Cover Page
Cover Page - shares | 3 Months Ended | |
Sep. 29, 2023 | Oct. 25, 2023 | |
Cover [Abstract] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Sep. 29, 2023 | |
Document Transition Report | false | |
Entity File Number | 1-8703 | |
Entity Registrant Name | WESTERN DIGITAL CORPORATION | |
Entity Incorporation, State or Country Code | DE | |
Entity Tax Identification Number | 33-0956711 | |
Entity Address, Address Line One | 5601 Great Oaks Parkway | |
Entity Address, City or Town | San Jose, | |
Entity Address, State or Province | CA | |
Entity Address, Postal Zip Code | 95119 | |
City Area Code | 408 | |
Local Phone Number | 717-6000 | |
Title of 12(b) Security | Common Stock, $0.01 Par Value Per Share | |
Trading Symbol | WDC | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 324,243,164 | |
Entity Central Index Key | 0000106040 | |
Document Fiscal Year Focus | 2024 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --06-28 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) $ in Millions | Sep. 29, 2023 | Jun. 30, 2023 |
Current assets: | ||
Cash and cash equivalents | $ 2,032 | $ 2,023 |
Accounts receivable, net | 1,451 | 1,598 |
Inventories | 3,497 | 3,698 |
Other current assets | 597 | 567 |
Total current assets | 7,577 | 7,886 |
Non-current assets: | ||
Property, plant and equipment, net | 3,371 | 3,620 |
Notes receivable and investments in Flash Ventures | 1,245 | 1,297 |
Goodwill | 10,035 | 10,037 |
Other intangible assets, net | 80 | 80 |
Other non-current assets | 1,693 | 1,509 |
Total assets | 24,001 | 24,429 |
Current liabilities: | ||
Accrued expenses | 1,347 | 1,288 |
Income taxes payable | 675 | 999 |
Accrued compensation | 349 | 349 |
Current portion of long-term debt | 1,850 | 1,213 |
Total current liabilities | 5,792 | 5,434 |
Non-current liabilities: | ||
Long-term debt | 5,822 | 5,857 |
Other liabilities | 1,398 | 1,415 |
Total liabilities | 13,012 | 12,706 |
Commitments and contingencies (Notes 9, 10, 12 and 16) | ||
Convertible preferred stock, $0.01 par value; authorized — 5 shares; issued and outstanding — 1 shares; aggregate liquidation preference of $939 and $924, respectively | 876 | 876 |
Shareholders’ equity: | ||
Common stock, $0.01 par value; authorized — 450 shares; issued and outstanding — 324 shares and 322 shares, respectively | 3 | 3 |
Additional paid-in capital | 3,970 | 3,936 |
Accumulated other comprehensive loss | (599) | (516) |
Retained earnings | 6,739 | 7,424 |
Total shareholders’ equity | 10,113 | 10,847 |
Total liabilities, convertible preferred stock and shareholders’ equity | 24,001 | 24,429 |
Nonrelated Party | ||
Current liabilities: | ||
Accounts payable | 1,294 | 1,293 |
Related Party | ||
Current liabilities: | ||
Accounts payable | $ 277 | $ 292 |
CONDENSED CONSOLIDATED BALANC_2
CONDENSED CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) $ in Millions | Sep. 29, 2023 | Jun. 30, 2023 |
Statement of Financial Position [Abstract] | ||
Convertible preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Convertible preferred stock, shares authorized (in shares) | 5,000,000 | 5,000,000 |
Convertible preferred stock, shares issued (in shares) | 1,000,000 | 1,000,000 |
Convertible preferred stock, shares outstanding (in shares) | 1,000,000 | 1,000,000 |
Convertible preferred stock, liquidation preference | $ 939 | $ 924 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 450,000,000 | 450,000,000 |
Common stock, shares issued (in shares) | 324,000,000 | 322,000,000 |
Common stock, shares outstanding (in shares) | 324,000,000 | 322,000,000 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Millions, $ in Millions | 3 Months Ended | |
Sep. 29, 2023 | Sep. 30, 2022 | |
Income Statement [Abstract] | ||
Revenue, net | $ 2,750 | $ 3,736 |
Cost of revenue | 2,651 | 2,755 |
Gross profit | 99 | 981 |
Operating expenses: | ||
Research and development | 431 | 552 |
Selling, general and administrative | 207 | 247 |
Employee termination, asset impairment, and other | 57 | 24 |
Total operating expenses | 695 | 823 |
Operating income (loss) | (596) | 158 |
Interest and other income (expense): | ||
Interest income | 8 | 2 |
Interest expense | (98) | (70) |
Other income (expense), net | 4 | (6) |
Total interest and other expense, net | (86) | (74) |
Income (loss) before taxes | (682) | 84 |
Income tax expense | 3 | 57 |
Net income (loss) | (685) | 27 |
Less: cumulative dividends allocated to preferred shareholders | 15 | 0 |
Net income (loss) attributable to common shareholders | $ (700) | $ 27 |
Net income (loss) per common share: | ||
Basic (in dollars per share) | $ (2.17) | $ 0.09 |
Diluted (in dollars per share) | $ (2.17) | $ 0.08 |
Weighted average shares outstanding: | ||
Basic (in shares) | 323 | 316 |
Diluted (in shares) | 323 | 319 |
CONDENSED CONSOLIDATED STATEM_2
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE LOSS - USD ($) $ in Millions | 3 Months Ended | |
Sep. 29, 2023 | Sep. 30, 2022 | |
Statement of Comprehensive Income [Abstract] | ||
Net income (loss) | $ (685) | $ 27 |
Other comprehensive loss, before tax: | ||
Foreign currency translation adjustment | (38) | (80) |
Net unrealized loss on derivative contracts and available-for-sale securities | (58) | (76) |
Total other comprehensive loss, before tax | (96) | (156) |
Income tax benefit related to items of other comprehensive loss, before tax | 13 | 16 |
Other comprehensive loss, net of tax | (83) | (140) |
Total comprehensive loss | $ (768) | $ (113) |
CONDENSED CONSOLIDATED STATEM_3
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Millions | 3 Months Ended | |
Sep. 29, 2023 | Sep. 30, 2022 | |
Cash flows from operating activities | ||
Net income (loss) | $ (685) | $ 27 |
Adjustments to reconcile net income (loss) to net cash provided by (used in) operations: | ||
Depreciation and amortization | 147 | 216 |
Stock-based compensation | 77 | 86 |
Deferred income taxes | (46) | (42) |
Loss (Gain) on disposal of assets | (87) | 1 |
Non-cash portion of asset impairment | 95 | 0 |
Amortization of debt issuance costs and discounts | 4 | 3 |
Other non-cash operating activities, net | 1 | 44 |
Changes in: | ||
Accounts receivable, net | 147 | 382 |
Inventories | 201 | (224) |
Accounts payable | 25 | (125) |
Accounts payable to related parties | (15) | (25) |
Accrued expenses | 63 | (44) |
Income taxes payable | (325) | 117 |
Accrued compensation | 1 | (104) |
Other assets and liabilities, net | (229) | (306) |
Net cash provided by (used in) operating activities | (626) | 6 |
Cash flows from investing activities | ||
Purchases of property, plant and equipment | (124) | (320) |
Proceeds from the sale of property, plant and equipment | 193 | 0 |
Notes receivable issuances to Flash Ventures | (121) | (84) |
Notes receivable proceeds from Flash Ventures | 134 | 183 |
Strategic investments and other, net | 2 | (3) |
Net cash provided by (used in) investing activities | 84 | (224) |
Cash flows from financing activities | ||
Taxes paid on vested stock awards under employee stock plans | (43) | (50) |
Net proceeds from convertible preferred stock | (3) | 0 |
Repayments of debt | 0 | (300) |
Proceeds from debt | 600 | 300 |
Net cash provided by (used in) financing activities | 554 | (50) |
Effect of exchange rate changes on cash | (3) | (10) |
Net increase (decrease) in cash and cash equivalents | 9 | (278) |
Cash and cash equivalents, beginning of year | 2,023 | 2,327 |
Cash and cash equivalents, end of period | 2,032 | 2,049 |
Supplemental disclosure of cash flow information: | ||
Cash paid for income taxes | 545 | 134 |
Cash paid for interest | $ 127 | $ 106 |
CONDENSED CONSOLIDATED STATEM_4
CONDENSED CONSOLIDATED STATEMENTS OF CONVERTIBLE PREFRRED STOCK AND SHAREHOLDERS’ EQUITY - USD ($) shares in Millions, $ in Millions | Total | Cumulative Effect, Period of Adoption, Adjustment | Common Stock | Additional Paid-In Capital | Additional Paid-In Capital Cumulative Effect, Period of Adoption, Adjustment | Accumulated Other Comprehensive Loss | Retained Earnings | Retained Earnings Cumulative Effect, Period of Adoption, Adjustment |
Beginning balance (in shares) at Jul. 01, 2022 | 0 | |||||||
Beginning balance at Jul. 01, 2022 | $ 0 | |||||||
Ending balance (in shares) at Sep. 30, 2022 | 0 | |||||||
Ending balance at Sep. 30, 2022 | $ 0 | |||||||
Common stock, beginning balance (in shares) at Jul. 01, 2022 | 315 | |||||||
Beginning balance at Jul. 01, 2022 | 12,221 | $ (37) | $ 3 | $ 3,733 | $ (128) | $ (554) | $ 9,039 | $ 91 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Net income (loss) | 27 | 27 | ||||||
Employee stock plans (in shares) | 3 | |||||||
Employee stock plans | (50) | (50) | ||||||
Stock-based compensation | 86 | 86 | ||||||
Foreign currency translation adjustment | (80) | (80) | ||||||
Net unrealized loss on derivative contracts | (60) | (60) | ||||||
Common stock, ending balance (in shares) at Sep. 30, 2022 | 318 | |||||||
Ending balance at Sep. 30, 2022 | $ 12,107 | $ 3 | 3,641 | (694) | 9,157 | |||
Beginning balance (in shares) at Jun. 30, 2023 | 1 | |||||||
Beginning balance at Jun. 30, 2023 | $ 876 | |||||||
Ending balance (in shares) at Sep. 29, 2023 | 1 | |||||||
Ending balance at Sep. 29, 2023 | $ 876 | |||||||
Common stock, beginning balance (in shares) at Jun. 30, 2023 | 322 | 322 | ||||||
Beginning balance at Jun. 30, 2023 | $ 10,847 | $ 3 | 3,936 | (516) | 7,424 | |||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||||
Net income (loss) | (685) | (685) | ||||||
Employee stock plans (in shares) | 2 | |||||||
Employee stock plans | (43) | (43) | ||||||
Stock-based compensation | 77 | 77 | ||||||
Foreign currency translation adjustment | (38) | (38) | ||||||
Net unrealized loss on derivative contracts | $ (45) | (45) | ||||||
Common stock, ending balance (in shares) at Sep. 29, 2023 | 324 | 324 | ||||||
Ending balance at Sep. 29, 2023 | $ 10,113 | $ 3 | $ 3,970 | $ (599) | $ 6,739 |
Organization and Basis of Prese
Organization and Basis of Presentation | 3 Months Ended |
Sep. 29, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Basis of Presentation | Organization and Basis of Presentation Western Digital Corporation (“Western Digital” or the “Company”) is a leading developer, manufacturer, and provider of data storage devices and solutions based on both NAND flash and hard disk drive technologies. The Company’s broad portfolio of technology and products address the following key end markets: Cloud, Client and Consumer. The Company also generates immaterial license and royalty revenue from its extensive intellectual property portfolio, which is included in each of these three end market categories. The accounting policies followed by the Company are set forth in Part II, Item 8, Note 1, Organization and Basis of Presentation, of the Notes to Consolidated Financial Statements included in the Company’s Annual Report on Form 10‑K for the year ended June 30, 2023. In the opinion of management, all adjustments necessary to fairly state the Condensed Consolidated Financial Statements have been made. All such adjustments are of a normal, recurring nature. Certain information and footnote disclosures normally included in the Consolidated Financial Statements prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”) have been condensed or omitted pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). These Condensed Consolidated Financial Statements should be read in conjunction with the Consolidated Financial Statements and the notes thereto included in the Company’s Annual Report on Form 10‑K for the year ended June 30, 2023. The results of operations for interim periods are not necessarily indicative of results to be expected for the full year. Fiscal Year The Company’s fiscal year ends on the Friday nearest to June 30 and typically consists of 52 weeks. Approximately every five to six years, the Company reports a 53-week fiscal year to align the fiscal year with the foregoing policy. Fiscal year 2024, which will end on June 28, 2024, and fiscal year 2023, which ended June 30, 2023, are each comprised of 52 weeks, with all quarters presented consisting of 13 weeks. Segment Reporting The Company manufactures, markets, and sells data storage devices and solutions in the United States (“U.S.”) and in foreign countries through its sales personnel, dealers, distributors, retailers, and subsidiaries. The Company manages and reports under two reportable segments: flash-based products (“Flash”) and hard disk drives (“HDD”). The Chief Executive Officer, who is the Company’s Chief Operating Decision Maker (“CODM”), evaluates the performance of the Company and makes decisions regarding the allocation of resources based on each operating segment’s net revenue and gross margin. Because of the integrated nature of the Company’s production and distribution activities, separate segment asset measures are either not available or not used as a basis for the CODM to evaluate the performance of or to allocate resources to the segments. Use of Estimates Company management has made estimates and assumptions relating to the reporting of certain assets and liabilities in conformity with U.S. GAAP. These estimates and assumptions have been applied using methodologies that are consistent throughout the periods presented with consideration given to the potential impacts of current macroeconomic conditions. However, actual results could differ materially from these estimates. |
Recent Accounting Pronouncement
Recent Accounting Pronouncements | 3 Months Ended |
Sep. 29, 2023 | |
Accounting Changes and Error Corrections [Abstract] | |
Recent Accounting Pronouncements | Recent Accounting Pronouncements Accounting Pronouncements Recently Adopted In September 2022, the Financial Accounting Standards Board issued an accounting standards update (“ASU”) No. 2022-04, “Liabilities-Supplier Finance Programs (Subtopic 405-50): Disclosure of Supplier Finance Program Obligations”, which requires annual and interim disclosures for entities that use supplier finance programs in connection with the purchase of goods and services. The ASU requires the Company to provide disclosure of outstanding obligations to such suppliers for all balance sheet dates presented beginning with the Company’s first quarter of 2024 and to provide certain rollforward information related to those obligations beginning in the Company’s first fiscal quarter of 2025. The ASU does not affect the recognition, measurement, or financial statement presentation of supplier finance program obligations. The Company adopted the guidance on the first day of fiscal year 2024, except for the rollforward information, which the Company is compiling and intends to provide beginning in fiscal year 2025. See Note 15, Supplier Finance Program, of the Notes to the Condensed Consolidated Financial Statements for information regarding the supplier finance program. |
Business Segments, Geographic I
Business Segments, Geographic Information, and Concentrations of Risk | 3 Months Ended |
Sep. 29, 2023 | |
Segment Reporting [Abstract] | |
