What changed in this filing

/stocks — the workspaceLOADING

Item 1. Business

2023-08-22 compared with 2022-08-25 · 95 added, 97 removed, 162 unchanged (54% of the section changed)

Western Digital Corporation (“Western Digital”) is on a mission to unlock the potential of data by harnessing the possibility to use it.

We are a leading developer, manufacturer, and provider of data storage devices based on both flash-based products (“Flash”) and hard disk drives (“HDD”) technologies.

With dedicated business units driving advancements in NAND flash and magnetic recording technologies, we create and drive innovations needed to help customers capture, preserve, access, and transform an ever-increasing diversity of data.

We are a leading developer, manufacturer, and provider of data storage devices and solutions based on both NAND flash and hard disk drive technologies.

With dedicated flash-based products (“Flash”) and hard disk drives (“HDD”) business units driving advancements in storage technologies, our broad and ever-expanding portfolio delivers powerful Flash and HDD storage solutions for everyone from students, gamers, and home offices, to the largest enterprises and public clouds to capture, preserve, access, and transform an ever-increasing diversity of data.

Our broad portfolio of technology and products in Flash and HDD address multiple end markets of “Cloud”, “Client” and “Consumer.”

Cloud is comprised primarily of products for public or private cloud environments and end customers, which we believe we are uniquely positioned to address as the only provider of both Flash and HDD.

Through the Client end market, we provide our original equipment manufacturer (“OEM”) and channel customers a broad array of high-performance flash and hard drive solutions across personal computer, mobile, gaming, automotive, virtual reality headsets, at-home entertainment, and industrial spaces.

The Consumer end market is highlighted by our broad range of retail and other end-user products, which capitalize on the strength of our product brand recognition and vast points of presence around the world.

Founded in 1970 in Santa Ana, California, Western Digital is now a Standard & Poor’s 500 (“S&P 500”) company headquartered in San Jose, California.

We have one of the technology industry’s most valuable patent portfolios with approximately 13,000 active patents worldwide.

We have a rich heritage of innovation and operational excellence, a wide range of intellectual property (“IP”) assets and broad research and development (“R&D”) capabilities.

The strong growth in amount, value, and use of data continues, creating a global need for larger, faster and more capable storage solutions.

We have a rich heritage of innovation and operational excellence, a wide range of intellectual property (“IP”) assets, broad research and development (“R&D”) capabilities, and large-scale, efficient manufacturing supply chains.

The strong growth in the amount, value, and use of data continues, creating a global need for larger, faster and more capable storage solutions.

We are a customer-focused organization that has developed deep relationships with industry leaders to continue to deliver innovative solutions to help users capture, store and transform data across a boundless range of applications.

1 unchanged sentence

We enable cloud, Internet, and social media infrastructure players to build more powerful, cost-effective and efficient data centers.

We help original equipment manufacturers (“OEM”) address storage opportunities and solutions to capture and transform data in a myriad of devices and edge technologies.

We help OEMs address storage opportunities and solutions to capture and transform data in a myriad of devices and edge technologies.

We have also built strong consumer brands with tools to manage vast libraries of personal content and to push the limits of what’s possible for storage.

5 unchanged sentences

There is tremendous market opportunity flowing from the rapid global adoption of the technology architecture built with cloud infrastructure tied to intelligent endpoints all connected by high-performance networks.

The value and urgency of data storage at every point across this architecture has never been clearer.

The growth in computing complexity, cloud computing applications, connected mobile devices and Internet connected products, and edge devices is driving unabated growth in the volume of digital content to be stored and used.

This growth has led to a creation of new form factors for data storage.

The storage industry is increasingly utilizing tiered architectures with HDD, solid state drives (“SSD”) and other non-volatile memory-based storage to address an expanding set of uses and applications.

The value and urgency of data storage at every point across this architecture have never been clearer.

The increase in computing complexity and advancements in artificial intelligence, along with growth in cloud computing applications, connected mobile devices and Internet-connected products, and edge devices is driving unabated growth in the volume of digital content to be stored and used.

This growth has led to the creation of new form factors for data storage.

The storage industry is increasingly utilizing tiered architectures with solid state drives (“SSD”), HDD and other non-volatile memory-based storage to address an expanding set of uses and applications.

