Western Digital Announces Plans to Separate Businesses, Reports Narrower Loss for Q1

Western Digital, a leading data-storage company, has revealed its intentions to split its two businesses and has reported a narrower loss for the fiscal first quarter, exceeding expectations from Wall Street analysts.

Positive Market Reaction

Following this announcement, Western Digital's stock experienced a surge of over 8% in morning trading, reaching $42.19. So far this year, shares have seen a notable increase of approximately 34%.

Separating Business Segments

The company has decided to separate its traditional hard drive manufacturing business from its flash-memory business. This separation will likely be achieved through a spinoff of the latter.

Better-Than-Expected Q1 Performance

For the fiscal first quarter, which concluded on September 29th, Western Digital reported a narrower adjusted loss compared to what Wall Street analysts had predicted. The company transitioned from a profit of 8 cents per share last year to a loss of $2.17 per share.

However, the adjusted loss of $1.76 per share was narrower than the anticipated loss of $1.91 per share forecasted by analysts according to FactSet.

Optimistic Outlook for Q2

Looking ahead, Western Digital is aiming for a reduced loss within an estimated range of $1.35 to $1.05 per share for the fiscal second quarter. This projected loss is narrower than what analysts were expecting.