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What changed in Seagate Technology's 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of Seagate Technology's 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+316 added−326 removedSource: 10-K (2025-08-01) vs 10-K (2024-08-02)

Top changes in Seagate Technology's 2025 10-K

316 paragraphs added · 326 removed · 261 edited across 7 sections

Item 1. Business

Business — how the company describes what it does

76 edited+16 added−12 removed69 unchanged
Biggest changeFactors contributing to the growth of digital content include: • Creation, sharing and consumption of media-rich content, such as high-resolution photos, high definition videos and digital music through smart phones, tablets, digital cameras, personal video cameras, DVRs, gaming consoles or other digital devices; • Increasing use of video and imaging sensors to collect and analyze data used to improve traffic flow, emergency response times and manufacturing production costs, as well as for new security surveillance systems that feature higher resolution digital cameras and thus require larger data storage capacities; • Creation and collection of data through the development and evolution of the IoT ecosystem, big data analytics, machine learning and new technology trends such as autonomous vehicles and drones, smart manufacturing, and smart cities, as well as emerging trends including generative AI content growth or applications that converge the digital and physical worlds such as the metaverse or use of digital twins; 1 Worldwide IDC Global DataSphere Forecast, 2024–2028: AI Everywhere, But Upsurge in Data Will Take Time, Doc #US52076424, May 2024. 5 Table of Contents • The growing use of analytics, especially for action on data created at the edge instead of processing and analyzing at the data center, which is particularly important for verticals such as autonomous vehicles, property monitoring systems, and smart manufacturing; • Cloud migration initiatives and the ongoing advancement of the cloud, including the build out of large numbers of cloud data centers by CSPs and private companies transitioning on-site data centers into the cloud; and • Need for protection of increased digital content through redundant storage on backup devices and externally provided storage services.
Biggest changeFactors contributing to the growth of digital content include: • Creation, sharing and consumption of media-rich content, such as high-resolution photos, high-definition videos and digital music through smart phones, tablets, digital cameras, personal video cameras, DVRs, gaming consoles or other digital devices; the adoption of smart home and wearable devices as well as the growth of social media platforms; • Rapid consumer and enterprise adoption of widely available generative AI tools; • Increasing use of video and imaging sensors to collect and analyze data used to improve traffic flow, emergency response times and manufacturing production costs, as well as for new security surveillance systems that feature higher resolution digital cameras and thus require larger data storage capacities; • Creation and collection of data through the development and evolution of the IoT ecosystem, big data analytics, machine learning and new technology trends such as autonomous vehicles and drones, smart manufacturing, and smart cities, as well as emerging trends including generative AI content growth or applications that converge the digital and physical worlds such as the metaverse or use of digital twins; • The growing use of analytics, especially for action on data created at the edge instead of processing and analyzing at the data center, which is particularly important for verticals such as autonomous vehicles, property monitoring systems, and smart manufacturing; 1 Worldwide IDC Global DataSphere Forecast, 2025–2029, Doc #US53363625, May 2025. 5 Table of Contents • Cloud migration initiatives and the ongoing advancement of the cloud, including the build out of large numbers of cloud data centers by CSPs and private companies transitioning on-site data centers into the cloud; and • The need for protection of increased digital content through redundant storage on backup devices and externally provided storage services is essential.
The read/write heads are mounted vertically on an E-shaped assembly (“E-block”) that is actuated by a voice-coil motor to allow the heads to move from track to track. The E-block and the recording media are mounted inside the head disk assembly.
The read/write heads are mounted vertically on an E-shaped assembly (“E-block”) that is actuated by a voice-coil motor to allow the heads to move from track to track. The E-block and recording media are mounted inside the head disk assembly.
Our Business Data Storage Technologies The design and manufacturing of HDDs depends on highly advanced technology and manufacturing techniques. Therefore, it requires high levels of research and development spending and capital equipment investments. We design, fabricate and assemble a number of the most important components in our disk drives, including read/write heads and recording media.
Our Business Data Storage Technologies The design and manufacturing of HDDs depends on highly advanced technology and manufacturing techniques. Therefore, it requires relatively high levels of research and development spending and capital equipment investments. We design, fabricate and assemble a number of the most important components in our disk drives, including read/write heads and recording media.
As a result, we may increase our use of alternative shipment methods to help offset any increase in freight costs, and we will continually review various forms of shipments and routes in order to minimize the exposure to higher freight costs. Products We offer a broad range of storage solutions for mass capacity storage and legacy applications.
As a result, we may increase our use of alternative shipment methods to help offset any increase in freight costs, and we will continually review various forms of shipments and routes to minimize the exposure to higher freight costs. Products We offer a broad range of storage solutions for mass capacity storage and legacy applications.
Our DVR HDDs are optimized for video streaming in always-on consumer premise equipment applications with capacities up to 8TB. Our gaming SSDs are specifically optimized internal storage for gaming rigs and are designed to enhance the gaming experience during game load and game play with capacities up to 4TB for SSD. Lyve Edge-to-Cloud Mass Capacity Platform Lyve.
Our DVR HDDs are optimized for video streaming in always-on consumer premise equipment applications with capacities up to 8TB. Our gaming SSDs are specifically optimized internal storage for gaming rigs and are designed to enhance the gaming experience during game load and game play with capacities up to 4TB. Lyve Edge-to-Cloud Mass Capacity Platform Lyve.
Nearline applications require mass capacity devices and mass capacity subsystems that provide end-to-end solutions to businesses for the purpose of modular and scalable storage. Enterprise storage applications require both high-capacity and energy efficient storage devices to support low total cost of ownership. Seagate systems offer mass capacity storage solutions that provide foundational infrastructure for private and public clouds.
Nearline applications require mass capacity devices and mass capacity subsystems that provide end-to-end solutions to businesses for the purpose of modular and scalable storage. Cloud and enterprise storage applications require both high-capacity and energy efficient storage devices to support low total cost of ownership. Seagate systems offer mass capacity storage solutions that provide foundational infrastructure for private and public clouds.
We offer capacity and performance-optimized systems that include all-flash, all-disk and hybrid arrays for workloads demanding high performance, capacity and efficiency. VIA. Our video and image HDDs are built to support the high-write workload of an always-on, always-recording video systems.
We offer capacity and performance-optimized systems that include all-flash, all-disk and hybrid arrays for workloads demanding high performance, capacity and efficiency. VIA. Our video and image HDDs are built to support the high-write workload of always-on, always-recording video systems.
Disk drives that we manufacture are commonly differentiated by the following key characteristics: • input/output operations per second (“IOPS”), commonly expressed in megabytes per second, which is the maximum number of reads and writes to a storage location; • storage capacity, commonly expressed in TB, which is the amount of data that can be stored on the disk drive; • areal density, which is a measurement of the storage capacity per square inch on the recording surface of a disk; 6 Table of Contents • spindle rotation speed, commonly expressed in revolutions per minute (“RPM”), which has an effect on speed of access to data; • interface transfer rate, commonly expressed in megabytes per second, which is the rate at which data moves between the disk drive and the computer controller; • average seek time, commonly expressed in milliseconds, which is the time needed to position the heads over a selected track on the disk surface; • data transfer rate, commonly expressed in megabytes per second, which is the rate at which data is transferred to and from the disk drive; • product quality and reliability, commonly expressed in annualized return rates; and • energy efficiency, commonly measured by the power output such as energy per TB necessary to operate the disk drive.
Disk drives that we manufacture are commonly differentiated by the following key characteristics: • Input/output operations per second (“IOPS”), commonly expressed in megabytes per second, which is the maximum number of reads and writes to a storage location; • Storage capacity, commonly expressed in TB, which is the amount of data that can be stored on the disk drive; • Areal density, which is a measurement of the storage capacity per square inch on the recording surface of a disk (also known as platter); 6 Table of Contents • Spindle rotation speed, commonly expressed in revolutions per minute (“RPM”), which has an effect on speed of access to data; • Interface transfer rate, commonly expressed in megabytes per second, which is the rate at which data moves between the disk drive and the computer controller; • Average seek time, commonly expressed in milliseconds, which is the time needed to position the heads over a selected track on the disk surface; • Data transfer rate, commonly expressed in megabytes per second, which is the rate at which data is transferred to and from the disk drive; • Product quality and reliability, commonly expressed in annualized return rates; and • Energy efficiency, commonly measured by the power output such as energy per TB necessary to operate the disk drive.
We compete with manufacturers of storage solutions and the other principal manufacturers in the data storage solution industry including: • Micron Technology, Inc.; • Samsung Electronics; • SK hynix, Inc.; • Kioxia Holdings Corporation; • Toshiba Corporation; and • Western Digital Corporation. Price Erosion.
We compete with manufacturers of storage solutions and the other principal manufacturers in the data storage solution industry including: • Kioxia Holdings Corporation; • Micron Technology, Inc.; • Samsung Electronics; • Sandisk Corporation; • SK hynix, Inc.; • Toshiba Corporation; and • Western Digital Corporation. Price Erosion.
Generally, the drive manufacturer that introduces a new product first benefits from improved product mix, favorable profit margins and less pricing pressure until comparable products are introduced. Changing technology also necessitates on-going investments in research and development, which may be difficult to recover due to rapid product life cycles or economic declines.
Generally, the drive manufacturer that introduces a new product first benefits from improved product mix, favorable profit margins and less pricing pressure until comparable products are introduced. Evolving technology also necessitates on-going investments in research and development, which may be difficult to recover due to rapid product life cycles or economic declines.
Since joining Seagate in 1989 as an engineer, Mr. Chong has held a variety of leadership positions and has been a key strategic contributor for many of Seagate’s operations and manufacturing capabilities across the global footprints. Dr. John C. Morris, 57, has served as our Senior Vice President, HDD and SSD Products and Chief Technology Officer since 2019.
Since joining Seagate in 1989 as an engineer, Mr. Chong has held a variety of leadership positions and has been a key strategic contributor for many of Seagate’s operations and manufacturing capabilities across the global footprints. Dr. John C. Morris, 58, has served as our Senior Vice President, HDD and SSD Products and Chief Technology Officer since 2019.
