 maturing 2023	1,543		1,536		1,692		1,656

1.50% convertible notes due 2024	994		1,043		987		1,036

4.75% senior unsecured notes due 2026	2,286		2,475		2,286		2,428





Total	$	9,372	$	9,515	$	9,575	$	9,624

- 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	3 Months Ended
Derivatives Instruments and Hedging Activities	Oct. 02, 2020
Derivative Instruments and Hedging Activities Disclosure [Abstract]
Derivative Instruments and Hedging Activities	Derivative Instruments and Hedging Activities As of October 2, 2020, 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 pay-fixed interest rate swaps that were designated as cash flow hedges of variable rate interest payments on a portion of its term loans through February 2023. As of October 2, 2020, the amount of existing net losses related to cash flow hedges recorded in AOCI included $70 million related to the Company’s interest rate swaps that is expected to be reclassified to earnings after twelve months. In addition, as of October 2, 2020, the Company did not have any foreign exchange forward contracts with credit-risk-related contingent features. Changes in fair values of the non-designated foreign exchange contracts are recognized in Other income, 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 months ended October 2, 2020 and October 4, 2019, 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. 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 October 2, 2020 and July 3, 2020, 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

3 Months Ended

Oct. 02, 2020

Debt Disclosure [Abstract]

Debt

Debt consisted of the following as of October 2, 2020 and July 3, 2020:


	October 2, 2020		July 3, 2020
	(in millions)
0.50% convertible senior notes due 2020	$	35	$	35


Variable interest rate Term Loan A-1 maturing 2023	4,520		4,583




Variable interest rate Term Loan B-4 maturing 2023	1,543		1,693




1.50% convertible notes due 2024	1,100		1,100

4.75% senior unsecured notes due 2026	2,300		2,300

Total debt	9,498		9,711
Issuance costs and debt discounts	(126)		(136)
Subtotal	9,372		9,575
Less current portion of long-term debt	(286)		(286)
Long-term debt	$	9,086	$	9,289

The credit agreement governing the revolving credit facility and Term Loan A-1 requires the Company to comply with certain financial covenants, consisting of a leverage ratio and an interest coverage ratio. As of October 2, 2020, the Company was in compliance with these financial covenants.

During the three months ended October 2, 2020, the Company made a voluntary prepayment of $150 million on its Term Loan B-4. Subsequent to October 2, 2020, the 0.50% convertible notes due 2020 were settled in full in accordance with their terms

Pensions and Other Post-Retirement Benefit Plans

3 Months Ended

Oct. 02, 2020

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, Thailand and the Philippines. All pension and other post-retirement benefit plans outside of the Company’s Japan, Thailand and Philippines defined benefit pension plans (the “Pension Plans”) are immaterial to the Condensed Consolidated Financial Statements. The expected long-term rate of return on the Pension Plans assets is 2.5%.

Obligations and Funded Status

The following table presents the unfunded status of the benefit obligations for the Pension Plans:


	October 2, 2020		July 3, 2020
	(in millions)











Benefit obligation at end of period	$	374	$	366









Fair value of plan assets at end of period	221		215
Unfunded status	$	153	$	151

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


	October 2, 2020		July 3, 2020
	(in millions)
Current liabilities	$	1	$	1
Non-current liabilities	152		150
Net amount recognized	$	153	$	151

Net periodic benefit costs were not material for the three months ended October 2, 2020.

- Definition

The entire disclosure for retirement benefits.

+ References

Reference 1: http://www.xbrl.org/2003/role/exampleRef
-Publisher FASB
-Name Accounting Standards Codification
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Reference 2: http://www.xbrl.org/2003/role/disclosureRef
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Reference 7: http://www.xbrl.org/2003/role/disclosureRef
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Reference 8: http://www.xbrl.org/2003/role/disclosureRef
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+ Details

Related Parties and Related Commitments and Contingencies

3 Months Ended

Oct. 02, 2020

Commitments and Contingencies Disclosure [Abstract]

Flash Ventures

The Company’s business ventures with Kioxia Corporation (“Kioxia”) 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 October 2, 2020 and July 3, 2020:


	October 2, 2020		July 3, 2020
	(in millions)
Notes receivable, Flash Partners	$	271	$	273
Notes receivable, Flash Alliance	231		301
Notes receivable, Flash Forward	597		670
Investment in Flash Partners	208		203
Investment in Flash Alliance	307		300
Investment in Flash Forward	132		128
Total notes receivable and investments in Flash Ventures	$	1,746	$	1,875

During the three months ended October 2, 2020 and October 4, 2019, the Company made net payments to Flash Ventures of $981 million and $682 million, 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.

As of October 2, 2020 and July 3, 2020, the Company had Accounts payable balances due to Flash Ventures of $404 million and $407 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 October 2, 2020, 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.


	October 2, 2020
	(in millions)
Notes receivable	$	1,099
Equity investments	647
Operating lease guarantees	2,004
Inventory and prepayments	575
Maximum estimable loss exposure	$	4,325

The Company is obligated to pay for variable costs incurred in producing its share of Flash Ventures’ flash-based memory wafer supply, based on its three-month forecast, 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.

In June 2019, an unexpected power outage incident occurred at the flash-based memory manufacturing facilities operated in Yokkaichi, Japan. The power outage incident impacted the facilities and process tools and resulted in damage to flash wafers in production and a reduction in the Company’s flash wafer availability. As a result of this incident, the Company incurred charges of $68 million for the three months ended October 4, 2019, which were recorded in Cost of revenue and primarily consisted of unabsorbed manufacturing overhead costs. During the three months ended October 2, 2020, the Company received a recovery of $30 million related to this incident from its insurance carriers, which was recorded in Cost of revenue. The Company continues to pursue recovery of its losses associated with this event; however, the total amount of recovery cannot be estimated at this time.

In May 2019, the Company entered into additional agreements with Kioxia to extend Flash Ventures to a new wafer fabrication facility, known as “K1,” located in Kitakami, Japan. The primary purpose of K1 is to provide clean room space to continue the transition of existing flash-based wafer capacity to newer technology nodes. Output from the initial production line at K1 began in the third quarter of fiscal year 2020, although meaningful output from K1 is not expected to begin until the end of calendar 2020. The Company has paid for most of its share of initial K1 equipment investments and relocation costs. Other period expenses associated with the initial production ramp at K1 are expected to begin trailing off toward the end of calendar year 2020 as output increases. The Company also agreed to prepay an aggregate of approximately $360 million over a 3-year period beginning in the first half of fiscal year 2020 toward K1 building depreciation, to be credited against future wafer charges. As of October 2, 2020, remaining committed prepayments totaled $178 million.

Inventory Purchase Commitments with Flash Ventures. Purchase orders placed under Flash Ventures for up to three months are binding and cannot be canceled.

Research and Development Activities. The Company participates in common research and development (“R&D”) activities with Kioxia and is contractually committed to a minimum funding level. R&D commitments are immaterial to the Condensed Consolidated Financial Statements.

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 are subject to customary covenants and cancellation events related to Flash Ventures and each of the guarantors. The occurrence of a cancellation event could result in an acceleration of Flash Ventures’ obligations and a call on the Company’s guarantees.

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 October 2, 2020.


	Lease Amounts
	(Japanese yen, in billions)		(U.S. dollar, in millions)
Total guarantee obligations	¥	211	$	2,004

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 October 2, 2020 in U.S. dollars, based upon the Japanese yen to U.S. dollar exchange rate as of October 2, 2020:


Annual Installments	Payment of Principal Amortization		Purchase Option Exercise Price at Final Lease Terms		Guarantee Amount
	(in millions)
Remaining nine months of 2021	$	407	$	80	$	487
2022	469		51		520
2023	356		69		425
2024	194		123		317
2025	55		113		168
Thereafter	15		72		87
Total guarantee obligations	$	1,496	$	508	$	2,004

The Company and Kioxia 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 October 2, 2020, 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 months ended October 2, 2020 and October 4, 2019, the Company recognized approximately 2% and 1%, respectively, of its consolidated revenue on products distributed by the Unis Venture. The outstanding accounts receivable due from and investment in the Unis Venture were 6% and 4% of Accounts receivable, net as of October 2, 2020 and July 3, 2020, respectively.

