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| Debt Disclosure [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Debt | Debt Debt consisted of the following:
Revolving Credit Facility and Term Loans On February 20, 2025, the Company entered into a fourth amendment to the loan agreement governing the Company’s revolving credit facility maturing in January 2027 (the “Revolving Credit Facility”) and Term Loan Facility (as defined below), dated as of January 7, 2022 (as amended, the “Loan Agreement”) that, among other changes, (a) permitted the Separation, (b) provided for the automatic release, in connection with the Separation, of guarantees and liens on collateral provided by Sandisk and Sandisk Technologies, Inc. under the Loan Agreement, (c) provided for the issuance of a new $2.51 billion Term Loan A-3 in a non-cash exchange to replace the Company’s previously existing Term Loan A-2 (the “Term Loan A-2” and, together with the Term Loan A-3, the “Term Loan Facility”), (d) facilitated the exchange of Sandisk shares retained at the Separation to settle a portion of the Term Loan A-3 in connection with the Sandisk retained interest, and (e) in connection with the Separation, reduced the aggregate commitments under the Revolving Credit Facility from $2.25 billion to $1.25 billion. In June 2025, the Company settled $800 million of the Term Loan A-3 principal amount, through a non-cash exchange of 21.3 million shares of Sandisk common stock held by the Company, and a $4 million cash payment, resulting in $100 million recorded in Costs in connection with debt-for-equity exchange in the Consolidated Statement of Operations. In September and December 2025, the Company made scheduled principal repayments aggregating to $63 million under Term Loan A-3. In February 2026, the Company executed a series of transactions to further reduce its outstanding debt. Initially, the Company entered into a $1.50 billion bridge loan (the “Bridge Loan”). The Bridge Loan was utilized to consolidate the holders of the 4.75% senior unsecured notes due 2026, the 2.85% senior notes due 2029, and the 3.10% senior notes due 2032 (collectively, the “Senior Notes”) from a broad creditor base into two holders to facilitate a debt-for-equity exchange. The proceeds of the Bridge Loan were used to fully redeem all of the Senior Notes in cash, at par plus accrued interest. In connection with the redemptions, the Company wrote off $6 million of remaining unamortized issuance costs. Following the redemptions, the Company retired the Bridge Loan and its existing Term Loan A-3 through a non-cash, tax-free exchange for 5.8 million shares of Sandisk common stock held by the Company, valued at $3.62 billion on the date of exchange. The exchange resulted in $539 million recorded in Costs in connection with debt-for-equity exchange in the Consolidated Statement of Operations. This amount primarily reflects a discount to the market price of Sandisk shares provided to the counterparties in connection with the exchange and was primarily driven by volatility of Sandisk’s stock price over the period between exchange and settlement. In 2025, the Company drew and repaid $150 million principal amount under the Revolving Credit Facility. In June 2026, the Company drew $450 million in principal amount and repaid $100 million thereunder, with $350 million remaining outstanding as of July 3, 2026. The remaining available capacity under the Revolving Credit Facility was $900 million as of July 3, 2026, net of an immaterial amount of outstanding letters of credit. Borrowings under the Loan Agreement bear interest, at the Company’s option, at a per annum rate equal to either (x) the Adjusted Term SOFR Rate (as defined in the Loan Agreement) plus an applicable margin varying from 1.125% to 2.000% or (y) a base rate plus an applicable margin varying from 0.125% to 1.000%, in each case depending on the corporate family ratings of the Company from at least two of the Credit Rating Agencies (as defined in the Loan Agreement). The Company is also required to pay an unused commitment fee on the Revolving Credit Facility ranging from 0.120% to 0.350% based on the corporate family ratings of the Company from at least two of the Credit Rating Agencies, with an initial unused commitment fee of 0.200%. The all-in interest rate for the Revolving Credit Facility was 5.127% as of July 3, 2026. The Loan Agreement governing the Revolving Credit Facility requires the Company to maintain a ratio of total funded debt to Consolidated Adjusted EBITDA (as defined in the Loan Agreement) below a maximum, at the end of each quarter, which is currently 3.25 times for all periods through maturity. As of July 3, 2026, the Company was in compliance with all financial covenants under the Loan Agreement. The Loan Agreement also requires the Company to comply with customary covenants that include, among others, limitations on the incurrence of additional debt, liens on property, acquisitions and investments, loans and guarantees, mergers, consolidations, liquidations and