We expect these trends will have a positive impact on storage demand. As more applications require real-time decision making, some data processing and storage is moving closer to the network edge. We believe this will result in a buildup of private and edge cloud environments that will enable fast and secure access to data throughout the IoT ecosystem.
We expect these trends will have a positive impact on storage demand. As more applications require real-time decision making, some data processing and storage are moving closer to the network edge. We believe this will result in a buildup of private and edge cloud environments that will enable fast and secure access to data throughout the IoT ecosystem.
From 1994 until 2008, Mr. Romano held various finance positions at STMicroelectronics, an electronics and semiconductor manufacturer, most recently as Group Vice-President, Central & North Europe Finance Director, Shared Accounting Services Director. Ban Seng Teh, 58, has served as our Executive Vice President and Chief Commercial Officer since July 2022. Prior to that, Mr.
From 1994 until 2008, Mr. Romano held various finance positions at STMicroelectronics, an electronics and semiconductor manufacturer, most recently as Group Vice-President, Central & North Europe Finance Director, Shared Accounting Services Director. Ban Seng Teh, 59, has served as our Executive Vice President and Chief Commercial Officer since July 2022. Prior to that, Mr.
Lee served as Senior Vice President, General Counsel & Corporate Secretary at Maxar Technologies, a space technology company, from April 2019 to June 2024. Prior to Maxar Technologies, Mr. Lee worked at Aramark Corporation, a food and facilities service provider, for 15 years. KianFatt Chong, 61, has served as our Senior Vice President, Global Operations since October 2020.
Lee served as Senior Vice President, General Counsel & Corporate Secretary at Maxar Technologies, a space technology company, from April 2019 to June 2024. Prior to Maxar Technologies, Mr. Lee worked at Aramark Corporation, a food and facilities service provider, for 15 years. KianFatt Chong, 62, has served as our Senior Vice President, Global Operations since October 2020.
Information contained on our website or in our annual ESG Performance Report is not incorporated by reference into this or any other report we filed with the Securities and Exchange Commission. Financial Information Financial information for our reportable business segment and about geographic areas is set forth in “Item 8. Financial Statements and Supplementary Data— Note 16.
Information contained on our website or in our annual ESG Performance Report is not incorporated by reference into this or any other report we filed with the Securities and Exchange Commission. Financial Information Financial information for our reportable business segment and about geographic areas is set forth in “Item 8. Financial Statements and Supplementary Data— Note 15.
Digital transformation has given rise to many new applications, all of which rely on faster access to and secure storage of data proliferating from endpoints through edge to cloud. Additionally, the proliferation of generative AI applications is expected to accelerate the creation of digital content such as text, images and video over the long-term.
Digital transformation has given rise to many new applications, all of which rely on faster access to and secure storage of data proliferating from endpoints through edge to cloud. Additionally, the adoption of generative AI applications is expected to accelerate the creation of digital content such as text, images and video over the long term.
Our core technology platforms focus on the areal density of media and read/write head technologies, including the Mozaic platform, which is our implementation of the high-capacity enabling heat-assisted magnetic recording (“HAMR”) technology as well as innovations like shingled-magnetic-recording ("SMR") technology, and the throughput-optimizing multi actuator MACH.2 technology.
Our core technology platforms focus on the areal density of media and read/write head technologies, including the Mozaic platform, which is the industry’s first implementation of the high-capacity enabling heat-assisted magnetic recording (“HAMR”) technology as well as innovations like shingled-magnetic-recording ("SMR") technology, and the throughput-optimizing multi actuator MACH.2 technology.
Our NAS HDD solutions are available in capacities up to 24TB. We also offer NAS SSDs with capacities up to 4TB. Legacy Applications Mission Critical HDDs and SSDs. Although we have stopped offering 15,000 RPM HDDs, we continue to support 10,000 RPM HDDs, offered in capacities up to 2.4TB, which enable increased throughput while improving energy efficiency.
Our NAS HDD solutions are available in capacities up to 30TB. We also offer NAS SSDs with capacities up to 4TB. Legacy Applications Mission Critical HDDs and SSDs. Although we have stopped offering 15,000 RPM HDDs, we continue to support 10,000 RPM HDDs, offered in capacities up to 2.4TB, which enable increased throughput while improving energy efficiency.
For example, our internal mobility and career development tool provides Seagate employees with the opportunity to establish networking and mentor connections, identify and participate in internal part-time projects, and explore internal full-time positions. Our Total Rewards program is designed to attract, motivate and retain talented people to meet our business goals.
For example, our internal mobility and career development tool provides Seagate employees with the opportunity to establish networking and mentorship connections, identify and participate in internal part-time projects, and explore internal full-time positions. Our Total Rewards program is designed to attract, motivate and retain talented people to meet our business goals.
Our retail channel consists of our branded storage products sold to retailers either by us directly or by our distributors. Retail sales made by us or our distributors typically require greater marketing support, sales incentives and price protection periods. See “Item 8. Financial Statements and Supplementary Data— Note 17.
Our retail channel consists of our branded storage products sold to retailers either by us directly or by our distributors. Retail sales made by us or our distributors typically require greater marketing support, sales incentives and price protection periods. See “Item 8. Financial Statements and Supplementary Data— Note 16.
From 1996 to 2002, he served at Seagate in varying roles of increasing responsibility until his promotion to Vice President. Gianluca Romano, 55, has served as our Executive Vice President and Chief Financial Officer since January 2019. From October 2011 to December 2018, Mr.
From 1996 to 2002, he served at Seagate in varying roles of increasing responsibility until his promotion to Vice President. Gianluca Romano, 56, has served as our Executive Vice President and Chief Financial Officer since January 2019. From October 2011 to December 2018, Mr.
While not entirely eliminating order deferments or cancellations from our key OEM customers, we expect these changes will dampen demand volatility over time. 9 Table of Contents Our distributors generally enter into non-exclusive agreements for the resale of our products. They typically furnish us with a non-binding indication of their near-term requirements and product deliveries are generally scheduled accordingly.
While not entirely eliminating order deferments or cancellations from our key OEM customers, we expect these changes will dampen demand volatility over time. Our distributors generally enter into non-exclusive agreements for the resale of our products. They typically furnish us with a non-binding indication of their near-term requirements and product deliveries are generally scheduled accordingly.
Our HDD and SSD product portfolio 3 Table of Contents includes Serial Advanced Technology Attachment (“SATA”), Serial Attached SCSI (“SAS”) and Non-Volatile Memory Express (“NVMe”) based designs to support a wide variety of mass capacity and legacy applications. Our systems portfolio includes storage subsystems for enterprises, cloud service providers (“CSPs”), scale-out storage servers and original equipment manufacturers (“OEMs”).
Our HDD and SSD product portfolio includes Serial Advanced Technology Attachment (“SATA”), Serial Attached SCSI (“SAS”) and Non-Volatile Memory Express (“NVMe”) based designs to support a wide variety of mass capacity and legacy applications. Our systems portfolio includes storage subsystems for enterprises, cloud service providers (“CSPs”), scale-out storage servers and original equipment manufacturers (“OEMs”).
Our high-capacity enterprise HDDs, including HAMR-based Mozaic drives, ship in capacities of up to 32TB. These products are designed for mass capacity data storage in the core and at the edge, as well as server environments and cloud systems that require high capacity, enterprise reliability, energy efficiency and integrated security. They are available in SATA and SAS interfaces.
Our high-capacity enterprise HDDs, including HAMR-based Mozaic drives, ship in capacities of up to 35TB. These products are designed for mass capacity data storage in the cloud and at the edge, as well as server environments and cloud systems that require high capacity, enterprise reliability, energy efficiency and integrated security. They are available in SATA and SAS interfaces.
Employee engagement is the psychological commitment and passion that drives discretionary effort. It predicts individual performance and is the measure of the relationship between employees and the Company. Our engagement survey includes facets of the employee experience throughout the employee life cycle. Employee experience is what employees encounter and 12 Table of Contents observe during their career at Seagate.
Employee engagement is the psychological commitment and passion that drives discretionary effort. It predicts individual performance and is the measure of the relationship between employees and the Company. Our engagement survey includes facets of the employee experience throughout the employee life cycle. Employee experience is what employees encounter and observe during their career at Seagate.
Engineered for modularity, mobility, capacity and performance, these solutions include our enterprise HDDs and SSDs, enabling customers to integrate powerful, scalable storage within existing environments or create new ecosystems from the ground up in a secure, cost-effective manner. Our Lyve portfolio provides a simple, cost-efficient and secure way to manage massive volumes of data across the distributed enterprise.
Engineered for modularity, mobility, capacity and performance, these solutions are built with our enterprise HDDs and SSDs, enabling customers to integrate powerful, scalable storage within existing environments or create new ecosystems from the ground up in a secure, cost-effective manner. Our Lyve portfolio provides a simple, cost-efficient and secure way to manage massive volumes of data across the distributed enterprise.
Managers were provided access to a dashboard with results that shared key drivers of employee engagement specific to their own organizations for action planning. We conducted several additional surveys across Seagate’s global footprint, which were followed by employee and leader connection sessions at the regional and site levels, for the continuous improvement of internal communications and business planning. Giving Back.
Managers were provided access to a dashboard with results that shared key drivers of employee engagement specific to their own organizations for action planning. We conducted several additional surveys across Seagate’s global footprint, which were followed by employee and leader connection sessions at the regional and site levels, for the continuous improvement of internal communications and business planning. Community Impact.
Our legacy markets, such as consumer 10 Table of Contents storage applications, traditionally experienced seasonal variability in demand with higher levels of demand in the first half of the fiscal year, primarily driven by consumer spending related to back-to-school season and traditional holiday shopping season.
Our legacy markets, such as consumer storage applications, traditionally experienced seasonal variability in demand with higher levels of demand in the first half of the fiscal year, primarily driven by consumer spending related to back-to-school season and traditional holiday shopping season.
Additionally, certain customers can utilize many of our HDDs with SMR technology enabled which increases the available storage capacity of the drive with certain performance trade-offs. Enterprise SSDs. Our enterprise SSDs are designed for high-performance, hyperscale, high-density and cloud applications. They are offered with multiple interfaces, including SAS, SATA, and NVMe and in capacities up to 15TB. Enterprise Nearline Systems.