Business Segments, Geographic Information, and Concentrations of Risk | Business Segments, Geographic Information, and Concentrations of Risk The following table summarizes the operating performance of the Company’s reportable segments: Three Months Ended September 29, September 30, $ in millions Net revenue: Flash $ 1,556 $ 1,722 HDD 1,194 2,014 Total net revenue $ 2,750 $ 3,736 Gross profit: Flash $ (161) $ 422 HDD 273 574 Total gross profit for segments 112 996 Unallocated corporate items: Stock-based compensation expense (13) (14) Amortization of acquired intangible assets — (1) Total unallocated corporate items (13) (15) Consolidated gross profit $ 99 $ 981 Gross margin: Flash (10.3) % 24.5 % HDD 22.9 % 28.5 % Consolidated gross margin 3.6 % 26.3 % Disaggregated Revenue The Company’s broad portfolio of technology and products address multiple end markets. Cloud is comprised primarily of products for public or private cloud environments and end customers, which the Company believes it is uniquely positioned to address as the only provider of both Flash and HDD. Through the Client end market, the Company provides its original equipment manufacturer (“OEM”) and channel customers a broad array of high-performance flash and hard drive solutions across personal computer, mobile, gaming, automotive, virtual reality headsets, at-home entertainment, and industrial spaces. The Consumer end market is highlighted by the Company’s broad range of retail and other end-user products, which capitalize on the strength of the Company’s product brand recognition and vast points of presence around the world. The Company’s disaggregated revenue information is as follows: Three Months Ended September 29, September 30, (in millions) Revenue by End Market Cloud $ 872 $ 1,829 Client 1,147 1,229 Consumer 731 678 Total Revenue $ 2,750 $ 3,736 Revenue by Geography Asia $ 1,551 $ 1,686 Americas 662 1,423 Europe, Middle East and Africa 537 627 Total Revenue $ 2,750 $ 3,736 The Company’s top 10 customers accounted for 44% and 52% of its net revenue for the three months ended September 29, 2023 and September 30, 2022, respectively. For the three months ended September 29, 2023 and September 30, 2022, no single customer accounted for 10% or more of the Company’s net revenue. Goodwill Goodwill is not amortized. Instead, it is tested for impairment annually as of the beginning of the Company’s fourth quarter, or more frequently if events or changes in circumstances indicate that goodwill may be impaired. Management performed a goodwill impairment assessment for each segment and concluded there were no impairment indicators as of either the beginning or end of the three months ended September 29, 2023. The following table provides a summary of goodwill activity for the period: Flash HDD Total (in millions) Balance at June 30, 2023 $ 5,716 $ 4,321 $ 10,037 Foreign currency translation adjustment (1) (1) (2) Balance at September 29, 2023 $ 5,715 $ 4,320 $ 10,035 |
Supplemental Financial Statemen
Supplemental Financial Statement Data | 3 Months Ended |
Sep. 29, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Supplemental Financial Statement Data | Supplemental Financial Statement Data Accounts receivable, net From time to time, in connection with factoring agreements, the Company sells trade accounts receivable without recourse to third-party purchasers in exchange for cash. During the three months ended September 29, 2023 and September 30, 2022, the Company sold trade accounts receivable aggregating $150 million and $291 million, respectively. The discounts on the trade accounts receivable sold were not material and were recorded within Other income (expense), net in the Condensed Consolidated Statements of Operations. As of both September 29, 2023 and June 30, 2023, the amount of factored receivables that remained outstanding was $150 million. Inventories September 29, June 30, (in millions) Inventories: Raw materials and component parts $ 1,975 $ 2,096 Work-in-process 925 979 Finished goods 597 623 Total inventories $ 3,497 $ 3,698 Property, plant and equipment, net September 29, June 30, (in millions) Property, plant and equipment: Land $ 235 $ 269 Buildings and improvements 1,842 1,955 Machinery and equipment 8,691 8,704 Computer equipment and software 473 470 Furniture and fixtures 55 54 Construction-in-process 729 798 Property, plant and equipment, gross 12,025 12,250 Accumulated depreciation (8,654) (8,630) Property, plant and equipment, net $ 3,371 $ 3,620 Other Intangible assets, net As part of prior acquisitions, the Company recorded at the time of the acquisition acquired in-process research and development (“IPR&D”) for projects in progress that had not yet reached technological feasibility. IPR&D is initially accounted for as an indefinite-lived intangible asset. Once a project reaches technological feasibility, the Company reclassifies the balance to existing technology and begins to amortize the intangible asset over its estimated useful life. As of both September 29, 2023, and June 30, 2023, IPR&D included in intangible assets, net was $80 million. As of both September 29, 2023 and June 30, 2023, all other intangible assets were fully amortized. Product warranty liability Changes in the warranty accrual were as follows: Three Months Ended September 29, September 30, (in millions) Warranty accrual, beginning of period $ 244 $ 345 Charges to operations 22 32 Utilization (43) (34) Changes in estimate related to pre-existing warranties (5) (3) Warranty accrual, end of period $ 218 $ 340 The current portion of the warranty accrual is classified in Accrued expenses and the long-term portion is classified in Other liabilities as noted below: September 29, June 30, (in millions) Warranty accrual: Current portion (included in Accrued expenses) $ 61 $ 97 Long-term portion (included in Other liabilities) 157 147 Total warranty accrual $ 218 $ 244 Other liabilities September 29, June 30, (in millions) Other liabilities: Non-current net tax payable $ 199 $ 464 Non-current portion of unrecognized tax benefits 497 408 Other non-current liabilities 702 543 Total other liabilities $ 1,398 $ 1,415 Accumulated other comprehensive loss Accumulated other comprehensive loss (“AOCL”), net of tax refers to expenses, gains and losses that are recorded as an element of shareholders’ equity but are excluded from net income. The following table illustrates the changes in the balances of each component of AOCL: Actuarial Pension Losses Foreign Currency Translation Adjustment Unrealized Losses on Derivative Contracts Total Accumulated Comprehensive Loss (in millions) Balance at June 30, 2023 $ (2) $ (357) $ (157) $ (516) Other comprehensive loss before reclassifications — (38) (101) (139) Amounts reclassified from accumulated other comprehensive loss — — 43 43 Income tax benefit related to items of other comprehensive loss — 1 12 13 Net current-period other comprehensive loss — (37) (46) (83) Balance at September 29, 2023 $ (2) $ (394) $ (203) $ (599) During the three months ended September 29, 2023, the amounts reclassified out of AOCL were losses related to foreign exchange contracts that were substantially charged to Cost of revenue in the Condensed Consolidated Statements of Operations. |
Fair Value Measurements and Inv
Fair Value Measurements and Investments | 3 Months Ended |
Sep. 29, 2023 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements and Investments | Fair Value Measurements and Investments Financial Instruments Carried at Fair Value Financial assets and liabilities that are remeasured and reported at fair value at each reporting period are classified and disclosed in one of the following three levels: Level 1. Quoted prices in active markets for identical assets or liabilities. Level 2. Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3. Inputs that are unobservable for the asset or liability and that are significant to the fair value of the assets or liabilities. The following tables present information about the Company’s financial assets and liabilities that are measured at fair value on a recurring basis as of September 29, 2023 and June 30, 2023, and indicate the fair value hierarchy of the valuation techniques utilized to determine such values: September 29, 2023 Level 1 Level 2 Level 3 Total (in millions) Assets: Cash equivalents - Money market funds $ 371 $ — $ — $ 371 Foreign exchange contracts — 28 — 28 Total assets at fair value $ 371 $ 28 $ — $ 399 Liabilities: Foreign exchange contracts $ — $ 226 $ — $ 226 Total liabilities at fair value $ — $ 226 $ — $ 226 June 30, 2023 Level 1 Level 2 Level 3 Total (in millions) Assets: Cash equivalents - Money market funds $ 371 $ — $ — $ 371 Foreign exchange contracts — 35 — 35 Total assets at fair value $ 371 $ 35 $ — $ 406 Liabilities: Foreign exchange contracts $ — $ 192 $ — $ 192 Total liabilities at fair value $ — $ 192 $ — $ 192 During the periods presented, the Company had no transfers of financial assets and liabilities between levels and there were no changes in valuation techniques or the inputs used in the fair value measurement. Financial Instruments Not Carried at Fair Value For financial instruments where the carrying value (which includes principal adjusted for any unamortized issuance costs, and discounts or premiums) differs from fair value (which is based on quoted market prices), the following table represents the related carrying value and fair value for each of the Company’s outstanding financial instruments. Each of the financial instruments presented below was categorized as Level 2 for all periods presented, based on the frequency of trading immediately prior to the end of the first quarter of 2024 and the fourth quarter of 2023, respectively. September 29, 2023 June 30, 2023 Carrying Fair Carrying Fair (in millions) 1.50% convertible notes due 2024 $ 1,099 $ 1,082 $ 1,099 $ 1,067 Variable interest rate Delayed Draw Term Loan due 2024 600 606 — — 4.75% senior unsecured notes due 2026 2,294 2,194 2,293 2,193 Variable interest rate Term Loan A-2 maturing 2027 2,688 2,678 2,687 2,661 2.85% senior notes due 2029 496 401 496 400 3.10% senior notes due 2032 495 367 495 371 Total $ 7,672 $ 7,328 $ 7,070 $ 6,692 |
Derivative Instruments and Hedg
Derivative Instruments and Hedging Activities | 3 Months Ended |
Sep. 29, 2023 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Instruments and Hedging Activities | Derivative Instruments and Hedging Activities As of September 29, 2023, the Company had outstanding foreign exchange forward contracts that were designated as either cash flow hedges or non-designated hedges. Substantially all of the contract maturity dates of these foreign exchange forward contracts do not exceed 12 months. As of September 29, 2023, the Company did not have any derivative contracts with credit-risk-related contingent features. Changes in fair values of the non-designated foreign exchange contracts are recognized in Other income (expense), net and are largely offset by corresponding changes in the fair values of the foreign currency-denominated monetary assets and liabilities. For each of the three months ended September 29, 2023 and September 30, 2022, total net realized and unrealized transaction and foreign exchange contract currency gains and losses were not material to the Company’s Condensed Consolidated Financial Statements. Unrealized gains or losses on designated cash flow hedges are recognized in AOCL. For more information regarding cash flow hedges, see Note 4, Supplemental Financial Statement Data - Accumulated other comprehensive loss. Netting Arrangements Under certain provisions and conditions within agreements with counterparties to the Company’s foreign exchange forward contracts, subject to applicable requirements, the Company has the right of offset associated with the Company’s foreign exchange forward contracts and is allowed to net settle transactions of the same currency with a single net amount payable by one party to the other. As of September 29, 2023 and June 30, 2023, the effect of rights of offset was not material and the Company did not offset or net the fair value amounts of derivative instruments in its Condensed Consolidated Balance Sheets. |
Debt
Debt | 3 Months Ended |
Sep. 29, 2023 | |
Debt Disclosure [Abstract] | |
Debt | Debt Debt consisted of the following: September 29, June 30, (in millions) 1.50% convertible notes due 2024 $ 1,100 $ 1,100 Variable interest rate Delayed Draw Term Loan due 2024 600 — 4.75% senior unsecured notes due 2026 2,300 2,300 Variable interest rate Term Loan A-2 maturing 2027 2,700 2,700 2.85% senior notes due 2029 500 500 3.10% senior notes due 2032 500 500 Total debt 7,700 7,100 Issuance costs and debt discounts (28) (30) Subtotal 7,672 7,070 Less current portion of long-term debt (1,850) (1,213) Long-term debt $ 5,822 $ 5,857 During the three months ended September 29, 2023, the Company drew $600 million principal amount (the “Delayed Draw Term Loan”) under a loan agreement entered into in January 2023 and amended in June 2023 (the “Delayed Draw Term Loan Agreement”), which allowed the Company to draw a single loan of up to $600 million through August 14, 2023. The Delayed Draw Term Loan will mature on June 28, 2024. The Delayed Draw Term Loan bears interest, at the Company’s option, at a per annum rate equal to either (x) the Adjusted Term SOFR Rate (as defined in the Delayed Draw Term Loan Agreement) plus an applicable margin varying from 1.750% to 2.625% or (y) a base rate plus an applicable margin varying from 0.750% to 1.625%, in each case depending on the corporate family ratings of the Company from at least two of Standard & Poor’s Ratings Services, Moody’s Investors Service, Inc. and Fitch Ratings, Inc. (the “Credit Rating Agencies”). The all-in interest rate for the Delayed Draw Term Loan as of September 29, 2023 was 7.416%. The Term Loan A-2 Loan bears interest, at the Company’s option, at a per annum rate equal to either (x) the Adjusted Term SOFR (as defined in the loan agreement governing the Term Loan A-2) plus an applicable margin varying from 1.125% to 2.000% or (y) a base rate plus an applicable margin varying from 0.125% to 1.000%, in each case depending on the corporate family ratings of the Company from at least two of the Credit Rating Agencies, with an initial interest rate of Adjusted Term SOFR plus 1.375%. The all-in interest rate for Term Loan A-2 as of September 29, 2023 was 6.807%. The loan agreements governing the Company’s revolving credit facility, Term Loan A-2 due 2027, and the Delayed Draw Term Loan require the Company to comply with certain financial covenants, consisting of a leverage ratio, a minimum liquidity and a free cash flow requirement. As of September 29, 2023, the Company was in compliance with these financial covenants. |
Pension and Other Post-Retireme
Pension and Other Post-Retirement Benefit Plans | 3 Months Ended |
Sep. 29, 2023 | |
Retirement Benefits [Abstract] | |
