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Investor Presentaiton

17 © 2023 WESTERN DIGITAL CORPORATION OR ITS AFFILIATES ALL RIGHTS RESERVED Credit Agreement Defined Leverage Ratio In millions; unaudited; trailing 12 months Net Income (Loss) Income tax expense Q3F22 $ 1,821 Q4F22 Q2F23 Interest and other expense, net Depreciation and amortization EBITDA(1) Stock-based compensation expense Contamination related charges Employee termination, asset impairment and other charges Strategic review Recoveries from a power outage incident Other Adjusted EBITDA(2)(3) Total Debt(4) Debt to Adjusted EBITDA Flash Ventures equipment depreciation expenses Other Credit Agreement Adjustments (5) Credit Agreement Defined Adjusted EBITDA (6) Total Debt(4) Credit Agreement Defined Leverage Ratio (7) Q1F23 $ 1,500 $ 917 $ (93) Q3F23 $ (690) 387 623 586 565 371 296 268 268 251 246 959 929 895 867 864 $ 3,463 $ 3,320 $ 2,666 $ 1,590 $ 791 $ 328 203 20 $ 326 207 43 $ 336 $ 335 $ 323 207 207 4 49 123 159 ― ― ― 195 15 (7) 7 $ 4,014 $ 7,250 1.8X $ 990 2 $ 5,006 $ 7,250 1.4X (7) $ 3,894 $ 7,100 1.8X $ 929 11 $ 4,834 $ 7,100 1.5X (7) $ 3,254 $ 7,100 2.2X $ 858 2 $ 4,114 $ 7,100 1.7X (7) 2 $ 2,250 $ 7,100 3.2X $ 786 1 $ 1,293 $ 7,100 5.5X 292 $730 504 $ 2,527 $ 7,100 2.1X $ 7,100 2.8X $ 3,328 1. 2. 3. EBITDA is defined as net income before income tax expense, interest and other expense, net, and depreciation and amortization. Adjusted EBITDA is defined as EBITDA (as defined above), adjusted to exclude certain expenses, gains and losses that the company believes are not indicative of its core operating results or because these exclusions are consistent with the financial models and estimates published by many analysts who follow the company and its peers. See the GAAP to Non-GAAP reconciliation slides within the Appendix for further details. Adjusted EBITDA is not intended to reflect measures used under the company's debt agreements. 345 4. Total Debt is the total principal balance of debt outstanding as of the end of the applicable trailing 12-month period. 5. 19 Other Credit Agreement Adjustments includes deductions and addbacks for other income, expenses, and special charges, including underutilization charges and expected future cost savings from cost reduction initiatives in each case as provided under the company's credit agreement applicable to Term Loan A-2 and Revolver. Credit Agreement Defined Adjusted EBITDA is used to measure financial covenant compliance under the company's credit agreement applicable to Term Loan A-2 and Revolver. Credit Agreement Defined Leverage Ratio is calculated as Total Debt divided by Credit Agreement Defined Adjusted EBITDA and is the Leverage Ratio as defined in the company's credit agreement for purpose of the financial covenant applicable to Term Loan A-2 and Revolver.
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