Additionally, certain customers can utilize many of our HDDs with SMR technology enabled which increases the available storage capacity of the drive with certain performance trade-offs. Enterprise SSDs. Our enterprise SSDs are designed for high-performance, hyperscale, high-density and cloud applications. They are offered with multiple interfaces, including SATA and NVMe, and in capacities up to 30TB. Enterprise Systems.
A positive employee experience can have an impact on everything from recruiting to Seagate's bottom line. In fiscal year 202 4, we conducted our Employee Experience Survey to obtain feedback from our global workforce on their experience at Seagate.
A positive employee experience can have an impact on everything from recruiting to Seagate's bottom line. In fiscal year 2025 , we conducted our Employee Experience Survey to obtain feedback from our global workforce on their experience at Seagate.
Our 3.5-inch desktop drives offer up to 8TB of capacity, designed for personal computers and workstation applications and our 2.5-inch notebook drives offer up to 5TB for HDD and up to 2TB for SSD designed for applications such as traditional notebooks, convertible systems and external storage to address a range of performance needs and sizes for affordable, high-capacity storage.
Our 3.5-inch desktop drives offer up to 24TB of capacity, designed for personal computers and workstation applications and our 2.5-inch notebook drives offer up to 5TB for HDD and up to 4TB for SSD designed for applications such as traditional notebooks, convertible systems and external storage to address a range of performance needs and sizes for affordable, high-capacity storage.
The resulting mass data ecosystem is expected to require increasing amounts of data storage at the edge, in the core and in between.
The resulting mass data ecosystem is expected to require increasing amounts of data storage at the edge, in the cloud and in between.
Teh joined Seagate in 1989 as a field customer engineer and has served in varying roles of increasing responsibilities, including as Vice President, Asia Pacific Sales and Marketing (Singapore) from January 2008 to July 2010; Vice President, Sales Operations from 2006 to 2008; Vice President, Asia Pacific Sales from 2003 to 2006; Director, Marketing and APAC Distribution Sales from 1999 to 2003; and Country Manager, South Asia Sales from 1996 to 1999.
Teh joined Seagate in 1989 as a field customer engineer and has served in varying roles of increasing responsibilities, including as Vice President, Asia Pacific Sales and Marketing (Singapore) from January 2008 to July 2010; Vice President, Sales Operations from 2006 to 2008; Vice President, Asia Pacific Sales from 2003 to 2006; Director, Marketing and APAC Distribution Sales from 1999 to 2003; and Country Manager, South Asia Sales from 1996 to 1999. 14 Table of Contents James C.
Since joining the Company in 1996, Dr. Morris has held a variety of engineering leadership positions and has been a key contributor to many of Seagate’s core technologies. 14 Table of Contents
Since joining the Company in 1996, Dr. Morris has held a variety of engineering leadership positions and has been a key contributor to many of Seagate’s core technologies.
We strive to deliver the best customer experience by leveraging our core technologies, offering services such as Seagate Recovery Services (data recovery) and partnering with leading brands such as Microsoft’s Xbox, Sony’s PlayStation and Disney’s Star Wars and Marvel. Client Applications.
We strive to deliver the best customer experience by leveraging our core technologies, offering services such as Seagate Recovery Services (data recovery) and partnering with leading brands such as Microsoft’s Xbox and Sony’s PlayStation. Client Applications.
Our systems portfolio provides modular storage arrays, storage server platforms, multi-level configuration for disks (commonly referred as JBODs) and expansion shelves to expand and upgrade data center storage infrastructure and other enterprise applications. They feature speed, scalability and security. Our capacity-optimized systems feature multiple scalable configurations and can accommodate up to 96 26TB dri ves per chassis.
Our systems portfolio provides modular storage arrays, storage server platforms, multi-level configuration for disks (commonly referred as JBODs) and expansion shelves to expand and upgrade data center storage infrastructure and other enterprise applications. They feature speed, scalability and security. Our capacity-optimized systems feature multiple scalable configurations and can accommodate up to 2.5 petabytes of HDDs per chassis.
Mass capacity storage involves well-established use cases, such as hyperscale data centers and private and public clouds as well as emerging use cases. Legacy markets are those that we continue to sell to but we do not plan to invest in significantly.
Mass capacity storage involves well-established use cases, such as hyperscale data centers and private and public clouds as well as quickly emerging use cases such as machine learning (“ML”) and artificial intelligence (“AI”). Legacy markets are those that we continue to sell to but we do not plan to invest in significantly.
Accordingly, we intend to continue our efforts to broadly protect our intellectual property, including obtaining patents, where available, in connection with our research and development program. The data storage industry is characterized by significant litigation arising from time to time relating to patent and other intellectual property rights.
Accordingly, we intend to continue our efforts to broadly protect our intellectual property, including obtaining patents, where available, in connection with our research and development program. The data storage industry is characterized by significant litigation arising from time to time relating to patent and other intellectual property rights. Occasionally, we receive claims that our products infringe patents of third parties.
Markets The principal data storage markets include: Mass Capacity Storage Markets Mass capacity storage supports high capacity, low-cost per terabyte (“TB”) storage applications, including nearline, video and image applications (“VIA”) and network-attached storage (“ NAS”) and edge-to-cloud data storage infrastructures. Nearline.
Markets The principal data storage markets include: Mass Capacity Storage Markets Mass capacity storage supports scalable, high capacity, cost efficient storage applications, including nearline cloud, nearline enterprise, video and image applications (“VIA”) and network-attached storage (“ NAS”) and edge-to-cloud data storage infrastructures. Nearline.
He previously served as our President and Chief Operating Officer (“COO”) from June 2016 to September 2017. He also served as our President of Operations and Technology from October 2013 to June 2016 and as our Executive Vice President of Operations from March 2011 until October 2013. Prior to these positions, Dr.
He also served as our President of Operations and Technology from October 2013 to June 2016 and as our Executive Vice President of Operations from March 2011 until October 2013. Prior to these positions, Dr.
We believe the proliferation and personal creation of media-rich digital content, further enabled by fifth-generation wireless (“5G”) technology, the edge, the Internet of Things (“IoT”), machine learning (“ML”) and generative artificial intelligence (“AI”), will continue to create demand for higher capacity storage solutions.
We believe the proliferation and creation of media-rich digital content, further enabled by Gen AI, ML, fifth-generation wireless (“5G”) technology, the edge and the Internet of Things (“IoT”) will continue to create demand for higher capacity storage solutions.
Our enterprise SSDs are available in capacities up to 15TB, with endurance options up to 10 drive writes per day and various interfaces. Our SSDs deliver the speed and consistency required for demanding enterprise storage and server applications. Consumer Solutions.
Our enterprise SSDs are available in capacities up to 30TB with various interfaces. Our SSDs deliver the speed and consistency required for demanding enterprise storage and server applications. Consumer Solutions.
Information in, or that can be accessed through, our website is not incorporated into this Form 10-K. 13 Table of Contents Information About Our Executive Officers The following sets forth the name, age and position of each of the persons who were serving as executive officers as of August 2, 2024.
Information in, or that can be accessed through, our website is not incorporated into this Form 10-K. Information About Our Executive Officers The following sets forth the name, age and position of each of the persons who were serving as executive officers as of August 1, 2025. There are no family relationships among any of our executive officers.
Patents and Licenses As of June 28, 2024, we had approximatel y 4,000 U .S. patents and 300 patents issued in various non-U.S. jurisdictions, as well as approximately 150 U.S. and 100 non-U.S. patent applications pending. The number of patents and patent applications will vary at any given time as part of our ongoing patent portfolio management activity.
Patents and Licenses As of June 27, 2025, we had approximatel y 3,273 U .S. patents and 243 patents issued in various non-U.S. jurisdictions, as well as approximately 221 U.S. and 38 non-U.S. patent applications pending. The number of patents and patent applications will vary at any given time as part of our ongoing patent portfolio management activity.
Mission critical applications are defined as those that use very high-performance enterprise class HDDs and SSDs with sophisticated firmware to reliably support very high workloads. We expect that enterprises utilizing dedicated storage area networks will continue to drive market demand for mission critical enterprise storage solutions. Participants in the data storage industry include: Major subcomponent manufacturers.
Mission critical applications are defined as those that use very high-performance enterprise class HDDs and SSDs with sophisticated firmware to reliably support very high workloads. Participants in the data storage industry include: Major subcomponent manufacturers.
Demand for Data Storage In the “Worldwide Global DataSphere Forecast, 2024-2028”, published by the International Data Corporation 1 (“IDC”), the global datasphere is forecasted to grow at a compound rate of more than 24% over the next five years to reach 394 zettabytes by 2028.
Demand for Data Storage In the “Worldwide Global DataSphere Forecast, 2025-2029”, published by the International Data Corporation 1 (“IDC”), the global datasphere is forecasted to grow at a compound rate of 25% over the next five years to reach 527 zettabytes annually by 2029.
The Lyve platform includes a shuttle solution that enables enterprises to transfer massive amounts of data from endpoints to the core cloud and a storage-as-a-service cloud offering that provides frictionless mass capacity storage at the metro edge. In January 2024, the Company established Singapore as its principal executive offices to better align its operational footprint.
The Lyve platform includes a shuttle solution that enables enterprises to transfer massive amounts of data from endpoints to the core cloud and a storage-as-a-service cloud offering that provides frictionless mass capacity storage at the metro edge.
Mass capacity is and will continue to be the enabler of scale. We expect increased data creation will lead to the expansion of the need for storage in the form of HDDs, SSDs and systems.
Mass capacity storage is and will continue to be the enabler of scale. According to IDC’s 2025 Cloud Infrastructure Index, hard drives store 87% of exabytes in large data center deployments. We expect increased data creation will lead to the expansion of the need for storage in the form of HDDs, SSDs and systems.
James C. Lee, 54, has served as our Senior Vice President, Chief Legal Officer and Corporate Secretary since June 2024. Mr. Lee oversees all legal operations, government relations and public policy at Seagate. Before joining our company, Mr.
