Western Digital Reports Q2 2025 Earnings and Future Outlook

Western Digital's second quarter fiscal 2025 results indicate a solid performance with revenue growth despite some pressures. The company's gross margin was impacted but still holds strong potential for future growth. Investors should monitor upcoming market trends and the company's separation plans.

Date: 30-01-2025

AI Rating: 7

Earnings Per Share (EPS): Western Digital reported a non-GAAP earnings per share of $1.77 for the second quarter, which shows a healthy performance compared to prior quarters. This strong EPS is a positive signal for investors, as it indicates the company's capability to generate profit.

Revenue Growth: The company delivered revenue of $4.3 billion for this quarter, up 5% sequentially and 41% year-over-year. This growth indicates a robust demand for its HDD products, especially in the data center market.

Net Income: While the report does not specify net income, the revenue and gross margin trends suggest a favorable financial environment for the company. Investors may infer that consistent revenue increases could contribute positively to net income in upcoming reports.

Profit Margins: Western Digital reported a non-GAAP gross margin of 35.9%, which is below their guidance range, indicating some challenges due to pricing pressures in the Flash segment. However, the HDD business reported record gross margins due to strong demand, pointing to profitability potential in that segment.

Return on Equity (ROE): There is no mention of Return on Equity in the provided text, so we cannot assess this metric based on the current information.

Free Cash Flow (FCF): The report indicates free cash flow generation of $335 million for the fiscal second quarter, reflecting good cash generation capability, which is crucial for funding operations and future investments.

Overall, investors should stay attentive to the dynamics in the Flash market, where pricing pressures exist, while recognizing the HDD sector's strong performance and contributions to overall growth.

Stocks: WDC