Pension and Other Post-Retirement Benefit Plans | Pension and Other Post-Retirement Benefit Plans The Company has pension and other post-retirement benefit plans in various countries. The Company’s principal pension plans are in Japan, Thailand and the Philippines. All pension and other post-retirement benefit plans outside of the Company’s Japan, Thailand and the Philippines defined benefit pension plans (the “Pension Plans”) are immaterial to the Condensed Consolidated Financial Statements. The expected long-term rate of return on the Pension Plans assets is 2.5%. Obligations and Funded Status The following table presents the unfunded status of the benefit obligations for the Pension Plans: September 29, June 30, (in millions) Benefit obligation at end of period $ 265 $ 273 Fair value of plan assets at end of period 180 185 Unfunded status $ 85 $ 88 The following table presents the unfunded amounts related to the Pension Plans as recognized on the Company’s Condensed Consolidated Balance Sheets: September 29, June 30, (in millions) Current liabilities $ 1 $ 1 Non-current liabilities 84 87 Net amount recognized $ 85 $ 88 |
Related Parties and Related Com
Related Parties and Related Commitments and Contingencies | 3 Months Ended |
Sep. 29, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Related Parties and Related Commitments and Contingencies | Related Parties and Related Commitments and Contingencies Flash Ventures The Company’s business ventures with Kioxia Corporation (“Kioxia”) consist of three separate legal entities: Flash Partners Ltd. (“Flash Partners”), Flash Alliance Ltd. (“Flash Alliance”), and Flash Forward Ltd. (“Flash Forward”), collectively referred to as “Flash Ventures”. The following table presents the notes receivable from, and equity investments in, Flash Ventures: September 29, June 30, (in millions) Notes receivable, Flash Partners $ 21 $ 37 Notes receivable, Flash Alliance 35 48 Notes receivable, Flash Forward 699 709 Investment in Flash Partners 155 160 Investment in Flash Alliance 227 234 Investment in Flash Forward 108 109 Total notes receivable and investments in Flash Ventures $ 1,245 $ 1,297 During the three months ended September 29, 2023 and September 30, 2022, the Company made net payments to Flash Ventures of $0.9 billion and $1.0 billion, respectively, for purchased flash-based memory wafers and net loans. The Company makes, or will make, loans to Flash Ventures to fund equipment investments for new process technologies and additional wafer capacity. The Company aggregates its Flash Ventures’ notes receivable into one class of financing receivables due to the similar ownership interest and common structure in each Flash Venture entity. For all reporting periods presented, no loans were past due and no loan impairments were recorded. The Company’s notes receivable from each Flash Ventures entity, denominated in Japanese yen, are secured by equipment owned by that Flash Ventures entity. As of September 29, 2023 and June 30, 2023, the Company had accounts payable balances due to Flash Ventures of $277 million and $292 million, respectively. The Company’s maximum reasonably estimable loss exposure (excluding lost profits) as a result of its involvement with Flash Ventures, based upon the Japanese yen to U.S. dollar exchange rate at September 29, 2023, is presented below. Investments in Flash Ventures are denominated in Japanese yen, and the maximum estimable loss exposure excludes any cumulative translation adjustment due to revaluation from the Japanese yen to the U.S. dollar. September 29, (in millions) Notes receivable $ 755 Equity investments 490 Operating lease guarantees 1,590 Inventory and prepayments 1,047 Maximum estimable loss exposure $ 3,882 The Company is obligated to pay for variable costs incurred in producing its share of Flash Ventures’ flash-based memory wafer supply, based on its three-month forecast, which generally equals 50% of Flash Ventures’ output. In addition, the Company is obligated to pay for half of Flash Ventures’ fixed costs regardless of the output the Company chooses to purchase. The Company is not able to estimate its total wafer purchase commitment obligation beyond its rolling three-month purchase commitment because the price is determined by reference to the future cost of producing the semiconductor wafers. In addition, the Company is committed to fund 49.9% to 50.0% of each Flash Ventures entity’s capital investments to the extent that each Flash Ventures entity’s operating cash flow is insufficient to fund these investments. Flash Ventures has historically operated near 100% of its manufacturing capacity. During 2023 and the three months ended September 29, 2023, as a result of flash market conditions, the Company temporarily reduced its utilization of its share of Flash Ventures’ manufacturing capacity to an abnormally low level to more closely align the Company’s flash-based wafer supply with projected demand. During the three months ended September 29, 2023, the Company incurred costs of $141 million associated with the reduction in utilization related to Flash Ventures, which was recorded as a charge to Cost of revenue. No such charges were incurred during the three months ended September 30, 2022. The Company has facility agreements with Kioxia related to the construction and operation of Kioxia’s “K1” 300-millimeter wafer fabrication facility in Kitakami, Japan and a wafer fabrication facility in Yokkaichi, Japan, referred to as “Y7”. In connection with the start-up of these facilities, the Company has made prepayments toward future building depreciation. As of September 29, 2023, such prepayments aggregated $539 million and will be credited against future wafer charges. Inventory Purchase Commitments with Flash Ventures. Purchase orders placed under Flash Ventures for up to three months are binding and cannot be canceled. Research and Development Activities. The Company participates in common research and development (“R&D”) activities with Kioxia and is contractually committed to a minimum funding level. R&D commitments are immaterial to the Condensed Consolidated Financial Statements. Off-Balance Sheet Liabilities Flash Ventures sells to and leases back from a consortium of financial institutions a portion of its tools and has entered into equipment lease agreements of which the Company guarantees half or all of the outstanding obligations under each lease agreement. The lease agreements are subject to customary covenants and cancellation events related to Flash Ventures and each of the guarantors. The occurrence of a cancellation event could result in an acceleration of Flash Ventures’ obligations and a call on the Company’s guarantees. The following table presents the Company’s portion of the remaining guarantee obligations under the Flash Ventures’ lease facilities in both Japanese yen and U.S. dollar-equivalent, based upon the Japanese yen to U.S. dollar exchange rate as of September 29, 2023. Lease Amounts (Japanese yen, in billions) (U.S. dollar, in millions) Total guarantee obligations ¥ 237 $ 1,590 The following table details the breakdown of the Company’s remaining guarantee obligations between the principal amortization and the purchase option exercise price at the end of the term of the Flash Ventures lease agreements, in annual installments as of September 29, 2023 in U.S. dollars, based upon the Japanese yen to U.S. dollar exchange rate as of September 29, 2023: Annual Installments Payment of Principal Amortization Purchase Option Exercise Price at Final Lease Terms Guarantee Amount (in millions) Remaining nine months of 2024 $ 340 $ 70 $ 410 2025 273 80 353 2026 324 121 445 2027 128 102 230 2028 37 99 136 2029 1 15 16 Total guarantee obligations $ 1,103 $ 487 $ 1,590 The Company and Kioxia have agreed to mutually contribute to, and indemnify each other and Flash Ventures for, environmental remediation costs or liability resulting from Flash Ventures’ manufacturing operations in certain circumstances. The Company has not made any indemnification payments, nor recorded any indemnification receivables, under any such agreements. As of September 29, 2023, no amounts had been accrued in the Condensed Consolidated Financial Statements with respect to these indemnification agreements. Unis Venture The Company has a joint venture with Unisplendour Corporation Limited and Unissoft (Wuxi) Group Co. Ltd. (“Unis”), referred to as the “Unis Venture”, to market and sell the Company’s products in China and to develop data storage systems for the Chinese market in the future. The Unis Venture is 49% owned by the Company and 51% owned by Unis. The Company accounts for its investment in the Unis Venture under the equity method of accounting. Revenue on products distributed by the Unis Venture is recognized upon sell through to third-party customers. For the three months ended September 29, 2023 and September 30, 2022, the Company recognized approximately 6% and 3% of its consolidated revenue on products distributed by the Unis Venture, respectively. The outstanding accounts receivable due from the Unis Venture were 7% and 8% of Accounts receivable, net as of September 29, 2023 and June 30, 2023, respectively. |
Leases and Other Commitments
Leases and Other Commitments | 3 Months Ended |
Sep. 29, 2023 | |
Leases [Abstract] | |
Leases and Other Commitments | Leases and Other Commitments Leases The Company leases certain domestic and international facilities and data center space under long-term, non-cancelable operating leases that expire at various dates through 2039. These leases include no material variable or contingent lease payments. Operating lease assets and liabilities are recognized based on the present value of the remaining lease payments discounted using the Company’s incremental borrowing rate. Operating lease assets also include prepaid lease payments minus any lease incentives. Extension or termination options present in the Company’s lease agreements are included in determining the right-of-use asset and lease liability when it is reasonably certain the Company will exercise those options. Lease expense is recognized on a straight-line basis over the lease term. The following table summarizes supplemental balance sheet information related to operating leases as of September 29, 2023: Lease Amounts ($ in millions) Minimum lease payments by year: Remaining nine months of 2024 $ 49 2025 63 2026 65 2027 58 2028 51 Thereafter 329 Total future minimum lease payments 615 Less: Imputed interest 175 Present value of lease liabilities 440 Less: Current portion (included in Accrued expenses 44 Long-term operating lease liabilities (included in Other liabilities $ 396 Operating lease right-of-use assets (included in Other non-current assets $ 419 Weighted average remaining lease term in years 10.5 Weighted average discount rate 6.0 % The following table summarizes supplemental disclosures of operating cost and cash flow information related to operating leases: Three Months Ended September 29, September 30, (in millions) Cost of operating leases $ 14 $ 14 Cash paid for operating leases 15 14 Operating lease assets obtained in exchange for operating lease liabilities 168 4 Sale-Leaseback In September 2023, the Company completed a sale and leaseback of its facility in Milpitas, California. The Company received net proceeds of $191 million in cash and recorded a gain of $85 million on the sale. In connection with the sale, the Company agreed to lease back the facility at an annual lease rate of $16 million for the first year, increasing by 3% per year thereafter through January 1, 2039. The lease includes three 5-year renewal options and one 4-year renewal option for the ability to extend through December 2057. The supplemental balance sheet information and supplemental disclosures of operating cost and cash flow information related to the lease are included in the tables above. Purchase Agreements and Other Commitments In the normal course of business, the Company enters into purchase orders with suppliers for the purchase of components used to manufacture its products. These purchase orders generally cover forecasted component supplies needed for production during the next quarter, are recorded as a liability upon receipt of the components, and generally may be changed or canceled at any time prior to shipment of the components. The Company also enters into long-term agreements with suppliers that contain fixed future commitments, which are contingent on certain conditions such as performance, quality and technology of the vendor’s components. As of September 29, 2023, the Company had the following minimum long-term commitments: Long-Term Commitments (in millions) Year: Remaining nine months of 2024 $ 215 2025 267 2026 75 2027 52 2028 20 Thereafter 130 Total $ 759 |
Shareholders' Equity and Conver
Shareholders' Equity and Convertible Preferred Stock | 3 Months Ended |
Sep. 29, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Shareholders' Equity and Convertible Preferred Stock | Shareholders’ Equity and Convertible Preferred Stock Stock-based Compensation Expense The following tables present the Company’s stock-based compensation for equity-settled awards by type (i.e. restricted stock units (“RSUs”), restricted stock unit awards with performance conditions or market conditions (“PSUs”), and rights to purchase shares of common stock under the Company’s Employee Stock Purchase Plan (“ESPP”)) and financial statement line as well as the related tax benefit included in the Company’s Condensed Consolidated Statements of Operations: Three Months Ended September 29, September 30, (in millions) RSUs and PSUs $ 65 $ 75 ESPP 12 11 Total $ 77 $ 86 Three Months Ended September 29, September 30, (in millions) Cost of revenue $ 13 $ 14 Research and development 34 39 Selling, general and administrative 30 33 Subtotal 77 86 Tax benefit (10) (13) Total $ 67 $ 73 Any shortfalls or excess windfall tax benefits and tax deficiencies for shortfalls related to the vesting and exercise of stock-based awards, which are recognized as a component of the Company’s Income tax expense, were not material for the periods presented. Compensation cost related to unvested RSUs, PSUs, and rights to purchase shares of common stock under the ESPP will generally be amortized on a straight-line basis over the remaining average service period. The following table presents the unamortized compensation cost and weighted average service period of all unvested outstanding awards as of September 29, 2023: Unamortized Compensation Costs Weighted Average Service Period (in millions) (years) RSUs and PSUs (1) $ 588 2.8 ESPP 55 1.2 Total unamortized compensation cost $ 643 (1) Weighted average service period assumes the performance conditions are met for the PSUs. Plan Activities Stock Options The following table summarizes stock option activity under the Company’s incentive plans. As of September 29, 2023, there were no remaining outstanding options. Number of Shares Weighted Average Exercise Price Per Share Weighted Average Remaining Contractual Life (in millions) (in years) Options outstanding at June 30, 2023 0.3 $ 44.95 0.10 Canceled or expired (0.3) 44.95 Options outstanding at September 29, 2023 — $ — RSUs and PSUs The following table summarizes RSU and PSU activity under the Company’s incentive plans: Number of Shares Weighted Average Grant Date Fair Value Aggregate Intrinsic Value at Vest Date (in millions) (in millions) RSUs and PSUs outstanding at June 30, 2023 13.8 $ 46.56 Granted 5.5 37.87 Vested (3.3) 47.00 $ 147 Forfeited (0.9) 46.86 RSUs and PSUs outstanding at September 29, 2023 15.1 $ 43.85 RSUs and PSUs are generally settled in an equal number of shares of the Company’s common stock at the time of vesting of the units. Convertible Preferred Stock On January 31, 2023, the Board of Directors of the Company authorized the designation of 900,000 shares of Series A Convertible Perpetual Preferred Stock, par value $0.01 per share (the “Preferred Shares”), from the Company’s existing five million authorized but unissued shares of preferred stock and issued the Preferred Shares through a private placement for an aggregate purchase price of $900 million, less issuance costs of $24 million. The Preferred Shares accrue a cumulative preferred dividend at an annual rate of 6.25% per annum (increasing to 7.25% per annum on January 31, 2030 and to 8.25% per annum on January 31, 2033) compounded on a quarterly basis. The Preferred Shares also participate in any dividends declared for common shareholders on an as-converted equivalent basis. No dividends have been declared or paid since the issuance of the Preferred Shares. As of September 29, 2023 and June 30, 2023, unpaid and cumulative dividends payable with respect to the Preferred Shares were $39 million and $24 million, respectively. The Preferred Shares outstanding would have been convertible, if otherwise permitted, into approximately 20 million shares of common stock on September 29, 2023 and June 30, 2023 and as of September 29, 2023 and June 30, 2023, the total aggregate liquidation preference was $939 million and $924 million, respectively. |