Lee, 55, has served as our Senior Vice President, Chief Legal Officer and Corporate Secretary since June 2024. Mr. Lee oversees all legal operations, government relations and public policy at Seagate, as well as leads the enterprise-wide strategy for identifying, incubating, and commercializing emerging technologies. Before joining our company, Mr.
Our performance management system is a continuous process that helps team members focus on the right priorities. Meaningful conversations between managers and employees are the foundation of performance management at Seagate. We focus on dialogue centered around manager and employee conversations, and ongoing feedback, to align goals. This approach focuses on achieving high-quality productive dialogue between managers and employees.
Meaningful conversations between managers and employees are the foundation of performance management at Seagate. We focus on dialogue centered around manager and employee conversations, and ongoing feedback, to align goals. This approach focuses on achieving high-quality productive dialogue between managers and employees. We also encourage our employees to participate in the many learning opportunities available at Seagate.
Deliveries are scheduled only after receipt of purchase orders. Historically, customers could defer or cancel most purchase orders without significant penalty.
Historically, customers could defer or cancel most purchase orders without significant penalty.
Securities and Exchange Commission (the “SEC”). Because we make filings to the SEC electronically, the public may access this information at the SEC's website: www.sec.gov. This site contains reports, proxy and information statements and other information regarding issuers that file electronically with the SEC. Website Access. Our website is www.seagate.com.
This site contains reports, proxy and information statements and other information regarding issuers that file electronically with the SEC. Website Access. Our website is www.seagate.com.
We also encourage our employees to participate in the many learning opportunities available at Seagate. The portfolio of learning and training formats include but are not limited to mentoring and coaching, e-learning opportunities, LinkedIn Learning classroom training, on-the-job training and other strategic internal programs that cover topics ranging from leadership and technical skills to health, safety and the environment.
The portfolio of learning and training opportunities includes but is not limited to mentoring and coaching, e-learning opportunities, self-paced training, on-the-job training and other strategic internal programs that cover topics ranging from leadership and technical skills to health, safety and the environment.
Industry Overview Data Storage Industry The data storage industry includes companies that manufacture components or subcomponents designed for data storage devices, as well as providers of storage solutions, software and services for enterprise cloud, big data, computing platforms and consumer markets. The rapid growth of data generation and the intelligent application of data are driving demand for data storage.
Industry Overview Data Storage Industry The data storage industry includes companies that manufacture components or subcomponents designed for data storage devices, as well as providers of storage solutions, software and services. These providers address data storage needs for cloud, enterprise and other edge markets.
Our community engagement program is designed to provide support to our local communities, with an emphasis on science, technology, engineering and mathematics (“STEM”).
Our community engagement program is designed to provide support to our local communities, with an emphasis on science, technology, engineering and mathematics (“STEM”). This year to support STEM, we organized Take Our Children to Work Day at eight of our largest sites.
If we or our suppliers fail to comply with the substance restrictions, recycle content requirements or other environmental requirements as they are enacted worldwide, it could have a materially adverse effect on our business .
If we or our suppliers fail to comply with the substance restrictions, recycle content requirements or other environmental requirements as they are enacted worldwide, it could have a materially adverse effect on our business . Social and Employee Matters As of June 27, 2025, we employed approximately 30,000 full-time employees worldwide, of which approximately 25,000 were located in Asia.
Environmental Matters Our operations are subject to U.S. and foreign laws and regulations relating to the protection of the environment, including those governing discharges of pollutants into the air and water, the management and disposal of hazardous substances and wastes and the cleanup of contaminated sites.
Legal, Environmental and Other Contingencies .” The costs of engaging in intellectual property litigation in the past have been, and in the future may be, substantial, irrespective of the merits of the claim or the outcome. 11 Table of Contents Environmental Matters Our operations are subject to U.S. and foreign laws and regulations relating to the protection of the environment, including those governing discharges of pollutants into the air and water, the management and disposal of hazardous substances and wastes and the cleanup of contaminated sites.
Based on our current estimates of cleanup costs and our expected allocation of these costs, we do not expect costs in connection with these sites to be material . 11 Table of Contents We may be subject to various state, federal and international laws and regulations governing the environment, including those restricting the presence of certain substances in electronic products.
We may be subject to various state, federal and international laws and regulations governing the environment, including those restricting the presence of certain substances in electronic products.
From time to time, we receive claims that our products infringe patents of third parties. Although we have been able to resolve some of those claims or potential claims without a material adverse effect on us, other claims have resulted in adverse decisions or settlements.
Although we have been able to resolve some of those claims or potential claims without a material adverse effect on us, other claims have resulted in adverse decisions or settlements. In addition, other claims are pending, which if resolved unfavorably to us could have a material adverse effect on our business and results of operations.
We perform all primary stages of design and manufacture of read/write heads at our facilities. We use a combination of internally manufactured and externally sourced read/write heads, the mix of which varies based on product mix, technology and our internal capacity levels. Media.
We use a combination of internally manufactured and externally sourced read/write heads, the mix of which varies based on product mix, technology and our internal capacity levels. Media. Data is written to or read from the media, or disk, as it rotates at very high speeds past the read/write head.
We have fulfilled our responsibilities at some of these sites and remain involved in only a few at this time.
We have fulfilled our responsibilities at some of these sites and remain involved in only a few at this time. Based on our current estimates of cleanup costs and our expected allocation of these costs, we do not expect costs in connection with these sites to be material .
Through our EHS management systems, we ensure that the focus remains on the continuous improvement of employee health and safety programs. We continue to provide comprehensive health and safety training to our employees. We emphasize e-learning courses as our main vehicle for delivering such training because employees can learn at their own pace. Development, Retention, Compensation, Benefits & Engagement.
We emphasize e-learning courses as our main vehicle for delivering such training because employees can learn at their own pace. 12 Table of Contents Development, Retention, Compensation, Benefits & Engagement. Our performance management system is a continuous process that helps team members focus on the right priorities.
Lee 54 Senior Vice President, Chief Legal Officer and Corporate Secretary KianFatt Chong 61 Senior Vice President, Global Operations Dr. John C. Morris 57 Senior Vice President and Chief Technology Officer Dr. William D. Mosley, 57, has served as our Chief Executive Officer (“CEO”) since October 2017 and as a member of the Board since July 2017.
Morris 58 Senior Vice President and Chief Technology Officer Dr. William D. Mosley, 58, has served as our Chief Executive Officer (“CEO”) since October 2017 and as a member of the Board since July 2017. He previously served as our President and Chief Operating Officer (“COO”) from June 2016 to September 2017.
Social and Employee Matters As of June 28, 2024, we employed approximately 30,000 full-time employees worldwide, of which approximately 25,200 were located in our Asia operations. We believe that our employees are crucial to our current success and that our future success will depend, in part, on our ability to attract, retain and further motivate qualified employees at all levels.
We believe that our employees are crucial to our current success and that our future success will depend, in part, on our ability to attract, retain and further motivate qualified employees at all levels. We believe that our employee relations are good. Culture of Inclusion.
Our global health and safety standards, as well as our accompanying Environment, Health and Safety (“EHS”) management systems, frequently go beyond country or industry-level guidelines to ensure that we keep our employees healthy and safe. We regularly host health and safety regulatory visits that focus on issues such as safety, radiation, fire codes, food and transportation.
In addition, we are audited to health and safety standards set forth by the Responsible Business Alliance (“RBA”). Our global health and safety standards, as well as our accompanying Environment, Health and Safety (“EHS”) management systems, frequently go beyond country or industry-level guidelines to ensure that we keep our employees healthy and safe.
HDDs continue to be the primary medium of mass data storage due to their performance attributes, reliability, high capacities, superior quality and cost effectiveness. Complementing HDD storage architectures, SSDs use NAND flash memory integrated circuit assemblies to store data. Our HDD products are designed for mass capacity storage and legacy markets.
HDDs continue to be the primary medium of mass data storage due to their performance attributes, reliability, high capacities, superior quality and cost effectiveness.
Data storage manufacturers typically attempt to offset price erosion with an improved mix of data storage products characterized by higher capacity, better performance and additional feature sets and product cost reductions.
Data storage manufacturers typically attempt to offset price erosion with an improved mix of data storage products characterized by higher capacity, better performance and additional feature sets and product cost reductions. We believe our HDDs’ supply and demand remained well balanced during fiscal year 2025, supporting a healthy pricing environment. 10 Table of Contents Product Life Cycles and Changing Technology.
Business Segment and Geographic Information.” Corporate Information Seagate Technology Holdings public limited company is a public limited company organized under the laws of Ireland. Available Information Availability of Reports. We are a reporting company under the Securities Exchange Act of 1934, as amended (the “1934 Exchange Act”), and we file reports, proxy statements and other information with the U.S.
Business Segment and Geographic Information.” Corporate Information Seagate Technology Holdings plc is a public limited company organized under the laws of Ireland. 13 Table of Contents Available Information Availability of Reports.
There are no family relationships among any of our executive officers. Name Age Positions Dr. William D. Mosley 57 Director and Chief Executive Officer Gianluca Romano 55 Executive Vice President and Chief Financial Officer Ban Seng Teh 58 Executive Vice President and Chief Commercial Officer James C.
Name Age Positions Dr. William D. Mosley 58 Director and Chief Executive Officer Gianluca Romano 56 Executive Vice President and Chief Financial Officer Ban Seng Teh 59 Executive Vice President and Chief Commercial Officer James C. Lee 55 Senior Vice President, Chief Legal Officer and Corporate Secretary KianFatt Chong 62 Senior Vice President, Global Operations Dr. John C.
Lyve is our as-a-service platform built with mass data in mind. These solutions, including modular hardware and software delivered in a consumption-based model, support enterprises’ on-premise and cloud storage infrastructure needs. Customers We sell our products to major OEMs, distributors and retailers. OEM customers, including large hyperscale data center companies and CSPs, typically enter into master purchase agreements with us.
Lyve is our as-a-service platform built with mass data in mind. These solutions, including modular hardware and software delivered in a consumption-based model, support enterprises’ on-premise and cloud data transfer and retention needs. Lyve Cloud Object Storage is a consumption-based, mass storage simple storage service (“S3”) compatible cloud, completing our comprehensive edge-to-cloud portfolio.