We believe our expertise and innovation across both Flash and HDD technologies enable us to bring powerful solutions to a broader range of applications.

We continuously monitor the full array of storage technologies, including reviewing these technologies with our customers, to ensure we are appropriately resourced to meet our customers’ storage needs.

Our industry is highly competitive.

We compete with manufacturers of Flash and HDD for cloud, client, and consumer end markets.

In Flash, we compete with vertically integrated suppliers such as Kioxia, Micron Technology, Inc., Samsung Electronics Co., Ltd., SK hynix, Inc., Solidigm, Yangtze Memory Technologies Co., Ltd.

and numerous smaller companies that assemble flash into products.

In HDD, we compete with Seagate Technology plc and Toshiba Electronic Devices & Storage Corporation.

Business Strategy

Our overall strategy is to leverage our innovation, technology and execution capabilities to be an industry-leading and broad-based developer, manufacturer and provider of storage devices and solutions that support the infrastructure that has enabled the unabated proliferation of data.

We believe we are the only company in the world with large-scale capabilities to develop and manufacture a portfolio of integrated data storage solutions that are based on both Flash and HDD technologies.

We strive to successfully execute our strategy through the following foundational elements in order to create long-term value for our customers, partners, investors and employees:

• Innovation and Cost Leadership:

We continue to innovate and develop advanced technologies across platforms for both Flash and HDD to deliver timely new products and solutions to meet growing demands for scale, performance and cost efficiency in the market.

• Broad Product Portfolio:

We leverage our capabilities in firmware, software and systems in both Flash and HDD to deliver compelling and differentiated integrated storage solutions to our customers that offer the best combinations of performance, cost, power consumption, form factor, quality and reliability, while creating new use cases for our solutions in emerging markets.

• Operational Excellence:

We are focused on delivering the best value for our customers in cloud, client and consumer end markets through a relentless focus on appropriately scaling our operations across both Flash and HDD technologies to efficiently support business growth;

achieving best in class cost, quality and cycle-time;

maintaining industry leading manufacturing capabilities;

and having a competitive advantage in supply-chain management.

Our strategy provides the following benefits, which distinguish us in the dynamic and competitive data storage industry:

• a broad product portfolio that differentiates us as a leading developer and manufacturer of integrated products and solutions based on both Flash and HDD, making us a more strategic supply partner to our large-scale customers who have storage needs across the data infrastructure ecosystem;

• efficient and flexible manufacturing capabilities, allowing us to leverage our Flash and HDD R&D and capital expenditures to deliver innovative and cost-effective storage solutions to multiple markets;

• deep relationships with industry leaders across the data ecosystems that give us the broadest routes to market.

In June 2022, we announced that we are reviewing potential strategic alternatives aimed at further optimizing long-term value for our stockholders.

The Executive Committee of our Board, chaired by our CEO, is overseeing the assessment process, and the potential strategic alternatives include, among other things, options for separating our Flash and HDD business units.

Table of Content s

Flash Technologies .

2 unchanged sentences

Over time, we have successfully developed and commercialized successive generations of 3-dimensional flash technology with increased numbers of storage bits per cell in an increasingly smaller form factor, further driving cost reductions.

We devote significant research and development resources to the development of highly reliable, high-performance, cost-effective flash-based technology and are pursuing developments in next generation flash-based technology capacities.

We devote significant research and development resources to the development of highly reliable, high-performance, cost-effective flash-based technology and are continually pursuing developments in next-generation flash-based technology capacities.

We are leveraging our expertise, resources and strategic investments in non-volatile memories to explore a wide spectrum of persistent memory and storage class memory technologies.

5 unchanged sentences

Our improvements in HDD capacity, which lower product costs over time, have been enabled largely through advancements in magnetic recording head and media technologies.

Our multi-year product roadmap for high-capacity HDD, which combine ePMR, OptiNAND, UltraSMR and triple stage actuators to deliver a cutting edge portfolio of drives, in commercial volumes, at a wide variety of capacity points, puts Western Digital in great position to capitalize on the opportunities presented by the large and growing storage markets We invest considerable resources in R&D, manufacturing infrastructure and capital equipment for recording head and media technology, as well as other aspects of the magnetic recording system such as HDD mechanics, controller and firmware technology, in order to secure our competitive position and cost structure.