Income Tax Expense
Income Tax Expense | 3 Months Ended |
Sep. 29, 2023 | |
Income Tax Disclosure [Abstract] | |
Income Tax Expense | Income Tax Expense The Tax Cuts and Jobs Act (the “2017 Act”), enacted on December 22, 2017, includes a broad range of tax reform proposals affecting businesses. The Company completed its accounting for the tax effects of the enactment of the 2017 Act during the second quarter of 2019. However, the U.S. Treasury and the Internal Revenue Service (“IRS”) have issued tax guidance on certain provisions of the 2017 Act since the enactment date, and the Company anticipates the issuance of additional regulatory and interpretive guidance. The Company applied a reasonable interpretation of the 2017 Act along with the then-available guidance in finalizing its accounting for the tax effects of the 2017 Act. Any additional regulatory or interpretive guidance would constitute new information, which may require further refinements to the Company’s estimates in future periods. On August 16, 2022, President Biden signed into law the Inflation Reduction Act of 2022, which contained significant law changes related to tax, climate, energy, and health care. The tax measures include, among other things, a corporate alternative minimum tax (“CAMT”) of 15% on corporations with three-year average annual adjusted financial statement income (“AFSI”) exceeding $1.0 billion. The corporate alternative minimum tax is effective for the Company beginning with fiscal year 2024. The Company is not subject to the CAMT of 15% for fiscal year 2024 as its average annual AFSI did not exceed $1.0 billion for the preceding three-year period. The following table presents the Company’s Income tax expense and the effective tax rate: Three Months Ended September 29, September 30, ($ in millions) Income (loss) before taxes $ (682) $ 84 Income tax expense 3 57 Effective tax rate — % 68 % Beginning in 2023, the 2017 Act requires the Company to capitalize and amortize R&D expenses rather than expensing them in the year incurred. The tax effects related to the capitalization of R&D expenses are included in the effective tax rate for the three months ended September 29, 2023, but did not have a material impact on the Company’s effective tax rate. The primary drivers of the difference between the effective tax rate for the three months ended September 29, 2023 and the U.S. Federal statutory rate of 21% are the relative mix of earnings and losses by jurisdiction, the deduction for foreign-derived intangible income, credits, and tax holidays in Malaysia, the Philippines and Thailand that will expire at various dates during years 2024 through 2031. In addition, the effective tax rate for the three months ended September 29, 2023 includes the discrete effect of a net decrease of $30 million to the liability for unrecognized tax benefits, which includes interest and offsetting tax benefits, as a result of adjustments to align with IRS calculations. The primary drivers of the difference between the effective tax rate for three months ended September 30, 2022 and the U.S. Federal statutory rate of 21% are the relative mix of earnings and losses by jurisdiction, the deduction for foreign-derived intangible income, credits, and tax holidays in Malaysia, the Philippines and Thailand. Uncertain Tax Positions With the exception of certain unrecognized tax benefits that are directly associated with the tax position taken, unrecognized tax benefits are presented gross in the Condensed Consolidated Balance Sheets. The following is a tabular reconciliation of the total amounts of unrecognized tax benefits excluding accrued interest and penalties for the three months ended September 29, 2023 (in millions): Accrual balance at June 30, 2023 $ 1,021 Gross increases related to current year tax positions 2 Gross increases related to prior year tax positions 17 Gross decreases related to prior year tax positions (3) Settlements (363) Lapse of statute of limitations (2) Accrual balance at September 29, 2023 $ 672 In addition to the amounts noted above, interest and penalties related to unrecognized tax benefits are recognized in liabilities recorded for uncertain tax positions and are recorded in the provision for income taxes. Accrued interest and penalties included in the Company’s liability related to unrecognized tax benefits as of September 29, 2023 were $157 million. Of the aggregate unrecognized tax benefits, including interest and penalties, as of September 29, 2023, approximately $663 million could result in potential cash payments and the Company believes it is reasonably likely that payments of approximately $183 million may be made within the next twelve months and has classified that portion of these unrecognized tax benefits, including interest, in Income taxes payable on the Consolidated Balance Sheets as of September 29, 2023. The remaining payables related to unrecognized tax benefits are included in Other liabilities on the Condensed Consolidated Balance Sheets as of September 29, 2023. The Company reached a final agreement with the IRS regarding notices of deficiency with respect to years 2008 through 2012 and tentatively reached a basis for resolving the notices of proposed adjustments with respect to years 2013 through 2015. As of September 29, 2023, the Company has recognized a liability for tax and interest of $183 million related to all years from 2008 through 2015. The change in this liability from the prior quarter liability of $753 million was the result of a payment of $363 million for tax and $160 million for interest with respect to years 2008 through 2012 as well as adjustments to align with IRS calculations. The Company expects to pay any remaining balance with respect to this matter within the next twelve months. In connection with settlements for the years 2008 through 2015, the Company expects to realize reductions to its mandatory deemed repatriation tax obligations and tax savings from interest deductions in future years aggregating to approximately $168 million. Of this amount, $34 million of the interest savings from the interest paid with respect to years 2008 through 2012 is classified as a deferred tax asset due to interest expense limitation rules. The Company believes that adequate provision has been made for any adjustments that may result from any other tax examinations. However, the outcome of such tax examinations cannot be predicted with certainty. If any issues addressed in the Company’s tax examinations are resolved in a manner not consistent with management’s expectations, the Company could be required to adjust its provision for income taxes in the period such resolution occurs. As of September 29, 2023, with the exception of the IRS matter discussed above, it was not possible to estimate the amount of change, if any, in the unrecognized tax benefits that is reasonably possible within the next twelve months. Any significant change in the amount of the Company’s liability for unrecognized tax benefits would most likely result from additional information or settlements relating to the examination of the Company’s tax returns. |
Net Income (Loss) Per Common Sh
Net Income (Loss) Per Common Share | 3 Months Ended |
Sep. 29, 2023 | |
Earnings Per Share [Abstract] | |
Net Income (Loss) Per Common Share | Net Income (Loss) Per Common Share The following table presents the computation of basic and diluted income (loss) per common share: Three Months Ended September 29, September 30, (in millions, except per share data) Net income (loss) $ (685) $ 27 Less: cumulative dividends on Preferred Stock 15 — Net income (loss) attributable to common shareholders $ (700) $ 27 Weighted average shares outstanding: Basic 323 316 Employee stock options, RSUs, PSUs, and ESPP — 3 Diluted 323 319 Net income (loss) per common share Basic $ (2.17) $ 0.09 Diluted $ (2.17) $ 0.08 Anti-dilutive potential common shares excluded 15 8 Basic net income (loss) per share attributable to common shareholders is computed using (i) net income (loss) less (ii) dividends paid to holders of Preferred Shares less (iii) net income (loss) attributable to participating securities divided by (iv) weighted average basic shares outstanding. Diluted net income or loss per share attributable to common shareholders is computed as (i) basic net income (loss) attributable to common shareholders plus (ii) diluted adjustments to income allocable to participating securities divided by (iii) weighted average diluted shares outstanding. The "if-converted" method is used to determine the dilutive impact for the 1.50% convertible notes and the Preferred Shares. The treasury stock method is used to determine the dilutive impact of unvested restricted stock. |
Employee Termination, Asset Imp
Employee Termination, Asset Impairment, and Other | 3 Months Ended |
Sep. 29, 2023 | |
Postemployment Benefits [Abstract] | |
Employee Termination, Asset Impairment, and Other | Employee Termination, Asset Impairment, and Other Business Realignment The Company periodically incurs charges as part of the integration process of recent acquisitions and to realign its operations with anticipated market demand, primarily consisting of organization rationalization designed to streamline its business, reduce its cost structure and focus its resources. In this regard, in the three months ended September 29, 2023, the Company reassessed existing capacity development plans and made a decision to cancel certain projects to expand capacity in its Penang, Malaysia facility, resulting in the impairment of existing construction in progress and the recognition of a liability for certain contract termination costs. The Company has also taken actions to reduce the amount of capital invested in facilities, including the sale-leaseback of its facility in Milpitas, California in September 2023. The Company recorded the following net charges related to these actions for the periods noted below: Three Months Ended September 29, September 30, (in millions) Employee termination benefits $ 19 $ 24 Contract termination and other 29 — Asset impairments 94 — Gain on sale-leaseback of facility (85) — Total employee termination, asset impairment, and other $ 57 $ 24 The following table presents an analysis of the components of these activities against the reserve during the three months ended September 29, 2023: Employee Termination Benefits Contract Termination and Other Total (in millions) Accrual balance at June 30, 2023 $ 31 $ 5 $ 36 Charges 19 29 48 Cash payments (45) — (45) Accrual balance at September 29, 2023 $ 5 $ 34 $ 39 |
Supplier Finance Program
Supplier Finance Program | 3 Months Ended |
Sep. 29, 2023 | |
Payables and Accruals [Abstract] | |
Supplier Finance Program | Supplier Finance Program The Company maintains a voluntary supplier finance program that provides participating suppliers with enhanced receivable options. The program allows participating suppliers of the Company, at their sole discretion and cost, to sell their receivables due from the Company to a third-party financial institution and receive early payment at terms negotiated between the supplier and the third-party financial institution. The Company’s vendor payment terms and amounts are not impacted by a supplier’s decision to participate in this program. The Company’s current payment terms with its suppliers under these programs generally range from 60 to 90 days and payment terms that the Company negotiates with its suppliers are not impacted by whether a supplier participates in the program. The Company does not provide any guarantees to any third parties and no assets are pledged in connection with the arrangements. The Company’s outstanding payment obligations to vendors eligible to participate under its supplier finance program were $39 million and $38 million as of September 29, 2023 and June 30, 2023, respectively, and are included within Accounts payable on the Company’s Condensed Consolidated Balance Sheets. |
Legal Proceedings
Legal Proceedings | 3 Months Ended |
Sep. 29, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Legal Proceedings | Legal Proceedings Tax For disclosures regarding the status of statutory notices of deficiency issued by the IRS with regard to tax years 2008 through 2015, see Note 12, Income Tax Expense . Other Matters In the normal course of business, the Company is subject to legal proceedings, lawsuits and other claims. Although the ultimate aggregate amount of probable monetary liability or financial impact with respect to these other matters is subject to many uncertainties, management believes that any monetary liability or financial impact to the Company from these matters, individually and in the aggregate, would not be material to the Company’s financial condition, results of operations or cash flows. However, any monetary liability and financial impact to the Company from these matters could differ materially from the Company’s expectations. |
Subsequent Events
Subsequent Events | 3 Months Ended |