Data is written to or read from the media, or disk, as it rotates at very high speeds past the read/write head. The media is made from non-magnetic substrates, usually an aluminum alloy or glass and is coated with thin layers of magnetic materials.
The media is made from non-magnetic substrates, usually an aluminum alloy or glass and is coated with thin layers of magnetic materials. HAMR technology requires media with higher coercivity alloys that are stable at room temperature. The laser temporarily lowers the coercivity allowing data to be written.
As more data is created at endpoints outside traditional data centers, which requires processing at the edge and in the core or cloud, the need for data storage and management between the edge and cloud has also increased. Use cases include connected and autonomous vehicles, smart manufacturing and smart cities.
Additionally, the need for data storage and management between the edge and cloud continues to increase. Use cases include connected and autonomous vehicles, smart manufacturing, smart cities and emerging generative AI (“Gen AI”) applications.
We believe that our employee relations are good. Diversity, Equity & Inclusion. One of our core values is inclusion. We rely on our diverse workforce to develop, deliver and sustain our business strategy to achieve our goals. One way we embrace our diverse employees and promote a culture of inclusion is through the support of employee resource groups (“ERG”).
We thrive as a global workforce by leveraging our collective strengths and experiences to develop and deliver our business strategy. One of the ways we foster a culture of belonging and inclusion is through our support of Employee Resource Groups (ERGs).
We also believe that as HDD capacities continue to increase, a focus exclusively on unit demand does not reflect the increase in demand for exabytes. As demand for higher capacity drives increases, the demand profile has shifted to reflect fewer total HDD units, but with higher average capacity per drive and higher overall exabyte demand.
As HDD capacities continue to increase, demand for higher capacity drives is expected to grow due to their better total cost of ownership compared with lower capacity drives. As a result, we can address higher exabyte demand with fewer HDD units that have higher average capacity per drive.
In addition, other claims are pending, which if resolved unfavorably to us could have a material adverse effect on our business and results of operations. For more information on these claims, see “Item 8. Financial Statements and Supplementary Data— Note 14.
For more information on these claims, see “Item 8. Financial Statements and Supplementary Data— Note 13.
All our manufacturing sites have health and safety management systems certified to the International Organization for Standardization (“ISO”) 45001 standard. In addition, we are audited to health and safety standards set forth by the Responsible Business Alliance (“RBA”).
Events such as Lunar New Year, Veterans Day, and International Women’s Day are marked with activities like educational panels, cultural recipe sharing, employee interviews, and other community-relevant celebrations. Health & Safety. All our manufacturing sites have health and safety management systems certified to the International Organization for Standardization (“ISO”) 45001 standard.
Removed
According to IDC, we are in a new era of the Data Age, whereby data is shifting to both the core and the edge. It is expected that by 2028, nearly 76% of the world’s data will be generated in the core and edge, up from 58% in 2023.
Added
Complementing HDD storage architectures, SSDs use NAND flash memory integrated circuit assemblies to store data. 3 Table of Contents Our HDD products are designed for mass capacity storage in the cloud and at the edge as well as legacy market applications.
Removed
We believe our HDDs’ supply and demand were well balanced for most of fiscal year 2024 leading to flat to higher pricing, compared to higher than usual price erosion in fiscal year 2023 driven primarily by demand contraction. Product Life Cycles and Changing Technology.
Added
The rapid growth of data generation, the intelligent application of data and the rise in data value are driving demand for data storage. As more data is created at endpoints outside traditional data centers, the need for real-time decision making we expect will drive an increase in processing at the edge and in the cloud.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeIf we fail to predict demand accurately for our products or if the markets for our products change, we may have insufficient demand or we may be unable to meet demand, which may materially and adversely affect our financial condition and results of operations. • Changes in demand for computer systems, data storage subsystems and consumer electronic devices has previously and may in the future cause a decline in demand for our products. • We have a long and unpredictable sales cycle for nearline storage solutions, which impairs our ability to accurately predict our financial and operating results in any period and may adversely affect our ability to manage inventory and forecast the need for investments and expenditures. • We experience seasonal declines in the sales of our consumer products during the second half of our fiscal year which may adversely affect our results of operations. • We may not be able to grow our systems, SSD and Lyve revenues, which would adversely affect our results of operations. • Our worldwide sales and manufacturing operations subject us to risks that may adversely affect our business related to disruptions in international markets, currency exchange fluctuations and increased costs. • If we do not control our costs, we will not be able to compete effectively and our financial condition may be adversely impacted. • We may not be able to execute acquisitions, divestitures and other significant transactions successfully and we may have difficulty or fail to successfully integrate acquired companies.
Biggest changeIf we fail to predict demand accurately for our products or if the markets for our products change, we may have insufficient demand or we may be unable to meet demand, which may materially and adversely affect our financial condition and results of operations. • Changes in demand for computer systems, data storage subsystems and consumer electronic devices has previously caused, and may in the future cause, a decline in demand for our products. • We have a long and unpredictable sales cycle for nearline storage solutions, which impairs our ability to accurately predict our financial and operating results in any period and may adversely affect our ability to manage inventory and forecast the need for investments and expenditures. • We experience seasonal declines in the sales of our consumer products during the second half of our fiscal year which may adversely affect our results of operations. • Our worldwide sales and manufacturing operations subject us to risks that may adversely affect our business related to disruptions in international markets, currency exchange fluctuations and increased costs. • We may not be able to execute acquisitions, divestitures and other significant transactions successfully and we may have difficulty or fail to successfully integrate acquired companies. 15 Table of Contents Risks Associated with Supply and Manufacturing • Shortages or delays in the receipt of, or cost increases in, critical components, equipment or raw materials necessary to manufacture our products, as well as reliance on single-source suppliers, has in the past and may in the future affect our production and development of products and harm our operating results. • We have cancelled purchase commitments with suppliers and incurred costs associated with such cancellations, and if revenues fall or customer demand decreases significantly, we may seek to cancel or may otherwise not meet our purchase commitments to certain suppliers in the future, which could result in damages, penalties, disputes, litigation, increased manufacturing costs or excess inventory. • Due to the complexity of our products, some defects may only become detectable after deployment, which may lead to increased costs and adversely affect our operating results.
Legal, Regulatory and Compliance Risks • Our business is subject to various laws, regulations and governmental policies that may cause us to incur significant expense or adversely impact our results of operations and financial condition. • Some of our products and services are subject to export control laws and other laws affecting the countries in which our products and services may be sold, distributed, or delivered, and any changes to or violation of these laws could have a material and adverse effect on our business, results of operations, financial condition and cash flows. • Our business is exposed to risks associated with litigation, investigations and regulatory proceedings that may cause us to incur significant expense or adversely impact our results of operations and financial condition. • Tax-related matters could have a material and adverse effect on our business, results of operations or financial condition. • Changes in U.S. trade policy, including the imposition of sanctions or tariffs and the resulting consequences, may have a material and adverse impact on our business and results of operations.
Legal, Regulatory and Compliance Risks • Our business is subject to various laws, regulations and governmental policies that may cause us to incur significant expense or adversely impact our results of operations and financial condition. • Some of our products and services are subject to export control laws and other laws affecting the countries in which our products and services may be sold, distributed, or delivered, and any changes to or violation of these laws could have a material and adverse effect on our business, results of operations, financial condition and cash flows. • Changes in U.S. trade policy, including the imposition of sanctions or tariffs and the resulting consequences, may have a material and adverse impact on our business and results of operations. • Our business is exposed to risks associated with litigation, investigations and regulatory proceedings that may cause us to incur significant expense or adversely impact our results of operations and financial condition. • Tax-related matters could have a material and adverse effect on our business, results of operations or financial condition.
These markets, however, have been, and we expect them to continue to be, adversely affected by: • announcements or introductions of major new operating systems or semiconductor improvements or shifts in customer preferences, performance requirements and behavior, such as the shift to tablet computers, smart phones, NAND flash memory or similar devices that meet customers’ cost and capacity metrics; • longer product life cycles; and • changes in macroeconomic conditions that cause customers to spend less, such as the imposition of new tariffs, increased laws and regulations, and increased unemployment levels.
These markets, however, have been, and we expect them to continue to be, adversely affected by: • announcements or introductions of major new operating systems or semiconductor improvements or shifts in customer preferences, performance requirements and behavior, such as the shift to tablet computers, smart phones, NAND flash memory or similar devices that meet customers’ cost and capacity metrics; • longer product life cycles; and • changes in macroeconomic conditions that cause customers to spend less, such as the imposition of new and/or increased tariffs, increased laws and regulations, and increased unemployment levels.
We have also been forced and could in the future be forced to pay higher prices, make volume purchase commitments or advance deposits for some components, equipment or raw materials that were in short supply in the industry.
We have also been, and could in the future be, forced to pay higher prices, make volume purchase commitments or advance deposits for some components, equipment or raw materials that were in short supply in the industry.
Some of our business and some of our products rely on or include software licensed from third parties, including open source licenses. We may not be able to obtain or continue to obtain licenses from these third parties at all or on reasonable terms, or such third parties may demand cross-licenses to our intellectual property.
Our business and some of our products rely on or include software licensed from third parties, including open source licenses. We may not be able to obtain or continue to obtain licenses from these third parties at all or on reasonable terms, or such third parties may demand cross-licenses to our intellectual property.
If our products do not keep pace with customer requirements, our results of operations will be adversely affected. • We operate in highly competitive markets and our failure to anticipate and respond to technological changes and other market developments, including price competition, could harm our ability to compete and risk the commoditization of our products. • We have been adversely affected by reduced, delayed, loss of or canceled purchases by one or more of our key customers, including large hyperscale data center companies and CSPs. • We are dependent on sales to distributors and retailers, which may increase price erosion and the volatility of our sales. • We must plan our investments in our products and incur costs before we have customer orders or know about the market conditions at the time the products are produced.
If our products do not keep pace with customer requirements, our results of operations will be adversely affected. • We operate in highly competitive markets and our failure to anticipate and respond to technological changes and other market developments, including price competition, could harm our ability to compete and risk the commoditization of our products. • We have been, and may in the future be, adversely affected by reduced, delayed, loss of or canceled purchases by one or more of our key customers, including large hyperscale data center companies and CSPs. • We are dependent on sales to distributors and retailers, which may increase price erosion and the volatility of our sales. • We must plan our investments in our products and incur costs before we have customer orders or know about the market conditions at the time the products are produced.