Our multi-year product roadmap for high-capacity HDD, which combine ePMR, OptiNAND, UltraSMR and triple stage actuators to deliver a cutting-edge portfolio of drives, in commercial volumes, at a wide variety of capacity points, puts Western Digital in a strong position to capitalize on the opportunities presented by the large and growing storage markets.

We invest considerable resources in R&D, manufacturing infrastructure and capital equipment for recording head and media technology, as well as other aspects of the magnetic recording system such as HDD mechanics, controller and firmware technology, in order to secure our competitive position and cost structure.

Our products generally leverage a common platform for various products within product families, and in some cases across product families, resulting in the commonality of components which reduces our exposure to changes in demand, facilitates inventory management and allows us to achieve lower costs through purchasing economies.

1 unchanged sentence

Our Data Solutions

Our broad portfolio of technology and products address multiple end markets and are comprised of the Western Digital®, SanDisk® and WD brands®.

In 2022, we refined the end markets we report to be “Cloud”, “Client” and “Consumer”.

Our broad portfolio of technology and products address multiple end markets of “Cloud”, “Client” and “Consumer” and are comprised of the Western Digital®, SanDisk® and WD® brands.

Cloud represents a large and growing end market comprised primarily of products for public or private cloud environments and enterprise customers, which we believe we are uniquely positioned to address as the only provider of both flash and hard drive products.

We provide the Cloud end market with an array of high-capacity enterprise HDD and high-performance enterprise SSD, and platforms.

Our capacity enterprise helium hard drives provide high-capacity storage needs and low total cost of ownership per GB for the growing cloud data center market.

Our capacity enterprise hard drives provide high-capacity storage needs and a low total cost of ownership per gigabyte for the growing cloud data center and smart video system markets.

These drives are primarily for use in data storage systems, in tiered storage models and where data must be stored reliably for years.

Our high-performance enterprise class SSD include high-performance flash-based SSD and software solutions that are optimized for performance applications providing a range of capacity and performance levels primarily for use in enterprise servers and supporting high volume on-line transactions, data analysis and other enterprise applications.

Our high-performance enterprise class SSD include high-performance flash-based SSD and software solutions that are optimized for performance applications providing a range of capacity and performance levels primarily for use in enterprise servers and supporting high-volume online transactions, data analysis and other enterprise applications.

We also provide higher value data storage platforms to the market.

Through the Client end market, we provide our OEM and channel customers a broad array of high-performance flash and hard drive solutions across personal computer (“PC”), mobile, gaming consoles, automotive, virtual reality headsets, at-home entertainment, and industrial spaces.

We provide numerous data solutions that we incorporate into our client’s devices, which consist of HDD and SSD desktop and notebook PCs, smart video systems, gaming consoles and set top boxes, as well as flash-based embedded storage products for mobile phones, tablets, notebook PCs and other portable and wearable devices, automotive applications, Internet of Things, industrial and connected home applications.

Through the Client end market, we provide numerous data solutions that we incorporate into our client’s devices, which consist of HDD and SSD desktop and notebook PCs, gaming consoles and set top boxes, as well as flash-based embedded storage products for mobile phones, tablets, notebook PCs and other portable and wearable devices, automotive applications, Internet of Things, industrial and connected home applications.

Our HDD and SSD are designed for use in devices requiring high performance, reliability and capacity with various attributes such as low cost per gigabyte, quiet acoustics, low power consumption and protection against shocks.

We provide consumers with a portfolio of HDD and SSD embedded into external storage products and removable Flash, which include cards, universal serial bus (“USB”) flash drives and wireless drives, through our retail and channel routes to market.

Table of Content s

The Consumer end market provides consumers with a portfolio of HDD and SSD embedded into external storage products and removable Flash, which include cards, universal serial bus (“USB”) flash drives and wireless drives, through our retail and channel routes to market.

Our external HDD storage products in both mobile and desktop form factors provide affordable, high quality, reliable storage for backup and capacity expansion that are designed to keep digital content secure.

2 unchanged sentences

Our USB flash drives are used in the computing and consumer markets and are designed for high-performance and reliability.

