Western Digital Corporation Q1 FY2020 Earnings Call

· Earnings call transcript and AI-powered summary

Quarter Overview

  • Revenue of 4.0 billion dollars, above the high end of guidance and up 11 percent sequentially, but down 20 percent year-over-year due to a strong comparable period in fiscal 2019.
  • Non-GAAP EPS at the high end of guidance, supported primarily by strong data center demand.
  • CEO Steve Milligan announced his planned retirement. He will remain in the role until a successor is named and will stay through September 2020 in an advisory capacity.

Key Business Highlights

  • Record exabyte shipments for both hard drives and flash.
  • Strong data center momentum driven by 14 terabyte drives, which now comprise the majority of capacity enterprise shipments.
  • The company accelerated its 9‑platter energy-assisted platform, enabling 16 and 18 terabyte CMR and 20 terabyte SMR drives. Sampling begins this quarter with volume shipping expected in the first half of calendar 2020.
  • Initial revenue ramp began for NVMe enterprise SSDs, with next‑generation 96‑layer 3D flash products qualifying with more customers.
  • Flash supply remains tight; management expects industry inventory levels to be substantially normalized by the end of calendar 2019.
  • Client SSD exabyte shipments grew over 70 percent year-over-year, leading to market-share gains in PCs and notebooks.

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Operator: Ladies and gentlemen, thank you for standing by and welcome to Western Digital's First Quarter of Fiscal 2020 Conference Call. At this time, all participants are in a listen-only mode. After the speakers' presentation, there will be a question-and-answer session. [Operator Instructions]I would now like to hand the conference over to your speaker, Mr. Peter Andrew. Please go ahead, sir. Peter Andrew: Okay. Thank you and good afternoon everyone. Before we begin, let me remind everyone that today's discussion contains forward-looking statements including product development expectations business plans trends and financial outlook. Based upon management's current assumptions and expectations and as such does include risks and uncertainties. We assume no obligation to update these statements, please refer to our most recent financial report on Form 10-Q filed with the SEC for more information on the risks and uncertainties that could cause actual results to differ materially.We will also make references to non-GAAP financial measures today reconciliations between the non-GAAP and comparable GAAP financial measures are included in the press release and other materials that are being posted in the Investor Relations section of our website.With that, I'll now turn the call over to Steve Milligan, our CEO. Steve Milligan: Thank you, Peter, and good afternoon everyone. Joining me today are Mike Cordano, President and Chief Operating Officer; and Bob Eulau Chief Financial Offi

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