Leases and Other Commitments

3 Months Ended

Oct. 02, 2020

Leases [Abstract]

Leases and Other Commitments

Leases

The Company leases certain domestic and international facilities and data center space under long-term, non-cancelable operating leases that expire at various dates through 2034. These leases include no material variable or contingent lease payments. Operating lease assets and liabilities are recognized based on the present value of the remaining lease payments discounted using the Company’s incremental borrowing rate. Operating lease assets also include prepaid lease payments minus any lease incentives. Extension or termination options present in the Company’s lease agreements are included in determining the right-of-use asset and lease liability when it is reasonably certain the Company will exercise those options. Lease expense is recognized on a straight-line basis over the lease term. The following table summarizes supplemental balance sheet information related to operating leases as of October 2, 2020:


	Lease Amounts
Minimum lease payments by fiscal year:	(in millions)
Remaining nine months of 2021	$	35
2022	35
2023	29
2024	29
2025	27
Thereafter	144
Total future minimum lease payments	299
Less: Imputed Interest	(56)
Present value of lease liabilities	243
Less: Current portion (included in Accrued expenses)	37
Long-term operating lease liabilities (included in Other liabilities)	$	206

Operating lease right-of-use assets (included in Other non-current assets)	$	228

Weighted average remaining lease term in years	9.0
Weighted average discount rate	4.2		%

The following table summarizes supplemental disclosures of operating cost and cash flow information related to operating leases:


	Three Months Ended
	October 2, 2020		October 4, 2019
	(in millions)
Cost of operating leases	$	13	$	12
Cash paid for operating leases	12		16
Operating lease assets obtained in exchange for operating lease liabilities	7		49

Purchase Agreements and Other Commitments

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 agreements with suppliers that contain fixed future commitments, which are contingent on certain conditions such as performance, quality and technology of the vendor’s components. As of October 2, 2020, the Company had the following minimum long-term commitments:


	Long-term commitments
	(in millions)
Fiscal year:
Remaining nine months of 2021	$	328
2022	596
2023	523
2024	322
2025	148
Thereafter	190
Total	$	2,107

Shareholders' Equity

3 Months Ended

Oct. 02, 2020

Share-based Payment Arrangement [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 (i.e., stock options, restricted stock units (“RSUs”), restricted stock unit awards with performance conditions or market conditions (“PSUs”), and rights to purchase shares of common stock under the Company’s Employee Stock Purchase Plan (“ESPP”)) and financial statement line as well as the related tax benefit included in the Company’s Condensed Consolidated Statements of Operations:


	Three Months Ended
		October 2, 2020		October 4, 2019
		(in millions)
Options		$	—	$	2
RSUs and PSUs		67		66
ESPP		9		9
Total		$	76	$	77


	Three Months Ended
		October 2, 2020		October 4, 2019
		(in millions)
Cost of revenue		$	12	$	12
Research and development		39		41
Selling, general and administrative		25		24

Subtotal		76		77
Tax benefit		(11)		(12)
Total		$	65	$	65

Windfall tax benefits and tax deficiencies for shortfalls related to the vesting and exercise of stock-based awards, which are recognized as a component of the Company’s Income tax expense, were not material for the periods presented.

Compensation cost related to unvested stock options, RSUs, PSUs, and rights to purchase shares of common stock under the ESPP will generally be amortized on a straight-line basis over the remaining average service period. The following table presents the unamortized compensation cost and weighted average service period of all unvested outstanding awards as of October 2, 2020:


	Unamortized Compensation Costs		Weighted Average Service Period
	(in millions)		(years)

RSUs and PSUs (1)	$	743	3.0
ESPP	29		0.8
Total unamortized compensation cost	$	772

(1) Weighted average service period assumes the performance metrics are met for the PSUs.

Plan Activities

Stock Options

The following table summarizes stock option activity under the Company’s incentive plans:


	Number of Shares	Weighted Average Exercise Price Per Share		Weighted Average Remaining Contractual Life	Aggregate Intrinsic Value
	(in millions)			(in years)	(in millions)















Options outstanding at July 3, 2020	2.7	$	69.16	2.1	$	—


Exercised	—	18.30			$	—
Canceled or expired	(0.2)	68.81
Options outstanding at October 2, 2020	2.5	69.21		1.5	$	—
Exercisable at October 2, 2020	2.5	$	69.21	1.5	$	—

RSUs and PSUs

The following table summarizes RSU and PSU activity under the Company’s incentive plans:


	Number of Shares	Weighted Average Grant Date Fair Value		Aggregate Intrinsic Value at Vest Date
	(in millions)			(in millions)















RSUs and PSUs outstanding at July 3, 2020	13.3	$	60.92
Granted	7.9	37.86

Vested	(3.7)	61.20		$	149
Forfeited	(0.5)	65.04
RSUs and PSUs outstanding at October 2, 2020	17.0	49.70

RSUs and PSUs are generally settled in an equal number of shares of the Company’s common stock at the time of vesting of the units.

Stock Repurchase Program

The Company’s Board of Directors has authorized a stock repurchase program for the repurchase of up to $5.0 billion of the Company’s common stock, which authorization is effective through July 25, 2023. The Company did not make any stock repurchases during the three months ended October 2, 2020 and has not repurchased any shares of its common stock pursuant to its stock repurchase program since the first quarter of fiscal 2019. The remaining amount available to be repurchased under the Company’s current stock repurchase program as of October 2, 2020 was $4.5 billion. Repurchases under the stock repurchase program may be made in the open market or in privately negotiated transactions and may be made under a Rule 10b5-1 plan. The Company expects stock repurchases to be funded principally by operating cash flows.

Dividends to Shareholders

The Company issued a quarterly cash dividend from the first quarter of fiscal 2013 up to the third quarter of fiscal 2020. In April 2020, the Company suspended its dividend to reinvest in the business and to support its ongoing deleveraging efforts.

Income Tax Expense

3 Months Ended

Oct. 02, 2020

Income Tax Disclosure [Abstract]

Income Tax Expense

On March 27, 2020, the Coronavirus Aid, Relief, and Economic Security Act (the “CARES Act”) was enacted in response to the COVID-19 pandemic in the U.S. The CARES Act, among other things, allows net operating losses arising in tax years 2018, 2019, and 2020 to be carried back to each of the five preceding taxable years to generate a refund of previously paid income taxes and increases the business interest expense limitation from 30% to 50% of adjusted taxable income for tax years 2019 and 2020. Additionally, countries around the world continue to implement emergency tax measures to provide relief similar to the CARES Act. The Company at present does not expect that any of the provisions of the CARES Act or the emergency tax measures around the world would result in a material cash benefit. However, the Company continues to monitor and evaluate the regulatory and interpretive guidance related to the CARES Act as well as in other jurisdictions.

The Tax Cuts and Jobs Act (the “2017 Act”), enacted on December 22, 2017, includes a broad range of tax reform proposals affecting businesses. The Company completed its accounting for the tax effects of the enactment of the 2017 Act during the second quarter of fiscal 2019. However, the U.S. Treasury and the Internal Revenue Service (“IRS”) have issued tax guidance on certain provisions of the 2017 Act since the enactment date, and the Company anticipates the issuance of additional regulatory and interpretive guidance. The Company applied a reasonable interpretation of the 2017 Act along with the then-available guidance in finalizing its accounting for the tax effects of the 2017 Act. Any additional regulatory or interpretive guidance would constitute new information, which may require further refinements to the Company’s estimates in future periods.

The following table presents the Company’s Income tax expense and the effective tax rate:


	Three Months Ended
	October 2, 2020			October 4, 2019
	(in millions)
Loss before taxes	$	(3)		$	(237)
Income tax expense	57			39
Effective tax rate	(1,900)		%	(16)		%

The primary drivers of the difference between the effective tax rate for the three months ended October 2, 2020 and the U.S. Federal statutory rate of 21% are the relative mix of earnings and losses by jurisdiction, the deduction for foreign derived intangible income, credits and tax holidays in Malaysia, the Philippines and Thailand that will expire at various dates during fiscal years 2021 through 2030. In addition, the effective tax rate for the three months ended October 2, 2020 includes the discrete effects of net tax deficiencies from shortfalls of $11 million related to the vesting of stock-based awards and additional tax expense of $10 million from the re-measurement of purchase accounting deferred tax liabilities due to restructuring activities. The discrete items have no impact on the amount of income taxes paid by the Company.

The primary drivers of the difference between the effective tax rate for the three months ended October 4, 2019 and the U.S. Federal statutory rate of 21% are the relative mix of earnings and losses by jurisdiction, the deduction for foreign derived intangible income, credits, and tax holidays in Malaysia, Philippines and Thailand that expired or will expire at various dates during fiscal years 2020 through 2030.

