Analysis of Geographic Areas
Western Digital Corp. operates in 4 regions: United States; China; Rest of Asia; and Europe, Middle East and Africa.
Area Asset Turnover
Western Digital Corp., asset turnover by geographic area
| Jun 30, 2023 | Jul 1, 2022 | Jul 2, 2021 | Jul 3, 2020 | Jun 28, 2019 | Jun 29, 2018 | |
|---|---|---|---|---|---|---|
| United States | 3.56 | 4.79 | 3.55 | 4.93 | 3.74 | 3.91 |
| China | 6.98 | 10.26 | 10.98 | 10.92 | 9.19 | 10.29 |
| Rest of Asia | 1.55 | 2.69 | 3.04 | 2.90 | 3.72 | 4.76 |
| Europe, Middle East and Africa | 44.68 | 62.43 | 69.57 | 57.37 | 57.57 | 65.39 |
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).
- United States Asset Turnover
- The asset turnover ratio in the United States exhibited fluctuations over the six-year period. Starting at 3.91 in 2018, it slightly decreased to 3.74 in 2019, then increased notably to 4.93 in 2020. This was followed by a decline to 3.55 in 2021, a rebound to 4.79 in 2022, and a substantial decrease to 3.56 in 2023. The pattern indicates variability without a clear long-term upward or downward trend.
- China Asset Turnover
- China's asset turnover ratio showed a downward trend after an initial period of stability. It started at 10.29 in 2018, decreased to 9.19 in 2019, rebounded slightly to 10.92 in 2020, and peaked at 10.98 in 2021. Subsequently, it decreased to 10.26 in 2022 and dropped significantly to 6.98 in 2023. The sharp decline in the final year suggests potential challenges affecting asset utilization in this region.
- Rest of Asia Asset Turnover
- The ratio for the Rest of Asia decreased steadily across the period. It began at 4.76 in 2018, dropped to 3.72 in 2019, and further declined to 2.90 in 2020. Minor increases followed with 3.04 in 2021, but the trend resumed downward reaching 2.69 in 2022 and declining sharply to 1.55 in 2023. The consistent drop highlights declining efficiency in asset turnover in this area.
- Europe, Middle East and Africa (EMEA) Asset Turnover
- The EMEA region demonstrated the highest asset turnover ratios throughout the period but with notable volatility. The ratio decreased from 65.39 in 2018 to 57.57 in 2019, remaining relatively stable at 57.37 in 2020. A significant increase to 69.57 occurred in 2021, followed by a decline to 62.43 in 2022 and a sharp drop to 44.68 in 2023. Despite fluctuations, the region consistently achieved superior asset turnover compared to other geographic areas.
- Overall Observations
- The data reveals differing regional asset turnover dynamics. The EMEA region exhibits strong asset utilization but with recent volatility and a sharp decline in the latest year. The United States shows inconsistent performance without a clear trend. China maintains relatively high ratios but faces a marked decrease recently. The Rest of Asia reveals a persistent downward trend, signaling deteriorating asset efficiency. These patterns suggest varying regional market conditions and operational effectiveness that may warrant targeted strategic focus.
Area Asset Turnover: United States
Western Digital Corp.; United States; area asset turnover calculation
| Jun 30, 2023 | Jul 1, 2022 | Jul 2, 2021 | Jul 3, 2020 | Jun 28, 2019 | Jun 29, 2018 | |
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Net revenue | 3,810) | 5,411) | 3,789) | 4,679) | 3,602) | 4,640) |
| Long-lived assets | 1,071) | 1,130) | 1,068) | 949) | 962) | 1,187) |
| Area Activity Ratio | ||||||
| Area asset turnover1 | 3.56 | 4.79 | 3.55 | 4.93 | 3.74 | 3.91 |
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).
1 2023 Calculation
Area asset turnover = Net revenue ÷ Long-lived assets
= 3,810 ÷ 1,071 = 3.56
- Net Revenue
- Net revenue exhibits significant fluctuations over the observed periods. It initially declines from $4,640 million in 2018 to $3,602 million in 2019, followed by a recovery to $4,679 million in 2020. The amount decreases again to $3,789 million in 2021, increases sharply to $5,411 million in 2022, and then falls back to $3,810 million in 2023. This pattern indicates volatility in revenues with no clear upward or downward trend, but notable peaks in 2020 and 2022.