Sep. 29, 2023 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events Separation of Business Units On October 30, 2023, the Company announced that its Board of Directors authorized management to pursue a plan to separate its HDD and Flash business units into two independent public companies. The completion of the separation is subject to certain conditions, including final approval by its Board of Directors. The Company is targeting to complete the separation of the business units in the second half of calendar year 2024. Convertible Notes and Related Capped Call Transactions On November 3, 2023, the Company issued $1.60 billion aggregate principal amount of convertible senior notes which bear interest at an annual rate of 3.00% and mature on November 15, 2028, unless earlier repurchased, redeemed or converted (the “2028 Convertible Notes”). The 2028 Convertible Notes are jointly and severally guaranteed by each of the Company’s wholly-owned subsidiaries that guarantees the 2026 Notes (currently, Western Digital Technologies, Inc.). The 2028 Convertible Notes are convertible at an initial conversion price of approximately $52.20 per share of common stock. Prior to August 15, 2028, the 2028 Convertible Notes are convertible only upon the occurrence of certain events and during certain periods. Upon any conversion of the 2028 Convertible Notes, the Company will pay cash up to the aggregate principal amount of the notes to be converted and pay or deliver, as the case may be, cash, shares of the Company’s common stock or a combination thereof, at the Company’s election, in respect of the remainder, if any, of its conversion obligation in excess of the aggregate principal amount of the notes being converted. In connection with the debt issuance, the Company used approximately $155 million of the net proceeds of the 2028 Convertible Notes offering to pay the cost of entering into capped call contracts with a cap price of approximately $70.26 per share to hedge the potential dilution impact of the notes’ conversion feature. Contemporaneously with the issuance of the 2028 Convertible Notes, the Company entered into individually negotiated transactions with certain holders of the Company’s existing 2024 Convertible Notes to repurchase approximately $508 million aggregate principal amount of such notes at an immaterial discount. |
Pay vs Performance Disclosure
Pay vs Performance Disclosure - USD ($) $ in Millions | 3 Months Ended | |
Sep. 29, 2023 | Sep. 30, 2022 | |
Pay vs Performance Disclosure | ||
Net income (loss) | $ (685) | $ 27 |
Insider Trading Arrangements
Insider Trading Arrangements | 3 Months Ended |
Sep. 29, 2023 | |
Trading Arrangements, by Individual | |
Rule 10b5-1 Arrangement Adopted | false |
Non-Rule 10b5-1 Arrangement Adopted | false |
Rule 10b5-1 Arrangement Terminated | false |
Non-Rule 10b5-1 Arrangement Terminated | false |
Organization and Basis of Pre_2
Organization and Basis of Presentation (Policies) | 3 Months Ended |
Sep. 29, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Western Digital Corporation (“Western Digital” or the “Company”) is a leading developer, manufacturer, and provider of data storage devices and solutions based on both NAND flash and hard disk drive technologies. The Company’s broad portfolio of technology and products address the following key end markets: Cloud, Client and Consumer. The Company also generates immaterial license and royalty revenue from its extensive intellectual property portfolio, which is included in each of these three end market categories. The accounting policies followed by the Company are set forth in Part II, Item 8, Note 1, Organization and Basis of Presentation, of the Notes to Consolidated Financial Statements included in the Company’s Annual Report on Form 10‑K for the year ended June 30, 2023. In the opinion of management, all adjustments necessary to fairly state the Condensed Consolidated Financial Statements have been made. All such adjustments are of a normal, recurring nature. Certain information and footnote disclosures normally included in the Consolidated Financial Statements prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”) have been condensed or omitted pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). These Condensed Consolidated Financial Statements should be read in conjunction with the Consolidated Financial Statements and the notes thereto included in the Company’s Annual Report on Form 10‑K for the year ended June 30, 2023. The results of operations for interim periods are not necessarily indicative of results to be expected for the full year. |
Fiscal Year | Fiscal Year The Company’s fiscal year ends on the Friday nearest to June 30 and typically consists of 52 weeks. Approximately every five to six years, the Company reports a 53-week fiscal year to align the fiscal year with the foregoing policy. Fiscal year 2024, which will end on June 28, 2024, and fiscal year 2023, which ended June 30, 2023, are each comprised of 52 weeks, with all quarters presented consisting of 13 weeks. |
Segment Reporting | Segment Reporting The Company manufactures, markets, and sells data storage devices and solutions in the United States (“U.S.”) and in foreign countries through its sales personnel, dealers, distributors, retailers, and subsidiaries. The Company manages and reports under two reportable segments: flash-based products (“Flash”) and hard disk drives (“HDD”). The Chief Executive Officer, who is the Company’s Chief Operating Decision Maker (“CODM”), evaluates the performance of the Company and makes decisions regarding the allocation of resources based on each operating segment’s net revenue and gross margin. Because of the integrated nature of the Company’s production and distribution activities, separate segment asset measures are either not available or not used as a basis for the CODM to evaluate the performance of or to allocate resources to the segments. |
Use of Estimates | Use of Estimates Company management has made estimates and assumptions relating to the reporting of certain assets and liabilities in conformity with U.S. GAAP. These estimates and assumptions have been applied using methodologies that are consistent throughout the periods presented with consideration given to the potential impacts of current macroeconomic conditions. However, actual results could differ materially from these estimates. |
Recent Accounting Pronouncements | Recent Accounting Pronouncements Accounting Pronouncements Recently Adopted In September 2022, the Financial Accounting Standards Board issued an accounting standards update (“ASU”) No. 2022-04, “Liabilities-Supplier Finance Programs (Subtopic 405-50): Disclosure of Supplier Finance Program Obligations”, which requires annual and interim disclosures for entities that use supplier finance programs in connection with the purchase of goods and services. The ASU requires the Company to provide disclosure of outstanding obligations to such suppliers for all balance sheet dates presented beginning with the Company’s first quarter of 2024 and to provide certain rollforward information related to those obligations beginning in the Company’s first fiscal quarter of 2025. The ASU does not affect the recognition, measurement, or financial statement presentation of supplier finance program obligations. The Company adopted the guidance on the first day of fiscal year 2024, except for the rollforward information, which the Company is compiling and intends to provide beginning in fiscal year 2025. See Note 15, Supplier Finance Program, of the Notes to the Condensed Consolidated Financial Statements for information regarding the supplier finance program. |
Fair Value Measurements and Investments | Financial assets and liabilities that are remeasured and reported at fair value at each reporting period are classified and disclosed in one of the following three levels: Level 1. Quoted prices in active markets for identical assets or liabilities. Level 2. Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3. Inputs that are unobservable for the asset or liability and that are significant to the fair value of the assets or liabilities. |
Business Segments, Geographic_2
Business Segments, Geographic Information, and Concentrations of Risk (Tables) | 3 Months Ended |
Sep. 29, 2023 | |
Segment Reporting [Abstract] | |
Schedule of Segment Reporting Information, by Segment | The following table summarizes the operating performance of the Company’s reportable segments: Three Months Ended September 29, September 30, $ in millions Net revenue: Flash $ 1,556 $ 1,722 HDD 1,194 2,014 Total net revenue $ 2,750 $ 3,736 Gross profit: Flash $ (161) $ 422 HDD 273 574 Total gross profit for segments 112 996 Unallocated corporate items: Stock-based compensation expense (13) (14) Amortization of acquired intangible assets — (1) Total unallocated corporate items (13) (15) Consolidated gross profit $ 99 $ 981 Gross margin: Flash (10.3) % 24.5 % HDD 22.9 % 28.5 % Consolidated gross margin 3.6 % 26.3 % |
Schedule of Disaggregation of Revenue | The Company’s disaggregated revenue information is as follows: Three Months Ended September 29, September 30, (in millions) Revenue by End Market Cloud $ 872 $ 1,829 Client 1,147 1,229 Consumer 731 678 Total Revenue $ 2,750 $ 3,736 Revenue by Geography Asia $ 1,551 $ 1,686 Americas 662 1,423 Europe, Middle East and Africa 537 627 Total Revenue $ 2,750 $ 3,736 |
Schedule of Goodwill | The following table provides a summary of goodwill activity for the period: Flash HDD Total (in millions) Balance at June 30, 2023 $ 5,716 $ 4,321 $ 10,037 Foreign currency translation adjustment (1) (1) (2) Balance at September 29, 2023 $ 5,715 $ 4,320 $ 10,035 |
Supplemental Financial Statem_2
Supplemental Financial Statement Data (Tables) | 3 Months Ended |
Sep. 29, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of Inventories | Inventories September 29, June 30, (in millions) Inventories: Raw materials and component parts $ 1,975 $ 2,096 Work-in-process 925 979 Finished goods 597 623 Total inventories $ 3,497 $ 3,698 |
Schedule of Property, Plant and Equipment, Net | Property, plant and equipment, net September 29, June 30, (in millions) Property, plant and equipment: Land $ 235 $ 269 Buildings and improvements 1,842 1,955 Machinery and equipment 8,691 8,704 Computer equipment and software 473 470 Furniture and fixtures 55 54 Construction-in-process 729 798 Property, plant and equipment, gross 12,025 12,250 Accumulated depreciation (8,654) (8,630) Property, plant and equipment, net $ 3,371 $ 3,620 |
Schedule of Product Warranty Liability | Product warranty liability Changes in the warranty accrual were as follows: Three Months Ended September 29, September 30, (in millions) Warranty accrual, beginning of period $ 244 $ 345 Charges to operations 22 32 Utilization (43) (34) Changes in estimate related to pre-existing warranties (5) (3) Warranty accrual, end of period $ 218 $ 340 The current portion of the warranty accrual is classified in Accrued expenses and the long-term portion is classified in Other liabilities as noted below: September 29, June 30, (in millions) Warranty accrual: Current portion (included in Accrued expenses) $ 61 $ 97 Long-term portion (included in Other liabilities) 157 147 Total warranty accrual $ 218 $ 244 |
Schedule of Other Liabilities | Other liabilities September 29, June 30, (in millions) Other liabilities: Non-current net tax payable $ 199 $ 464 Non-current portion of unrecognized tax benefits 497 408 Other non-current liabilities 702 543 Total other liabilities $ 1,398 $ 1,415 |
Schedule of Accumulated Other Comprehensive Loss | The following table illustrates the changes in the balances of each component of AOCL: Actuarial Pension Losses Foreign Currency Translation Adjustment Unrealized Losses on Derivative Contracts Total Accumulated Comprehensive Loss (in millions) Balance at June 30, 2023 $ (2) $ (357) $ (157) $ (516) Other comprehensive loss before reclassifications — (38) (101) (139) Amounts reclassified from accumulated other comprehensive loss — — 43 43 Income tax benefit related to items of other comprehensive loss — 1 12 13 Net current-period other comprehensive loss — (37) (46) (83) Balance at September 29, 2023 $ (2) $ (394) $ (203) $ (599) |
Fair Value Measurements and I_2
Fair Value Measurements and Investments (Tables) | 3 Months Ended |
Sep. 29, 2023 | |
Fair Value Disclosures [Abstract] | |
Schedule of Financial Assets and Liabilities Measured at Fair Value on Recurring Basis | The following tables present information about the Company’s financial assets and liabilities that are measured at fair value on a recurring basis as of September 29, 2023 and June 30, 2023, and indicate the fair value hierarchy of the valuation techniques utilized to determine such values: September 29, 2023 Level 1 Level 2 Level 3 Total (in millions) Assets: Cash equivalents - Money market funds $ 371 $ — $ — $ 371 Foreign exchange contracts — 28 — 28 Total assets at fair value $ 371 $ 28 $ — $ 399 Liabilities: Foreign exchange contracts $ — $ 226 $ — $ 226 Total liabilities at fair value $ — $ 226 $ — $ 226 June 30, 2023 Level 1 Level 2 Level 3 Total (in millions) Assets: Cash equivalents - Money market funds $ 371 $ — $ — $ 371 Foreign exchange contracts — 35 — 35 Total assets at fair value $ 371 $ 35 $ — $ 406 Liabilities: Foreign exchange contracts $ — $ 192 $ — $ 192 Total liabilities at fair value $ — $ 192 $ — $ 192 |
Schedule of Related Costs And Fair Values Based On Quoted Market Prices | For financial instruments where the carrying value (which includes principal adjusted for any unamortized issuance costs, and discounts or premiums) differs from fair value (which is based on quoted market prices), the following table represents the related carrying value and fair value for each of the Company’s outstanding financial instruments. Each of the financial instruments presented below was categorized as Level 2 for all periods presented, based on the frequency of trading immediately prior to the end of the first quarter of 2024 and the fourth quarter of 2023, respectively. September 29, 2023 June 30, 2023 Carrying Fair Carrying Fair (in millions) 1.50% convertible notes due 2024 $ 1,099 $ 1,082 $ 1,099 $ 1,067 Variable interest rate Delayed Draw Term Loan due 2024 600 606 — — 4.75% senior unsecured notes due 2026 2,294 2,194 2,293 2,193 Variable interest rate Term Loan A-2 maturing 2027 2,688 2,678 2,687 2,661 2.85% senior notes due 2029 496 401 496 400 3.10% senior notes due 2032 495 367 495 371 Total $ 7,672 $ 7,328 $ 7,070 $ 6,692 |
Debt (Tables)
Debt (Tables) | 3 Months Ended |
Sep. 29, 2023 | |
Debt Disclosure [Abstract] | |
Schedule of Debt | Debt consisted of the following: September 29, June 30, (in millions) 1.50% convertible notes due 2024 $ 1,100 $ 1,100 Variable interest rate Delayed Draw Term Loan due 2024 600 — 4.75% senior unsecured notes due 2026 2,300 2,300 Variable interest rate Term Loan A-2 maturing 2027 2,700 2,700 2.85% senior notes due 2029 500 500 3.10% senior notes due 2032 500 500 Total debt 7,700 7,100 Issuance costs and debt discounts (28) (30) Subtotal 7,672 7,070 Less current portion of long-term debt (1,850) (1,213) Long-term debt $ 5,822 $ 5,857 |
Pension and Other Post-Retire_2
Pension and Other Post-Retirement Benefit Plans (Tables) | 3 Months Ended |
Sep. 29, 2023 | |
Retirement Benefits [Abstract] | |
Schedule of Obligations and Funded Status | The following table presents the unfunded status of the benefit obligations for the Pension Plans: September 29, June 30, (in millions) Benefit obligation at end of period $ 265 $ 273 Fair value of plan assets at end of period 180 185 Unfunded status $ 85 $ 88 |