The IRS previously completed its field examination of the Company’s federal income tax returns for fiscal years 2008 through 2012 and proposed certain adjustments. As previously disclosed, the Company received Revenue Agent Reports from the IRS for fiscal years 2008 through 2009, proposing adjustments relating to transfer pricing with the Company’s foreign subsidiaries and intercompany payable balances. The Company disagrees with the proposed adjustments and in September 2015, filed a protest with the IRS Appeals Office and received the IRS rebuttal in July 2016. The Company and the IRS Appeals Office did not reach a settlement on the disputed matters. On June 28, 2018, the IRS issued a statutory notice of deficiency with respect to the disputed matters for fiscal years 2008 through 2009, seeking to increase the Company’s U.S. taxable income by an amount that would result in additional federal tax through fiscal year 2009 totaling approximately $516 million, subject to interest and penalties. The Company filed a petition with the U.S. Tax Court in September 2018. On December 10, 2018, the IRS issued a statutory notice of deficiency with respect to fiscal years 2010 through 2012, seeking to increase the Company’s U.S. taxable income by an amount that would result in additional federal tax for fiscal years 2010 through 2012 totaling approximately $549 million, subject to interest and penalties. Approximately $535 million of the total additional federal tax for fiscal years 2010 through 2012 relates to proposed adjustments for transfer pricing with the Company’s foreign subsidiaries, intercompany payable balances and the utilization of certain tax attributes. The Company filed a petition with the U.S. Tax Court in March 2019. The U.S. Tax Court consolidated the case for fiscal years 2008 through 2009 with the case for fiscal years 2010 through 2012. On May 4, 2020, the IRS filed with the U.S. Tax Court Amendments to Answer to assert penalties totaling $340 million on the proposed adjustments relating to transfer pricing with respect to fiscal years 2008 through 2009 and fiscal years 2010 through 2012. In September 2020, the IRS proposed adjustments relating to transfer pricing with the Company’s foreign subsidiaries for fiscal years 2013 through 2015 that, if sustained, would result in additional federal tax totaling approximately $271 million. The Company disagrees with the proposed adjustments. The Company continues to believe that its tax positions are properly supported and will vigorously contest the position taken by the IRS.

The Company believes that adequate provision has been made for any adjustments that may result from tax examinations. However, the outcome of tax examinations cannot be predicted with certainty. If any issues addressed in the Company’s tax examinations are resolved in a manner not consistent with management’s expectations, the Company could be required to adjust its provision for income taxes in the period such resolution occurs. As of October 2, 2020, it was not possible to estimate the amount of change, if any, in the unrecognized tax benefits that is reasonably possible within the next twelve months. Any significant change in the amount of the Company’s liability for unrecognized tax benefits would most likely result from additional information or settlements relating to the examination of the Company’s tax returns.

As of October 2, 2020, the liability for unrecognized tax benefits (excluding accrued interest and penalties) was approximately $711 million. Accrued interest and penalties related to unrecognized tax benefits as of October 2, 2020 was approximately $141 million. Of these amounts, approximately $715 million could result in potential cash payments. The Company is not able to provide a reasonable estimate of the timing of future tax payments related to these obligations.

- Definition

The entire disclosure for income taxes. Disclosures may include net deferred tax liability or asset recognized in an enterprise's statement of financial position, net change during the year in the total valuation allowance, approximate tax effect of each type of temporary difference and carryforward that gives rise to a significant portion of deferred tax liabilities and deferred tax assets, utilization of a tax carryback, and tax uncertainties information.

+ References + Details

Net Loss Per Common Share

3 Months Ended

Oct. 02, 2020

Earnings Per Share [Abstract]

Net Loss Per Common Share

The following table presents the computation of basic and diluted loss per common share:


	Three Months Ended
	October 2, 2020		October 4, 2019
	(in millions, except per share data)
Net loss	$	(60)	$	(276)
Weighted average shares outstanding:


Basic and diluted	303		296
Loss per common share

Basic and diluted	$	(0.20)	$	(0.93)
Anti-dilutive potential common shares excluded	16		15

The Company computes basic loss per common share using Net loss and the weighted average number of common shares outstanding during the period. Diluted loss per common share is computed using Net loss and the weighted average number of common shares and potentially dilutive common shares outstanding during the period. Potentially dilutive common shares include dilutive outstanding employee stock options, RSUs and PSUs, and rights to purchase shares of common stock under the Company’s ESPP. For the three months ended October 2, 2020 and the three months ended October 4, 2019, the Company recorded net losses, and all shares subject to outstanding equity awards have been excluded for those periods because including them would be anti-dilutive.

Employee Termination, Asset Impairment and Other Charges

3 Months Ended

Oct. 02, 2020

Postemployment Benefits [Abstract]

Employee Termination, Asset Impairment and Other Charges

The Company recorded the following charges related to employee termination benefits, asset impairment, and other charges:


	Three Months Ended
	October 2, 2020		October 4, 2019
	(in millions)
Employee termination and other charges:

Closure of Foreign Manufacturing Facilities	$	—	$	4
Business Realignment	23		4











Total employee termination, asset impairment, and other charges	$	23	$	8

Business Realignment

The Company periodically incurs charges as part of the integration process of recent acquisitions and to realign its operations with anticipated market demand, primarily consisting of organization rationalization designed to streamline its business, reduce its cost structure and focus its resources.

The following table presents an analysis of the components of the activity against the reserve during the three months ended October 2, 2020:


	Employee Termination Benefits		Contract Termination and Other		Total
	(in millions)








Accrual balance at July 3, 2020	$	13	$	—	$	13
Charges	20		2		22
Cash payments	(20)		(2)		(22)

Accrual balance at October 2, 2020	$	13	$	—	$	13

Legal Proceedings	3 Months Ended
Legal Proceedings	Oct. 02, 2020
Commitments and Contingencies Disclosure [Abstract]
Legal Proceedings	Legal Proceedings Tax For disclosures regarding statutory notices of deficiency issued by the IRS on June 28, 2018 and December 10, 2018, and petitions filed by the Company with the U.S. Tax Court in September 2018 and March 2019, see Note 12, Income Tax Expense. Other Matters In the normal course of business, the Company is subject to legal proceedings, lawsuits and other claims. Although the ultimate aggregate amount of probable monetary liability or financial impact with respect to these other matters is subject to many uncertainties, management believes that any monetary liability or financial impact to the Company from these matters, individually and in the aggregate, would not be material to the Company’s financial condition, results of operations or cash flows. However, any monetary liability and financial impact to the Company from these matters could differ materially from the Company’s expectations.

Organization and Basis of Presentation (Policies)	3 Months Ended
Organization and Basis of Presentation (Policies)	Oct. 02, 2020
Organization, Consolidation and Presentation of Financial Statements [Abstract]
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 (“IT”) industry and the infrastructure that enables the proliferation of data in virtually every other industry. The Company creates environments for data to thrive. The Company is driving the innovation needed to help customers capture, preserve, access and transform an ever-increasing diversity of data. Everywhere data lives, from advanced data centers to mobile sensors to personal devices, the Company’s industry-leading solutions deliver the possibilities of data. The Company’s broad portfolio of technology and products address the following key end markets: Client Devices; Data Center Devices and Solutions; and Client Solutions. The Company also generates license and royalty revenue from its extensive intellectual property (“IP”), which is included in each of these three end market 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 July 3, 2020. 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 July 3, 2020. The results of operations for interim periods are not necessarily indicative of results to be expected for the full year.
Fiscal Year	Fiscal YearThe Company’s fiscal year ends on the Friday nearest to June 30 and typically consists of 52 weeks. Approximately every five to six years, the Company reports a 53-week fiscal year to align the fiscal year with the foregoing policy. Fiscal year 2021, which ends on July 2, 2021, will be comprised of 52 weeks, with all quarters presented consisting of 13 weeks. Fiscal year 2020, which ended on July 3, 2020, was comprised of 53 weeks, with the first quarter consisting of 14 weeks and the remaining quarters consisting of 13 weeks each.
Use of Estimates	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 with consideration given to the potential impacts of the coronavirus disease 2019 (“COVID-19”) pandemic. However, actual results could differ materially from these estimates and be significantly affected by the severity and duration of the pandemic, the extent of actions to contain or treat COVID-19, how quickly and to what extent normal economic and operating activity can resume, and the severity and duration of the global economic downturn that results from the pandemic.
Segment Information	Segment Information The Company manufactures, markets, and sells data storage devices and solutions in the U.S. and in foreign countries through its sales personnel, dealers, distributors, retailers, and subsidiaries. Historically, the Company has managed and reported under a single operating segment. Late in the first quarter of fiscal 2021, the Chief Executive Officer, who is the Company’s Chief Operating Decision Maker (“CODM”), announced a decision to reorganize the Company’s business by forming two separate product business units: flash-based products and hard disk drives (“HDD”). Beginning in the second fiscal quarter, the Company is in the process of transitioning to this new operating model and discrete information has not yet been established to align with the new business structure. Management expects to finalize its assessment of its operating segments when the transition is completed, which is expected to be by the end of fiscal 2021.
Recent Accounting Pronouncements	Accounting Pronouncements Recently Adopted In June 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Updates (“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 adopted this standard effective July 4, 2020 (the beginning of fiscal 2021) with no material impact on its Condensed Consolidated Financial Statements. 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 Accounting Standards Codification (ASC) 606 by recognizing a cumulative-effect adjustment to the opening balance of retained earnings of the earliest annual period presented. The Company adopted this standard effective July 4, 2020 (the beginning of fiscal 2021) with no material impact on its Condensed Consolidated Financial Statements. Recently Issued Accounting Pronouncements Not Yet Adopted In December 2019, the FASB issued ASU No. 2019-12, “Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes” (“ASU 2019-12”). ASU 2019-12 removes certain exceptions for recognizing deferred taxes for investments, performing intraperiod allocation and calculating income taxes in interim periods. The ASU also adds guidance to reduce complexity in certain areas, including recognizing deferred taxes for tax goodwill and allocating taxes to members of a consolidated group. This ASU is effective for fiscal years (and interim periods within those fiscal years) beginning after December 15, 2020, which for the Company is the first quarter of fiscal 2022. Early adoption is permitted. The Company does not expect this update to have a material impact on its Condensed Consolidated Financial Statements.
Fair Value Measurements and Investments	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.

