Western Digital Records 84% Rise in Net Earnings

Citing exceptionally strong orders for its line of computer electronics, Western Digital of Irvine said net earnings for its fiscal 1987 third quarter rose 84% to $12.5 million from $6.8 million reported the year before.

Revenues for the period ended March 28 were $121.9 million, 60% higher than the $76.4 million recorded in the third quarter of the company’s fiscal 1986.

The latest quarter was the seventh consecutive quarter in which Western Digital reported record profits and revenues. The results include a previously announced extraordinary charge of $2.1 million to cover the cost of closing the company’s obsolete Camarillo manufacturing plant.

For the first nine months of the fiscal year, profits were $32.6 million, an increase of 119% from the $14.9 million posted the year before. Revenues were $322.1 million, an increase of 52% from the $212.2 million over the year-ago period.

Roger W. Johnson, Western Digital’s chairman and chief executive, said demand for the company’s lines of data storage, communications and graphics products surged in the third quarter and remains strong as the company moves into its final period for the fiscal year.

He said the percentage of Western Digital’s business from its largest customer, IBM, fell to 18% during the third quarter, a move the company considers a healthy sign in that it is gradually reducing its reliance on a single, and often unpredictable, client. Two years ago, IBM accounted for as much as 50% of the company’s sales.

Johnson said Western Digital’s immediate business prospects were unaffected by the recent IBM announcement of a new line of personal computers. Although IBM chose not to include Western Digital products in those machines, as it had in earlier PC models, Johnson said his company was prepared for the development.

“Our near-term business has been unaffected by the recent IBM announcements. Our order rates and backlog have remained strong in recent weeks,” he said in a prepared statement.