Western Digital Reports 31% Revenue Growth to $2.294 Billion in Latest Quarter

Western Digital Corporation reported significant financial performance improvements in its latest quarterly filing, with net revenue reaching $2.294 billion for the three months ended March 28, 2025, a 31% increase from $1.752 billion in the same period last year. For the nine months ending March 28, 2025, revenue surged to $6.915 billion, up 60% from $4.313 billion in the prior year. The company attributed this growth to a 4% increase in units sold and a 23% rise in average selling prices, particularly driven by higher demand for high-capacity enterprise products in the cloud segment.

The company’s gross profit also saw a substantial increase, rising to $912 million for the third quarter, compared to $519 million a year earlier, reflecting a gross margin improvement from 29.6% to 39.8%. Operating income for the quarter was reported at $760 million, a significant turnaround from an operating loss of $94 million in the same quarter of the previous year. This improvement was largely due to higher product shipments and favorable pricing dynamics, alongside the absence of prior year charges related to unabsorbed manufacturing overhead.

In terms of strategic developments, Western Digital completed the separation of its hard disk drive (HDD) and flash business units on February 21, 2025, creating two independent public companies. This strategic move is expected to enhance operational efficiency and allow each entity to focus on its respective market opportunities. Following the separation, Western Digital retains a 19.9% ownership stake in Sandisk, which is now an independent entity. The company anticipates monetizing this stake within a year.

Operationally, Western Digital reported a notable increase in its customer concentration, with its top ten customers accounting for 73% of net revenue for the three months ended March 28, 2025, compared to 59% in the same period last year. The company also experienced a geographic revenue shift, with significant growth in the Americas and Asia, reflecting increased sales to cloud customers. Employee headcount remained stable, with ongoing investments in research and development to drive innovation in data storage solutions.

Looking ahead, Western Digital expressed optimism about future market conditions, particularly in light of the ongoing digital transformation and the increasing demand for data storage solutions driven by artificial intelligence. The company plans to continue monitoring macroeconomic factors, including trade policies and inflation, which could impact its operations. With a strong cash position of $3.477 billion as of March 28, 2025, and a commitment to maintaining liquidity, Western Digital is well-positioned to navigate potential challenges while pursuing growth opportunities in the data storage market.