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Western Digital announces Q3 revenue of US$1.1 billion and net income of US$ .45 per share |
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5/16/2006 11:31:27 AM |
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 Western Digital Corp. (NYSE: WDC) has reported revenue of US$ 1.1 billion on shipments of approximately 18.8 million units, and net income of US$ 102.9 million, or US$ .45 per share for its third fiscal quarter ended March 31, 2006. Gross margin for the March quarter was 19.3 per cent.
These results represented strong year-over-year performance, including 23 per cent growth in units from 15.3 million in the year-ago period, 23 per cent growth in revenue versus US$ 920 million, and 45 per cent growth in net income over the US$ 70.8 million reported last year. A year ago, the company reported earnings of US$ .32 per share and gross margin of 18.2 per cent.
The company’s results for the nine-month period ended March 31, 2006, also reflected strong year-over-year performance, with revenue of US$ 3.3 billion, net income of US$ 276 million, and earnings per share of US$ 1.24, representing increases of 21 per cent, 76 per cent and 70 per cent, respectively, compared with the first nine months of fiscal 2005.
In the March quarter, the company continued to broaden its business beyond the desktop PC market into segments such as notebook, consumer electronics, enterprise and branded products. 29 per cent of the March quarter revenue came from the new markets and 71 per cent from the desktop PC business. This compares with a mix in the year-ago quarter of 23 per cent non-desktop PC revenue and 77 per cent desktop PC revenue.
Since January 2006, eight new WD products have begun shipping into five different growth markets—desktop, notebook, enterprise, consumer electronics and branded products. Reflecting the company’s significant investments in research and development and capital spending over the last three years, WD is now able to address 90 per cent of the worldwide hard drive market, which in calendar year 2005 was a US$ 28 billion industry.
From a balance sheet perspective, the company generated US$ 119 million in cash from operations during the March quarter, ending with total cash and short-term investments of US$ 674 million. During the quarter, the company repurchased 0.9 million shares of its common stock for approximately US$ 17.5 million. Since the inception of the share repurchase program in May 2004, the company has repurchased 9.7 million shares for approximately US$105 million. The company also increased capital expenditures to US$ 104 million in the quarter.
Arif Shakeel, WD’s president and chief executive officer, said, “The March quarter results demonstrate a continuation of our strong and consistent financial performance and penetration of new markets. Providing customers with high quality, cost-effective hard drives at capacity points they require —when they need them—is of tremendous value in all the markets that we serve, be it notebook, consumer electronics, enterprise, branded products and desktop. As these markets grow, we have significant opportunities to leverage our investments into continued strong financial performance.”
About WD
WD, one of the storage industry's pioneers and long-time leaders, provides products and services for people and organizations that collect, manage and use digital information. The company produces reliable, high-performance hard drives that keep users' data close-at-hand and secure from loss.
WD was founded in 1970. The company's storage products are marketed to leading systems manufacturers and selected resellers under the Western Digital and WD brand names. Visit the Investor section of the company's Web site (www.westerndigital.com) to access a variety of financial and investor information.
This press release contains forward-looking statements, including a statement regarding the company’s significant opportunity to leverage its investments into continued strong financial performance as markets for hard disk drives grow. These forward-looking statements are based on current management expectations and are subject to risks and uncertainties that could cause actual results to differ materially from those expressed in the forward-looking statements, including: pricing trends and fluctuations in average selling prices (ASPs); actions by competitors; changes in the availability and cost of specialized product components, including media; supply and demand conditions in the hard drive industry; changes in product and customer mix; uncertainties related to the development and introduction of products based on new technologies and successful expansion into new hard drive markets, including the 1-inch and other small form factor markets; difficulties in reducing yield losses from complex manufacturing processes; business conditions and growth in the notebook, consumer electronics, enterprise, branded products and desktop markets; and other risks and uncertainties listed in the company’s recent Form 10-Q filed with the SEC on Feb. 8, 2006, to which your attention is directed. Readers are cautioned not to 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 subsequent events or circumstances.
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