- Definition

Disclosure of accounting policy for segment reporting.

+ References + Details

Revenues (Tables)

3 Months Ended

Oct. 02, 2020

Revenue from Contract with Customer [Abstract]

Disaggregation of Revenue

The Company’s disaggregated revenue information is as follows:



	Three Months Ended
	October 2, 2020		October 4, 2019
	(in millions)
Revenue by Product
Hard disk drives (“HDD”)	$	1,844	$	2,408
Flash-based	2,078		1,632
Total Revenue	$	3,922	$	4,040

Revenue by End Market
Client Devices	$	1,946	$	1,616
Data Center Devices & Solutions	1,129		1,532
Client Solutions	847		892
Total Revenue	$	3,922	$	4,040

Revenue by Geography
Americas	$	1,079	$	1,313
Europe, Middle East and Africa	629		779
Asia	2,214		1,948
Total Revenue	$	3,922	$	4,040

Supplemental Financial Statement Data (Tables)

3 Months Ended

Oct. 02, 2020

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Schedule of Inventories

Inventories


	October 2, 2020		July 3, 2020
	(in millions)
Inventories:
Raw materials and component parts	$	1,426	$	1,306
Work-in-process	964		956
Finished goods	965		808
Total inventories	$	3,355	$	3,070

Schedule of Property, Plant and Equipment, Net

Property, plant and equipment, net


	October 2, 2020		July 3, 2020
	(in millions)
Property, plant and equipment:
Land	$	286	$	294
Buildings and improvements	1,865		1,837
Machinery and equipment	7,514		7,391
Computer equipment and software	430		429
Furniture and fixtures	52		52
Construction-in-process	327		297
Property, plant and equipment, gross	10,474		10,300
Accumulated depreciation	(7,577)		(7,446)
Property, plant and equipment, net	$	2,897	$	2,854

Schedule of Goodwill

Goodwill


	Carrying Amount
	(in millions)















Balance at July 3, 2020	$	10,067


Foreign currency translation adjustment	2
Balance at October 2, 2020	$	10,069

Schedule of Intangible Assets

Intangible assets


	October 2, 2020		July 3, 2020
	(in millions)
Finite-lived intangible assets	$	5,543	$	5,541
In-process research and development	80		80
Accumulated amortization	(4,865)		(4,680)
Intangible assets, net	$	758	$	941

Schedule of Product Warranty Liability

Product warranty liability

Changes in the warranty accrual were as follows:


	Three Months Ended
	October 2, 2020		October 4, 2019
	(in millions)
Warranty accrual, beginning of period	$	408	$	350

Charges to operations	35		49
Utilization	(31)		(48)
Changes in estimate related to pre-existing warranties	(21)		6
Warranty accrual, end of period	$	391	$	357

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:


	October 2, 2020		July 3, 2020
	(in millions)
Warranty accrual
Current portion (included in Accrued expenses)	$	191	$	205
Long-term portion (included in Other liabilities)	200		203
Total warranty accrual	$	391	$	408

Schedule of Other Liabilities

Other liabilities


	October 2, 2020		July 3, 2020
	(in millions)
Other liabilities:
Non-current net tax payable	$	711	$	815
Payables related to unrecognized tax benefits	715		720
Other non-current liabilities	885		881
Total other liabilities	$	2,311	$	2,416

Schedule of Accumulated Other Comprehensive Income (Loss)

The following table illustrates the changes in the balances of each component of AOCI:


	Actuarial Pension Gains (Losses)		Foreign Currency Translation Adjustment		Unrealized Gains (Losses) on Derivative Contracts		Total Accumulated Comprehensive Income (Loss)
	(in millions)










Balance at July 3, 2020	$	(58)	$	(2)	$	(97)	$	(157)
Other comprehensive loss before reclassifications	1		32		18		51
Amounts reclassified from accumulated other comprehensive loss	—		—		12		12
Income tax benefit (expense) related to items of other comprehensive loss	—		—		(7)		(7)
Net current-period other comprehensive loss	1		32		23		56
Balance at October 2, 2020	$	(57)	$	30	$	(74)	$	(101)

Fair Value Measurements and Investments (Tables)

3 Months Ended

Oct. 02, 2020

Fair Value Disclosures [Abstract]

Financial Assets and Liabilities Measured at Fair Value on Recurring Basis


	October 2, 2020
	Level 1		Level 2		Level 3		Total
	(in millions)
Assets:

Cash equivalents - Money market funds	$	861	$	—	$	—	$	861


















Foreign exchange contracts	—		24		—		24


Total assets at fair value	$	861	$	24	$	—	$	885
Liabilities:
Foreign exchange contracts	$	—	$	10	$	—	$	10
Interest rate swap contract	—		120		—		120

Total liabilities at fair value	$	—	$	130	$	—	$	130


	July 3, 2020
	Level 1		Level 2		Level 3		Total
	(in millions)
Assets:

Cash equivalents - Money market funds	$	1,079	$	—	$	—	$	1,079


















Foreign exchange contracts	—		28		—		28


Total assets at fair value	$	1,079	$	28	$	—	$	1,107
Liabilities:
Foreign exchange contracts	$	—	$	9	$	—	$	9
Interest rate swap contract	—		133		—		133

Total liabilities at fair value	$	—	$	142	$	—	$	142

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 first quarter of 2021 and the fourth quarter of 2020, respectively.


	October 2, 2020				July 3, 2020
	Carrying Value		Fair Value		Carrying Value		Fair Value
	(in millions)
0.50% convertible senior notes due 2020	$	35	$	34	$	34	$	30

Variable interest rate Term Loan A-1 maturing 2023	4,514		4,427		4,576		4,474


Variable interest rate Term Loan B-4 maturing 2023	1,543		1,536		1,692		1,656

1.50% convertible notes due 2024	994		1,043		987		1,036

4.75% senior unsecured notes due 2026	2,286		2,475		2,286		2,428





Total	$	9,372	$	9,515	$	9,575	$	9,624

Debt (Tables)

3 Months Ended

Oct. 02, 2020

Debt Disclosure [Abstract]

Schedule of Debt

Debt consisted of the following as of October 2, 2020 and July 3, 2020:


	October 2, 2020		July 3, 2020
	(in millions)
0.50% convertible senior notes due 2020	$	35	$	35


Variable interest rate Term Loan A-1 maturing 2023	4,520		4,583




Variable interest rate Term Loan B-4 maturing 2023	1,543		1,693




1.50% convertible notes due 2024	1,100		1,100

4.75% senior unsecured notes due 2026	2,300		2,300

Total debt	9,498		9,711
Issuance costs and debt discounts	(126)		(136)
Subtotal	9,372		9,575
Less current portion of long-term debt	(286)		(286)
Long-term debt	$	9,086	$	9,289

Pensions and Other Post-Retirement Benefit Plans (Tables)

3 Months Ended

Oct. 02, 2020

Retirement Benefits [Abstract]

Obligations and Funded Status

The following table presents the unfunded status of the benefit obligations for the Pension Plans:


	October 2, 2020		July 3, 2020
	(in millions)











Benefit obligation at end of period	$	374	$	366









Fair value of plan assets at end of period	221		215
Unfunded status	$	153	$	151

Unfunded Amounts Recognized on Consolidated Balance Sheets

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


	October 2, 2020		July 3, 2020
	(in millions)
Current liabilities	$	1	$	1
Non-current liabilities	152		150
Net amount recognized	$	153	$	151

Related Parties and Related Commitments and Contingencies (Tables)

3 Months Ended

Oct. 02, 2020

Commitments and Contingencies Disclosure [Abstract]

Notes Receivable and Investments in Related Parties

The following table presents the notes receivable from, and equity investments in, Flash Ventures as of October 2, 2020 and July 3, 2020:


