Western Digital (WDC): what its 10-K says it depends on

Customers

Top 10 customers

concentrated in · 73% of our net revenuenamed as a risk

For the year ended July 3, 2026, the Cloud end market accounted for 89% of our net revenue and our top 10 customers accounted for 73% of our net revenue, with three customers each accounting for 10% or more of our net revenue.Risk factors (Item 1A)

Also named by AESI, CLS, COR, ECG, JBHT, MTSI, MYRG, Q and 1 more

Three largest customers

concentrated in · 16%, 15%, and 13%named as a risk

For 2026, three customers accounted for 16%, 15%, and 13%, respectively, of our net revenue.Business (Item 1)

Also named by INTC, PDFS, SWKS, TREX, UCTT

Cloud end market

concentrated in · 89% of our net revenuenamed as a risk

For the year ended July 3, 2026, the Cloud end market accounted for 89% of our net revenue and our top 10 customers accounted for 73% of our net revenue, with three customers each accounting for 10% or more of our net revenue.Risk factors (Item 1A)

Long-term customer supply agreements

earns fromnamed as a risk

We have entered into long-term agreements with certain customers that commit us to deliver and our customers to purchase substantial volumes of products over multi-quarter or multi-year periods.Risk factors (Item 1A)

Suppliers

Sole-source component suppliers

depends onnamed as a risk

Many of the components and much of the equipment we acquire must be specifically designed for use in our products or for developing and manufacturing our products and are only available from a limited number of suppliers, some of whom are our sole-source suppliers.Risk factors (Item 1A)

Also named by CW, CYRX, ONDS, ONTO, POWL, TER, ZBRA

Other companies

Revolving Credit Facility

exposed to its price · $350 millionnamed as a risk

As of July 3, 2026, the outstanding balance on our Revolving Credit Facility was $350 million, and a 1% increase in the variable rate of interest would increase annual interest expense by $4 million.Market risk (Item 7A)

Also named by AAON, BRO, BX, CG, CRGY, FIVE, FIX, HEI and 22 more

2028 Convertible Notes

3.00%named as a risk

Our 3.00% convertible senior notes due 2028 (the “2028 Convertible Notes”) are currently convertible as a result of the sale price conditional feature being triggered, and as a result, the holders of the 2028 Convertible Notes have the right to convert the notes during the next succeeding calendar quarter.Risk factors (Item 1A)

Sandisk Corporation

named as a risk

If the Separation is ultimately determined to be taxable, Western Digital, Sandisk, or our stockholders could incur income tax and/or other liabilities that could be significant.Risk factors (Item 1A)

Also named by MU

Competitors

Seagate Technology Holdings plc

competes withnamed as a risk

Our competitors include HDD competitors such as Seagate Technology Holdings plc, and Toshiba Electronic Devices & Storage Corporation along with NAND flash suppliers that provide and enable alternative storage technologies, as well as storage systems and solutions providers.Business (Item 1)

Toshiba Electronic Devices & Storage Corporation

competes withnamed as a risk

Our competitors include HDD competitors such as Seagate Technology Holdings plc, and Toshiba Electronic Devices & Storage Corporation along with NAND flash suppliers that provide and enable alternative storage technologies, as well as storage systems and solutions providers.Business (Item 1)

Places

International sales

earns from · 60%named as a risk

Our international sales, which include sales to foreign subsidiaries of U.S. companies but do not include sales to U.S. subsidiaries of foreign companies, represented 60%, 55%, and 58% of our net revenue for 2026, 2025, and 2024, respectively.Business (Item 1)

Also named by AEHR, AMD, AME, ATI, AVAV, CRS, ENTG, FSS and 5 more

Asia Pacific

concentrated in · approximately 88% of our employees

Our global workforce spans 24 countries with approximately 88% of our employees in Asia Pacific, approximately 11% in the Americas and less than 1% in Europe, the Middle East and Africa.Business (Item 1)

Also named by AIG, AVY, BLK, BNY, CCK, CL, COHR, DCI and 17 more

China

operates innamed as a risk

Our vertically integrated, in-house assembly and test operations are concentrated in Prachinburi and Bang Pa-In, Thailand; Penang, Johor Bahru, and Kuching, Malaysia; Laguna, Philippines; Shenzhen, China; and San Jose and Fremont, California, USA.Business (Item 1)

Also named by A, AA, AAOI, AAP, AAPL, AB, ADI, AEHR and 261 more

California

operates innamed as a risk

We conduct our operations primarily at large, high-volume, purpose-built facilities in California and throughout Asia.Risk factors (Item 1A)

Also named by A, AAON, AFRM, ALK, ALLY, AN, ARE, AVAV and 88 more

Malaysia

operates innamed as a risk

Our vertically integrated, in-house assembly and test operations are concentrated in Prachinburi and Bang Pa-In, Thailand; Penang, Johor Bahru, and Kuching, Malaysia; Laguna, Philippines; Shenzhen, China; and San Jose and Fremont, California, USA.Business (Item 1)

Also named by A, ANET, AVGO, CGNX, DELL, FSLR, LITE, MSI and 6 more

Philippines

operates innamed as a risk

Our vertically integrated, in-house assembly and test operations are concentrated in Prachinburi and Bang Pa-In, Thailand; Penang, Johor Bahru, and Kuching, Malaysia; Laguna, Philippines; Shenzhen, China; and San Jose and Fremont, California, USA.Business (Item 1)