Schedule of Unfunded Amounts Recognized on Consolidated Balance Sheets | The following table presents the unfunded amounts related to the Pension Plans as recognized on the Company’s Condensed Consolidated Balance Sheets: September 29, June 30, (in millions) Current liabilities $ 1 $ 1 Non-current liabilities 84 87 Net amount recognized $ 85 $ 88 |
Related Parties and Related C_2
Related Parties and Related Commitments and Contingencies (Tables) | 3 Months Ended |
Sep. 29, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Schedule of Notes Receivable and Investments in Related Parties | The following table presents the notes receivable from, and equity investments in, Flash Ventures: September 29, June 30, (in millions) Notes receivable, Flash Partners $ 21 $ 37 Notes receivable, Flash Alliance 35 48 Notes receivable, Flash Forward 699 709 Investment in Flash Partners 155 160 Investment in Flash Alliance 227 234 Investment in Flash Forward 108 109 Total notes receivable and investments in Flash Ventures $ 1,245 $ 1,297 |
Schedule of Variable Interest Entity Maximum Loss Exposure | The Company’s maximum reasonably estimable loss exposure (excluding lost profits) as a result of its involvement with Flash Ventures, based upon the Japanese yen to U.S. dollar exchange rate at September 29, 2023, is presented below. Investments in Flash Ventures are denominated in Japanese yen, and the maximum estimable loss exposure excludes any cumulative translation adjustment due to revaluation from the Japanese yen to the U.S. dollar. September 29, (in millions) Notes receivable $ 755 Equity investments 490 Operating lease guarantees 1,590 Inventory and prepayments 1,047 Maximum estimable loss exposure $ 3,882 |
Schedule of Guarantor Obligations | The following table presents the Company’s portion of the remaining guarantee obligations under the Flash Ventures’ lease facilities in both Japanese yen and U.S. dollar-equivalent, based upon the Japanese yen to U.S. dollar exchange rate as of September 29, 2023. Lease Amounts (Japanese yen, in billions) (U.S. dollar, in millions) Total guarantee obligations ¥ 237 $ 1,590 |
Schedule of Remaining Guarantee Obligations | The following table details the breakdown of the Company’s remaining guarantee obligations between the principal amortization and the purchase option exercise price at the end of the term of the Flash Ventures lease agreements, in annual installments as of September 29, 2023 in U.S. dollars, based upon the Japanese yen to U.S. dollar exchange rate as of September 29, 2023: Annual Installments Payment of Principal Amortization Purchase Option Exercise Price at Final Lease Terms Guarantee Amount (in millions) Remaining nine months of 2024 $ 340 $ 70 $ 410 2025 273 80 353 2026 324 121 445 2027 128 102 230 2028 37 99 136 2029 1 15 16 Total guarantee obligations $ 1,103 $ 487 $ 1,590 |
Leases and Other Commitments (T
Leases and Other Commitments (Tables) | 3 Months Ended |
Sep. 29, 2023 | |
Leases [Abstract] | |
Schedule of Supplemental Balance Sheet Disclosures | The following table summarizes supplemental balance sheet information related to operating leases as of September 29, 2023: Lease Amounts ($ in millions) Minimum lease payments by year: Remaining nine months of 2024 $ 49 2025 63 2026 65 2027 58 2028 51 Thereafter 329 Total future minimum lease payments 615 Less: Imputed interest 175 Present value of lease liabilities 440 Less: Current portion (included in Accrued expenses 44 Long-term operating lease liabilities (included in Other liabilities $ 396 Operating lease right-of-use assets (included in Other non-current assets $ 419 Weighted average remaining lease term in years 10.5 Weighted average discount rate 6.0 % |
Schedule of Lease, Cost | The following table summarizes supplemental disclosures of operating cost and cash flow information related to operating leases: Three Months Ended September 29, September 30, (in millions) Cost of operating leases $ 14 $ 14 Cash paid for operating leases 15 14 Operating lease assets obtained in exchange for operating lease liabilities 168 4 |
Schedule of Long-term Purchase Agreements | As of September 29, 2023, the Company had the following minimum long-term commitments: Long-Term Commitments (in millions) Year: Remaining nine months of 2024 $ 215 2025 267 2026 75 2027 52 2028 20 Thereafter 130 Total $ 759 |
Shareholders' Equity and Conv_2
Shareholders' Equity and Convertible Preferred Stock (Tables) | 3 Months Ended |
Sep. 29, 2023 | |
Share-Based Payment Arrangement [Abstract] | |
Schedule of Share-based Compensation Arrangements by Share-based Payment Award | The following tables present the Company’s stock-based compensation for equity-settled awards by type (i.e. restricted stock units (“RSUs”), restricted stock unit awards with performance conditions or market conditions (“PSUs”), and rights to purchase shares of common stock under the Company’s Employee Stock Purchase Plan (“ESPP”)) and financial statement line as well as the related tax benefit included in the Company’s Condensed Consolidated Statements of Operations: Three Months Ended September 29, September 30, (in millions) RSUs and PSUs $ 65 $ 75 ESPP 12 11 Total $ 77 $ 86 Three Months Ended September 29, September 30, (in millions) Cost of revenue $ 13 $ 14 Research and development 34 39 Selling, general and administrative 30 33 Subtotal 77 86 Tax benefit (10) (13) Total $ 67 $ 73 |
Schedule of Employee Service Share-based Compensation, Unrecognized Costs | The following table presents the unamortized compensation cost and weighted average service period of all unvested outstanding awards as of September 29, 2023: Unamortized Compensation Costs Weighted Average Service Period (in millions) (years) RSUs and PSUs (1) $ 588 2.8 ESPP 55 1.2 Total unamortized compensation cost $ 643 (1) Weighted average service period assumes the performance conditions are met for the PSUs. |
Schedule of Stock Option Activity | The following table summarizes stock option activity under the Company’s incentive plans. As of September 29, 2023, there were no remaining outstanding options. Number of Shares Weighted Average Exercise Price Per Share Weighted Average Remaining Contractual Life (in millions) (in years) Options outstanding at June 30, 2023 0.3 $ 44.95 0.10 Canceled or expired (0.3) 44.95 Options outstanding at September 29, 2023 — $ — |
Schedule of Restricted Stock Unit | The following table summarizes RSU and PSU activity under the Company’s incentive plans: Number of Shares Weighted Average Grant Date Fair Value Aggregate Intrinsic Value at Vest Date (in millions) (in millions) RSUs and PSUs outstanding at June 30, 2023 13.8 $ 46.56 Granted 5.5 37.87 Vested (3.3) 47.00 $ 147 Forfeited (0.9) 46.86 RSUs and PSUs outstanding at September 29, 2023 15.1 $ 43.85 |
Income Tax Expense (Tables)
Income Tax Expense (Tables) | 3 Months Ended |
Sep. 29, 2023 | |
Income Tax Disclosure [Abstract] | |
Schedule of Effective Income Tax Rate Reconciliation | The following table presents the Company’s Income tax expense and the effective tax rate: Three Months Ended September 29, September 30, ($ in millions) Income (loss) before taxes $ (682) $ 84 Income tax expense 3 57 Effective tax rate — % 68 % |
Schedule of Income Tax Contingencies | The following is a tabular reconciliation of the total amounts of unrecognized tax benefits excluding accrued interest and penalties for the three months ended September 29, 2023 (in millions): Accrual balance at June 30, 2023 $ 1,021 Gross increases related to current year tax positions 2 Gross increases related to prior year tax positions 17 Gross decreases related to prior year tax positions (3) Settlements (363) Lapse of statute of limitations (2) Accrual balance at September 29, 2023 $ 672 |
Net Income (Loss) Per Common _2
Net Income (Loss) Per Common Share (Tables) | 3 Months Ended |
Sep. 29, 2023 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Share, Basic and Diluted | The following table presents the computation of basic and diluted income (loss) per common share: Three Months Ended September 29, September 30, (in millions, except per share data) Net income (loss) $ (685) $ 27 Less: cumulative dividends on Preferred Stock 15 — Net income (loss) attributable to common shareholders $ (700) $ 27 Weighted average shares outstanding: Basic 323 316 Employee stock options, RSUs, PSUs, and ESPP — 3 Diluted 323 319 Net income (loss) per common share Basic $ (2.17) $ 0.09 Diluted $ (2.17) $ 0.08 Anti-dilutive potential common shares excluded 15 8 |
Employee Termination, Asset I_2
Employee Termination, Asset Impairment, and Other (Tables) | 3 Months Ended |
Sep. 29, 2023 | |
Postemployment Benefits [Abstract] | |
Schedule of Restructuring Reserve by Type of Cost | The Company recorded the following net charges related to these actions for the periods noted below: Three Months Ended September 29, September 30, (in millions) Employee termination benefits $ 19 $ 24 Contract termination and other 29 — Asset impairments 94 — Gain on sale-leaseback of facility (85) — Total employee termination, asset impairment, and other $ 57 $ 24 The following table presents an analysis of the components of these activities against the reserve during the three months ended September 29, 2023: Employee Termination Benefits Contract Termination and Other Total (in millions) Accrual balance at June 30, 2023 $ 31 $ 5 $ 36 Charges 19 29 48 Cash payments (45) — (45) Accrual balance at September 29, 2023 $ 5 $ 34 $ 39 |
Organization and Basis of Pre_3
Organization and Basis of Presentation - Additional Information (Details) | 3 Months Ended |
Sep. 29, 2023 segment | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Number of reportable segments | 2 |
Business Segments, Geographic_3
Business Segments, Geographic Information, and Concentrations of Risk (Details) - USD ($) $ in Millions | 3 Months Ended | |
Sep. 29, 2023 | Sep. 30, 2022 | |
Segment Reporting Information [Line Items] | ||
Revenue, net | $ 2,750 | $ 3,736 |
Gross profit | 99 | 981 |
Stock-based compensation expense | 77 | 86 |
Consolidated gross profit | $ 99 | $ 981 |
Gross margin, percentage | 3.60% | 26.30% |
Operating Segments | ||
Segment Reporting Information [Line Items] | ||
Revenue, net | $ 2,750 | $ 3,736 |
Gross profit | 112 | 996 |
Consolidated gross profit | 112 | 996 |
Corporate, Non-Segment | ||
Segment Reporting Information [Line Items] | ||
Gross profit | (13) | (15) |
Stock-based compensation expense | (13) | (14) |
Amortization of acquired intangible assets | 0 | (1) |
Consolidated gross profit | $ (13) | $ (15) |
Flash | ||
Segment Reporting Information [Line Items] | ||
Gross margin, percentage | (10.30%) | 24.50% |
Flash | Operating Segments | ||
Segment Reporting Information [Line Items] | ||
Revenue, net | $ 1,556 | $ 1,722 |
Gross profit | (161) | 422 |
Consolidated gross profit | $ (161) | $ 422 |
HDD | ||
Segment Reporting Information [Line Items] | ||
Gross margin, percentage | 22.90% | 28.50% |
HDD | Operating Segments | ||
Segment Reporting Information [Line Items] | ||
Revenue, net | $ 1,194 | $ 2,014 |
Gross profit | 273 | 574 |
Consolidated gross profit | $ 273 | $ 574 |
Business Segments, Geographic_4
Business Segments, Geographic Information, and Concentrations of Risk - Disaggregation of Revenue (Details) - USD ($) $ in Millions | 3 Months Ended | |
Sep. 29, 2023 | Sep. 30, 2022 | |
Disaggregation of Revenue [Line Items] | ||
Revenue, net | $ 2,750 | $ 3,736 |
Asia | ||
Disaggregation of Revenue [Line Items] | ||
Revenue, net | 1,551 | 1,686 |
Americas | ||
Disaggregation of Revenue [Line Items] | ||
Revenue, net | 662 | 1,423 |
Europe, Middle East and Africa | ||
Disaggregation of Revenue [Line Items] | ||
Revenue, net | 537 | 627 |
Cloud | ||
Disaggregation of Revenue [Line Items] | ||
Revenue, net | 872 | 1,829 |
Client | ||
Disaggregation of Revenue [Line Items] | ||
Revenue, net | 1,147 | 1,229 |
Consumer | ||
Disaggregation of Revenue [Line Items] | ||
Revenue, net | $ 731 | $ 678 |
Business Segments, Geographic_5
Business Segments, Geographic Information, and Concentrations of Risk - Additional Information (Details) | 3 Months Ended | |
Sep. 29, 2023 | Sep. 30, 2022 | |
Revenue from Contract with Customer | Customer Concentration Risk | Top Ten Customers | ||
Concentration Risk [Line Items] | ||
Concentration risk, percentage | 44% | 52% |
Business Segments, Geographic_6
Business Segments, Geographic Information, and Concentrations of Risk - Goodwill Rollforward (Details) $ in Millions | 3 Months Ended |
Sep. 29, 2023 USD ($) | |
Goodwill [Roll Forward] | |
Balance at June 30, 2023 | $ 10,037 |
Foreign currency translation adjustment | (2) |
Balance at September 29, 2023 | 10,035 |
Flash | |
Goodwill [Roll Forward] | |
Balance at June 30, 2023 | 5,716 |
Foreign currency translation adjustment | (1) |
Balance at September 29, 2023 | 5,715 |
HDD | |
Goodwill [Roll Forward] | |
Balance at June 30, 2023 | 4,321 |
Foreign currency translation adjustment | (1) |
Balance at September 29, 2023 | $ 4,320 |
Supplemental Financial Statem_3
Supplemental Financial Statement Data - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | ||
Sep. 29, 2023 | Sep. 30, 2022 | Jun. 30, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |||
Proceeds on sale of trade accounts receivable | $ 150 | $ 291 | |
Factored receivables outstanding | 150 | $ 150 | |
Intangible assets, net | $ 80 | $ 80 |
Supplemental Financial Statem_4
Supplemental Financial Statement Data - Inventory (Details) - USD ($) $ in Millions | Sep. 29, 2023 | Jun. 30, 2023 |
Inventories: | ||
Raw materials and component parts | $ 1,975 | $ 2,096 |
Work-in-process | 925 | 979 |
Finished goods | 597 | 623 |
Total inventories | $ 3,497 | $ 3,698 |
Supplemental Financial Statem_5
Supplemental Financial Statement Data - Property, Plant and Equipment (Details) - USD ($) $ in Millions | Sep. 29, 2023 | Jun. 30, 2023 |
Property, plant and equipment: | ||
Property, plant and equipment, gross | $ 12,025 | $ 12,250 |
Accumulated depreciation | (8,654) | (8,630) |
Property, plant and equipment, net | 3,371 | 3,620 |
Land | ||
Property, plant and equipment: | ||
Property, plant and equipment, gross | 235 | 269 |
Buildings and improvements | ||
Property, plant and equipment: | ||
Property, plant and equipment, gross | 1,842 | 1,955 |
Machinery and equipment | ||
Property, plant and equipment: | ||
Property, plant and equipment, gross | 8,691 | 8,704 |
Computer equipment and software | ||
Property, plant and equipment: | ||
Property, plant and equipment, gross | 473 | 470 |
Furniture and fixtures | ||
Property, plant and equipment: | ||
Property, plant and equipment, gross | 55 | 54 |
Construction-in-process | ||
Property, plant and equipment: | ||
Property, plant and equipment, gross | $ 729 | $ 798 |
Supplemental Financial Statem_6
Supplemental Financial Statement Data - Warranty Accrual Roll Forward (Details) - USD ($) $ in Millions | 3 Months Ended | |
Sep. 29, 2023 | Sep. 30, 2022 | |