Our wireless drive products allow in-field back up of created content, as well as wireless streaming of high-definition movies, photos, music and documents to tablets, smartphones and PCs.

Our wireless drive products allow in-field backup of created content, as well as wireless streaming of high-definition movies, photos, music and documents to tablets, smartphones and PCs.

Our industry is highly competitive.

We compete with manufacturers of Flash and HDD for Cloud, Client, and Consumer end markets.

In Flash, we compete with vertically integrated suppliers such as Kioxia, Micron Technology, Inc., Samsung Electronics Co., Ltd., SK hynix, Inc., Yangtze Memory Technologies Co., Ltd.

and numerous smaller companies that assemble flash into products.

In HDD, we compete with Seagate Technology Holdings plc and Toshiba Electronic Devices & Storage Corporation.

Business Strategy

We strive to successfully execute our strategy through the following foundational elements in order to create long-term value for our customers, partners, investors and employees:

• Innovation and Cost Leadership:

• Broad Product Portfolio:

• Operational Excellence:

We are focused on delivering the best value for our customers in Cloud, Client and Consumer end markets through a relentless focus on appropriately scaling our operations across both Flash and HDD technologies to efficiently support business growth;

achieving best in class cost, quality and cycle-time;

maintaining industry leading manufacturing capabilities;

and having a competitive advantage in supply-chain management.

Our strategy provides the following benefits, which distinguish us in the dynamic and competitive data storage industry:

• deep relationships with industry leaders across the data ecosystems that give us the broadest routes to market;

• industry leading consumer brand awareness and global retail distribution presence.

In June 2022, we announced that we are reviewing potential strategic alternatives aimed at further optimizing long-term value for our stockholders.

Table of Content s

Research and Development

17 unchanged sentences

Manufacturing

We believe that we have significant know-how, unique product manufacturing processes, test and tooling, execution skills, human resources and training to continue to be successful and to grow our manufacturing operations as necessary.

We strive to maintain manufacturing flexibility, high manufacturing yields, reliable products and high-quality components.

4 unchanged sentences

We continually evaluate our manufacturing processes in an effort to increase productivity, sustain and improve quality and decrease manufacturing costs.

For example, we are taking aggressive actions to restructure our client HDD manufacturing footprint in light of ongoing trends in the HDD Client market as PCs shift from using HDD to Flash technology.

For example, we have taken aggressive actions to restructure our client HDD manufacturing footprint in light of ongoing trends in the HDD Client market as PCs shift from using HDD to Flash technology.

We continually evaluate which steps in the manufacturing process would benefit from automation and how automated manufacturing processes can improve productivity and reduce manufacturing costs.

5 unchanged sentences

San Jose and Fremont, CA, USA.

Table of Content s

Ventures with Kioxia

6 unchanged sentences

We hold a 49.9% ownership position in each of the Flash Venture entities.

Each Flash Venture entity purchases wafers from Kioxia at cost and then resells those wafers to us and Kioxia at cost plus a small mark-up.

Each Flash Venture entity purchases wafers from Kioxia at cost and then resells those wafers to us and Kioxia at cost plus a small markup.

We are obligated to take our share of the output from these ventures or pay for variable costs incurred in producing our share of Flash Ventures’ flash-based memory wafer supply, based on our three-month forecast, which generally equals 50% of Flash Ventures’ output.

4 unchanged sentences

Since its inception, Flash Ventures’ primary manufacturing site has been located in Yokkaichi, Japan.

The Yokkaichi site, which is owned and operated by Kioxia, currently includes five wafer fabrication facilities.

The Yokkaichi site, which is owned and operated by Kioxia, currently includes six wafer fabrication facilities.

We have jointly invested, and intend to continue to jointly invest, with Kioxia in manufacturing equipment for the Yokkaichi fabrication facilities.

We also have agreements that extend Flash Ventures to a wafer fabrication facility located in Kitakami, Japan, referred to as “K1”, which is operated by Kioxia Iwate Corporation, a wholly-owned subsidiary of Kioxia.

The primary purpose of K1 is to provide clean room space to continue the transition of existing flash-based wafer capacity to newer technology nodes.

K1 is now fully operational.

In January 2022, we entered into additional agreements regarding Flash Ventures’ investment in a new wafer fabrication facility currently under construction in Yokkaichi, Japan, referred to as “Y7”, which upon completion will be the sixth wafer fabrication facility at the Yokkaichi site.

