Western Digital 2008 Annual Report Download - page 41

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Summary Comparison of 2008, 2007 and 2006
The following table sets forth, for the periods indicated, summary information from our consolidated statements of
income by dollars and percentage of revenue (in millions, except percentages):
June 27, 2008 June 29, 2007 June 30, 2006
Years Ended
Revenue, net .................................. $8,074 100% $5,468 100% $4,341 100%
Gross margin ................................. 1,739 21.5 900 16.5 829 19.1
Operating expenses ............................. 684 8.5 485 8.9 463 10.7
Acquired in-process research and development .......... 49 0.6 — — — —
Operating income .............................. 1,006 12.4 415 7.6 366 8.4
Non-operating income (expense) .................... (25) (0.3) 28 0.5 16 0.4
Income before income taxes ....................... 981 12.1 443 8.1 382 8.8
Income tax expense (benefit) ....................... 114 1.4 (121) (2.2) (13) (0.3)
Net income .................................. 867 10.7 564 10.3 395 9.1
The following table sets forth, for the periods indicated, summary information regarding volume shipments,
average selling prices (“ASPs”) and revenues by geography, channel and product (in millions, except percentages and
ASPs):
June 27,
2008
June 29,
2007
June 30,
2006
Years Ended
Net revenue ..................................... $8,074 $5,468 $4,341
Unit shipments* .................................. 133 97 73
ASPs (per unit)* .................................. $ 59 $ 57 $ 59
Revenues by Geography(%)*
Americas ..................................... 31% 37% 36%
Europe, Middle East and Africa ..................... 30 29 28
Asia ......................................... 39 34 36
Revenues by Channel(%)*
OEM........................................ 51% 48% 54%
Distributors ................................... 31 36 39
Branded products ............................... 18 16 7
Revenues by Product(%)*
Non-desktop sources ............................. 56% 43% 29%
Desktop computers .............................. 44 57 71
* Based on sales of hard drives only
Fiscal Year 2008 Compared to Fiscal Year 2007
Net Revenue. Net revenue was $8.1 billion for 2008, an increase of 48% from 2007. Total unit shipments increased
to 133 million as compared to 97 million for the prior year. This unit increase resulted from an increase in higher overall
demand for hard drives and our continuing diversification into non-desktop markets, including mobile, consumer
electronics, enterprise and branded products. For example, we shipped 37 million 2.5 inch drives to the mobile and
branded markets in 2008 as compared to 12 million units in 2007. Additionally, we shipped 15 million units to the DVR
market in 2008 as compared to 10 million units in 2007. ASPs increased to $59 due to an improved mix of revenues by
market category, improved product mix and more favorable demand/supply conditions. Changes in revenue by
geography generally reflect normal fluctuations in market demand and competitive dynamics as well as an increase
in mobile drives sold to Asia. Changes in revenue by channel are a result of increases in sales of mobile hard drives to
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