dissolution, asset sales, dividends and distribution, and other payments in respect of the Company’s capital stock, prepayments of certain debt, transactions with affiliates and certain modifications of organizational documents and certain debt agreements. Convertible Notes On November 3, 2023, the Company issued $1.60 billion in aggregate principal amount of convertible senior notes which bear interest at an annual rate of 3.00% and mature on November 15, 2028, unless earlier repurchased, redeemed or converted (the “2028 Convertible Notes”). Net proceeds from the 2028 Convertible Notes were approximately $1.56 billion after deducting issuance costs of approximately $37 million. Debt issuance costs are amortized to interest expense over the term of the 2028 Convertible Notes. As of July 3, 2026, $8 million of issuance costs remained unamortized. Interest is payable on May 15 and November 15 of each year. The Company is not required to make principal payments on the 2028 Convertible Notes prior to the maturity date. The 2028 Convertible Notes are guaranteed by Western Digital Technologies, Inc., the Company’s wholly-owned subsidiary. The 2028 Convertible Notes are convertible at the option of any holder beginning on August 15, 2028, at a conversion price of approximately $37.72 per share of common stock as of July 3, 2026 (which has been adjusted from its original conversion price of approximately $52.20 in accordance with the indenture, as a result of the Separation and dividends paid on the Company’s common stock). Prior to August 15, 2028, if the trading price of the Company’s common stock remains above 130% of the conversion price for at least 20 trading days (whether or not consecutive) during the 30 consecutive trading-day period prior to the end of a calendar quarter, holders of the 2028 Convertible Notes would have the right to convert the 2028 Convertible Notes during the next succeeding calendar quarter. The 2028 Convertible Notes are also convertible prior to August 15, 2028 upon the occurrence of certain corporate events. Upon any conversion of the 2028 Convertible Notes, the Company will pay cash for the aggregate principal amount of the notes to be converted and pay or deliver, as the case may be, cash, shares of the Company’s common stock or a combination thereof, at the Company’s election, in respect of the remainder, if any, of its conversion obligation in excess of the aggregate principal amount of the notes being converted. On or after November 15, 2026, the Company may redeem for cash, at par plus accrued interest, all or any portion of the 2028 Convertible Notes, at its option, if the last reported sale price of the Company’s common stock has been at least 130% of the conversion price then in effect for at least 10 trading days during any 20 consecutive trading day period immediately preceding the date of the Company’s redemption notice. The sale price conditional conversion feature of the 2028 Convertible Notes has been triggered since June 30, 2025, which has provided, and continues to provide, the holders of those notes with the right to convert through September 30, 2026, at which point the common stock price will be re-evaluated to determine whether the 2028 Convertible Notes will continue to be convertible in the subsequent calendar quarter. Accordingly, the Company has classified the 2028 Convertible Notes as current liabilities in the Company’s Consolidated Financial Statements as of July 3, 2026 and June 27, 2025. In March 2026, holders of $32 million in aggregate principal amount of the 2028 Convertible Notes tendered them for conversion (the “Tendered Notes”). At that same time, the Company made an irrevocable election to settle in cash the conversion obligation in excess of the principal amount of the Tendered Notes, as permitted by the Indenture. On June 2, 2026, the Company used $360 million in cash to fully settle the Tendered Notes. The election to settle the conversion premium in cash, instead of shares, required the allocation of a portion of the settlement proceeds to the embedded conversion feature as a derivative instrument pursuant to Accounting Standards Codification 815, Derivatives and Hedging. Driven by the appreciation of the Company’s common stock from the tendered date through the settlement date, the derivative instrument was remeasured to a fair value of $106 million and was recognized in Costs in connection with convertible notes transactions in the Consolidated Statements of Operations. In June 2026, the Company entered into separate, privately negotiated exchange agreements with certain holders of the 2028 Convertible Notes, in an aggregate principal amount of $858 million, pursuant to which the Company fully settled the obligation for an aggregate $860 million cash (which reflected principal amount and a small inducement cost) and 21.3 million shares of the Company’s common stock for the conversion premium of $12.5 billion. In connection with these exchange transactions, the Company wrote off $10 million of remaining unamortized issuance