In January 2022, we entered into agreements regarding Flash Ventures’ investment in a new wafer fabrication facility in Yokkaichi, Japan, referred to as “Y7”, which is the sixth wafer fabrication facility at the Yokkaichi site.

The primary purpose of Y7 is to provide clean room space to continue the transition of existing flash-based wafer capacity to newer flash technology nodes.

The first phase of construction of Y7 is complete and output is expected to commence in the first half of 2023.

The first phase of construction of Y7 is now complete and has commenced output.

For a discussion of risks associated with our business ventures with Kioxia, see Part I, Item 1A, Risk Factors , of this Annual Report on Form 10-K.

4 unchanged sentences

We believe the use of our in-house assembly and test facilities, as well as contract manufacturers, provides flexibility and gives us access to increased production capacity.

We have developed deep relationships with these vendors and Kioxia to establish continuous supply of flash-based memory and controllers.

We have developed deep relationships with these vendors and Kioxia to establish a continuous supply of flash-based memory and controllers.

HDD consists primarily of recording heads, magnetic media, controllers and firmware, and a printed circuit board assembly.

5 unchanged sentences

For a discussion of associated risks, see Part I, Item 1A, Risk Factors , of this Annual Report on Form 10-K.

Table of Content s

Sales and Distribution

5 unchanged sentences

Sales to international customers are subject to certain risks not normally encountered in domestic operations, including exposure to tariffs and various trade regulations.

For a discussion of associated risks, see Part I, Item 1A, Risk Factors , of this Annual Report on Form 10-K.

We perform our marketing and advertising functions internally and through outside firms utilizing both consumer media and trade publications targeting various reseller and end-user markets.

For a discussion of such risks, see Part I, Item 1A, Risk Factors , of this Annual Report on Form 10-K.

We perform our marketing and advertising functions both internally and through outside firms utilizing both consumer media and trade publications targeting various reseller and end-user markets.

We also maintain customer relationships through direct communication and by providing information and support through our website.

3 unchanged sentences

We have historically experienced seasonal fluctuations in our business with higher levels of demand in the first and second quarters as a result of increased customer spending.

Seasonality can also be impacted by the growth in emerging markets and macroeconomic conditions.

Seasonality can also be impacted by cyclicality in the industry and macroeconomic conditions.

For a discussion of associated risks, see Part I, Item 1A, Risk Factors , of this Annual Report on Form 10-K.

5 unchanged sentences

Human Capital Management

We have been on a journey to transform the Company and redefine the data storage market.

Our employees are paramount to our success.

To this end, our people strategy is grounded in the intention to hire, engage and retain the best talent to support our vision of creating breakthrough innovation that enables the world to actualize its aspirations.

In 2022, we hired a new Chief People Officer to help accelerate the transformation of our human resources function to be more people-centric and to drive better outcomes for the business.

We employ approximately 65,000 people worldwide, and our diverse team spans 38 countries.

By geography, approximately 86% of our employees are in Asia Pacific, 12% in the Americas, and 2% in Europe, the Middle East and Africa.

In order to support our company’s strategy, a continued emphasis on talent is required.

Despite the current industry headwinds, we continue to focus on attracting, developing, engaging and retaining the best talent for our company.

At the end of 2023, we employed approximately 53,000 people worldwide.

Our diverse team spans 38 countries with approximately 85% of our employees in Asia Pacific, 13% in the Americas and 2% in Europe, the Middle East and Africa.

Diversity, Equity and Inclusion

We want to leverage the power and potential of diversity.

We are committed to promoting an inclusive environment where every individual can thrive through a sense of belonging, respect and contribution.

We are committed to diversity and promoting an inclusive environment where every individual can thrive through a sense of belonging, respect and contribution.

We support inclusive hiring, training and development opportunities and ensuring equitable pay for employees, and we continue to focus on increasing diverse representation at every level of our company.

As of June 30, 2023, women represented 26% of our management positions and 23% of our technical staff.

Additionally, members of Asian, Black/African American, Hispanic/Latino or other racially or ethnically diverse communities, represented 62% of our U.S.

management positions, which is a 1.4 percentage point increase compared to 2022.