Movement in Standard Product Warranty Accrual [Roll Forward] | ||
Warranty accrual, beginning of period | $ 244 | $ 345 |
Charges to operations | 22 | 32 |
Utilization | (43) | (34) |
Changes in estimate related to pre-existing warranties | (5) | (3) |
Warranty accrual, end of period | $ 218 | $ 340 |
Supplemental Financial Statem_7
Supplemental Financial Statement Data - Total Warranty Accrual (Details) - USD ($) $ in Millions | Sep. 29, 2023 | Jun. 30, 2023 | Sep. 30, 2022 | Jul. 01, 2022 |
Warranty accrual: | ||||
Current portion (included in Accrued expenses) | $ 61 | $ 97 | ||
Long-term portion (included in Other liabilities) | 157 | 147 | ||
Total warranty accrual | $ 218 | $ 244 | $ 340 | $ 345 |
Supplemental Financial Statem_8
Supplemental Financial Statement Data - Other Liabilities (Details) - USD ($) $ in Millions | Sep. 29, 2023 | Jun. 30, 2023 |
Other liabilities: | ||
Non-current net tax payable | $ 199 | $ 464 |
Non-current portion of unrecognized tax benefits | 497 | 408 |
Other non-current liabilities | 702 | 543 |
Total other liabilities | $ 1,398 | $ 1,415 |
Supplemental Financial Statem_9
Supplemental Financial Statement Data - Accumulated Other Comprehensive Loss Roll Forward (Details) - USD ($) $ in Millions | 3 Months Ended | |
Sep. 29, 2023 | Sep. 30, 2022 | |
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ||
Beginning balance | $ 10,847 | $ 12,221 |
Other comprehensive loss before reclassifications | (139) | |
Amounts reclassified from accumulated other comprehensive loss | 43 | |
Income tax benefit related to items of other comprehensive loss | 13 | 16 |
Other comprehensive loss, net of tax | (83) | (140) |
Ending balance | 10,113 | 12,107 |
Actuarial Pension Losses | ||
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ||
Beginning balance | (2) | |
Other comprehensive loss before reclassifications | 0 | |
Amounts reclassified from accumulated other comprehensive loss | 0 | |
Income tax benefit related to items of other comprehensive loss | 0 | |
Other comprehensive loss, net of tax | 0 | |
Ending balance | (2) | |
Foreign Currency Translation Adjustment | ||
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ||
Beginning balance | (357) | |
Other comprehensive loss before reclassifications | (38) | |
Amounts reclassified from accumulated other comprehensive loss | 0 | |
Income tax benefit related to items of other comprehensive loss | 1 | |
Other comprehensive loss, net of tax | (37) | |
Ending balance | (394) | |
Unrealized Losses on Derivative Contracts | ||
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ||
Beginning balance | (157) | |
Other comprehensive loss before reclassifications | (101) | |
Amounts reclassified from accumulated other comprehensive loss | 43 | |
Income tax benefit related to items of other comprehensive loss | 12 | |
Other comprehensive loss, net of tax | (46) | |
Ending balance | (203) | |
Accumulated Other Comprehensive Loss | ||
Accumulated Other Comprehensive Income (Loss) [Roll Forward] | ||
Beginning balance | (516) | (554) |
Ending balance | $ (599) | $ (694) |
Fair Value Measurements and I_3
Fair Value Measurements and Investments - Financial Assets and Liabilities Measured at Fair Value on Recurring Basis (Details) - Fair Value, Measurements, Recurring - USD ($) $ in Millions | Sep. 29, 2023 | Jun. 30, 2023 |
Assets: | ||
Total assets at fair value | $ 399 | $ 406 |
Liabilities: | ||
Total liabilities at fair value | 226 | 192 |
Foreign exchange contracts | ||
Liabilities: | ||
Derivative liability | 226 | 192 |
Cash equivalents - Money market funds | ||
Assets: | ||
Cash equivalents - Money market funds | 371 | 371 |
Foreign exchange contracts | ||
Assets: | ||
Foreign exchange contracts | 28 | 35 |
Level 1 | ||
Assets: | ||
Total assets at fair value | 371 | 371 |
Liabilities: | ||
Total liabilities at fair value | 0 | 0 |
Level 1 | Foreign exchange contracts | ||
Liabilities: | ||
Derivative liability | 0 | 0 |
Level 1 | Cash equivalents - Money market funds | ||
Assets: | ||
Cash equivalents - Money market funds | 371 | 371 |
Level 1 | Foreign exchange contracts | ||
Assets: | ||
Foreign exchange contracts | 0 | 0 |
Level 2 | ||
Assets: | ||
Total assets at fair value | 28 | 35 |
Liabilities: | ||
Total liabilities at fair value | 226 | 192 |
Level 2 | Foreign exchange contracts | ||
Liabilities: | ||
Derivative liability | 226 | 192 |
Level 2 | Cash equivalents - Money market funds | ||
Assets: | ||
Cash equivalents - Money market funds | 0 | 0 |
Level 2 | Foreign exchange contracts | ||
Assets: | ||
Foreign exchange contracts | 28 | 35 |
Level 3 | ||
Assets: | ||
Total assets at fair value | 0 | 0 |
Liabilities: | ||
Total liabilities at fair value | 0 | 0 |
Level 3 | Foreign exchange contracts | ||
Liabilities: | ||
Derivative liability | 0 | 0 |
Level 3 | Cash equivalents - Money market funds | ||
Assets: | ||
Cash equivalents - Money market funds | 0 | 0 |
Level 3 | Foreign exchange contracts | ||
Assets: | ||
Foreign exchange contracts | $ 0 | $ 0 |
Fair Value Measurements and I_4
Fair Value Measurements and Investments - Debt Instrument Fair Value (Details) - USD ($) $ in Millions | Sep. 29, 2023 | Jun. 30, 2023 |
1.50% convertible notes due 2024 | Convertible Debt | ||
Debt Instrument [Line Items] | ||
Debt instrument, interest rate (percentage) | 1.50% | 1.50% |
4.75% senior unsecured notes due 2026 | ||
Debt Instrument [Line Items] | ||
Debt instrument, interest rate (percentage) | 4.75% | 4.75% |
Variable interest rate Term Loan A-2 maturing 2027 | ||
Debt Instrument [Line Items] | ||
Debt instrument, interest rate (percentage) | 6.807% | |
2.85% senior notes due 2029 | ||
Debt Instrument [Line Items] | ||
Debt instrument, interest rate (percentage) | 2.85% | 2.85% |
3.10% senior notes due 2032 | ||
Debt Instrument [Line Items] | ||
Debt instrument, interest rate (percentage) | 3.10% | 3.10% |
Carrying Value | ||
Debt Instrument [Line Items] | ||
Long-term debt | $ 7,672 | $ 7,070 |
Carrying Value | 1.50% convertible notes due 2024 | ||
Debt Instrument [Line Items] | ||
Long-term debt | 1,099 | 1,099 |
Carrying Value | Variable interest rate Delayed Draw Term Loan due 2024 | ||
Debt Instrument [Line Items] | ||
Long-term debt | 600 | 0 |
Carrying Value | 4.75% senior unsecured notes due 2026 | ||
Debt Instrument [Line Items] | ||
Long-term debt | 2,294 | 2,293 |
Carrying Value | Variable interest rate Term Loan A-2 maturing 2027 | ||
Debt Instrument [Line Items] | ||
Long-term debt | 2,688 | 2,687 |
Carrying Value | 2.85% senior notes due 2029 | ||
Debt Instrument [Line Items] | ||
Long-term debt | 496 | 496 |
Carrying Value | 3.10% senior notes due 2032 | ||
Debt Instrument [Line Items] | ||
Long-term debt | 495 | 495 |
Level 2 | Fair Value | ||
Debt Instrument [Line Items] | ||
Long-term debt | 7,328 | 6,692 |
Level 2 | Fair Value | 1.50% convertible notes due 2024 | ||
Debt Instrument [Line Items] | ||
Long-term debt | 1,082 | 1,067 |
Level 2 | Fair Value | Variable interest rate Delayed Draw Term Loan due 2024 | ||
Debt Instrument [Line Items] | ||
Long-term debt | 606 | 0 |
Level 2 | Fair Value | 4.75% senior unsecured notes due 2026 | ||
Debt Instrument [Line Items] | ||
Long-term debt | 2,194 | 2,193 |
Level 2 | Fair Value | Variable interest rate Term Loan A-2 maturing 2027 | ||
Debt Instrument [Line Items] | ||
Long-term debt | 2,678 | 2,661 |
Level 2 | Fair Value | 2.85% senior notes due 2029 | ||
Debt Instrument [Line Items] | ||
Long-term debt | 401 | 400 |
Level 2 | Fair Value | 3.10% senior notes due 2032 | ||
Debt Instrument [Line Items] | ||
Long-term debt | $ 367 | $ 371 |
Derivative Instruments and He_2
Derivative Instruments and Hedging Activities (Details) | 3 Months Ended |
Sep. 29, 2023 | |
Foreign Exchange Forward Contracts Designated | |
Derivatives, Fair Value [Line Items] | |
Derivative, term of contract (to not exceed) (in months) | 12 months |
Debt - Schedule of Debt (Detail
Debt - Schedule of Debt (Details) - USD ($) $ in Millions | Sep. 29, 2023 | Jun. 30, 2023 |
Debt Instrument [Line Items] | ||
Total debt | $ 7,700 | $ 7,100 |
Issuance costs and debt discounts | (28) | (30) |
Subtotal | 7,672 | 7,070 |
Less current portion of long-term debt | (1,850) | (1,213) |
Long-term debt | 5,822 | 5,857 |
Variable interest rate Delayed Draw Term Loan due 2024 | ||
Debt Instrument [Line Items] | ||
Total debt | $ 600 | $ 0 |
4.75% senior unsecured notes due 2026 | ||
Debt Instrument [Line Items] | ||
Debt instrument, interest rate (percentage) | 4.75% | 4.75% |
Total debt | $ 2,300 | $ 2,300 |
Variable interest rate Term Loan A-2 maturing 2027 | ||
Debt Instrument [Line Items] | ||
Debt instrument, interest rate (percentage) | 6.807% | |
Total debt | $ 2,700 | $ 2,700 |
2.85% senior notes due 2029 | ||
Debt Instrument [Line Items] | ||
Debt instrument, interest rate (percentage) | 2.85% | 2.85% |
Total debt | $ 500 | $ 500 |
3.10% senior notes due 2032 | ||
Debt Instrument [Line Items] | ||
Debt instrument, interest rate (percentage) | 3.10% | 3.10% |
Total debt | $ 500 | $ 500 |
Convertible Debt | 1.50% convertible notes due 2024 | ||
Debt Instrument [Line Items] | ||
Debt instrument, interest rate (percentage) | 1.50% | 1.50% |
Total debt | $ 1,100 | $ 1,100 |
Debt - Additional Information (
Debt - Additional Information (Details) - USD ($) | 1 Months Ended | 3 Months Ended |
Aug. 14, 2023 | Sep. 29, 2023 | |
Delayed Draw Term Loan Agreement | ||
Debt Instrument [Line Items] | ||
Debt instrument, face amount | $ 600,000,000 | |
Proceeds from delayed draw term loan | $ 600,000,000 | |
Debt instrument, interest rate (percentage) | 7.416% | |
Delayed Draw Term Loan Agreement | Minimum | Line of Credit | SOFR | ||
Debt Instrument [Line Items] | ||
Variable interest rate | 1.75% | |
Delayed Draw Term Loan Agreement | Minimum | Line of Credit | Base Rate | ||
Debt Instrument [Line Items] | ||
Variable interest rate | 0.75% | |
Delayed Draw Term Loan Agreement | Maximum | Line of Credit | SOFR | ||
Debt Instrument [Line Items] | ||
Variable interest rate | 2.625% | |
Delayed Draw Term Loan Agreement | Maximum | Line of Credit | Base Rate | ||
Debt Instrument [Line Items] | ||
Variable interest rate | 1.625% | |
Variable interest rate Term Loan A-2 maturing 2027 | ||
Debt Instrument [Line Items] | ||
Debt instrument, interest rate (percentage) | 6.807% | |
Variable interest rate Term Loan A-2 maturing 2027 | SOFR | ||
Debt Instrument [Line Items] | ||
Variable interest rate | 1.375% | |
Variable interest rate Term Loan A-2 maturing 2027 | Minimum | SOFR | ||
Debt Instrument [Line Items] | ||
Variable interest rate | 1.125% | |
Variable interest rate Term Loan A-2 maturing 2027 | Minimum | Base Rate | ||
Debt Instrument [Line Items] | ||
Variable interest rate | 0.125% | |
Variable interest rate Term Loan A-2 maturing 2027 | Maximum | SOFR | ||
Debt Instrument [Line Items] | ||
Variable interest rate | 2% | |
Variable interest rate Term Loan A-2 maturing 2027 | Maximum | Base Rate | ||
Debt Instrument [Line Items] | ||
Variable interest rate | 1% |
Pension and Other Post-Retire_3
Pension and Other Post-Retirement Benefit Plans - Additional Information (Details) | 3 Months Ended |
Sep. 29, 2023 | |
Retirement Benefits [Abstract] | |
Expected long-term rate of return on plan assets | 2.50% |
Pension and Other Post-Retire_4
Pension and Other Post-Retirement Benefit Plans - Obligations and Funded Status (Details) - USD ($) $ in Millions | Sep. 29, 2023 | Jun. 30, 2023 |
Retirement Benefits [Abstract] | ||
Benefit obligation at end of period | $ 265 | $ 273 |
Fair value of plan assets at end of period | 180 | 185 |
Unfunded status | $ 85 | $ 88 |
Pension and Other Post-Retire_5
Pension and Other Post-Retirement Benefit Plans - Unfunded Amounts Recognized on Consolidated Balance Sheets (Details) - USD ($) $ in Millions | Sep. 29, 2023 | Jun. 30, 2023 |
Retirement Benefits [Abstract] | ||
Current liabilities | $ 1 | $ 1 |
Non-current liabilities | 84 | 87 |
Net amount recognized | $ 85 | $ 88 |
Related Parties and Related C_3
Related Parties and Related Commitments and Contingencies - Additional Information (Details) $ in Millions | 3 Months Ended | 12 Months Ended | |
Sep. 29, 2023 USD ($) entity | Sep. 30, 2022 USD ($) | Jun. 30, 2023 USD ($) | |
Guarantor Obligations [Line Items] | |||
Number of legal entities | entity | 3 | ||
Investment funding commitments, percentage | 50% | ||
Percent of total manufacturing capacity in operation | 100% | ||
Costs incurred associated with reduction in utilization | $ 141 | $ 0 | |
Accounts Receivable Benchmark | Product Concentration Risk | Unis Venture | |||
Guarantor Obligations [Line Items] | |||
Concentration risk, percentage | 7% | 8% | |
Unis Venture | |||
Guarantor Obligations [Line Items] | |||
Equity method investment, ownership percentage | 49% | ||
Unis Venture | Revenue from Contract with Customer | Product Concentration Risk | |||
Guarantor Obligations [Line Items] | |||
Concentration risk, percentage | 6% | 3% | |
Unis Venture | Unissoft (Wuxi) Group Co Ltd. | |||
Guarantor Obligations [Line Items] | |||
Partner's ownership in venture business | 51% | ||
Kioxia Corporation | Prepayments Of Future Depreciation | |||
Guarantor Obligations [Line Items] | |||
Other commitment | $ 539 | ||
Western Digital Corp | Minimum | |||
Guarantor Obligations [Line Items] | |||
Investment funding commitments, percentage | 49.90% | ||
Western Digital Corp | Maximum | |||
Guarantor Obligations [Line Items] | |||
Investment funding commitments, percentage | 50% | ||
Equity Method Investee | |||
Guarantor Obligations [Line Items] | |||
Payments for equity method investments | $ 900 | $ 1,000 | |
Accounts payable | $ 277 | $ 292 |
Related Parties and Related C_4
Related Parties and Related Commitments and Contingencies - Equity Investments (Details) - USD ($) $ in Millions | Sep. 29, 2023 | Jun. 30, 2023 |
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Total notes receivable and investments in Flash Ventures | $ 1,245 | $ 1,297 |
Flash Partners Ltd | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Investments | 155 | 160 |
Flash Partners Ltd | Related Party | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Notes receivable, related parties | 21 | 37 |
Flash Alliance Ltd | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Investments | 227 | 234 |
Flash Alliance Ltd | Related Party | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Notes receivable, related parties | 35 | 48 |
Flash Forward Ltd | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Investments | 108 | 109 |
Flash Forward Ltd | Related Party | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Notes receivable, related parties | 699 | 709 |
Equity Method Investee | ||
Accounts, Notes, Loans and Financing Receivable [Line Items] | ||
Total notes receivable and investments in Flash Ventures | $ 1,245 | $ 1,297 |
Related Parties and Related C_5
Related Parties and Related Commitments and Contingencies - Maximum Loss Exposure (Details) - Sep. 29, 2023 - Related Party $ in Millions, ¥ in Billions | USD ($) | JPY (¥) |
Guarantor Obligations [Line Items] | ||
VIE, reporting entity involvement, maximum loss exposure, amount | $ 3,882 | |
Notes receivable | ||
