Western Digital Settles With IRS Over ‘Long-Running Tax Matter’
Western Digital reached a tentative settlement with the IRS to resolve “a long-running tax matter” involving the fiscal years 2008 through 2015, said CEO David Goeckeler on an earnings call Thursday for fiscal Q3 ended April 1. The settlement is…
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expected to result in a “previously unforecasted” cash payment to the government of between $500 million and $600 million during the fiscal year ending July 2023, he said. WD’s consumer business is experiencing “short-term demand weakness” outside the U.S. tied to the “geopolitical events in Europe,” plus the COVID-19 lockdowns in China, Goeckeler said. “However, we are confident in the strength of the business as we are entering a seasonally stronger second half of the calendar year with a number of new innovative products.” In mobile, WD has a “strong position in 5G phones,” he said. “We see demand for the latest 5G flagship phones remaining solid, with NAND content doubling from prior-generation smartphones.” Demand from gaming and virtual- and augmented-reality devices “remains robust,” he said. Industry analysts expect VR headset sales to rise at a 47% compound annual growth rate “over the next couple of years.” he said.