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Hard Drive Business Posts Small Fourth Quarter Operating Profit Amid Soft
Industry Environment, Achieves Substantial Year-Over-Year
Improvement in Operating Performance


Western Digital Corporation today reported fourth quarter revenues of $456.0
million and a net loss of $9.0 million, or $.05 per share, before
nonrecurring items. The results include an operating profit of approximately
$2.8 million and unit shipments of 5.3 million by the Company's hard drive
business. Including nonrecurring charges of $52.2 million, the total net
loss for the fourth quarter was $61.2 million, or $.34 per share.


The nonrecurring charges recorded in the fourth quarter result from
adjustments to the carrying values of equity investments in and notes
receivable from Komag Inc., and accrual of Komag contingent guarantees, all
of which originally arose when Western Digital sold its disk media business
to Komag in April 1999. The decision to take these charges was prompted by
Komag's previous announcement that it did not pay its senior debt or the
interest on its convertible bonds due June 30 and July 15, 2001,
respectively.


In the year-ago period, Western Digital reported revenues of $473.9 million
and a net loss before nonrecurring items of $26.3 million, or $.19 per
share. Including nonrecurring benefits for tax and other accrual adjustments
of $30.5 million, the Company reported net income of $4.2 million, or $.03
per share.


Matt Massengill, president and chief executive officer of Western Digital,
said: "The fourth quarter reflected continued execution in our core hard
drive business, culminating a 12-month positive swing in operating profit of
nearly $190 million, with a near break-even operating performance for the
fiscal year. We demonstrated continued leadership in the high performance
7200 RPM segment - which accounted for 58 percent of our quarterly revenue -
and we maintained our relentless focus on low-cost leadership and expense
management. We also delivered on our commitment to reduce losses from our
new-venture activities, which declined to $11.5 million from $15.0 million
in the March quarter. Faced with soft PC demand in the fourth fiscal
quarter, we adjusted our build plan downward to avoid contributing to excess
supply in the industry, affecting our revenue and unit volumes.


"Based on our flexible manufacturing model, we are positioned to weather the
current PC environment and quickly respond to and participate in the
eventual recovery in PC growth," said Massengill. "We remain excited about
the prospects for incremental growth in the new applications of personal
storage such as video game systems and personal video recorders. This
quarter, we will begin volume production deliveries of WD hard drives to
Microsoft for its new Xbox video game system."


For fiscal year 2001, the Company reported revenues of $1.95 billion and a
net loss before nonrecurring items of $67.4 million, or $.40 per share.
Including nonrecurring charges and extraordinary gains from bond
redemptions, the total net loss for fiscal 2001 was $98.9 million, or $.59
per share. For fiscal year 2000, the Company reported revenues of $1.96
billion and a net loss before nonrecurring items of $241.8 million, or $1.97
per share. Including nonrecurring items and extraordinary gains, the total
net loss was $188.0 million, or $1.53 per share.

During the fourth quarter, the Company adopted the provisions of SEC Staff
Accounting Bulletin No. 101 ("SAB101"). As a result, revenues for the
quarter and year ended June 29, 2001 were increased by $19.5 million and
$13.1 million, respectively, and the operating loss for the quarter and year
ended June 29, 2001 were reduced by $2.5 million, or $.01 per share, and
$1.1 million, or $.01 per share, respectively. The adjustments made to
implement SAB101 in the current quarter and restate prior quarters
accordingly, reflect the deferral of revenue for quarter-end sales made to
the Company's channel customers under certain shipping terms.



About Western Digital

Western Digital, one of the storage industry's pioneers and long-time
leaders, provides products and services for people and organisations that
collect, manage and use digital information. The Company's core business
produces reliable, high-performance hard drives that keep users' data
close-at-hand and secure from loss.

Applying its data storage core competencies to emerging markets, Western
Digital's new ventures meet the increasing demand for innovative information
management solutions arising from the proliferation of the Internet and
broadband services. Keen Personal Media helps cable TV MSOs build their
brand and revenue by providing personal video recording technology and
services. Connex designs Network Attached Storage products that enable IT
managers to quickly expand network storage. SANavigator develops and markets
software that simplifies the central management of Storage Area Networks.
SageTree is a software company providing enterprise manufacturing and supply
chain analytic applications.

Western Digital was founded in 1970. The Company's storage products are
marketed to leading systems manufacturers and selected resellers under the
Western Digital brand name.

Visit the Investor section of the Company's Web
site http://www.westerndigital.com to access a
variety of financial and investor information.


This release contains forward-looking statements, including statements
relating to the Company's participation in the recovery in PC growth and the
incremental growth in new applications for personal storage. The forward
looking statements are based on current management expectations, and actual
results may differ materially as a result of several factors, including:
supply and demand conditions in the hard drive industry; overall economic
conditions; changes in product and customer mix; pricing trends; actions by
competitors; the pace of development of new markets; successful entry into
new markets by the Company; the outcome of litigation between the Company
and Cirrus Logic, Inc.; and other factors discussed in the Company's recent
SEC filings. The Company undertakes no obligation to update forward-looking
statements to reflect events or circumstances occurring after the date of
such statements.


Western Digital is a registered trademark of Western Digital Technologies,
Inc. Keen Personal Media and TV4me are trademarks of Keen Personal Media,
Inc. Connex is a trademark of Connex, Inc. SageTree is a registered
trademark of SageTree, Inc. SANavigator is a trademark of SANavigator, Inc.
All other brand and product names mentioned herein are the property of their
respective companies.

Editorial Contacts:

Paul Calderwood
Western Digital Europe
Tel: 020 8763 2241
Fax: 020 8763 2245
Email: kingswoodmktg@btinternet.com

Emma Gurd
Account Executive
Bluegrass
Tel: 01264 323 141
Fax: 01264 323251
http://www.bluegrass.co.uk
emma.gurd@bluegrass.co.uk





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