WD: Fiscal 3Q08 Financial Results

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

The company generated $431 million in cash from
operations during the March quarter, ending with total cash, cash
equivalents and short-term investments of $949 million. During the
quarter, the company repaid $260 million of debt and repurchased $44
million of common stock. The company recently announced an additional
authorization to repurchase $500 million of its shares in the next five
years.

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

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

Western Digital Corp.