- Long-lived Assets
- The value of long-lived assets shows a generally declining trend from 2018 through 2020, moving from $1,187 million to $949 million. It then rises in 2021 and 2022 to $1,068 million and $1,130 million respectively, before slightly dropping again to $1,071 million in 2023. Overall, the asset base has experienced moderate fluctuations but remains relatively stable around the $1,000 million mark in recent years.
- Area Asset Turnover
- Area asset turnover, which measures the efficiency of asset use in generating revenue, displays volatile movements in line with net revenue changes. The ratio decreases from 3.91 in 2018 to 3.74 in 2019, peaks significantly at 4.93 in 2020, then declines sharply to 3.55 in 2021. It increases once more to 4.79 in 2022 before falling back to 3.56 in 2023. This oscillation highlights variability in operational efficiency year over year.
Area Asset Turnover: China
Western Digital Corp.; China; area asset turnover calculation
| Jun 30, 2023 | Jul 1, 2022 | Jul 2, 2021 | Jul 3, 2020 | Jun 28, 2019 | Jun 29, 2018 | |
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Net revenue | 2,773) | 4,525) | 4,339) | 4,075) | 3,861) | 4,393) |
| Long-lived assets | 397) | 441) | 395) | 373) | 420) | 427) |
| Area Activity Ratio | ||||||
| Area asset turnover1 | 6.98 | 10.26 | 10.98 | 10.92 | 9.19 | 10.29 |
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).
1 2023 Calculation
Area asset turnover = Net revenue ÷ Long-lived assets
= 2,773 ÷ 397 = 6.98
- Net Revenue
- Over the six-year period, the net revenue exhibited fluctuations with an overall declining trend in the most recent year. Initially, revenue decreased from 4393 million US dollars in 2018 to 3861 million US dollars in 2019. It then recovered somewhat in the following years, reaching a peak of 4525 million US dollars in 2022. However, there was a significant decline in 2023 to 2773 million US dollars, indicating a substantial drop in sales or market demand in this geographic area during the last reporting period.
- Long-lived Assets
- The long-lived assets demonstrated relatively minor fluctuations over the years, remaining within the range of 373 to 441 million US dollars. The asset base slightly decreased from 427 million US dollars in 2018 to 373 million US dollars in 2020, followed by a modest increase peaking at 441 million US dollars in 2022. The asset value slightly declined again to 397 million US dollars in 2023. This stability suggests a consistent level of investment or capacity in long-term assets in this region, with no major expansions or contractions.
- Area Asset Turnover
- The area asset turnover ratio, representing revenue generated per unit of long-lived assets, showed a downward trend during the period. Starting from a high of 10.29 in 2018, it declined to 9.19 in 2019 but increased again in 2020 and 2021, reaching nearly 10.98. However, afterward, it dropped to 10.26 in 2022 and sharply declined to 6.98 in 2023. This decrease indicates a reduced efficiency in utilizing assets to generate revenue in the most recent year, correlating with the significant drop in net revenue, potentially reflecting operational challenges or market conditions affecting asset productivity.
Area Asset Turnover: Rest of Asia
Western Digital Corp.; Rest of Asia; area asset turnover calculation
| Jun 30, 2023 | Jul 1, 2022 | Jul 2, 2021 | Jul 3, 2020 | Jun 28, 2019 | Jun 29, 2018 | |
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Net revenue | 3,273) | 5,529) | 5,116) | 4,291) | 5,238) | 6,774) |
| Long-lived assets | 2,105) | 2,053) | 1,681) | 1,481) | 1,407) | 1,422) |
| Area Activity Ratio | ||||||
| Area asset turnover1 | 1.55 | 2.69 | 3.04 | 2.90 | 3.72 | 4.76 |
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).
1 2023 Calculation
Area asset turnover = Net revenue ÷ Long-lived assets
= 3,273 ÷ 2,105 = 1.55
The financial data for the "Rest of Asia" geographic area reveals notable trends in net revenue, long-lived assets, and area asset turnover over the six-year period ending in June 2023.
- Net Revenue
- Net revenue demonstrates a clear declining trend overall, beginning at 6,774 million US dollars in mid-2018 and falling to 3,273 million US dollars by mid-2023. There is a consistent year-over-year decrease from 2018 to 2020, with revenue dropping from 6,774 to 4,291 million. A modest recovery occurs in 2021 and 2022, reaching 5,529 million, before declining sharply again in 2023 to the lowest value observed in the period.
