Stock Analysis on Net
AI Tokens
Stock Analysis on Net

Western Digital Corp. (NASDAQ:WDC)

This company has been moved to the archive! The financial data has not been updated since February 12, 2024.

Common-Size Income Statement

Western Digital Corp., common-size consolidated income statement

Microsoft Excel
12 months ended: Jun 30, 2023 Jul 1, 2022 Jul 2, 2021 Jul 3, 2020 Jun 28, 2019 Jun 29, 2018
Revenue, net 100.00 100.00 100.00 100.00 100.00 100.00
Cost of revenue -84.68 -68.74 -73.28 -77.41 -77.36 -62.68
Gross profit 15.32% 31.26% 26.72% 22.59% 22.64% 37.32%
Research and development -16.31 -12.36 -13.25 -13.51 -13.17 -11.62
Selling, general and administrative -7.87 -5.94 -6.53 -6.89 -7.95 -7.13
Employee termination, asset impairment, and other charges -1.57 -0.23 0.28 -0.19 -1.00 -1.04
Operating expenses -25.75% -18.53% -19.51% -20.59% -22.12% -19.80%
Operating income (loss) -10.43% 12.72% 7.21% 2.00% 0.53% 17.52%
Interest income 0.19 0.03 0.04 0.17 0.34 0.29
Interest expense -2.53 -1.62 -1.93 -2.47 -2.83 -3.27
Other income (expense), net 0.11 0.16 0.15 0.02 0.23 -4.44
Interest and other income (expense), net -2.23% -1.43% -1.73% -2.28% -2.26% -7.42%
Income (loss) before taxes -12.66% 11.30% 5.48% -0.27% -1.73% 10.10%
Income tax expense -1.19 -3.32 -0.63 -1.22 -2.82 -6.83
Net income (loss) -13.85% 7.98% 4.85% -1.49% -4.55% 3.27%
Cumulative dividends allocated to preferred shareholders -0.19 0.00 0.00 0.00 0.00 0.00
Net income (loss) attributable to common shareholders -14.04% 7.98% 4.85% -1.49% -4.55% 3.27%

Based on: 10-K (reporting date: 2023-06-30), 10-K (reporting date: 2022-07-01), 10-K (reporting date: 2021-07-02), 10-K (reporting date: 2020-07-03), 10-K (reporting date: 2019-06-28), 10-K (reporting date: 2018-06-29).

The financial performance over the analyzed six-year period is characterized by significant volatility in gross margins and net profitability, culminating in a substantial contraction in the final year. The transition from a high-margin environment in 2018 to a net loss position in 2023 indicates a period of intense operational pressure and fluctuating cost structures.

Gross Margin Analysis
A sharp contraction in gross profit is observed between 2018 and 2019, falling from 37.32% to 22.64%. While a gradual recovery occurred between 2020 and 2022, peaking at 31.26%, this trend reversed abruptly in 2023. In the final year, the cost of revenue rose to 84.68% of net revenue, leading to a gross profit margin of 15.32%, the lowest point in the observed period.
Operating Expense Trends
Operating expenses remained relatively stable between 2018 and 2022, fluctuating between 18.53% and 22.12% of revenue. Research and development costs generally held between 11% and 13.5% until 2023, when a significant spike to 16.31% occurred. Selling, general, and administrative expenses showed a slight downward trend from 2019 to 2022 before increasing to 7.87% in 2023. The aggregate effect of these increases resulted in total operating expenses reaching a period high of 25.75% in 2023.
Operating and Net Income Volatility
Operating income demonstrates extreme variance, moving from a robust 17.52% in 2018 to near-zero levels in 2019 (0.53%) and 2020 (2.00%). A period of operational recovery saw operating income climb to 12.72% by 2022, only to plunge into a deficit of -10.43% in 2023. Consequently, net income attributable to common shareholders followed a similar erratic trajectory, shifting from a profit of 7.98% in 2022 to a loss of 14.04% in 2023.
Non-Operating Items and Financial Costs
Interest expenses as a percentage of revenue showed a general declining trend from 3.27% in 2018 to a low of 1.62% in 2022, before increasing again to 2.53% in 2023. Other non-operating income and expenses were largely negligible after 2018, where a significant expense of 4.44% was recorded. The net impact of interest and other income remained a drag on the bottom line throughout the period, though the magnitude of this impact was minimized between 2021 and 2022.

AI Ask an analyst for more

My previous chats

Add tokens

Hi, I’m an AI-powered financial analyst at Stock Analysis on Net.
Without a user account, I tend to respond rather slowly.

How can I help you?