These fluctuations, which we expect to continue, have been and may continue to be precipitated by a variety of factors, including: • uncertainty in global economic and political conditions, and instability or war or adverse changes in the level of economic activity in the major regions in which we do business; • competitive pressures resulting in lower prices by our competitors which may shift demand away from our products; • announcements of new products, services or technological innovations by us or our competitors, and delays or problems in our introduction of new, more cost-effective products, the inability to achieve high production yields or delays in customer qualification or initial product quality issues; • changes in customer demand or the purchasing patterns or behavior of our customers; • application of new or revised industry standards; 25 Table of Contents • disruptions in our supply chain, including increased costs or adverse changes in availability of supplies of raw materials or components; • increased costs of electricity and/or other energy sources, freight and logistics costs or other materials or services necessary for the operation of our business; • pandemics or other global health issues that impact our operations as well as those of our customers and suppliers; • the impact of corporate restructuring activities that we have and may continue to engage in; • changes in the demand for the computer systems and data storage products that contain our products; • unfavorable supply and demand imbalances; • our high proportion of fixed costs, including manufacturing and research and development expenses; • any impairments in goodwill or other long-lived assets; • changes in tax laws, such as global tax developments applicable to multinational businesses; the impact of trade barriers, such as import/export duties and restrictions, sanctions, tariffs and quotas, imposed by the United States or other countries in which the Company conducts business; • the evolving legal and regulatory, economic, environmental and administrative climate in the international markets where the Company operates; and • adverse changes in the performance of our products.
These fluctuations, which we expect to continue, have been and may continue to be precipitated by a variety of factors, including: • uncertainty in global economic and political conditions, and instability or war or adverse changes in the level of economic activity in the major regions in which we do business; • competitive pressures resulting in lower prices by our competitors which may shift demand away from our products; • announcements of new products, services or technological innovations by us or our competitors, and delays or problems in our introduction of new, more cost-effective products, the inability to achieve high production yields or delays in customer qualification or initial product quality issues; • changes in customer demand or the purchasing patterns or behavior of our customers; • application of new or revised industry standards; • disruptions in our supply chain, including increased costs or adverse changes in availability of supplies of raw materials or components; • increased costs of electricity and/or other energy sources, freight and logistics costs or other materials or services necessary for the operation of our business; • pandemics or other global health issues that impact our operations as well as those of our customers and suppliers; • the impact of corporate restructuring activities that we have and may continue to engage in; • changes in the demand for the computer systems and data storage products that contain our products; • unfavorable supply and demand imbalances; • our high proportion of fixed costs, including manufacturing and research and development expenses; • any impairments in goodwill or other long-lived assets; • changes in tax laws, such as global tax developments applicable to multinational businesses; the impact of trade barriers, such as import/export duties and restrictions, sanctions, tariffs and quotas, imposed by the United States or other countries in which the Company conducts business; • the evolving legal and regulatory, economic, environmental and administrative climate in the international markets where the Company operates; and • adverse changes in the performance of our products.
Any significant disruption or deficiency in the design and implementation of the ERP may adversely affect our ability to process orders, ship product, send invoices and track payments, fulfill contractual obligations, maintain effective disclosure controls and internal control over financial reporting or otherwise operate our business.
Any significant disruption or deficiency in the design, implementation and maintenance of the ERP may adversely affect our ability to process orders, ship product, send invoices and track payments, fulfill contractual obligations, maintain effective disclosure controls and internal control over financial reporting or otherwise operate our business.
The market price of our ordinary shares has fluctuated and may continue to fluctuate or decline significantly in response to various factors, some of which are beyond our control, including : • general stock market conditions, or general uncertainty in stock market conditions due to global economic conditions and negative financial news unrelated to our business or industry; • the timing and amount of or the discontinuance of our share repurchases; • actual or anticipated variations in our results of operations; • announcements of innovations, new products, significant contracts, acquisitions, or significant price reductions by us or our competitors, including those competitors who offer alternative storage technology solutions; • our failure to meet our guidance or the performance estimates of investment research analysts, or changes in financial estimates by investment research analysts; • significant announcements by or changes in financial condition of a large customer; • the ability of our customers to procure necessary components which may impact their demand or timing of their demand for our products, especially during a period of persistent supply chain shortages; • reduction in demand from our key customers due to macroeconomic conditions that reduce cloud, enterprise or consumer spending; • the issuance of our ordinary shares upon exchange of some or all of our outstanding exchangeable notes for amounts in excess of the principal amount; • actual or perceived security breaches or incidents or security vulnerabilities; • actual or anticipated changes in the credit ratings of our indebtedness by rating agencies; and • the sale of our ordinary shares held by certain equity investors or members of management.
The market price of our ordinary shares has fluctuated and may continue to fluctuate or decline significantly in response to various factors, some of which are beyond our control, including : • general stock market conditions, or general uncertainty in stock market conditions due to global economic conditions and negative financial news unrelated to our business or industry; • the timing and amount of or the discontinuance of our share repurchases; • actual or anticipated variations in our results of operations; • announcements of innovations, new products, significant contracts, acquisitions, or significant price reductions by us or our competitors, including those competitors who offer alternative storage technology solutions; • our failure to meet our guidance or the performance estimates of investment research analysts, or changes in financial estimates by investment research analysts; • significant announcements by or changes in financial condition of a large customer; • the ability of our customers to procure necessary components which may impact their demand or timing of their demand for our products, especially during a period of persistent supply chain shortages; • reduction in demand from our key customers due to macroeconomic conditions that reduce cloud, enterprise or consumer spending; 34 Table of Contents • issuance of our ordinary shares, including upon exchange of some or all of our outstanding exchangeable 2028 Notes for amounts in excess of the principal amount; • actual or perceived security breaches or incidents or security vulnerabilities; • actual or anticipated changes in the credit ratings of our indebtedness by rating agencies; and • the sale of our ordinary shares held by certain equity investors or members of management.
Further, our customers could have reduced access to working capital due to global economic conditions, higher interest rates, reduced bank lending resulting from contractions in the money supply or the deterioration in the customer’s, or their bank’s financial condition or the inability to access other financing, which would increase our credit and non-payment risk, and could result in an increase in our operating costs or a reduction in our revenue.
Further, our customers could have reduced access to working capital due to global economic conditions, high interest rates, reduced bank lending resulting from contractions in the money supply or the deterioration in the customer’s, or their bank’s financial condition or the inability to access other financing, which would increase our credit and non-payment risk, and could result in an increase in our operating costs or a reduction in our revenue.
In implementing the ERP, we may experience significant increases to inherent costs and risks associated with changing and acquiring these systems, policies, procedures and monitoring tools, including capital expenditures, additional operating expenses, demands on management time and other risks and costs of delays or difficulties in transitioning to or integrating new systems policies, procedures or monitoring tools into our current systems.
In implementing, maintaining and upgrading the ERP, we may experience significant increases to inherent costs and risks associated with changing and acquiring these systems, policies, procedures and monitoring tools, including capital expenditures, additional operating expenses, demands on management time and other risks and costs of delays or difficulties in transitioning to or integrating new systems policies, procedures or monitoring tools into our current systems.
Other factors that could have a material and adverse effect on demand for our products, financial condition and results of operations include inflation, slower growth or recession, conditions in the labor market, healthcare costs, access to credit, consumer confidence and other macroeconomic factors affecting consumer and business spending behavior.
Other factors that could have a material and adverse effect on demand for our products, financial condition and results of operations include inflation, slower growth or recession, conditions in the labor market, access to credit, consumer confidence and other macroeconomic factors affecting consumer and business spending behavior.
RISKS RELATED TO INFORMATION TECHNOLOGY, DATA AND INFORMATION SECURITY We could suffer a loss of revenue and increased costs, exposure to significant liability including legal and regulatory consequences, reputational harm and other serious negative consequences in the event of cyber-attacks, ransomware or other cyber security breaches or incidents that disrupt our operations or result in unauthorized access to, or the loss, corruption, unavailability or dissemination of proprietary or confidential information of our customers or about us or other third parties .
RISKS RELATED TO INFORMATION TECHNOLOGY, DATA AND INFORMATION SECURITY We could suffer a loss of revenue and increased costs, exposure to significant liability including legal and regulatory consequences, reputational harm and other serious negative consequences in the event of cyber-attacks, ransomware or other cyber security breaches or incidents that disrupt our operations, cause widespread outages, and/or result in unauthorized access to, or the loss, corruption, unavailability or dissemination of proprietary or confidential information of our customers or about us or other third parties .
Our results of operations are highly dependent on strong cloud, enterprise and consumer spending and the resulting demand for our products.
Our results of operations are highly dependent on cloud, enterprise and consumer spending and the resulting demand for our products.
For example, attacks could be crafted with an AI tool to attack information systems by creating more effective phishing emails or social engineering or by exploiting vulnerabilities in electronic security programs utilizing false image or voice recognition, or could result from our or our customers or business partners incorporating the output of an AI tool, such as malicious code from an AI-generated source code.
For example, attacks could be crafted with an AI tool to attack information systems by creating more effective phishing emails or social engineering or by exploiting vulnerabilities in electronic security programs utilizing false image or voice recognition, or could result from us or our customers, vendors or business partners incorporating the output of AI tools, such as malicious code from an AI-generated source code.
A general weakening of, and related declining corporate confidence in, the global economy or the curtailment in government or corporate spending could 24 Table of Contents cause current or potential customers to reduce their IT budgets or be unable to fund data storage products, which could cause customers to delay, decrease or cancel purchases of our products or cause customers to not pay us or to delay paying us for previously purchased products and services.
A general weakening of, and related declining corporate confidence in, the global economy or the curtailment in government or corporate spending could cause current or potential customers to reduce their IT budgets or be unable to fund data storage products, which could cause customers to delay, decrease or cancel purchases of our products or cause customers to not pay us or to delay paying us for previously purchased products and services.