We have a number of initiatives that focus on increasing our diverse representation, including our new college graduate recruitment and hiring programs as well as veteran hiring and training programs.

Our Employee Resource Groups (“ERGs”) help create an inclusive culture that embraces the uniqueness of our employees.

We have several ERG communities, focusing on women, LGBTQ+, racial and ethnic minorities, military and people with disabilities.

In 2022, we were once again recognized by Human Rights Campaign Best Places to Work for LGBTQ+ Equality 2022.

We also received the Above and Beyond Award and the Pro Patria Award from the Employer Support of the Guard and Reserve for our support of employees who serve in the U.S.

National Guard and Reserve.

We are committed to hiring inclusively, providing training and development opportunities and ensuring equitable pay for employees, and we are continuing to focus on increasing diverse representation at every level of our company.

As of July 1, 2022, four of the nine members of our Board of Directors were women, and women represented 26% of our management positions and 23% of our technical staff.

Additionally, members of Asian, Black/African American, Hispanic/Latinx or other racially or ethnically diverse communities, represented 60% of our U.S.

management positions.

We believe that developing a diverse talent pool of new college graduates is essential, and we saw percentage point increases of 2.5 for women, 1.4 for Hispanic/Latinx and 1.0 for multiracial representation among our new college graduates in 2022.

For additional detail about our workforce, we encourage you to review our Sustainability Report, which we publish annually and make available on our corporate website.

Nothing on our website shall be deemed incorporated by reference into this Annual Report on Form 10-K.

In 2022, we launched a self-identification initiative that invited employees to share more about who they are across dimensions of gender, gender identity, veterans and disabilities.

Table of Content s

In 2023, we continued the self-identification initiative launched in the previous year by inviting new hires to share more about who they are across dimensions of gender, gender identity, veterans and disabilities.

Participation was optional, data was protected and the results were anonymized.

4 unchanged sentences

We also conduct internal focus groups and employee surveys to inform programs and identify opportunities.

We promote a strong pay-for-performance culture and offer employees competitive compensation consisting of base salary and both short-term and long-term incentives.

In the last year, we also implemented a global recognition program to celebrate the contributions of employees who bring our core values and cultural attributes to life.

To ensure that our pay practices are fair and equitable, we conduct an annual pay equity assessment to ensure that men and women receive equal pay for equal work.

We promote a pay-for-performance culture and offer employees competitive compensation consisting of base salary and both short-term and long-term incentives.

We also offer a global recognition program to celebrate the contributions of employees who bring our core values to life.

To ensure that our pay practices are fair and equitable, we conduct an annual pay equity assessment to promote equal pay for equal work for men and women.

As part of this review, we analyze current pay which takes into consideration various, non-discriminatory factors, such as seniority, experience, skills, performance, location, track and hiring and promotion dates.

We use the results to make pay adjustments as needed.

We are expanding our analysis of 2022 pay equity to cover 100% of our employee population globally.

We also believe in creating an environment that allows our employees to prioritize their health and well-being.

In 2023, we expanded our assessment to cover 100% of our employee population globally.

In the coming year, we plan to further our pay equity efforts by engaging in a living wage analysis.

We also believe in creating an environment that allows our employees to prioritize their physical, mental and financial well-being.

We provide competitive benefits, including health coverage, life and disability insurance, retirement, paid time off, an employee assistance program and an employee stock purchase plan.

In response to employee input in 2022, we expanded benefit access for our employees to caregivers and enhanced behavioral health benefits for dependent children in the U.S.;

enhanced medical coverage in our larger countries;

and offered flexible benefits in India.

In 2023, we continued our multi-year journey to modernize and improve our benefits portfolio with the goal of offering more choice to meet the unique needs of our diverse employees.

Talent Attraction, Development and Engagement

Foundational to our people strategy is the attraction, development and engagement of our employees.

We need a workforce that is as unique and diverse as our customer base, and it starts with talent attraction.

To increase the talent level of our diverse candidate pools, we adopted a skills-based philosophy that screens and hires employees based on capabilities and potential, and we plan to continue the implementation of these practices in 2023.

In the last year, we conducted an anonymous hiring pilot to identify and remove any potential for bias from our hiring process and broaden our diverse talent pool and tested technology to make sure that job descriptions utilize inclusive language.