Guarantor Obligations [Line Items] | ||
VIE, reporting entity involvement, maximum loss exposure, amount | 755 | |
Equity investments | ||
Guarantor Obligations [Line Items] | ||
VIE, reporting entity involvement, maximum loss exposure, amount | 490 | |
Operating lease guarantees | ||
Guarantor Obligations [Line Items] | ||
Operating lease guarantees | 1,590 | ¥ 237 |
Inventory and prepayments | ||
Guarantor Obligations [Line Items] | ||
Inventory and prepayments | $ 1,047 |
Related Parties and Related C_6
Related Parties and Related Commitments and Contingencies - JV Lease Guarantees (Details) - Sep. 29, 2023 $ in Millions, ¥ in Billions | USD ($) | JPY (¥) |
Operating lease guarantees | Related Party | ||
Loss Contingencies [Line Items] | ||
Total guarantee obligations | $ 1,590 | ¥ 237 |
Related Parties and Related C_7
Related Parties and Related Commitments and Contingencies - Joint Venture Lease Amounts (Details) - Equity Method Investee $ in Millions | Sep. 29, 2023 USD ($) |
Guarantor Obligations [Line Items] | |
Remaining nine months of 2024 | $ 410 |
Remaining nine months of 2024 | 353 |
2025 | 445 |
2026 | 230 |
2027 | 136 |
2028 | 16 |
Total guarantee obligations | 1,590 |
Payment of Principal Amortization | |
Guarantor Obligations [Line Items] | |
Remaining nine months of 2024 | 340 |
Remaining nine months of 2024 | 273 |
2025 | 324 |
2026 | 128 |
2027 | 37 |
2028 | 1 |
Total guarantee obligations | 1,103 |
Purchase Option Exercise Price at Final Lease Terms | |
Guarantor Obligations [Line Items] | |
Remaining nine months of 2024 | 70 |
Remaining nine months of 2024 | 80 |
2025 | 121 |
2026 | 102 |
2027 | 99 |
2028 | 15 |
Total guarantee obligations | $ 487 |
Leases and Other Commitments -
Leases and Other Commitments - Supplemental Balance Sheet (Details) $ in Millions | Sep. 29, 2023 USD ($) |
Minimum lease payments by year: | |
Remaining nine months of 2024 | $ 49 |
2025 | 63 |
2026 | 65 |
2027 | 58 |
2028 | 51 |
Thereafter | 329 |
Total future minimum lease payments | 615 |
Less: Imputed interest | 175 |
Present value of lease liabilities | $ 440 |
Operating Lease, Liability, Current, Statement of Financial Position [Extensible Enumeration] | Accrued expenses |
Less: Current portion (included in Accrued expenses) | $ 44 |
Operating Lease, Liability, Noncurrent, Statement of Financial Position [Extensible Enumeration] | Other liabilities |
Long-term operating lease liabilities (included in Other liabilities ) | $ 396 |
Operating Lease, Right-of-Use Asset, Statement of Financial Position [Extensible Enumeration] | Other non-current assets |
Operating lease right-of-use assets (included in Other non-current assets) | $ 419 |
Weighted average remaining lease term in years | 10 years 6 months |
Weighted average discount rate | 6% |
Leases and Other Commitments _2
Leases and Other Commitments - Supplemental Cash Flow (Details) - USD ($) $ in Millions | 3 Months Ended | |
Sep. 29, 2023 | Sep. 30, 2022 | |
Leases [Abstract] | ||
Cost of operating leases | $ 14 | $ 14 |
Cash paid for operating leases | 15 | 14 |
Operating lease assets obtained in exchange for operating lease liabilities | $ 168 | $ 4 |
Leases and Other Commitments _3
Leases and Other Commitments - Sale Leaseback (Details) $ in Millions | 1 Months Ended |
Sep. 29, 2023 USD ($) option | |
Lessee, Lease, Description [Line Items] | |
Sale leaseback net cash proceeds | $ 191 |
Sale leaseback gain | 85 |
Sale leaseback annual lease rate | $ 16 |
Sale leaseback increase percentage | 0.03 |
Through January 1, 2039 | |
Lessee, Lease, Description [Line Items] | |
Sale leaseback number of renewal options | option | 3 |
Sale leaseback renewal options term | 5 years |
Through December 2057 | |
Lessee, Lease, Description [Line Items] | |
Sale leaseback number of renewal options | option | 1 |
Sale leaseback renewal options term | 4 years |
Leases and Other Commitments _4
Leases and Other Commitments - Long-Term Commitments (Details) $ in Millions | Sep. 29, 2023 USD ($) |
Purchase Obligation, Fiscal Year Maturity [Abstract] | |
Remaining nine months of 2024 | $ 215 |
2025 | 267 |
2026 | 75 |
2027 | 52 |
2028 | 20 |
Thereafter | 130 |
Total | $ 759 |
Shareholders' Equity and Conv_3
Shareholders' Equity and Convertible Preferred Stock - Stock-Based Compensation Expense (Details) - USD ($) $ in Millions | 3 Months Ended | |
Sep. 29, 2023 | Sep. 30, 2022 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Expenses on stock-based compensation | $ 77 | $ 86 |
Tax benefit | (10) | (13) |
Total | 67 | 73 |
Cost of revenue | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Expenses on stock-based compensation | 13 | 14 |
Research and development | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Expenses on stock-based compensation | 34 | 39 |
Selling, general and administrative | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Expenses on stock-based compensation | 30 | 33 |
RSUs and PSUs | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Expenses on stock-based compensation | 65 | 75 |
ESPP | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Expenses on stock-based compensation | $ 12 | $ 11 |
Shareholders' Equity and Conv_4
Shareholders' Equity and Convertible Preferred Stock - Unrecognized Share-based Compensation (Details) $ in Millions | 3 Months Ended |
Sep. 29, 2023 USD ($) | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Unamortized Compensation Costs | $ 643 |
RSUs and PSUs | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Unamortized Compensation Costs | $ 588 |
Weighted Average Service Period | 2 years 9 months 18 days |
ESPP | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Unamortized Compensation Costs | $ 55 |
Weighted Average Service Period | 1 year 2 months 12 days |
Shareholders' Equity and Conv_5
Shareholders' Equity and Convertible Preferred Stock - Stock Option Activity (Details) - $ / shares | 3 Months Ended | 12 Months Ended |
Sep. 29, 2023 | Jun. 30, 2023 | |
Number of Shares | ||
Options outstanding, beginning balance (in shares) | 300,000 | |
Canceled or expired (in shares) | (300,000) | |
Options outstanding, ending balance (in shares) | 0 | 300,000 |
Weighted Average Exercise Price Per Share | ||
Options outstanding, beginning balance, exercise price (in dollars per share) | $ 44.95 | |
Canceled or expired, exercise price (in dollars per share) | 44.95 | |
Options outstanding, ending balance, exercise price (in dollars per share) | $ 0 | $ 44.95 |
Options outstanding, weighted average remaining contractual term | 1 month 6 days |
Shareholders' Equity and Conv_6
Shareholders' Equity and Convertible Preferred Stock - Restricted Stock Units And Performance Share Units (Details) - Restricted Stock Units And Performance Share Units $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended |
Sep. 29, 2023 USD ($) $ / shares shares | |
Number of Shares | |
Outstanding, beginning balance (in shares) | shares | 13.8 |
Granted (in shares) | shares | 5.5 |
Vested (in shares) | shares | (3.3) |
Forfeited (in shares) | shares | (0.9) |
Outstanding, ending balance (in shares) | shares | 15.1 |
Weighted Average Grant Date Fair Value | |
Outstanding, beginning balance, grant date fair value (in dollars per share) | $ / shares | $ 46.56 |
Granted, grant date fair value (in dollars per share) | $ / shares | 37.87 |
Vested, grant date fair value (in dollars per share) | $ / shares | 47 |
Forfeited, grant date fair value (in dollars per share) | $ / shares | 46.86 |
Outstanding, ending balance, grant date fair value (in dollars per share) | $ / shares | $ 43.85 |
Aggregate value of restricted stock awards vested | $ | $ 147 |
Shareholders' Equity and Conv_7
Shareholders' Equity and Convertible Preferred Stock - Convertible Preferred Stock (Details) - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 12 Months Ended | |
Jan. 31, 2023 | Sep. 29, 2023 | Jun. 30, 2023 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Convertible preferred stock, shares authorized (in shares) | 5,000,000 | 5,000,000 | |
Convertible preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 | |
Convertible preferred stock, liquidation preference | $ 939 | $ 924 | |
Series A Preferred Stock | Private Placement | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Convertible preferred stock, shares authorized (in shares) | 900,000 | ||
Convertible preferred stock, par value (in dollars per share) | $ 0.01 | ||
Convertible Preferred Stock | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Cumulative dividends | 39 | 24 | |
Unpaid dividends | $ 39 | $ 24 | |
Convertible shares issued (in shares) | 20,000,000 | 20,000,000 | |
Convertible preferred stock, liquidation preference | $ 939 | $ 924 | |
Convertible Preferred Stock | Private Placement | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Convertible preferred stock, shares authorized (in shares) | 5,000,000 | ||
Aggregate purchase price | $ 900 | ||
Issuance costs | $ 24 | ||
Preferred dividend annual rate increasing per annum (as percent) | 6.25% | ||
Convertible Preferred Stock | Private Placement | January 31, 2030 | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Preferred dividend annual rate increasing per annum (as percent) | 7.25% | ||
Convertible Preferred Stock | Private Placement | January 31, 2033 | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Preferred dividend annual rate increasing per annum (as percent) | 8.25% |
Income Tax Expense - Tax Expens
Income Tax Expense - Tax Expense and Effective Tax Rate (Details) - USD ($) $ in Millions | 3 Months Ended | |
Sep. 29, 2023 | Sep. 30, 2022 | |
Income Tax Disclosure [Abstract] | ||
Income (loss) before taxes | $ (682) | $ 84 |
Income tax expense | $ 3 | $ 57 |
Effective tax rate | 0% | 68% |
Income Tax Expense - Additional
Income Tax Expense - Additional Information (Details) $ in Millions | 3 Months Ended |
Sep. 29, 2023 USD ($) | |
Income Tax Disclosure [Line Items] | |
Unrecognized tax benefits, period net decrease | $ 30 |
Penalties and interest accrued on unrecognized tax benefits | 157 |
Potential payables related to unrecognized tax benefits | 663 |
Tax Years 2008 Through 2012 | |
Income Tax Disclosure [Line Items] | |
Federal tax related to adjustments for transfer pricing | 753 |
Tax and interest payments | 363 |
Interest | 160 |
Mandatory deemed repatriation tax obligations | 34 |
Tax Years 2008 Through 2015 | |
Income Tax Disclosure [Line Items] | |
Mandatory deemed repatriation tax obligations | 168 |
Settlement with Taxing Authority | Tax Years 2008 Through 2015 | |
Income Tax Disclosure [Line Items] | |
Penalties and interest accrued on unrecognized tax benefits | $ 183 |
Income Tax Expense - Unrecogniz
Income Tax Expense - Unrecognized Tax Benefits (Details) $ in Millions | 3 Months Ended |
Sep. 29, 2023 USD ($) | |
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward] | |
Unrecognized tax benefit, beginning balance | $ 1,021 |
Gross increases related to current year tax positions | 2 |
Gross increases related to prior year tax positions | 17 |
Gross decreases related to prior year tax positions | (3) |
Settlements | (363) |
Lapse of statute of limitations | (2) |
Unrecognized tax benefit, ending balance | $ 672 |
Net Income (Loss) Per Common _3
Net Income (Loss) Per Common Share (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | 3 Months Ended | |
Sep. 29, 2023 | Sep. 30, 2022 | |
Earnings Per Share [Abstract] | ||
Net income (loss) | $ (685) | $ 27 |
Less: cumulative dividends on Preferred Stock | 15 | 0 |
Net income (loss) attributable to common shareholders | $ (700) | $ 27 |
Weighted average shares outstanding: | ||
Basic (in shares) | 323 | 316 |
Employee stock options, RSUs, PSUs, and ESPP (in shares) | 0 | 3 |
Diluted (in shares) | 323 | 319 |
Net income (loss) per common share | ||
Basic (in dollars per share) | $ (2.17) | $ 0.09 |
Diluted (in dollars per share) | $ (2.17) | $ 0.08 |
Anti-dilutive potential common shares excluded (in shares) | 15 | 8 |
Net Income (Loss) Per Common _4
Net Income (Loss) Per Common Share - Additional Information (Details) | Sep. 29, 2023 | Jun. 30, 2023 |
1.50% convertible notes due 2024 | Convertible Debt | ||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||
Debt instrument, interest rate (percentage) | 1.50% | 1.50% |
Employee Termination, Asset I_3
Employee Termination, Asset Impairment, and Other - Expense Recognition (Details) - USD ($) $ in Millions | 1 Months Ended | 3 Months Ended | |
Sep. 29, 2023 | Sep. 29, 2023 | Sep. 30, 2022 | |
Restructuring Cost and Reserve [Line Items] | |||
Gain on sale-leaseback of facility | $ (85) | ||
Business Realignment | |||
Restructuring Cost and Reserve [Line Items] | |||
Employee termination benefits | $ 19 | $ 24 | |
Contract termination and other | 29 | 0 | |
Asset impairments | 94 | 0 | |
Gain on sale-leaseback of facility | (85) | 0 | |
Total employee termination, asset impairment, and other | $ 57 | $ 24 |
Employee Termination, Asset I_4
Employee Termination, Asset Impairment, and Other - Business Realignment Activities (Details) - Business Realignment $ in Millions | 3 Months Ended |
Sep. 29, 2023 USD ($) | |
Restructuring Reserve [Roll Forward] | |
Accrual balance at June 30, 2023 | $ 36 |
Charges | 48 |
Cash payments | (45) |
Accrual balance at September 29, 2023 | 39 |
Employee Termination Benefits | |
Restructuring Reserve [Roll Forward] | |
Accrual balance at June 30, 2023 | 31 |
Charges | 19 |
Cash payments | (45) |
Accrual balance at September 29, 2023 | 5 |
Contract Termination and Other | |
Restructuring Reserve [Roll Forward] | |
Accrual balance at June 30, 2023 | 5 |
Charges | 29 |
Cash payments | 0 |
Accrual balance at September 29, 2023 | $ 34 |
Supplier Finance Program (Detai
Supplier Finance Program (Details) - USD ($) $ in Millions | Sep. 29, 2023 | Jun. 30, 2023 |
Supplier Finance Program [Line Items] | ||
Supplier finance program, obligation | $ 39 | $ 38 |
Minimum | ||
Supplier Finance Program [Line Items] | ||
Supplier finance program, payment timing, period | 60 days | |
Maximum | ||
Supplier Finance Program [Line Items] | ||
Supplier finance program, payment timing, period | 90 days |
Subsequent Events (Details)
Subsequent Events (Details) | Nov. 03, 2023 USD ($) $ / shares $ / Unit | Oct. 30, 2023 company | Sep. 29, 2023 | Jun. 30, 2023 |
1.50% convertible notes due 2024 | Convertible Debt | ||||
Subsequent Event [Line Items] | ||||
Debt instrument, interest rate (percentage) | 1.50% | 1.50% | ||
Subsequent Event | ||||
Subsequent Event [Line Items] | ||||
Number of independent public companies | company | 2 | |||
Cost of capped call transactions | $ 155,000,000 | |||
Subsequent Event | 2028 Convertible Notes | Convertible Debt | ||||
Subsequent Event [Line Items] | ||||
Debt instrument, face amount | $ 1,600,000,000 | |||
Debt instrument, interest rate (percentage) | 3% | |||
Conversion price (in USD per share) | $ / shares | $ 52.20 | |||
Derivative cap price (in USD per share) | $ / Unit | 70.26 | |||
Subsequent Event | 1.50% convertible notes due 2024 | Convertible Debt | ||||
Subsequent Event [Line Items] | ||||
Repayment of aggregate principal amount convertible notes | $ 508,000,000 |