WD: Fiscal 4Q09 Financial Results

Western Digital Corp. reported financial results for its fiscal year 2009 and fourth quarter ended July 3, 2009.

For fiscal year 2009, the company posted revenue of $7.5 billion, net income of $470 million, or $2.08 per share, compared to $8.1 billion in revenue, and net income of $867 million, or $3.84 per share for the prior year. The 2009 net income amount included a $14 million in-process research and development charge related to the acquisition of SiliconSystems Inc., $112 million of restructuring charges, an $18 million gain on the sale of assets from the company’s media substrate manufacturing facility in Sarawak, Malaysia and $4 million of tax benefits associated with the restructuring charges. Excluding these amounts, the 2009 non-GAAP net income was $574 million, or $2.54 per share.The 2008 net income amount included net charges of $60 million for taxes related to the license of intellectual property to subsidiaries and $49 million for acquired in-process research and development related to the acquisition of Komag Inc. Excluding these amounts, 2008 non-GAAP net income was $976 million, or $4.32 per share.

For the fourth quarter, revenue totaled $1.9 billion, on shipments of 40 million hard drives and net income of $196 million, or $0.86 per share. The fourth quarter results include $5 million of income from favorable settlements of restructuring accruals and the $18 million gain on the sale of assets from the company’s media substrate manufacturing facility. Excluding these amounts, fourth quarter non-GAAP net income was $173 million, or $0.76 per share. In the year-ago fourth quarter, the company posted revenue of $2.0 billion on unit shipments of 35.2 million hard drives, net income of $213 million, and earnings per share of $0.94.

The company generated $349 million in cash from operations during the June quarter, ending with total cash and cash equivalents of $1.8 billion.

Throughout fiscal 2009, WD demonstrated increasing returns on its investments in technology, product breadth and production capability, with consistent delivery of compelling first-to-market products. The company maintained its momentum as the industry’s leading innovator with the announcement yesterday of another industry first – the 1 TB My Passport Essential SE external storage device which utilizes the company’s new, industry leading, WD Scorpio Blue 2.5-inch hard drives with 333 GB/platter technology.

"In a challenging time for the worldwide economy and the hard drive industry, WD maintained profitability and stayed cash flow positive throughout the fiscal year," said John Coyne, president and chief executive officer. "Our fiscal 2009 and June quarter results demonstrate customers’ ongoing preference for WD products based on their exceptional quality, reliability and availability, as well as the continued effectiveness of the WD business model and the passion, nimbleness and capabilities of the WD team. In the June quarter, we responded promptly to capitalize on unexpected market upside in each of our served markets to produce financial results that significantly exceeded expectations, and included a return to our targeted gross margin and operating expense model parameters."