In certain end markets, sales of computers, storage subsystems and consumer electronic devices tend to be seasonal, and therefore, we expect to continue to experience seasonality in our business as we respond to variations in our customers’ demand for our products.
In several of our end markets, sales of computers, storage subsystems and consumer electronic devices tend to be seasonal, and therefore, we expect to continue to experience seasonality in our business as we respond to variations in our customers’ demand for our products.
The effect of geopolitical uncertainties, war, terrorism, natural disasters, public health issues and other circumstances, on national and/or international commerce and on the global economy, could materially and adversely affect our results of operations and financial condition .
The effect of geopolitical uncertainties, political unrest, war, terrorism, natural disasters, public health issues and other circumstances, on national and/or international commerce and on the global economy, could materially and adversely affect our results of operations and financial condition .
Despite our best efforts to comply with all applicable export control and sanctions laws and regulations, we may discover additional violations. From time to time, we have voluntarily self-reported potential export violations to OFAC or BIS.
Despite our best efforts to comply with all applicable export control and sanctions laws and regulations, we may discover additional violations. From time to time, we have voluntarily self-reported potential trade controls violations to OFAC or BIS.
We risk damage to our reputation if we fail to act responsibly in a number of areas, such as diversity and inclusion, environmental stewardship, sustainability, supply chain management, climate change, the usage of AI, workplace conduct and human rights. The increasing concern over climate change could also result in shifting customer preferences and regulations.
We risk damage to our reputation if we fail to act responsibly in a number of areas, such as human capital, environmental stewardship, sustainability, supply chain management, climate change, the usage of AI, workplace conduct and human rights. The increasing concern over climate change could also result in shifting customer preferences and regulations.
Intellectual property litigation can be expensive and time-consuming, regardless of the merits of any claim, and could divert our management’s attention from operating our business. In addition, intellectual property lawsuits are subject to inherent uncertainties due to the complexity of the technical issues involved, which may cause actual results to differ materially from our expectations.
Intellectual property litigation can be expensive and time-consuming, regardless of the merits of any claim, and could divert management’s attention and resources away from our business. In addition, intellectual property lawsuits are subject to inherent uncertainties due to the complexity of the technical issues involved, which may cause actual results to differ materially from our expectations.
Jurisdictions such as China, Malaysia, Northern Ireland, Singapore, Thailand and the U.S., in which we have significant operating assets, and the European Union each have exercised and continue to exercise significant influence over many aspects of their domestic economies including, but not limited to, fair competition, tax practices, anti-corruption, anti-trust, data privacy, protection, security and sovereignty, price controls and international trade, which have had and may continue to have an adverse effect on our business operations and financial condition.
Jurisdictions such as China, Malaysia, Northern Ireland, Singapore, Thailand and the U.S., in which we have significant operating assets, and the European Union each have exercised and continue to exercise significant influence over many aspects of their domestic economies including, but not limited to, fair competition, tax practices, anti-corruption, anti-trust, data privacy, protection, security and sovereignty, price controls and international trade, including the imposition of tariffs or other trade restrictions, which have had and may continue to have an adverse effect on our business operations and financial condition.
While we have long-standing relationships with many of our customers, if any key customers were to significantly reduce, defer or cancel their purchases or delay product acceptances, or we were prohibited from selling to those key customers for any reason, such as export regulations, our revenues and results of operations may be materially and adversely affected, particularly if we are unable to collect any applicable cancellation charges.
While we have long-standing relationships with many of our customers, if any key customers were to significantly reduce, defer or cancel their purchases or delay product acceptances, or we were prohibited from selling to those key customers for any reason, such as export regulations or other factors beyond our control, our revenues and results of operations may be materially and adversely affected, particularly if we are unable to collect any applicable cancellation charges.
RISKS ASSOCIATED WITH SUPPLY AND MANUFACTURING Shortages or delays in the receipt of, or cost increases in, critical components, equipment or raw materials necessary to manufacture our products, as well as reliance on single-source suppliers, may affect our production and development of products and may harm our operating results.
RISKS ASSOCIATED WITH SUPPLY AND MANUFACTURING Shortages or delays in the receipt of, or cost increases in, critical components, equipment or raw materials necessary to manufacture our products, as well as reliance on single-source suppliers, has in the past and may in the future affect our production and development of products and harm our operating results.
In addition, we are subject to examinations of our income tax returns in tax regimes we are subject to or operate under. We regularly assess the likelihood of outcomes resulting from these examinations to determine the adequacy of our provision for 29 Table of Contents income taxes and have reserved for potential adjustments that may result from the examinations.
In addition, we are subject to examinations of our income tax returns in tax regimes we are subject to or operate under. We regularly assess the likelihood of outcomes resulting from these examinations to determine the adequacy of our provision for income taxes and have reserved for potential adjustments that may result from these examinations.
Our business operations are subject to interruption by natural disasters such as floods and earthquakes, fires, power or water shortages, terrorist attacks, other hostile acts, labor disputes, public health issues and related mitigation actions, and other events beyond our control.
Our business operations are also subject to interruption by natural disasters such as floods and earthquakes, fires, power or water shortages, terrorist attacks, other hostile acts, labor disputes, political unrest, public health issues and related mitigation actions, and other events beyond our control.
In addition, upon a default by an option counterparty, we may suffer more dilution than we currently anticipate with respect to our ordinary shares. We can provide no assurance as to the financial stability or viability of the option counterparties to the capped call transactions.
In addition, upon a default by an option counterparty, we may suffer more dilution than we currently anticipate with respect to our ordinary shares. We can provide no assurance as to the financial stability or viability of our counterparties.
Our high level of debt presents the following risks: • we are required to use a substantial portion of our cash flows from operations to service our debt, which reduces the availability of our cash flows to fund working capital, capital expenditures, product development efforts, strategic acquisitions, investments and alliances and other general corporate requirements; • our substantial leverage increases our vulnerability to economic downturns, decreases the availability of capital and may subject us to a competitive disadvantage vis-à-vis those of our competitors that are less leveraged; • our debt service obligations could limit our flexibility in planning for, or reacting to, changes in our business and our industry, and could limit our ability to borrow additional funds on satisfactory terms for operations or capital to implement our business strategies; and • covenants in our debt agreements, including our existing Credit Agreement (as defined herein), limit, among other things, our ability to pay future dividends or make other restricted payments and investments and to incur additional indebtedness, which could restrict our ability to execute on our business strategy or react to the economic environment.
Our high level of debt presents the following risks: • we are required to use a substantial portion of our cash flows from operations to service our debt, which reduces the availability of our cash flows to fund working capital, capital expenditures, product development efforts, strategic acquisitions, investments and alliances and other general corporate requirements; • our substantial leverage increases our vulnerability to economic downturns, decreases the availability of capital and may subject us to a competitive disadvantage vis-à-vis those of our competitors that are less leveraged; • our debt service obligations could limit our flexibility in planning for, or reacting to, changes in our business and our industry, and could limit our ability to borrow additional funds on satisfactory terms for operations or capital to implement our business strategies; and • covenants in our debt agreements, including our existing Credit Agreement (as defined herein), limit, among other things, our ability to pay future dividends or make other restricted payments and investments and to incur additional indebtedness, which could restrict our ability to execute on our business strategy or react to the economic environment. 24 Table of Contents In addition, our ability to service our debt obligations and comply with debt covenants depends on our financial performance.
Failure to comply with the Settlement Agreement could result in significant penalties, including the loss of the suspension of the denial order which would prohibit us from exporting our products subject to the EAR outside of the United States, and could have a material and adverse effect on our business, results of operations, financial condition and cash flows.
Failure to comply with the Settlement Agreement could result in significant penalties, including the loss of the suspension of the denial order which would prohibit us from a range of export-related activities, including exporting our products subject to the EAR outside of the United States, and could have a material and adverse effect on our business, results of operations, financial condition and cash flows.
To mitigate wildfire risk, electric utilities are deploying public safety power shutoffs, which affects electricity reliability to our facilities and our communities. Many of our suppliers and customers are also located in areas with risks of natural disasters.
To mitigate wildfire risk, electric utilities are deploying public safety power shutoffs, which affects electricity reliability to our facilities and our communities, potentially disrupting our operations. Many of our suppliers and customers are also located in areas with risks of natural disasters.
Our market share, revenue and results of operations in the future may be adversely affected if we fail to: • develop new products, identify business strategies and timely introduce competitive product offerings to meet technological shifts; • consistently maintain our time-to-market performance with our new products; • manufacture these products in adequate volume; • meet specifications or satisfy compatibility requirements; • qualify these products with key customers on a timely basis by meeting our customers’ performance, quality and security specifications; or • achieve acceptable manufacturing yields, quality and margins with these products.
Our market share, revenue and results of operations have been, and in the future may be adversely affected by our failure to: • develop new products, identify business strategies and timely introduce competitive product offerings to meet technological shifts; • consistently maintain our time-to-market performance with our new products; • manufacture these products in adequate volume; • meet specifications or satisfy compatibility requirements; • qualify these products with key customers on a timely basis by meeting our customers’ performance, quality and security specifications; or • achieve acceptable manufacturing yields, quality and margins with these products.
For example, due to customer inventory adjustments, we have experienced a slowdown in demand for our products, particularly in the mass capacity markets. These reductions in demand have required us to significantly reduce manufacturing production plans and recognize factory underutilization charges in fiscal years 2024 and 2023.
For example, due to customer inventory adjustments, we have in the past experienced, and may in the future experience, a slowdown in demand for our products, particularly in the mass capacity markets. These reductions in demand have required us to significantly reduce manufacturing production plans and recognize factory underutilization charges in fiscal years 2024 and 2023.
In addition, if we fail to identify and complete such transactions and successfully integrate acquired businesses that further our strategic objectives, we may be required to expend additional resources to develop products, services and technology 21 Table of Contents internally, which may put us at a competitive disadvantage.
In addition, if we fail to identify and complete such transactions and successfully integrate acquired businesses that further our strategic objectives, we may be required to expend additional resources to develop products, services and technology internally, which may put us at a competitive disadvantage.
Any further limitation that impedes our ability to export or 28 Table of Contents sell our products and services could materially and adversely affect our business, results of operations, financial condition and cash flows.