We also deliver unconscious bias training to leaders equipping them to lead inclusively and identify unconscious bias.

We continued our skills-based screening to hire employees based on capabilities and potential as well as our anonymous hiring pilot to identify and remove any potential for bias from our hiring process for interns.

Additionally, we revamped our event experience by focusing on career fairs and conferences.

Fostering the next generation of talent continues to be a key priority, and in 2023 we increased our U.S.

intern conversion rate by over 40 percentage points.

We are also a corporate sponsor for the Quad Fellowship by Schmidt Futures, which aims to “empower exceptional engineering, mathematics, science, and technology graduate students to advance research and innovation with a lens of positive social impact.”

Developing our talent is key to helping us reach our business goals and retaining our people.

We foster an environment of continuous learning through initiatives like our annual Career Month with virtual events, on-demand learning and resources to help employees create a Career Success Statement and Development Map so that they can chart their career journey and track their progress.

We are investing in leadership development through our flagship program Leader Essentials to help people at all levels cultivate skills such as effective communication, creating an inclusive culture and building effective relationships.

We also continue to develop the next generation of talent with our New College Grad program.

We foster an environment of continuous learning through on-demand tools to help employees chart their career journey and track their progress.

To equip employees with the skills needed to build resilience and manage the economic uncertainty, we shifted our focus to address critical capabilities in real-time.

Alongside our flagship program Leader Essentials, we introduced self-directed development modules to help employees at all levels cultivate skills such as how to navigate dynamic times, have a learning mindset, seek insights and communicate effectively.

We were recognized by Fast Company as one of the 10 most innovative companies in manufacturing in calendar year 2023 for upskilling 42% of our workforce at our Penang, Malaysia facility while working towards our sustainability goals.

Ongoing engagement is a keystone to our people strategy.

We believe that listening is crucial to identifying opportunities to strengthen employee engagement as well as influencing our overall strategy.

In 2022, we had an overall employee survey participation rate of 90%.

Key strengths that employees identified were that they felt that their work was meaningful, they are excited about our future, and they would recommend their manager to others.

We also engage employees by taking actions to promote and ground them in our core values and beliefs as a company, so that we are conducting business in an ethical way.

As a result of this focus, in 2022, we were named one of the World’s Most Ethical Companies by Ethisphere Institute for the fourth consecutive year.

Our employees also regularly engage in a wide range of hands-on volunteering and matching campaigns that support the communities in which they work and live.

As a result of this focus, in 2023, we were named one of the World’s Most Ethical Companies by Ethisphere Institute for the fifth consecutive year.

Our employees regularly engage in philanthropy to support the communities in which they work and live.

In 2023, 32% of our employees participated in a company-sponsored volunteer event, which was bolstered by a 27-percentage point increase in participation among our factory worker population.

Health and Safety

2 unchanged sentences

We use an integrated management system to manage health and safety standards at our manufacturing facilities.

Furthermore, in response to the ongoing COVID-19 pandemic, we continue to practice our global resiliency plans, which have allowed us to maintain 24/7 operations.

At each global Western Digital site, we have local, cross-functional teams responsible for our efforts to meet or exceed local COVID regulations, including providing real-time data to leaders, implementing changes to our physical workplaces and providing robust employee and family benefits to those impacted by COVID.

We have welcomed employees who transitioned to working from home during the pandemic back to the office and have offered a flexible hybrid work model for certain employees.

Table of Content s

Government Regulation

Our worldwide business activities are subject to various laws, rules, and regulations of the United States as well as of foreign governments.

Compliance with these laws, rules, and regulations has not had a material effect upon our capital expenditures, results of operations, or competitive position.

Nevertheless, compliance with existing or future governmental regulations, including, but not limited to, those pertaining to global trade, the environment, consumer and data protection, employee health and safety, and taxes, could have a material impact on our business in subsequent periods.

Compliance with existing or future governmental regulations, including, but not limited to, those pertaining to global trade, the environment, consumer and data protection, employee health and safety, and taxes, could have a material impact on our capital expenditures, earnings, competitive position and overall business in subsequent periods.

See Part I, Item 1A, Risk Factors for a discussion of these potential impacts.

16 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1. Business