costs. The Company accounted for these exchange transactions as induced conversion transactions and recognized an immaterial induced conversion expense in Costs in connection with convertible notes transactions in the Consolidated Statements of Operations. There was no settlement or modification made to the related capped call transactions in connection with the exchange agreements (see “Capped Calls” below). As of July 3, 2026, $710 million in aggregate principal amount of the 2028 Convertible Notes remained outstanding. Through July 3, 2026, $343 million in aggregate principal amount of these notes had been tendered for conversion. The Company has elected to issue shares of its common stock to satisfy the conversion obligation in excess of the principal amount for substantially all of these notes, which have settled or are expected to settle in the first quarter of 2027. The Company continues to retain the right to settle any conversion obligation in excess of the principal amount of any of the remaining 2028 Convertible Notes in cash or shares or a combination thereof, at its election. Capped Calls In connection with the issuance of the 2028 Convertible Notes, the Company also entered into privately negotiated capped call transactions with certain counterparties (the “Capped Calls”). As of July 3, 2026, the Capped Calls each have a strike price of approximately $37.72 per share and a cap price of approximately $50.40 per share, each of which has been adjusted from their original price, in accordance with the terms of the agreements. The Capped Calls are generally intended to reduce or offset the potential dilution to the Company’s common stock upon any conversion of the 2028 Convertible Notes with such reduction or offset, as the case may be, subject to a cap based on the cap price. If the market price per share of the Company’s common stock, as measured under the terms of the Capped Calls, exceeds the cap prices of the Capped Calls, there would not be an offset for the excess. The Capped Calls are separate transactions and not part of the terms of the 2028 Convertible Notes. As these transactions met certain accounting criteria, the Capped Calls were recorded in shareholders’ equity and are not accounted for as derivatives. The original cost of the Capped Calls of $155 million, net of $37 million in deferred tax assets, was recorded as a decrease to Additional paid-in capital on the Company’s Consolidated Balance Sheets. In June 2026, in connection with the settlement of the Tendered Notes, the Company received an immaterial number of shares of its common stock from the settlement of a pro rata amount of the Capped Calls. As of July 3, 2026, the outstanding Capped Calls had an aggregate notional value of $1.57 billion. Subsequent to July 3, 2026, in connection with the additional $343 million in aggregate principal amount of the 2028 Convertible Notes tendered for conversion, the Company has received or will receive additional shares of its common stock in the first quarter of 2027 from the settlement of a pro rata amount of the Capped Calls. Senior Notes In December 2021, the Company issued $500 million in aggregate principal amount of 2.850% senior notes due February 1, 2029 and $500 million in aggregate principal amount of 3.100% senior notes due February 1, 2032. As discussed above, in February 2026, the outstanding principal balances of these notes were fully redeemed in cash using the proceeds of the Bridge Loan. In February 2018, the Company issued $2.30 billion in aggregate principal amount of 4.750% senior unsecured notes due February 15, 2026. In April 2025, the Company redeemed, at its election, $1.80 billion in aggregate principal amount of these notes at par plus accrued interest. As discussed above, in February 2026, the remaining outstanding principal balance of these notes was fully redeemed in cash using the proceeds of the Bridge Loan. Collateral and Restrictive Covenants Historically, under the terms of the Loan Agreement, the Revolving Credit Facility and Term Loan Facility were unconditionally guaranteed by Western Digital Technologies, Inc. (the “Guarantor”) and were secured on a first-priority basis (subject to permitted liens) by a lien on substantially all assets and properties of the Company and the Guarantor (the “Collateral”), subject to certain exceptions. During the third quarter of 2026, the Company obtained investment-grade ratings from two rating agencies, and therefore, pursuant to the terms of the Loan Agreement, the guarantee and the lien on the Collateral on the Revolving Credit Facility have been fully released. The indenture governing the 2028 Convertible Notes contains various restrictive covenants, which can include limitations on the Company’s and its subsidiaries’ ability to, among other things, consolidate, merge or sell all or substantially all of their assets; create liens; and incur, assume or guarantee additional indebtedness, and are subject to a number of limitations and exceptions.
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