Western Digital Announces Financial Results for Second Fiscal Quarter 2017

Irvine, Ca - January 25, 2017

Western Digital Corp. (NASDAQ: WDC) today reported revenue of $4.9 billion, operating income of $545 million and net income of $235 million, or $0.80 per share, for its second fiscal quarter ended Dec. 30, 2016. The GAAP net income for the period includes charges associated with the company's recent acquisitions. Excluding these charges and after other non-GAAP adjustments, second quarter non-GAAP operating income was $995 million and non-GAAP net income was $675 million, or $2.30 per share.

In the year-ago quarter, the company reported revenue of $3.3 billion, operating income of $251 million and net income of $251 million, or $1.07 per share. Non-GAAP operating income in the year-ago quarter was $427 million and non-GAAP net income was $403 million, or $1.72 per share.

The company generated $1.1 billion in cash from operations during the second fiscal quarter of 2017, ending with approximately $5.2 billion of total cash and cash equivalents, and available-for-sale securities. On Nov. 3, 2016, the company declared a cash dividend of $0.50 per share of its common stock, which was paid to shareholders on Jan.17, 2017.

"We reported strong financial performance in the December quarter enabled by excellent operational execution by our team in a favorable market environment," said Steve Milligan, chief executive officer. "We saw healthy demand for capacity enterprise hard drives, all NAND based products and hard drives in client applications. We also achieved targeted cost and efficiency improvements and improved our liquidity position with continued strong cash flow performance.

"We continue to execute well on key strategic priorities, including the integration of HGST, SanDisk and WD, and the ramp of 3D NAND technology. We are achieving our planned synergy targets and are progressing with our transition to 3D NAND technology with the ramp of our 64 layer architecture."

The investment community conference call to discuss these results and the company's guidance for the third fiscal quarter 2017 will be broadcast live over the Internet today at 2 p.m. Pacific/5 p.m. Eastern. The live and archived conference call/webcast can be accessed online at investor.wdc.com. Supplemental financial information, including the company's guidance for the third fiscal quarter 2017, will also be posted on the same website. The telephone replay number in the U.S. is 1-(855) 859-2056 or +1-(404) 537-3406 for international callers. The required passcode is 48613052.

About Western Digital

Western Digital is an industry-leading provider of storage technologies and solutions that enable people to create, leverage, experience and preserve data. The company addresses ever-changing market needs by providing a full portfolio of compelling, high-quality storage solutions with customer-focused innovation, high efficiency, flexibility and speed. Our products are marketed under the HGST, SanDisk and WD brands to OEMs, distributors, resellers, cloud infrastructure providers and consumers. Financial and investor information is available on the company's Investor Relations website at investor.wdc.com.

Forward-Looking Statements

This press release contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including statements concerning the company's preliminary financial results for its second fiscal quarter ended Dec. 30, 2016; market and demand trends; integration activities from the company's acquisitions; achievement of our synergy goals associated with those acquisitions; and our transition to 3D NAND technology. These forward-looking statements are based on management's current expectations and are subject to risks and uncertainties that could cause actual results to differ materially from those expressed or implied in the forward-looking statements. The preliminary financial results for the company's second fiscal quarter ended Dec. 30, 2016 included in this press release represent the most current information available to management. The company's actual results when disclosed in its quarterly report on Form 10-Q may differ from these preliminary results as a result of the completion of the company's financial closing procedures; final adjustments; completion of the review by the company's independent registered accounting firm and other developments that may arise between now and the disclosure of the final results. Other risks and uncertainties that could cause actual results to differ materially from those expressed or implied in the forward-looking statements include: volatility in global economic conditions; business conditions and growth in the storage ecosystem; impact of competitive products and pricing; market acceptance and cost of commodity materials and specialized product components; actions by competitors; unexpected advances in competing technologies; our development and introduction of products based on new technologies and expansion into new data storage markets; risks associated with acquisitions, mergers and joint ventures; difficulties or delays in manufacturing; and other risks and uncertainties listed in the company's filings with the Securities and Exchange Commission (the "SEC"), including the company's Form 10-Q filed with the SEC on Nov. 8, 2016, to which your attention is directed. You should not place undue reliance on these forward-looking statements, which speak only as of the date hereof, and the company undertakes no obligation to update these forward-looking statements to reflect new information or events.

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Western Digital, WD and SanDisk are registered trademarks or trademarks of Western Digital Corporation or its affiliates in the U.S. and/or other countries. Other trademarks, registered trademarks, and/or service marks, indicated or otherwise, are the property of their respective owners.

Financial Statements

Second Quarter Fiscal 2017 Quarterly Fact Sheet