- Long-lived Assets
- Contrary to the revenue trend, long-lived assets show a generally increasing pattern. Starting at 1,422 million US dollars in 2018, the value fluctuates slightly downward in 2019 but then rises steadily each year, reaching 2,105 million by 2023. This suggests ongoing investment or asset accumulation despite the fluctuations in revenue.
- Area Asset Turnover
- The area asset turnover ratio, which measures the efficiency of asset utilization in generating revenue, shows a downward trajectory. The ratio declines from 4.76 in 2018 to 1.55 in 2023, indicating a decreased efficiency in the use of assets to generate sales over time. The drop is particularly pronounced in the last two years of the period.
In summary, the geographic area experienced a significant contraction in revenue alongside an increase in asset base. The declining asset turnover ratio implies diminishing returns on the assets employed, highlighting potential challenges in operational efficiency or market conditions affecting revenue generation in this region.
Area Asset Turnover: Europe, Middle East and Africa
Western Digital Corp.; Europe, Middle East and Africa; area asset turnover calculation
| Jun 30, 2023 | Jul 1, 2022 | Jul 2, 2021 | Jul 3, 2020 | Jun 28, 2019 | Jun 29, 2018 | |
|---|---|---|---|---|---|---|
| Selected Financial Data (US$ in millions) | ||||||
| Net revenue | 2,100) | 2,872) | 3,061) | 2,926) | 3,109) | 3,858) |
| Long-lived assets | 47) | 46) | 44) | 51) | 54) | 59) |
| Area Activity Ratio | ||||||
| Area asset turnover1 | 44.68 | 62.43 | 69.57 | 57.37 | 57.57 | 65.39 |
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).
1 2023 Calculation
Area asset turnover = Net revenue ÷ Long-lived assets
= 2,100 ÷ 47 = 44.68
The financial data for the Europe, Middle East, and Africa geographic area reveals notable trends in revenue, asset levels, and asset efficiency over the six-year period ending in mid-2023.
- Net Revenue
- The net revenue demonstrates a declining trend overall. Starting at $3,858 million in 2018, revenue decreases steadily to $3,109 million in 2019 and continues to decline in subsequent years, with a slight recovery in 2021 to $3,061 million. However, the decline resumes after 2021, with revenue dropping to $2,872 million in 2022 and descending further to $2,100 million by 2023. This consistent downward pattern indicates potential challenges in revenue generation within the region during the period.
- Long-lived Assets
- The value of long-lived assets shows a modest downward trajectory from $59 million in 2018 to $44 million in 2021. After 2021, assets slightly increase to $46 million in 2022 and $47 million in 2023, suggesting some reinvestment or acquisition of long-term assets in the latter years. Despite these fluctuations, the asset base remains lower than the initial value recorded in 2018.
- Area Asset Turnover Ratio
- Asset turnover ratio, which measures how efficiently assets generate revenue, reveals variability throughout the period. It decreases from a high level of 65.39 in 2018 to around 57.37 in 2020. In 2021, the ratio improves to 69.57, indicating a more efficient use of assets. However, efficiency declines again post-2021, falling to 62.43 in 2022 and sharply to 44.68 by 2023. This decline suggests a reduction in asset utilization effectiveness, potentially due to falling revenues or changes in asset structure.
Net revenue
Western Digital Corp., net revenue by geographic area
US$ in millions
| Jun 30, 2023 | Jul 1, 2022 | Jul 2, 2021 | Jul 3, 2020 | Jun 28, 2019 | Jun 29, 2018 | |
|---|---|---|---|---|---|---|
| United States | 3,810) | 5,411) | 3,789) | 4,679) | 3,602) | 4,640) |
| China | 2,773) | 4,525) | 4,339) | 4,075) | 3,861) | 4,393) |
| Rest of Asia | 3,273) | 5,529) | 5,116) | 4,291) | 5,238) | 6,774) |
| Europe, Middle East and Africa | 2,100) | 2,872) | 3,061) | 2,926) | 3,109) | 3,858) |
| Other | 362) | 456) | 617) | 765) | 759) | 982) |
| Total | 12,318) | 18,793) | 16,922) | 16,736) | 16,569) | 20,647) |
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 annual net revenue data across geographic areas demonstrates notable fluctuations over the six-year period examined. An overall declining trend in total net revenue is observed, particularly marked in the most recent year.