	October 2, 2020		July 3, 2020
	(in millions)
Notes receivable, Flash Partners	$	271	$	273
Notes receivable, Flash Alliance	231		301
Notes receivable, Flash Forward	597		670
Investment in Flash Partners	208		203
Investment in Flash Alliance	307		300
Investment in Flash Forward	132		128
Total notes receivable and investments in Flash Ventures	$	1,746	$	1,875

Variable Interest Entity Maximum Loss Exposure


	October 2, 2020
	(in millions)
Notes receivable	$	1,099
Equity investments	647
Operating lease guarantees	2,004
Inventory and prepayments	575
Maximum estimable loss exposure	$	4,325

Schedule of Guarantor Obligations


	Lease Amounts
	(Japanese yen, in billions)		(U.S. dollar, in millions)
Total guarantee obligations	¥	211	$	2,004

Remaining Guarantee Obligations


Annual Installments	Payment of Principal Amortization		Purchase Option Exercise Price at Final Lease Terms		Guarantee Amount
	(in millions)
Remaining nine months of 2021	$	407	$	80	$	487
2022	469		51		520
2023	356		69		425
2024	194		123		317
2025	55		113		168
Thereafter	15		72		87
Total guarantee obligations	$	1,496	$	508	$	2,004

Leases and Other Commitments (Tables)

3 Months Ended

Oct. 02, 2020

Leases [Abstract]

Supplemental Balance Sheet Disclosures

The following table summarizes supplemental balance sheet information related to operating leases as of October 2, 2020:


	Lease Amounts
Minimum lease payments by fiscal year:	(in millions)
Remaining nine months of 2021	$	35
2022	35
2023	29
2024	29
2025	27
Thereafter	144
Total future minimum lease payments	299
Less: Imputed Interest	(56)
Present value of lease liabilities	243
Less: Current portion (included in Accrued expenses)	37
Long-term operating lease liabilities (included in Other liabilities)	$	206

Operating lease right-of-use assets (included in Other non-current assets)	$	228

Weighted average remaining lease term in years	9.0
Weighted average discount rate	4.2		%

Supplemental Cash Flow Disclosures

The following table summarizes supplemental disclosures of operating cost and cash flow information related to operating leases:


	Three Months Ended
	October 2, 2020		October 4, 2019
	(in millions)
Cost of operating leases	$	13	$	12
Cash paid for operating leases	12		16
Operating lease assets obtained in exchange for operating lease liabilities	7		49

Long-term Purchase Agreements

As of October 2, 2020, the Company had the following minimum long-term commitments:


	Long-term commitments
	(in millions)
Fiscal year:
Remaining nine months of 2021	$	328
2022	596
2023	523
2024	322
2025	148
Thereafter	190
Total	$	2,107

Shareholders' Equity (Tables)

3 Months Ended

Oct. 02, 2020

Share-based Payment Arrangement [Abstract]

Disclosure of Share-based Compensation Arrangements by Share-based Payment Award


	Three Months Ended
		October 2, 2020		October 4, 2019
		(in millions)
Options		$	—	$	2
RSUs and PSUs		67		66
ESPP		9		9
Total		$	76	$	77


	Three Months Ended
		October 2, 2020		October 4, 2019
		(in millions)
Cost of revenue		$	12	$	12
Research and development		39		41
Selling, general and administrative		25		24

Subtotal		76		77
Tax benefit		(11)		(12)
Total		$	65	$	65

Employee Service Share-based Compensation , Unrecognized Costs

The following table presents the unamortized compensation cost and weighted average service period of all unvested outstanding awards as of October 2, 2020:


	Unamortized Compensation Costs		Weighted Average Service Period
	(in millions)		(years)

RSUs and PSUs (1)	$	743	3.0
ESPP	29		0.8
Total unamortized compensation cost	$	772

(1) Weighted average service period assumes the performance metrics are met for the PSUs.

Stock Option Activity

The following table summarizes stock option activity under the Company’s incentive plans:


	Number of Shares	Weighted Average Exercise Price Per Share		Weighted Average Remaining Contractual Life	Aggregate Intrinsic Value
	(in millions)			(in years)	(in millions)















Options outstanding at July 3, 2020	2.7	$	69.16	2.1	$	—


Exercised	—	18.30			$	—
Canceled or expired	(0.2)	68.81
Options outstanding at October 2, 2020	2.5	69.21		1.5	$	—
Exercisable at October 2, 2020	2.5	$	69.21	1.5	$	—

Restricted Stock Unit

The following table summarizes RSU and PSU activity under the Company’s incentive plans:


	Number of Shares	Weighted Average Grant Date Fair Value		Aggregate Intrinsic Value at Vest Date
	(in millions)			(in millions)















RSUs and PSUs outstanding at July 3, 2020	13.3	$	60.92
Granted	7.9	37.86

Vested	(3.7)	61.20		$	149
Forfeited	(0.5)	65.04
RSUs and PSUs outstanding at October 2, 2020	17.0	49.70

Income Tax Expense (Tables)

3 Months Ended

Oct. 02, 2020

Income Tax Disclosure [Abstract]

Schedule of Effective Income Tax Rate Reconciliation

The following table presents the Company’s Income tax expense and the effective tax rate:


	Three Months Ended
	October 2, 2020			October 4, 2019
	(in millions)
Loss before taxes	$	(3)		$	(237)
Income tax expense	57			39
Effective tax rate	(1,900)		%	(16)		%

Net Loss Per Common Share (Tables)

3 Months Ended

Oct. 02, 2020

Earnings Per Share [Abstract]

Schedule of Earnings Per Share, Basic and Diluted

The following table presents the computation of basic and diluted loss per common share:


	Three Months Ended
	October 2, 2020		October 4, 2019
	(in millions, except per share data)
Net loss	$	(60)	$	(276)
Weighted average shares outstanding:


Basic and diluted	303		296
Loss per common share

Basic and diluted	$	(0.20)	$	(0.93)
Anti-dilutive potential common shares excluded	16		15

Employee Termination, Asset Impairment and Other Charges (Tables)

3 Months Ended

Oct. 02, 2020

Postemployment Benefits [Abstract]

Schedule of Restructuring Reserve by Type of Cost

The Company recorded the following charges related to employee termination benefits, asset impairment, and other charges:


	Three Months Ended
	October 2, 2020		October 4, 2019
	(in millions)
Employee termination and other charges:

Closure of Foreign Manufacturing Facilities	$	—	$	4
Business Realignment	23		4











Total employee termination, asset impairment, and other charges	$	23	$	8

The following table presents an analysis of the components of the activity against the reserve during the three months ended October 2, 2020:


	Employee Termination Benefits		Contract Termination and Other		Total
	(in millions)








Accrual balance at July 3, 2020	$	13	$	—	$	13
Charges	20		2		22
Cash payments	(20)		(2)		(22)

Accrual balance at October 2, 2020	$	13	$	—	$	13

Organization and Basis of Presentation (Details)	12 Months Ended
Organization and Basis of Presentation (Details)	Jul. 03, 2020 segment
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Number of operating segments	1

Revenues - Revenue Remaining Performance Obligation (Details) $ in Millions	Oct. 02, 2020 USD ($)
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue, remaining performance obligation, amount	$ 102
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2020-10-03
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue, remaining performance obligation, amount	$ 31
Revenue, remaining performance obligation period	9 months
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2021-07-03
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue, remaining performance obligation, amount	$ 40
Revenue, remaining performance obligation period	1 year
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction, Start Date [Axis]: 2022-07-02
Revenue, Remaining Performance Obligation, Expected Timing of Satisfaction [Line Items]
Revenue, remaining performance obligation, amount	$ 31
Revenue, remaining performance obligation period

Revenues - Disaggregation of Revenue (Details) - USD ($) $ in Millions	3 Months Ended
	Oct. 02, 2020	Oct. 04, 2019
Disaggregation of Revenue [Line Items]
Revenue, net	$ 3,922	$ 4,040
Americas
Disaggregation of Revenue [Line Items]
Revenue, net	1,079	1,313
Europe, Middle East and Africa
Disaggregation of Revenue [Line Items]
Revenue, net	629	779
Asia
Disaggregation of Revenue [Line Items]
Revenue, net	2,214	1,948
Client Devices
Disaggregation of Revenue [Line Items]
Revenue, net	1,946	1,616
Data Center Devices & Solutions
Disaggregation of Revenue [Line Items]
Revenue, net	1,129	1,532
Client Solutions
Disaggregation of Revenue [Line Items]
Revenue, net	847	892
Hard disk drives (“HDD”)
Disaggregation of Revenue [Line Items]
Revenue, net	1,844	2,408
Flash-based
Disaggregation of Revenue [Line Items]
Revenue, net	$ 2,078	$ 1,632

Revenues - Additional Information (Details) - Revenue from Contract with Customer - Customer Concentration Risk	3 Months Ended
	Oct. 02, 2020	Oct. 04, 2019
Top Ten Customers
Concentration Risk [Line Items]
Concentration risk, percentage	44.00%	43.00%
One Customer
Concentration Risk [Line Items]
Concentration risk, percentage		11.00%

