Western Digital provides an update on the production status of its joint venture flash memory manufacturing facilities and its outlook for the third quarter of fiscal 2022

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SAN JOSE, Calif.–(BUSINESS WIRE)–Western Digital Corp. (Nasdaq: WDC) today provided an update on the production status of its joint venture flash memory manufacturing facilities and its outlook for the third quarter of fiscal 2022.

Production at its Yokkaichi and Kitakami joint venture flash manufacturing facilities resumed normal operations in late February 2022. Western Digital’s flash availability will be reduced by approximately 7 exabytes, which will occur primarily in its third and fourth fiscal quarters, as facilities restart. at full production output.

Western Digital also updated its outlook for the third fiscal quarter of 2022.

Three months ending

April 1, 2022

GAAP(1)

Non-GAAP(1)

Revenue ($B)

$4.20 – $4.40

$4.20 – $4.40

Gross margin

24.0% – 26.0%

30.0% – 32.0%

Diluted earnings per share

N / A

$1.30 – $1.60

Diluted shares outstanding (in millions)

~316

~316

(1) Non-GAAP gross margin outlook excludes stock-based compensation charges and charges associated with contamination of certain materials used in manufacturing processes that affected production operations at manufacturing facilities flash of the joint venture in Yokkaichi and Kitakami, Japan, and other adjustments, totaling approximately $250-270 million. The company’s non-GAAP diluted earnings per share also exclude amortization of acquired intangible assets; stock-based compensation expense; termination of employees, impairment of assets and other charges; and non-cash economic interest expense associated with its convertible notes, totaling approximately $120-130 million. Overall, the non-GAAP diluted earnings per share outlook excludes items aggregating $370 million to $400 million and related tax impacts or adjustments. The timing and amount of such charges or adjustments excluded from non-GAAP gross profit and non-GAAP diluted earnings per share cannot be further attributed or quantified with certainty. In addition, the timing and amount of additional charges the Company excludes from its non-GAAP diluted earnings per share depends on the timing and determination of certain actions and cannot be reasonably predicted. Accordingly, full reconciliations of non-GAAP gross margin and non-GAAP diluted earnings per share to the most directly comparable GAAP financial measures (gross margin and diluted earnings per share, respectively) are not available without unreasonable effort. .

About Western Digital

Western Digital creates environments for data to thrive. As a leader in data infrastructure, the company is at the forefront of the innovation needed to help customers capture, store, access and transform an ever-increasing diversity of data. Wherever data resides, from advanced data centers to mobile sensors to personal devices, our cutting-edge solutions enable the possibilities of data. Our data-centric solutions are comprised of Western Digital®, G-Technology™, SanDisk® and WD® brands.

Forward-looking statements

This press release contains forward-looking statements within the meaning of the federal securities laws, including statements regarding expectations regarding the Company’s business prospects and financial performance for the third quarter of fiscal 2022, as well as production operations and the availability of the company’s products. 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 by the forward-looking statements. Other risks and uncertainties that could cause actual results to differ materially from those expressed or implied by the forward-looking statements include: future responses to and effects of the COVID-19 pandemic; volatility in global economic conditions; the impact of business and market conditions; the impact of competitive products and prices; our development and introduction of products based on new technologies and our expansion into new data storage markets; risks associated with cost reduction initiatives, restructurings, acquisitions, divestitures, mergers, joint ventures and our strategic relationships; manufacturing difficulties or delays or other supply chain disruptions; the hiring and retention of key employees; our substantial level of indebtedness and other financial obligations; changes in our relationships with our major customers; disruptions to operations due to cyberattacks or other system security risks; actions of competitors; risks associated with compliance with changing legal and regulatory requirements and the outcome of legal proceedings; 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-K filed with the SEC on August 27, 2021, at which your attention is drawn. 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 or revise these forward-looking statements to reflect new information or events, except as required by law.

© 2022 Western Digital Corporation or its affiliates. All rights reserved.

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