- United States
- The revenue shows volatility, with an initial high of 4,640 million USD in 2018, followed by a decline to 3,602 million USD in 2019. A recovery to 4,679 million USD occurs in 2020, but subsequent years depict alternating decreases and increases, ending with 3,810 million USD in 2023. Despite these fluctuations, the final value is lower than the initial peak, indicating instability in this region.
- China
- China’s revenue exhibits growth from 4,393 million USD in 2018 to a peak of 4,525 million USD in 2022. However, a sharp decline to 2,773 million USD in 2023 is apparent, substantially reducing the revenue contribution from this area. This drop in the last year offsets several years of steady growth, representing a significant reversal.
- Rest of Asia
- The Rest of Asia region experiences a generally decreasing trend from 6,774 million USD in 2018 to 4,291 million USD in 2020. Thereafter, a modest recovery takes place, reaching 5,529 million USD in 2022, before falling again to 3,273 million USD in 2023. The region maintains a relatively high revenue contribution compared to others, but volatility is evident.
- Europe, Middle East and Africa (EMEA)
- EMEA revenues consistently decline throughout the period, starting at 3,858 million USD in 2018 and dropping to 2,100 million USD in 2023. The trend is downward with no notable recovery, suggesting persistent challenges in this geographic segment.
- Other Regions
- The net revenue from other regions decreases steadily from 982 million USD in 2018 to 362 million USD in 2023. This continuous reduction implies a diminishing impact from smaller or miscellaneous markets over time.
- Total Net Revenue
- Total net revenue peaks in 2018 at 20,647 million USD and declines sharply to 12,318 million USD by 2023. While some intermediate years (2020-2022) show modest stability or growth, the prevailing trend is downward, largely influenced by the steep declines in key regions, particularly China, Rest of Asia, and EMEA in the latest year.
In summary, the data reflects considerable geographic disparities, with the United States and China historically being the largest contributors but both experiencing significant recent declines. The Rest of Asia shows mixed performance, while EMEA and other regions face continual decreases. Overall, the net revenue trend points to a challenging environment in the latest year after several years of modest fluctuations.
Long-lived assets
Western Digital Corp., long-lived assets by geographic area
US$ in millions
| Jun 30, 2023 | Jul 1, 2022 | Jul 2, 2021 | Jul 3, 2020 | Jun 28, 2019 | Jun 29, 2018 | |
|---|---|---|---|---|---|---|
| United States | 1,071) | 1,130) | 1,068) | 949) | 962) | 1,187) |
| China | 397) | 441) | 395) | 373) | 420) | 427) |
| Rest of Asia | 2,105) | 2,053) | 1,681) | 1,481) | 1,407) | 1,422) |
| Europe, Middle East and Africa | 47) | 46) | 44) | 51) | 54) | 59) |
| Total | 3,620) | 3,670) | 3,188) | 2,854) | 2,843) | 3,095) |
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).
- United States
- The long-lived assets in the United States show a decline from 1,187 million US dollars in 2018 to 949 million in 2020. Subsequently, there is a partial recovery to 1,130 million in 2022, followed by a slight decrease to 1,071 million in 2023. Overall, the trend reflects some volatility with a decrease in the early period and modest fluctuations afterward.
- China
- Assets in China experienced a gradual decrease from 427 million in 2018 to 373 million in 2020. After this period, there was a rebound to 441 million in 2022, but this was followed by a slight decline to 397 million in 2023. The values illustrate a somewhat cyclical pattern with a moderate overall decline from the initial value.
- Rest of Asia
- This region displays consistent growth throughout the entire period, starting from 1,422 million in 2018 and increasing steadily every year, reaching 2,105 million in 2023. This represents a significant increase and the largest growth percentage among all regions, indicating a strong expansion of long-lived assets in the Rest of Asia.
- Europe, Middle East and Africa
- The assets in this combined region show a gradual decline from 59 million in 2018 to 44 million in 2021, followed by a slight increase to 47 million in 2023. The overall values remain relatively low compared to other regions, with minor fluctuations over the analyzed years.
- Total Long-Lived Assets
- The total long-lived assets reflect an initial decline from 3,095 million in 2018 to 2,843 million in 2019, then a stabilization around 2,850 million in 2020. From 2021 onwards, there is noticeable growth, peaking at 3,670 million in 2022 before a slight decrease to 3,620 million in 2023. This overall trend suggests recovery and expansion primarily driven by asset growth in the Rest of Asia and partial recoveries in the United States and China.