Supplemental Financial Statement Data - Additional Information (Details) - USD ($) $ in Millions	3 Months Ended
	Oct. 02, 2020	Oct. 04, 2019	Jul. 03, 2020
Accounts, Notes, Loans and Financing Receivable [Line Items]
Proceeds on sale of trade accounts receivable	$ 128	$ 85
Factored Receivables
Accounts, Notes, Loans and Financing Receivable [Line Items]
Outstanding factored receivables	$ 128		$ 113

Supplemental Financial Statement Data - Inventory (Details) - USD ($) $ in Millions	Oct. 02, 2020	Jul. 03, 2020
Inventories:
Raw materials and component parts	$ 1,426	$ 1,306
Work-in-process	964	956
Finished goods	965	808
Total inventories	$ 3,355	$ 3,070

Supplemental Financial Statement Data - Property, Plant and Equipment (Details) - USD ($) $ in Millions	Oct. 02, 2020	Jul. 03, 2020
Property, plant and equipment:
Property, plant and equipment, gross	$ 10,474	$ 10,300
Accumulated depreciation	(7,577)	(7,446)
Property, plant and equipment, net	2,897	2,854
Land
Property, plant and equipment:
Property, plant and equipment, gross	286	294
Buildings and improvements
Property, plant and equipment:
Property, plant and equipment, gross	1,865	1,837
Machinery and equipment
Property, plant and equipment:
Property, plant and equipment, gross	7,514	7,391
Computer equipment and software
Property, plant and equipment:
Property, plant and equipment, gross	430	429
Furniture and fixtures
Property, plant and equipment:
Property, plant and equipment, gross	52	52
Construction-in-process
Property, plant and equipment:
Property, plant and equipment, gross	$ 327	$ 297

Supplemental Financial Statement Data - Goodwill Roll Forward (Details) $ in Millions	3 Months Ended
	Oct. 02, 2020 USD ($)
Goodwill [Roll Forward]
Goodwill balance, beginning of period	$ 10,067
Foreign currency translation adjustment	2
Goodwill balance, end of period	$ 10,069

Supplemental Financial Statement Data - Intangible Assets (Details) - USD ($) $ in Millions	Oct. 02, 2020	Jul. 03, 2020
Intangible Assets and Goodwill [Abstract]
Finite-lived intangible assets	$ 5,543	$ 5,541
In-process research and development	80	80
Accumulated amortization	(4,865)	(4,680)
Intangible assets, net	$ 758	$ 941

Supplemental Financial Statement Data - Warranty Accrual Roll Forward (Details) - USD ($) $ in Millions	3 Months Ended
	Oct. 02, 2020	Oct. 04, 2019
Movement in Standard Product Warranty Accrual [Roll Forward]
Warranty accrual, beginning of period	$ 408	$ 350
Charges to operations	35	49
Utilization	(31)	(48)
Changes in estimate related to pre-existing warranties	(21)	6
Warranty accrual, end of period	$ 391	$ 357

Supplemental Financial Statement Data - Total Warranty Accrual (Details) - USD ($) $ in Millions	Oct. 02, 2020	Jul. 03, 2020	Oct. 04, 2019	Jun. 28, 2019
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Current portion (included in Accrued expenses)	$ 191	$ 205
Long-term portion (included in Other liabilities)	200	203
Total warranty accrual	$ 391	$ 408	$ 357	$ 350

Supplemental Financial Statement Data - Other Liabilities (Details) - USD ($) $ in Millions	Oct. 02, 2020	Jul. 03, 2020
Other liabilities:
Non-current net tax payable	$ 711	$ 815
Payables related to unrecognized tax benefits	715	720
Other non-current liabilities	885	881
Total other liabilities	$ 2,311	$ 2,416

Supplemental Financial Statement Data - Accumulated Other Comprehensive Income Roll Forward (Details) - USD ($) $ in Millions	3 Months Ended
	Oct. 02, 2020	Oct. 04, 2019
Accumulated Other Comprehensive Income (Loss) [Roll Forward]
Beginning balance	$ 9,551	$ 9,967
Income tax benefit (expense) related to items of other comprehensive loss	(7)	5
Net current-period other comprehensive loss	56	(22)
Ending balance	9,576	9,566
Actuarial Pension Gains (Losses)
Accumulated Other Comprehensive Income (Loss) [Roll Forward]
Beginning balance	(58)
Other comprehensive loss before reclassifications	1
Amounts reclassified from accumulated other comprehensive loss	0
Income tax benefit (expense) related to items of other comprehensive loss	0
Net current-period other comprehensive loss	1
Ending balance	(57)
Foreign Currency Translation Adjustment
Accumulated Other Comprehensive Income (Loss) [Roll Forward]
Beginning balance	(2)
Other comprehensive loss before reclassifications	32
Amounts reclassified from accumulated other comprehensive loss	0
Income tax benefit (expense) related to items of other comprehensive loss	0
Net current-period other comprehensive loss	32
Ending balance	30
Unrealized Gains (Losses) on Derivative Contracts
Accumulated Other Comprehensive Income (Loss) [Roll Forward]
Beginning balance	(97)
Other comprehensive loss before reclassifications	18
Amounts reclassified from accumulated other comprehensive loss	12
Income tax benefit (expense) related to items of other comprehensive loss	(7)
Net current-period other comprehensive loss	23
Ending balance	(74)
Accumulated Other Comprehensive Income (Loss)
Accumulated Other Comprehensive Income (Loss) [Roll Forward]
Beginning balance	(157)	(68)
Other comprehensive loss before reclassifications	51
Amounts reclassified from accumulated other comprehensive loss	12
Income tax benefit (expense) related to items of other comprehensive loss	(7)
Net current-period other comprehensive loss	56
Ending balance	$ (101)	$ (90)

Fair Value Measurements and Investments - Financial Assets and Liabilities Measured at Fair Value on Recurring Basis (Detail) - Fair Value, Measurements, Recurring - USD ($) $ in Millions	Oct. 02, 2020	Jul. 03, 2020
Assets:
Total assets at fair value	$ 885	$ 1,107
Liabilities:
Total liabilities at fair value	130	142
Level 1
Assets:
Total assets at fair value	861	1,079
Liabilities:
Total liabilities at fair value	0	0
Level 2
Assets:
Total assets at fair value	24	28
Liabilities:
Total liabilities at fair value	130	142
Level 3
Assets:
Total assets at fair value	0	0
Liabilities:
Total liabilities at fair value	0	0
Cash equivalents - Money market funds
Assets:
Cash equivalents - Money market funds	861	1,079
Cash equivalents - Money market funds \| Level 1
Assets:
Cash equivalents - Money market funds	861	1,079
Cash equivalents - Money market funds \| Level 2
Assets:
Cash equivalents - Money market funds	0	0
Cash equivalents - Money market funds \| Level 3
Assets:
Cash equivalents - Money market funds	0	0
Foreign exchange contracts
Assets:
Foreign exchange contracts	24	28
Liabilities:
Derivative liability	10	9
Foreign exchange contracts \| Level 1
Assets:
Foreign exchange contracts	0	0
Liabilities:
Derivative liability	0	0
Foreign exchange contracts \| Level 2
Assets:
Foreign exchange contracts	24	28
Liabilities:
Derivative liability	10	9
Foreign exchange contracts \| Level 3
Assets:
Foreign exchange contracts	0	0
Liabilities:
Derivative liability	0	0
Interest rate swap contracts
Liabilities:
Derivative liability	120	133
Interest rate swap contracts \| Level 1
Liabilities:
Derivative liability	0	0
Interest rate swap contracts \| Level 2
Liabilities:
Derivative liability	120	133
Interest rate swap contracts \| Level 3
Liabilities:
Derivative liability	$ 0	$ 0

