Goodwill balances recorded by the Company represent the historical goodwill balances in WDC’s business arising from acquisitions specific to the Company. As of October 2, 2026 and July 3, 2026, goodwill amounted to $5.0 billion, with an immaterial movement solely relating to foreign currency translation adjustment.

The Company determined that its single operating segment was also its single reporting unit. Goodwill is not amortized. Instead, it is tested for impairment annually as of the beginning of the Company’s fourth quarter or more frequently if events or changes in circumstances indicate that goodwill may be impaired.

For the three months ended October 2, 2026 and October 3, 2025, there were no goodwill impairment charges.

As of October 2, 2026 and July 3, 2026, the Company had total accounts receivable, net of $6.6 billion and $4.7 billion, respectively. Additionally, for the periods ended October 2, 2026 and July 3, 2026, the Company had three separate customers that accounted for approximately 16%, 15%, and 11%; and 19%, 12% and 10%, respectively, of the Company’s outstanding accounts receivable, net.


	October 2, 2026		July 3, 2026
	(in millions)
Inventories:
Raw materials and component parts	$	2,386	$	1,938
Work-in-process	286		313
Finished goods	344		447
Total inventories	$	3,016	$	2,698

The Company recorded as part of Cost of revenue, inventory charges of $22 million and $7 million during the three months ended October 2, 2026 and October 3, 2025, respectively. The Company’s inventory provisions amounted to $127 million and $125 million as of October 2, 2026 and July 3, 2026, respectively.


	October 2, 2026		July 3, 2026
	(in millions)
Property, plant and equipment:
Land	$	9	$	9
Machinery and equipment	1,597		1,564
Buildings and improvements	404		397
Computer equipment and software	183		176
Furniture and fixtures	19		18
Construction-in-process	53		46
Property, plant and equipment, gross	2,265		2,210
Accumulated depreciation	(1,560)		(1,536)
Property, plant and equipment, net	$	705	$	674

Changes in the warranty accrual were as follows:



	October 2, 2026
	(in millions)
Warranty accrual, beginning of period	$	48
Charges to operations	7
Utilization	(4)
Changes in estimate related to pre-existing warranties	(11)
Warranty accrual, end of period	$	40

The current portion of the warranty accrual was classified in Accrued expenses and the long-term portion was classified in Other liabilities as noted below:


	October 2, 2026		July 3, 2026
	(in millions)
Warranty accrual:
Current portion	$	19	$	23
Long-term portion	21		25
Total warranty accrual	$	40	$	48


	October 2, 2026		July 3, 2026
	(in millions)
Other liabilities:
Non-current lease liability	$	178	$	177
Tax indemnification liability	132		128
Other non-current liabilities	71		73
Total other liabilities	$	381	$	378

Upon separation, the Company recognized a tax indemnification liability pursuant to the Tax Matters Agreement with WDC relating to certain tax positions associated with the Company’s business before the spin-off. The liability is remeasured as related tax matters are resolved or statute of limitations lapses. The outstanding balance of the liability as of October 2, 2026 and July 3, 2026 was $132 million and $128 million, respectively.

Accumulated other comprehensive loss (“AOCL”), net of tax, refers to expenses, gains, and losses that are recorded as an element of equity but are excluded from net income. The components of AOCL were as follows:


	Foreign Currency Translation Adjustment
	(in millions)





Balance at July 3, 2026	$	(256)
Other comprehensive income	8
Income tax expense related to items of other comprehensive income	—
Net current-period other comprehensive income	8

Balance at October 2, 2026	$	(248)