Large Cap Watch List
member Western Digital Corp. (WDC
) reported its financial results
for its fiscal year 2007 and fourth quarter ended June 29, 2007. The company’s results for the fiscal year reflected strong year-over-year performance, with revenue of $5.5 billion compared to consensus estimates of $5.43 billion. Net income was $585 million, or $2.59 per share, compared to $395 million, or $1.76 per share for the prior year. The 2007 and 2006 net income amounts included income tax benefits of $147 million and $22 million, respectively, related to adjustments to the value of the company’s deferred tax assets. Adjusted net income of $1.93 narrowly edged the $1.92 consensus.
Part of the success reflected efforts to focus on more profitable lines of business. On a year-over-year basis, the company expanded its share of revenue from newer markets from 29 percent to 43 percent. The company’s newer market revenue includes hard drives for notebook PCs, consumer electronics, enterprise applications and WD branded products.
Despite the impact of tax benefits, the company was able to control working capital. This resulted in full year cash flow from operating activities rising from $368 million to $618 million.
The company also announced that the acquisition of Komag (KOMG) is progressing on schedule.
WDC 1-yr chart: