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Business Segments, Geographic Information, and Concentrations of Risk | 9 Months Ended
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Mar. 29, 2024
Segment Reporting [Abstract] |
Business Segments, Geographic Information, and Concentrations of Risk | Business Segments, Geographic Information, and Concentrations of Risk The following table summarizes the operating performance of the Company’s reportable segments:
| Three Months Ended |  | Nine Months Ended
| March 29, 2024 |  | March 31, 2023 |  | March 29, 2024 |  | March 31, 2023
| $ in millions
Revenue, net: |  |  |  |  |  |  |
Flash | $ | 1,705 |  |  | $ | 1,307 |  |  | $ | 4,926 |  |  | $ | 4,686 |
HDD | 1,752 |  |  | 1,496 |  |  | 4,313 |  |  | 4,960 |
Total net revenue | $ | 3,457 |  |  | $ | 2,803 |  |  | $ | 9,239 |  |  | $ | 9,646 |
Gross profit: |  |  |  |  |  |  |
Flash | $ | 467 |  |  | $ | (65) |  |  | $ | 437 |  |  | $ | 597 |
HDD | 545 |  |  | 363 |  |  | 1,157 |  |  | 1,237 |
Total gross profit for segments | 1,012 |  |  | 298 |  |  | 1,594 |  |  | 1,834 |
Unallocated corporate items: |  |  |  |  |  |  |
Stock-based compensation expense | (11) |  |  | (12) |  |  | (37) |  |  | (38) |
Amortization of acquired intangible assets | (1) |  |  | — |  |  | (2) |  |  | (1) |
Recovery from contamination incident | 1 |  |  | — |  |  | 37 |  |  | — |
Total unallocated corporate items | (11) |  |  | (12) |  |  | (2) |  |  | (39) |
Consolidated gross profit | $ | 1,001 |  |  | $ | 286 |  |  | $ | 1,592 |  |  | $ | 1,795 |
Gross margin: |  |  |  |  |  |  |
Flash | 27.4 | % |  | (5.0) | % |  | 8.9 | % |  | 12.7 | %
HDD | 31.1 | % |  | 24.3 | % |  | 26.8 | % |  | 24.9 | %
Consolidated gross margin | 29.0 | % |  | 10.2 | % |  | 17.2 | % |  | 18.6 | %
Disaggregated Revenue The Company’s broad portfolio of technology and products address multiple end markets. Cloud is comprised primarily of products for public or private cloud environments and end customers. Through the Client end market, the Company provides its original equipment manufacturer (“OEM”) and channel customers a broad array of high-performance flash and hard drive solutions across personal computer, mobile, gaming, automotive, virtual reality headsets, at-home entertainment, and industrial spaces. The Consumer end market is highlighted by the Company’s broad range of retail and other end-user products, which capitalize on the strength of the Company’s product brand recognition and vast points of presence around the world. The Company’s disaggregated revenue information is as follows:
| Three Months Ended |  | Nine Months Ended
| March 29, 2024 |  | March 31, 2023 |  | March 29, 2024 |  | March 31, 2023
| (in millions)
Revenue by end market |  |  |  |  |  |  |
Cloud | $ | 1,553 |  |  | $ | 1,205 |  |  | $ | 3,496 |  |  | $ | 4,258 |
Client | 1,174 |  |  | 975 |  |  | 3,443 |  |  | 3,293 |
Consumer | 730 |  |  | 623 |  |  | 2,300 |  |  | 2,095 |
Total revenue | $ | 3,457 |  |  | $ | 2,803 |  |  | $ | 9,239 |  |  | $ | 9,646 |
Revenue by geography |  |  |  |  |  |  |
Asia | $ | 1,740 |  |  | $ | 1,353 |  |  | $ | 4,990 |  |  | $ | 4,533 |
Americas | 1,154 |  |  | 935 |  |  | 2,620 |  |  | 3,448 |
Europe, Middle East and Africa | 563 |  |  | 515 |  |  | 1,629 |  |  | 1,665 |
Total revenue | $ | 3,457 |  |  | $ | 2,803 |  |  | $ | 9,239 |  |  | $ | 9,646 |
The Company’s top 10 customers accounted for 42% and 38% of its net revenue for each of the three and nine months ended March 29, 2024 and 49% and 45% of its net revenue for the three and nine months ended March 31, 2023, respectively. For the three and nine months ended March 29, 2024 and March 31, 2023, no single customer accounted for 10% or more of the Company’s net revenue. Goodwill 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. Management performed goodwill impairment assessments for each segment and concluded that there were no indications of impairment for the periods presented. The following table provides a summary of goodwill activity for the period:
| Flash |  | HDD |  | Total
| (in millions)
Balance at June 30, 2023 | $ | 5,716 |  |  | $ | 4,321 |  |  | $ | 10,037 |
Foreign currency translation adjustment | (2) |  |  | (1) |  |  | (3) |
Balance at March 29, 2024 | $ | 5,714 |  |  | $ | 4,320 |  |  | $ | 10,034 |

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