8-KMaterial Agreements

WESTERN DIGITAL CORP 8-K Report, Material Agreement (Jul 19, 2006)

Filed July 19, 2006For Securities:WDC

Summary

This 8-K filing from Western Digital Corporation (WDC), dated July 16, 2006, announces an amendment to a critical volume purchase agreement with Showa Denko K.K. (SDK). This amendment, extending the supply of specified media volumes until June 30, 2009, underscores WDC's strategic focus on securing essential components for its hard drive manufacturing operations. The company is actively managing its supply chain to ensure continued production capacity and meet market demand. The key takeaway for investors is WDC's proactive approach to supply chain management. By extending this agreement with a strategic supplier like Showa Denko, WDC aims to mitigate potential disruptions and ensure a stable flow of key media components. This is crucial in the volatile hard drive market, where component availability can significantly impact production and profitability. The extended commitment suggests a strong ongoing relationship and a strategic imperative to secure supply for the long term.

Key Highlights

  • 1Western Digital (WDC) amended its volume purchase agreement with Showa Denko K.K. (SDK) on July 16, 2006.
  • 2The amendment extends the supply of specified media volumes from SDK until June 30, 2009.
  • 3This agreement is part of WDC's strategic effort to ensure adequate supply of key components for its hard drives.
  • 4The amendment highlights WDC's proactive supply chain management to mitigate potential disruptions.
  • 5Securing key component supply is critical for WDC's ongoing hard drive production and market position.
  • 6The company is working diligently with strategic suppliers to ensure component availability.

Frequently Asked Questions

The main purpose of this 8-K filing is to report a material definitive agreement: an amendment to Western Digital's volume purchase agreement with Showa Denko K.K. for the supply of hard drive media.

The amendment extends the agreement for Showa Denko K.K. to supply specified media volumes to Western Digital until June 30, 2009. This is intended to ensure Western Digital has a steady supply of crucial components for its hard drives.

Securing a stable and adequate supply of key components, like the media from Showa Denko, is vital in the hard drive industry. It helps prevent production disruptions, manage costs, and meet customer demand, all of which directly impact the company's financial performance and market competitiveness.

The full text of the amendment will be filed as an exhibit to Western Digital's quarterly report on Form 10-Q for the period ended September 30, 2006. Portions will be omitted and filed separately with the SEC under a request for confidential treatment.