Also named by ACN, ADI, AEHR, COF, FDS, HRL, INTU, LITE and 5 more

Thailand

operates innamed as a risk

Our vertically integrated, in-house assembly and test operations are concentrated in Prachinburi and Bang Pa-In, Thailand; Penang, Johor Bahru, and Kuching, Malaysia; Laguna, Philippines; Shenzhen, China; and San Jose and Fremont, California, USA.Business (Item 1)

Also named by ADI, CB, CIEN, INGR, LITE, LZB, MCHP, NXT and 3 more

Hazards

Iran / Middle East conflict

named as a risk

For example, the escalation of the conflict involving Iran and heightened tensions in the Middle East could cause disruption to critical logistics and supply routes, which could affect the availability and cost of materials used in our business.Risk factors (Item 1A)

Earthquakes, floods and natural disasters in Asia

operates innamed as a risk

In addition, the geographic concentration of our manufacturing sites could exacerbate the negative impacts resulting from any of these problems.Risk factors (Item 1A)

Commodities and inputs

U.S. dollar exchange rates

exposed to its price · $74 millionnamed as a risk

The sensitivity analyses indicated that a hypothetical 10% adverse movement in foreign currency exchange rates relative to the U.S. dollar would result in a foreign exchange fair value loss of $74 million at July 3, 2026.Market risk (Item 7A)

Also named by EFX, TRU, WLFC

Rare earth minerals

depends onnamed as a risk

Additionally, China has imposed export restrictions on rare earth minerals and related materials critical to semiconductor and hard drive manufacturing.Risk factors (Item 1A)

Also named by ALAB, AMAT, COHR, DE, EXTR, GE, GEHC, GWW and 10 more

Dynamic random-access memory (DRAM)

depends onnamed as a risk

We depend on an external supply base for technologies, software (including firmware), preamps, controllers, dynamic random-access memory, components, equipment and other materials used in our product design and manufacturing.Risk factors (Item 1A)

Regulators

Internal Revenue Service

subject tonamed as a risk

For example, as disclosed in Part II, Item 8, Note 9, Income Taxes, of the Notes to Consolidated Financial Statements included in this Annual Report on Form 10-K, we are under examination by the Internal Revenue Service for certain fiscal years.Risk factors (Item 1A)

Also named by AAPL, ABNB, ADI, AJG, AMGN, BBSI, BMNR, BRO and 39 more

Laws and programs

OECD Pillar Two global minimum tax

subject to · 15%named as a risk

Further, the Organization for Economic Cooperation and Development (OECD) two-pillar approach to taxation with a global corporate minimum tax rate of 15% has been enacted in several jurisdictions.Risk factors (Item 1A)

Also named by ABNB, ACN, ADI, ADM, ADSK, AKAM, ALB, AMAT and 70 more

U.S. tariffs

subject tonamed as a risk

Any imposition of new tariffs or increase in existing tariff rates may increase the cost of importing our products or the costs for materials or components used in our products, which would increase our overall costs unless we are able to implement actions to offset these costs, such as leveraging tariff exemptions where possible, optimizing our supply chain, sourcing from alternative suppliers, or passing the costs to our customers through tariff surcharges or increased prices.Risk factors (Item 1A)

Also named by A, AAPL, ACHR, ADI, AEHR, AEP, AIOT, AKAM and 170 more

One Big Beautiful Bill Act of 2025

subject tonamed as a risk

In the U.S., the One Big Beautiful Bill Act of 2025 (OBBBA) includes broad tax reform provisions.Risk factors (Item 1A)

Also named by COO, FSLR, MRVL, NXT, PVLA, TT

Responsible Business Alliance

subject tonamed as a risk

In connection with our compliance with environmental laws and regulations, as well as our compliance with industry and coalition environmental initiatives, such as those established by the RBA, the standards of business conduct required by some of our customers, and our commitment to sound corporate citizenship in all aspects of our business, we could incur substantial compliance and operating costs and be subject to disruptions to our operations and logistics.Risk factors (Item 1A)

Also named by SNDK

China export restrictions on rare earth minerals

subject tonamed as a risk

These developments have increased, and could further increase, costs for, or limit the availability of, energy, rare earth minerals, materials, components and transportation, constrain manufacturing capacity and may require us to redesign products or reconfigure aspects of our global supply chain.Risk factors (Item 1A)

Tax holidays

subject tonamed as a risk

If the tax holidays are not extended, or if we fail to satisfy the conditions of the reduced tax rate, then our effective tax rate could increase in the future.Risk factors (Item 1A)

European Union Artificial Intelligence Act

subject tonamed as a risk

Governments worldwide are adopting or proposing AI-specific regulations, including the European Union’s Artificial Intelligence Act, as well as various proposed frameworks in the U.S., China, and other jurisdictions.Risk factors (Item 1A)

Technology

Heat-assisted magnetic recording (HAMR)

named as a risk

If we fail to adapt to or implement new technologies (including the transition to areal density recording technologies that use HAMR technology to increase HDD capacities), if we fail to quickly and cost-effectively develop new products that meet the specifications and requirements intended or desired by our customers or if technology transitions negatively impact our existing product roadmaps, our business may be harmed.Risk factors (Item 1A)

Flash memory

competes withnamed as a risk

We experience competition from other companies that produce alternative storage technologies such as flash memory, particularly in our legacy markets where we participate with our lower capacity, smaller form factor HDDs.Risk factors (Item 1A)