WDC Earnings Prediction
The chart below shows how WDC performed 10 days before and after its earnings report, based on data from the past quarters. Typically, WDC sees a -2.15% change in stock price 10 days leading up to the earnings, and a +3.32% change 10 days following the report. On the earnings day itself, the stock moves by +1.68%. This data can give you a slight idea of what to expect for the next quarter's release.
WDC Key Earning Data
2024/Q4
Year Over Year
Quarter Over Quarter
Total Revenue
3.76B
40.87%
8.88%
Gross Margin
35.95%
945.06%
24.14%
Operating Margin
15.81%
170.77%
79.86%
Net Margin
1.04%
103.92%
-73.40%
EPS
0.09
103.95%
-73.53%
No Data Available
WDC Earnings Analysis
Western Digital Corp Corporation (WDC.O) Earnings Conference Call
Positive
Strong Revenue Growth: Total revenue for Q2 was $4.3 billion, up 5% sequentially and 41% year over year, indicating strong overall growth.
HDD Revenue Surge: HDD revenue reached $2.4 billion, a 9% sequential increase and a remarkable 76% year-over-year growth, driven by strong demand for nearline storage solutions.
Gross Margin Improvement: Non-GAAP gross margin for the quarter was 35.9%, reflecting a 20.4 percentage point increase from the previous year, showcasing improved profitability.
Strong Cash Generation: Operating cash flow for Q2 was $403 million, with free cash flow generation of $335 million, demonstrating strong cash generation capabilities.
Business Separation Financing: The company successfully arranged financing for the upcoming separation of its businesses, marking a key milestone in its strategic plan.
Negative
Gross Margin Decline: Gross margin for the fiscal Q2 was 35.9 percent, which was below guidance, reflecting a sequential decline of 2.6 percentage points and indicating ongoing pricing pressure in the flash segment.
Gross Margin Decline: Flash gross margin decreased to 32.5%, down 6.4 percentage points sequentially due to pricing pressure, highlighting the challenges faced in maintaining profitability amid market oversupply.
Operating Income Decline: Operating income fell to $864,000,000, down 2% sequentially, driven by lower gross margin, which indicates a decline in operational efficiency and profitability.
Revenue Decline Forecast: In fiscal Q3, overall revenue is expected to decline sequentially in the mid-teens percentage, with gross margin anticipated to decrease due to lower blended ASPs and underutilization charges of $20,000,000 to $30,000,000.
HDD Revenue Decline: HDD revenue is projected to decrease sequentially by mid to high single-digit percentage in Q3, indicating a potential slowdown in demand despite previous strong performance.
WDC FAQs
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WDC Earning Call Sentiment
Earnings call transcript: Western Digital Q4 2024 misses EPS forecast, stock rises
WDC.O
1.51%Positive
The earnings call presents mixed signals. While revenue growth is strong, especially in the HDD segment, there are concerns about pricing pressures in the NAND market and a mid-cycle pause in flash demand. The separation of flash and HDD businesses could unlock value, but no buyback or dividend programs are in place. The Q&A section reveals some uncertainties and lack of specific guidance, particularly around underutilization charges. Overall, the financial performance is solid but tempered by market challenges, leading to a neutral sentiment.
