Western Digital Corp (NASDAQ: WDC) stock fell over 3.4% on April 30th, 2019 (as of 9:54 am GMT-4; Source: Google finance) after the company posted lower than expected results for the third quarter of FY 19. The company reported a fiscal third-quarter loss of $581 million compared with $61 million in the year-ago period. The company’s results included lower of cost or market inventory charges of approximately $110 million in cost of revenue, primarily related to certain flash memory products that contain DRAM components. Further, WDC has made substantial progress on realigning the cost and expense structure. The Kuala Lumpur manufacturing facility has largely ceased operations and combined with other actions the company is already realizing incremental cost savings.
Meanwhile, the company commenced the initial revenue shipments of the enterprise NVMe SSD and the company is on track to accelerate the volume ramp of this product over the remainder of calendar 2019. The company also commence shipments of the NVMe client SSDs based on 96-layer, 3D flash, BiCS4 technology. The manufacturing ramp and commercialization of BiCS4, which the company believe is the industry’s lowest cost technology is progressing well. In the second half of calendar 2019, BiCS4 will become the highest volume runner in terms of flash output. In HDDs, the company continue to lead the industry in aerial density through technologies such as SMR and energy-assisted recording and are on track to ship the first energy-assisted capacity enterprise drives later this year. From a flash supply perspective, the company is continuing the previously announced wafer output reductions without compromising the cost leadership position.
WDC in the third quarter of FY 19 has reported the adjusted earnings per share of 17 cents, missing the analysts’ estimates for the adjusted earnings per share of 46 cents. The company had reported the adjusted revenue of $3.67 billion in the third quarter of FY 19, missing the analysts’ estimates for revenue of $3.68 billion.
Additionally, the company has generated $204 million in cash from operations during the third fiscal quarter of 2019, ending with $3.8 billion of total cash, cash equivalents and available-for-sale securities. The company returned $146 million to shareholders through dividends. On February 14, 2019, the company had declared a cash dividend of $0.50 per share of its common stock, which was paid to shareholders on April 15, 2019.
For the fourth quarter of 2019, WDC expects revenue in the range of $3.6 to $3.8 billion and non-GAAP earnings per share of $0.10 to $0.30.