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WDC · Q4 2026
Archived report (Q4 2026). Latest deep dive →
The quarter in brief
An exceptionally strong quarter with revenue up 44% and operating margin expanding over 1,500bps, though the headline GAAP net income surge is dominated by a huge non-cash mark-to-market gain on WD's retained Sandisk stake rather than core operating momentum.
Net Income
$3,195M
up 1033% y/y
Revenue
$3,747M
up 44% y/y
Operating Income
$1,563M
up 130% y/y
Gross Profit
$2,028M
up 90% y/y
All figures in $M.
| Line item | Amount and change |
|---|---|
| Revenue | $3,747 · +44% |
| Cost of Revenue | $1,719 |
| Gross Profit | $2,028 · +90% · 54.1% margin |
| R&D | $284 |
| SG&A | $138 |
| Business Realignment | $43 |
| Operating Income | $1,563 · +130% · 41.7% margin |
| Interest & Other Income, net | $1,684 · vs -$333 · incl. $2,050 Sandisk gain* |
| Pre-Tax Income | $3,247 · +836% |
| Income Tax | $52 |
| Net Income | $3,195 · +1033% · $8.21 diluted EPS |
Verdict: an exceptionally strong quarter with revenue up 44% and operating margin expanding over 1,500bps, though the headline GAAP net income surge is dominated by a huge non-cash mark-to-market gain on WD's retained Sandisk stake rather than core operating momentum.
OCF $1,389M · FCF $1,281M · dividend $0.15/share declared · buybacks $672M in quarter · Q1FY27 revenue guided up 42-49% y/y
Source and notation
* marks non-cash / ≈ estimated. Source: Western Digital press release / 10-Q (SEC EDGAR).
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<figure> <a href="https://whoreportstoday.com/t/wdc/q4-2026"><img src="https://whoreportstoday.com/t/wdc/q4-2026/sankey.png" alt="WDC Q4 2026: where the revenue went" loading="lazy" style="max-width:100%;height:auto"></a> <figcaption>Source: <a href="https://whoreportstoday.com/t/wdc/q4-2026">Who Reports Today</a>, licensed under <a href="https://creativecommons.org/licenses/by/4.0/">CC BY 4.0</a></figcaption> </figure>
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<a href="https://whoreportstoday.com/t/wdc/q4-2026">WDC Q4 2026 earnings chart (Who Reports Today)</a>
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- GAAP net income of $3,195M is massively inflated by a $2,050M non-cash gain* on WD's retained interest in Sandisk, part of $1,684M total 'interest and other income, net'
- Non-GAAP net income of $1,382M strips out the Sandisk gain, $362M in debt/equity transaction costs, and SBC — a far more representative core-earnings figure
- Core operating performance is genuinely strong: revenue +44% y/y, GAAP gross margin expanded ~1,310bps to 54.1%, operating income +130% y/y
- Business realignment charges of $43M and ongoing SBC (~$45M) modestly weigh on GAAP opex
- Balance sheet actions were active: $1,220M settlement of convertible notes and $672M of buybacks funded partly by Sandisk-stake monetization
- Q1FY27 guidance implies continued strength (~$4.1B revenue, +42-49% y/y) but on a non-GAAP-only basis given difficulty reconciling one-off items
What distorts the picture in this report and what to watch beyond the headlines.
WDC — Western Digital designs, manufactures, and sells data storage devices and solutions, including hard drives and solid-state drives for consumers and enterprises.
The company is headquartered in San Jose, California.
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