Capital Allocation Framework slide image

Capital Allocation Framework

20 WESTERN DIGITAL CONFIDENTIAL ©2022 WESTERN DIGITAL CORPORATION OR ITS AFFILIATES ALL RIGHTS RESERVED Supplemental Operating Segment Results In millions, except percentages; unaudited Net Revenue Flash HDD Total Net Revenue Gross Profit By Segment Flash HDD Total Gross Profit for Segments Unallocated corporate items: Contamination related charges Stock-based compensation expense Amortization of acquired intangible assets Recoveries from a power outage incident Q4F21 Q1F22 Q2F22 Q3F22 Q4F22 $ 2,419 2,501 $ 4,920 $ 2,490 2,561 $ 5,051 $ 2,620 2,213 $ 2,243 2,138 $ 2,400 2,128 $ 4,833 $ 4,381 $ 4,528 $ 859 $ 921 $ 946 $ 798 759 792 677 592 $ 862 600 $1,618 $ 1,713 $ 1,623 $ 1,390 $ 1,462 (203) (14) (9) (14) (13) (38) (39) (26) +S (4) (12) (1) (52) (48) (40) (209) (17) $1,566 $1,665 $ 1,583 $ 1,181 $1,445 Total unallocated corporate items Consolidated Gross Profit Gross Margin Flash(1) HDD(2) Total gross margin for segments (3) Consolidated total(4) 1. Flash gross margin is calculated by dividing Flash gross profit by Flash revenue. 2. HDD gross margin is calculated by dividing HDD gross profit by HDD revenue. 3. Total gross margin for segments is calculated by dividing total gross profit for segments by total revenue. 4. 35.5% 37.0% 36.1% 35.6% 35.9% 30.3% 30.9% 30.6% 27.7% 28.2% 32.9% 33.9% 33.6% 31.7% 32.3% 31.8% 33.0% 32.8% 27.0% 31.9% Consolidated total gross margin is calculated by dividing consolidated gross profit by total revenue. Note: In the table above, Total gross profit for segments and Total gross margin for segments are Non-GAAP financial measures, which are also referred to herein as Non-GAAP gross profit and Non-GAAP gross margin, respectively.
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