Fair Value Measurements and Investments - Debt Instrument Fair Value (Details) - USD ($) $ in Millions	Oct. 02, 2020	Jul. 03, 2020
0.50% convertible senior notes due 2020
Debt Instrument [Line Items]
Debt instrument, interest rate (percentage)	0.50%	0.50%
1.50% convertible notes due 2024 \| Convertible Debt
Debt Instrument [Line Items]
Debt instrument, interest rate (percentage)	1.50%	1.50%
4.75% senior unsecured notes due 2026
Debt Instrument [Line Items]
Debt instrument, interest rate (percentage)	4.75%	4.75%
Carrying Value
Debt Instrument [Line Items]
Long-term debt	$ 9,372	$ 9,575
Carrying Value \| 0.50% convertible senior notes due 2020
Debt Instrument [Line Items]
Long-term debt	35	34
Carrying Value \| Variable interest rate Term Loan A-1 maturing 2023
Debt Instrument [Line Items]
Long-term debt	4,514	4,576
Carrying Value \| Variable interest rate Term Loan B-4 maturing 2023
Debt Instrument [Line Items]
Long-term debt	1,543	1,692
Carrying Value \| 1.50% convertible notes due 2024
Debt Instrument [Line Items]
Long-term debt	994	987
Carrying Value \| 4.75% senior unsecured notes due 2026
Debt Instrument [Line Items]
Long-term debt	2,286	2,286
Level 2 \| Fair Value
Debt Instrument [Line Items]
Long-term debt	9,515	9,624
Level 2 \| Fair Value \| 0.50% convertible senior notes due 2020
Debt Instrument [Line Items]
Long-term debt	34	30
Level 2 \| Fair Value \| Variable interest rate Term Loan A-1 maturing 2023
Debt Instrument [Line Items]
Long-term debt	4,427	4,474
Level 2 \| Fair Value \| Variable interest rate Term Loan B-4 maturing 2023
Debt Instrument [Line Items]
Long-term debt	1,536	1,656
Level 2 \| Fair Value \| 1.50% convertible notes due 2024
Debt Instrument [Line Items]
Long-term debt	1,043	1,036
Level 2 \| Fair Value \| 4.75% senior unsecured notes due 2026
Debt Instrument [Line Items]
Long-term debt	$ 2,475	$ 2,428

Derivatives Instruments and Hedging Activities (Details) $ in Millions	Oct. 02, 2020 USD ($)
Derivative Instruments and Hedging Activities Disclosure [Abstract]
Unrealized loss expected to be reclassified into earnings	$ 70

Debt - Schedule of Debt (Details) - USD ($) $ in Millions	Oct. 02, 2020	Jul. 03, 2020
Debt Instrument [Line Items]
Debt	$ 9,498	$ 9,711
Issuance costs and debt discounts	(126)	(136)
Net carrying value	9,372	9,575
Less current portion of long-term debt	(286)	(286)
Long-term debt	$ 9,086	$ 9,289
0.50% convertible senior notes due 2020
Debt Instrument [Line Items]
Debt instrument, interest rate (percentage)	0.50%	0.50%
Debt	$ 35	$ 35
Variable interest rate Term Loan A-1 maturing 2023
Debt Instrument [Line Items]
Debt	4,520	4,583
Variable interest rate Term Loan B-4 maturing 2023
Debt Instrument [Line Items]
Debt	$ 1,543	$ 1,693
4.75% senior unsecured notes due 2026
Debt Instrument [Line Items]
Debt instrument, interest rate (percentage)	4.75%	4.75%
Debt	$ 2,300	$ 2,300
Convertible Debt \| 1.50% convertible notes due 2024
Debt Instrument [Line Items]
Debt instrument, interest rate (percentage)	1.50%	1.50%
Debt	$ 1,100	$ 1,100

Debt - Additional Information (Details) - USD ($) $ in Millions	3 Months Ended
	Oct. 02, 2020	Oct. 04, 2019
Debt Instrument [Line Items]
Repayment of debt	$ 213	$ 319
Variable interest rate Term Loan B-4 maturing 2023
Debt Instrument [Line Items]
Repayment of debt	$ 150

Pensions and Other Post-Retirement Benefit Plans - Additional Information (Details)	3 Months Ended
	Oct. 02, 2020
Retirement Benefits [Abstract]
Expected long-term rate of return on plan assets	2.50%

Pensions and Other Post-Retirement Benefit Plans - Obligations and Funded Status (Details) - USD ($) $ in Millions	Oct. 02, 2020	Jul. 03, 2020
Defined Benefit Plan, Change in Benefit Obligation [Roll Forward]
Benefit obligation at end of period	$ 374	$ 366
Fair value of plan assets at end of period	221	215
Unfunded status	$ 153	$ 151

- Definition

Amount of asset segregated and restricted to provide benefit under defined benefit plan. Asset includes, but is not limited to, stock, bond, other investment, earning from investment, and contribution by employer and employee.

+ References + Details

Pensions and Other Post-Retirement Benefit Plans - Unfunded Amounts Recognized on Consolidated Balance Sheets (Details) - USD ($) $ in Millions	Oct. 02, 2020	Jul. 03, 2020
Retirement Benefits [Abstract]
Current liabilities	$ 1	$ 1
Non-current liabilities	152	150
Net amount recognized	$ 153	$ 151

Related Parties and Related Commitments and Contingencies - Additional Information (Details) - USD ($) $ in Millions	1 Months Ended	3 Months Ended		12 Months Ended
	May 31, 2019	Oct. 02, 2020	Oct. 04, 2019	Jul. 03, 2020
Related Party Transactions [Abstract]
Accounts payable to related parties		$ 404		$ 407
Investment funding commitments		50.00%
Costs associated with underutilized capacity as a result of unexpected power outage incident			$ 68
Partial insurance recovery of business interruption		$ 30
Western Digital Corp \| Minimum
Related Party Transactions [Abstract]
Investment funding commitments		49.90%
Western Digital Corp \| Maximum
Related Party Transactions [Abstract]
Investment funding commitments		50.00%
Flash Ventures
Related Party Transactions [Abstract]
Investments in Flash Ventures		$ (981)	$ (682)
Accounts payable to related parties		404		$ 407
Flash Ventures
Related Party Transactions [Abstract]
Remaining committed prepayments		$ 178
Unis Venture
Related Party Transactions [Abstract]
Equity method investment, ownership percentage		49.00%
Unissoft (Wuxi) Group Co Ltd. \| Unis Venture
Related Party Transactions [Abstract]
Partner's ownership in venture business		51.00%
Prepayments of Future Depreciation \| Flash Ventures
Related Party Transactions [Abstract]
Other commitment	$ 360
Other commitment, period	3 years
Revenue from Contract with Customer \| Unis Venture \| Product Concentration Risk
Related Party Transactions [Abstract]
Concentration risk, percentage		2.00%	1.00%
Accounts Receivable \| Product Concentration Risk \| Unis Venture
Related Party Transactions [Abstract]
Concentration risk, percentage		6.00%		4.00%

Related Parties and Related Commitments and Contingencies - Equity Investments (Details) - USD ($) $ in Millions	Oct. 02, 2020	Jul. 03, 2020
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total notes receivable and investments in Flash Ventures	$ 1,746	$ 1,875
Flash Partners Ltd
Accounts, Notes, Loans and Financing Receivable [Line Items]
Notes receivable, related parties	271	273
Investments	208	203
Flash Alliance Ltd
Accounts, Notes, Loans and Financing Receivable [Line Items]
Notes receivable, related parties	231	301
Investments	307	300
Flash Forward Ltd
Accounts, Notes, Loans and Financing Receivable [Line Items]
Notes receivable, related parties	597	670
Investments	132	128
Flash Ventures
Accounts, Notes, Loans and Financing Receivable [Line Items]
Total notes receivable and investments in Flash Ventures	$ 1,746	$ 1,875

Related Parties and Related Commitments and Contingencies - Maximum Loss Exposure (Details) - Oct. 02, 2020 - Flash Ventures $ in Millions, ¥ in Billions	USD ($)	JPY (¥)
Guarantor Obligations [Line Items]
VIE, reporting entity involvement, maximum loss exposure, amount	$ 4,325
Notes receivable
Guarantor Obligations [Line Items]
VIE, reporting entity involvement, maximum loss exposure, amount	1,099
Equity investments
Guarantor Obligations [Line Items]
VIE, reporting entity involvement, maximum loss exposure, amount	647
Operating lease guarantees
Guarantor Obligations [Line Items]
Operating lease guarantees	2,004	¥ 211
Inventory and prepayments
Guarantor Obligations [Line Items]
Inventory and prepayments	$ 575

Related Parties and Related Commitments and Contingencies - JV Lease Guarantees (Details) - Oct. 02, 2020 $ in Millions, ¥ in Billions	USD ($)	JPY (¥)
Operating lease guarantees \| Flash Ventures
Loss Contingencies [Line Items]
Total guarantee obligations	$ 2,004	¥ 211

Related Parties and Related Commitments and Contingencies - Joint Venture Lease Amounts (Details) - Flash Ventures $ in Millions	Oct. 02, 2020 USD ($)
Guarantor Obligations [Line Items]
Remaining nine months of 2021	$ 487
2022	520
2023	425
2024	317
2025	168
Thereafter	87
Total guarantee obligations	2,004
Payment of Principal Amortization
Guarantor Obligations [Line Items]
Remaining nine months of 2021	407
2022	469
2023	356
2024	194
2025	55
Thereafter	15
Total guarantee obligations	1,496
Purchase Option Exercise Price at Final Lease Terms
Guarantor Obligations [Line Items]
Remaining nine months of 2021	80
2022	51
2023	69
2024	123
2025	113
Thereafter	72
Total guarantee obligations	$ 508

