Summary
Western Digital Corporation (WDC) reported a significant improvement in financial performance for the three months ended September 27, 2002, compared to the same period in the prior year. Net revenue increased by 32% to $582.9 million, driven by a 59% rise in unit shipments, although this was partially offset by a 17% decrease in average selling prices (ASPs). The company achieved a substantial turnaround in profitability, with net income reaching $22.2 million, a stark contrast to a net loss of $557,000 from continuing operations in the prior year's quarter. This surge in income is also reflected in the earnings per share, which moved from a loss of $0.00 to an earning of $0.12 per basic share. The company also demonstrated improved liquidity, with cash and cash equivalents increasing to $244.4 million from $223.7 million at the end of the previous fiscal quarter. Operating cash flow from continuing operations saw a significant boost, reaching $45.0 million compared to $11.4 million in the prior year's quarter. Management expressed confidence in its ability to meet working capital needs through current cash balances and its senior credit facility.
Key Highlights
- 1Net revenue increased by 32% year-over-year to $582.9 million, driven by higher unit shipments.
- 2The company returned to profitability with a net income of $22.2 million, compared to a net loss from continuing operations of $557,000 in the prior year quarter.
- 3Basic earnings per share improved significantly from a loss of $0.00 to an earning of $0.12.
- 4Gross margin percentage improved to 14.3% from 12.7% year-over-year, due to higher unit shipments and cost reduction efforts.
- 5Operating cash flow from continuing operations increased substantially to $45.0 million from $11.4 million in the prior year quarter.
- 6Cash and cash equivalents grew to $244.4 million at the end of the quarter.
- 7The company has terminated several new business ventures, reporting their results as discontinued operations.