Leases and Other Commitments - Supplemental Balance Sheet (Details) $ in Millions	Oct. 02, 2020 USD ($)
Leases [Abstract]
Remaining nine months of 2021	$ 35
2022	35
2023	29
2024	29
2025	27
Thereafter	144
Total future minimum lease payments	299
Less: Imputed Interest	(56)
Present value of lease liabilities	243
Less: Current portion (included in Accrued expenses)	37
Long-term operating lease liabilities (included in Other liabilities)	206
Operating lease right-of-use assets (included in Other non-current assets)	$ 228
Weighted average remaining lease term in years	9 years
Weighted average discount rate	4.20%

Leases and Other Commitments - Supplemental Cash Flow (Details) - USD ($) $ in Millions	3 Months Ended
	Oct. 02, 2020	Oct. 04, 2019
Leases [Abstract]
Cost of operating leases	$ 13	$ 12
Cash paid for operating leases	12	16
Operating lease assets obtained in exchange for operating lease liabilities	$ 7	$ 49

Leases and Other Commitments - Long-Term Commitments (Details) $ in Millions	Oct. 02, 2020 USD ($)
Leases [Abstract]
Remaining nine months of 2021	$ 328
2022	596
2023	523
2024	322
2025	148
Thereafter	190
Total	$ 2,107

Shareholders' Equity - Stock-Based Compensation Expense (Details) - USD ($) $ in Millions	3 Months Ended
	Oct. 02, 2020	Oct. 04, 2019
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expenses on stock-based compensation	$ 76	$ 77
Tax benefit	(11)	(12)
Total	65	65
Cost of revenue
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expenses on stock-based compensation	12	12
Research and development
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expenses on stock-based compensation	39	41
Selling, general and administrative
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expenses on stock-based compensation	25	24
Options
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expenses on stock-based compensation	0	2
RSUs and PSUs
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expenses on stock-based compensation	67	66
ESPP
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Expenses on stock-based compensation	$ 9	$ 9

Shareholders' Equity - Unrecognized Share-based Compensation (Details) $ in Millions	3 Months Ended
	Oct. 02, 2020 USD ($)
Employee Service Share-based Compensation, Unrecognized Service Costs [Line Items]
Unamortized Compensation Costs	$ 772
RSUs and PSUs
Employee Service Share-based Compensation, Unrecognized Service Costs [Line Items]
Unamortized Compensation Costs	$ 743
Weighted Average Service Period	3 years
ESPP
Employee Service Share-based Compensation, Unrecognized Service Costs [Line Items]
Unamortized Compensation Costs	$ 29
Weighted Average Service Period	9 months 18 days

Shareholders' Equity - Stock Option Activity (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions	3 Months Ended	12 Months Ended
	Oct. 02, 2020	Jul. 03, 2020
Number of Shares
Options outstanding, beginning balance, shares	2.7
Exercised, shares	0.0
Canceled or expired, shares	(0.2)
Options outstanding, ending balance, shares	2.5	2.7
Exercisable, period end, shares	2.5
Weighted Average Exercise Price Per Share
Options outstanding, beginning balance, exercise price, in dollars per share	$ 69.16
Exercised, exercise price, in dollars per share	18.30
Canceled or expired, exercise price, in dollars per share	68.81
Options outstanding, ending balance, exercise price, in dollars per share	69.21	$ 69.16
Exercisable, period end, exercise price, in dollars per share	$ 69.21
Options outstanding, weighted average remaining contractual term	1 year 6 months	2 years 1 month 6 days
Exercisable, period end, weighted average remaining contractual life	1 year 6 months
Aggregate Intrinsic Value
Exercised, intrinsic value	$ 0
Options outstanding, ending balance, intrinsic value	0	$ 0
Exercisable, period end, intrinsic value	$ 0

Shareholders' Equity - Restricted Stock Units And Performance Share Units (Details) - Restricted Stock Units And Performance Share Units $ / shares in Units, shares in Millions, $ in Millions	3 Months Ended
	Oct. 02, 2020 USD ($) $ / shares shares
Number of Shares
Outstanding, beginning balance, shares \| shares	13.3
Granted, shares \| shares	7.9
Vested, shares \| shares	(3.7)
Forfeited, shares \| shares	(0.5)
Outstanding, ending balance, shares \| shares	17.0
Weighted Average Grant Date Fair Value
Outstanding, beginning balance, grant date fair value, in dollars per share \| $ / shares	$ 60.92
Granted, grant date fair value, in dollars per share \| $ / shares	37.86
Vested, grant date fair value, in dollars per share \| $ / shares	61.20
Forfeited, grant date fair value, in dollars per share \| $ / shares	65.04
Outstanding, ending balance, grant date fair value, in dollars per share \| $ / shares	$ 49.70
Aggregate value of restricted stock awards vested \| $	$ 149

Shareholders' Equity - Share Repurchase Program (Details)	Oct. 02, 2020 USD ($)
Stock Repurchase Program Effective Until July 25, 2023
Equity, Class of Treasury Stock [Line Items]
Stock repurchase program, number of shares authorized to be repurchased	$ 5,000,000,000.0
Share Repurchase Program
Equity, Class of Treasury Stock [Line Items]
Stock repurchase program, remaining authorized repurchase, amount	$ 4,500,000,000

Income Tax Expense - Tax Expense and Effective Tax Rate (Details) - USD ($) $ in Millions	3 Months Ended
	Oct. 02, 2020	Oct. 04, 2019
Income Tax Disclosure [Abstract]
Income (loss) before taxes	$ (3)	$ (237)
Income tax expense	$ 57	$ 39
Effective tax rate	(1900.00%)	(16.00%)

- Definition

Amount of current income tax expense (benefit) and deferred income tax expense (benefit) pertaining to continuing operations.

+ References + Details

Income Tax Expense - Additional Information (Details) - USD ($) $ in Millions			3 Months Ended
	Dec. 10, 2018	Jun. 28, 2018	Oct. 02, 2020	Sep. 30, 2020	May 04, 2020
Income Tax Disclosure [Line Items]
Net tax deficiencies			$ 11
Additional tax expense from re-measurement of deferred tax liabilities			10
Unrecognized tax benefits			711
Penalties and interest accrued on unrecognized tax benefits			141
Potential payables related to unrecognized tax benefits			$ 715
Internal Revenue Service (IRS) \| Tax Year 2008 Through 2009
Income Tax Disclosure [Line Items]
Federal tax, subject to interest		$ 516
Internal Revenue Service (IRS) \| Tax Years 2010 Through 2012
Income Tax Disclosure [Line Items]
Federal tax, subject to interest	$ 549
Federal tax related to adjustments for transfer pricing	$ 535
Penalties asserted					$ 340
Internal Revenue Service (IRS) \| Tax Years 2013 Through 2015
Income Tax Disclosure [Line Items]
Additional tax				$ 271

Net Loss Per Common Share (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions	3 Months Ended
	Oct. 02, 2020	Oct. 04, 2019
Earnings Per Share [Abstract]
Net loss	$ (60)	$ (276)
Weighted average shares outstanding:
Weighted average shares outstanding, basic and diluted (in shares)	303	296
Loss per common share
Loss per common share, basic and diluted (USD per share)	$ (0.20)	$ (0.93)
Anti-dilutive potential common shares excluded (in shares)	16	15

- Definition

The portion of profit or loss for the period, net of income taxes, which is attributable to the parent.

+ References

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+ Details

Employee Termination, Asset Impairment and Other Charges - Expense Recognition (Details) - USD ($) $ in Millions	3 Months Ended
	Oct. 02, 2020	Oct. 04, 2019
Restructuring Cost and Reserve [Line Items]
Total employee termination, asset impairment, and other charges	$ 23	$ 8
Closure of Foreign Manufacturing Facilities
Restructuring Cost and Reserve [Line Items]
Restructuring charges	0	4
Business Realignment
Restructuring Cost and Reserve [Line Items]
Restructuring charges	$ 23	$ 4

Employee Termination, Asset Impairment and Other Charges - Business Realignment Activities (Details) - Business Realignment $ in Millions	3 Months Ended
	Oct. 02, 2020 USD ($)
Restructuring Reserve [Roll Forward]
Accrual balance at July 3, 2020	$ 13
Charges	22
Cash payments	(22)
Accrual balance at October 2, 2020	13
Employee Termination Benefits
Restructuring Reserve [Roll Forward]
Accrual balance at July 3, 2020	13
Charges	20
Cash payments	(20)
Accrual balance at October 2, 2020	13
Contract Termination and Other
Restructuring Reserve [Roll Forward]
Accrual balance at July 3, 2020	0
Charges	2
Cash payments	(2)
Accrual balance at October 2, 2020	$ 0