Any further limitation that impedes our ability to export or sell our products and services could materially and adversely affect our business, results of operations, financial condition and cash flows.
As AI capabilities improve and are increasingly adopted, we may be subject to cyberattacks created with AI.
As AI capabilities improve and are increasingly adopted, we may be subject to cyberattacks created and/or augmented with AI.
We must successfully implement our new global enterprise resource planning system and maintain and upgrade our information technology (“IT”) systems, and our failure to do so could have a material and adverse effect on our business, financial condition and results of operations .
We must maintain and upgrade our global enterprise resource planning system and other information technology (“IT”) systems, and our failure to do so could have a material and adverse effect on our business, financial condition and results of operations .
In addition, current and potential competitors have established or might establish cooperative relationships among themselves or with third parties, including some of our partners or suppliers, that result in declines in revenue or willingness to purchase or sell to us, as applicable, on favorable terms.
In addition, current and potential competitors have established and may in the future establish cooperative relationships among themselves or with third parties, including some of our partners or suppliers, that result in declines in revenue or willingness to purchase from or sell to us, as applicable, on favorable terms.
These standards provide mechanisms to ensure technology component interoperability but they also hinder our ability to innovate or differentiate our products. When this occurs, our products may be considered commodities, which could result in downward pressure on prices.
These standards provide mechanisms to ensure technology component interoperability but they also hinder our ability to innovate or differentiate our products. When this occurs, our products may be considered commodities, which has historically, and could in the future, result in downward pressure on prices.
If one of our counterparties, including the option counterparties to the capped call transactions, becomes insolvent or files for bankruptcy, our ability to recover any losses suffered as a result of that counterparty's default may be limited by the liquidity of the counterparty or the applicable laws governing the bankruptcy proceedings.
If one of our counterparties becomes insolvent or files for bankruptcy, our ability to recover any losses suffered as a result of that counterparty's default may be limited by the liquidity of the counterparty or the applicable laws governing the bankruptcy proceedings.
Significant inflation and related increases in interest rates have negatively affected our business in recent quarters and could continue in the near future to negatively affect our business, operating results or financial condition or the markets in which we operate, which, in turn, could adversely affect the price of our ordinary shares.
Significant inflation and elevated interest rates have negatively affected our business in recent quarters and could continue to negatively affect our business, operating results or financial condition or the markets in which we operate, which, in turn, could adversely affect the price of our ordinary shares.
Our principal sources of competition include HDD and SSD manufacturers, and companies that provide storage subsystems, including electronic manufacturing services and contract electronic manufacturing. 17 Table of Contents The markets for our data storage products are characterized by technological change, which is driven in part by the adoption of new industry standards.
We face intense competition in the data storage industry. Our principal sources of competition include HDD and SSD manufacturers, and companies that provide storage subsystems, including electronic manufacturing services and contract electronic manufacturing. The markets for our data storage products are characterized by technological change, which is driven in part by the adoption of new industry standards.
In the past, we have been involved in significant and expensive disputes regarding our intellectual property rights and those of others, including claims that we may be infringing patents, trademarks and other intellectual property rights of third parties. We expect that we will be involved in similar disputes in the future .
We are frequently involved in significant and expensive disputes regarding our intellectual property rights and those of others, including claims that we may be infringing patents, trademarks and other intellectual property rights of third parties. We expect that we will be involved in similar disputes in the future .
From time to time, we have been and may continue to be involved in various legal, regulatory or administrative investigations, inquiries, negotiations or proceedings arising in the normal course of business. See “Item 8. Financial Statements and Supplementary Data— Note 14. Legal, Environmental and Other Contingencies ” contained in this Annual Report for a description of material legal proceedings.
From time to time, we have been and may continue to be involved in various legal, regulatory or administrative investigations, inquiries, negotiations or proceedings. See “Item 8. Financial Statements and Supplementary Data— Note 13. Legal, Environmental and Other Contingencies ” contained in this Annual Report for a description of material legal proceedings.
The reductions in workforce, salary reductions and variability in our bonus payouts that resulted from our historical restructurings have also made and may continue to make it difficult for us to recruit and retain personnel. Increased difficulty in accessing, recruiting or retaining personnel may lead to increased manufacturing and employment compensation costs, which could adversely affect our results of operations.
Our historical restructurings, temporary salary reductions and variability in bonus payouts have made and may continue to make it difficult for us to recruit and retain personnel. Increased difficulty in accessing, recruiting or retaining personnel may lead to increased manufacturing and employment compensation costs, which could adversely affect our results of operations.
Defects in our products could also result in legal actions by our customers for breach of warranty, property damage, injury or death. Such legal actions including, but not limited to, product liability claims could exceed the level of insurance coverage that we have obtained.
Defects in our products could also result in legal actions by our customers for breach of warranty, property damage, injury or death. Such legal actions including, but not limited to, product liability claims could exceed the level of insurance coverage that we have obtained. Any significant uninsured claims could significantly harm our financial condition.
The costs to eliminate or address security problems and security vulnerabilities before or after a security breach or incident may be significant. Certain legacy IT systems may not be easily remediated, and our disaster recovery planning may not be sufficient for all eventualities.
The costs of eliminating or addressing security problems and security vulnerabilities before or after a security breach or incident may be significant. Certain legacy IT systems may not be easily remediated, and our disaster recovery planning may not be sufficient for all eventualities.
Laws, regulations and policies may change in ways that will require us to modify our business model and objectives or affect our returns on investments by restricting existing activities and products, subjecting them to escalating costs or prohibiting them outright.
Laws, regulations and policies, particularly in the U.S., may change in significant, unexpected, and/or unpredictable ways that will require us to modify our business model and objectives or affect our returns on investments by restricting existing activities and products, subjecting them to escalating costs or prohibiting them outright.
Financial Statements and Supplementary Data — Note 14. Legal, Environmental and Other Contingencies ” contained in this report for a description of material intellectual property proceedings . Our business and certain products and services depend in part on intellectual property and technology licensed from third parties, as well as data centers and infrastructure operated by third parties.
Legal, Environmental and Other Contingencies ” contained in this report for a description of material intellectual property proceedings . 31 Table of Contents Our business and certain products and services depend in part on intellectual property and technology licensed from third parties, as well as data centers and infrastructure operated by third parties.
Geopolitical uncertainty, terrorism, instability or war, such as the military action against Ukraine launched by Russia and the latest developments in the Middle East conflict, natural disasters, public health issues and other business interruptions have caused and could cause damage or disruption to international commerce and the global economy, and thus could have a strong negative effect on our business, our direct and indirect suppliers, logistics providers, manufacturing vendors and customers.
Geopolitical uncertainty, political unrest, terrorism, instability or war, such as the conflict between Ukraine and Russia and conflicts in the Middle East, natural disasters, public health issues and other business interruptions have caused and could cause damage or disruption to international commerce and the global economy, and thus could have a strong negative effect on our business, our direct and indirect suppliers, logistics providers, manufacturing vendors and customers.
Because of our vertical design and manufacturing strategy, our operations have higher costs that are fixed or difficult to reduce in the short-term, including our costs related to utilization of existing facilities and equipment.
In addition, because of our vertical design and manufacturing strategy, operations have significant fixed costs that are difficult to reduce in the short-term, including our costs relating to utilization of existing facilities and equipment.
Risks Related to Financial Performance or General Economic Conditions • Changes in the macroeconomic environment have impacted and may continue to negatively impact our results of operations. 15 Table of Contents • We may not be able to generate sufficient cash flows from operations and our investments to meet our liquidity requirements, including servicing our indebtedness and continuing to declare our quarterly dividend. • Our quarterly results of operations fluctuate, sometimes significantly, from period to period, and may cause our share price to decline. • Any cost reduction initiatives that we undertake may not deliver the results we expected and these actions may adversely affect our business. • The effect of geopolitical uncertainties, war, terrorism, natural disasters, public health issues and other circumstances, on national and/or international commerce and on the global economy, could materially and adversely affect our results of operations and financial condition. • We are subject to counterparty default risks.
Risks Related to Financial Performance or General Economic Conditions • Changes in the macroeconomic environment have impacted and may continue to negatively impact our results of operations. • We may not be able to generate sufficient cash flows from operations and our investments to meet our liquidity requirements, including servicing our indebtedness and continuing to declare our quarterly dividend. • Our quarterly results of operations fluctuate, sometimes significantly, from period to period, and may cause our share price to decline. • If we do not adequately control our costs or if any cost reduction activities that we undertake do not deliver the results we expect, we will not be able to compete effectively and our financial condition may be adversely impacted. • The effect of geopolitical uncertainties, political unrest, war, terrorism, natural disasters, public health issues and other circumstances, on national and/or international commerce and on the global economy, could materially and adversely affect our results of operations and financial condition. • We are subject to counterparty default risks.
In light of this small, consolidated supplier base, if our suppliers increased their prices as a result of inflationary pressures from the current macroeconomic conditions or changes to such conditions, and we could not pass these price increases to our customers, our operating margin would decline.
In light of this small, consolidated supplier base, if our suppliers increased their prices as a result of inflationary pressures, evolving trade policies, including the imposition of tariffs or other trade restrictions, or other macroeconomic conditions or changes to such conditions, and we could not pass these price increases to our customers, our operating margin would decline.
These measures may materially increase costs for goods imported into the United States. This in turn could require us to materially increase prices to our customers which may reduce demand, or, if we are unable to increase prices to adequately address any tariffs, quotas or duties, could lower our margin on products sold and negatively impact our financial performance.
This in turn could require us to materially increase prices to our customers which may reduce demand, or, if we are unable to increase prices to adequately address any tariffs, quotas or duties, could lower our margin on products sold and negatively impact our financial performance.
Certain rare earth elements are also critical in the manufacture of our products. In addition, the equipment we use to manufacture our products and components is frequently custom made and comes from a few suppliers and the lead times required to obtain manufacturing equipment can be significant.
In addition, the equipment we use to manufacture our products and components is frequently custom made and comes from a few suppliers and the lead times required to obtain manufacturing equipment can be significant.
If prices decline significantly in this distribution channel or our distributors or retailers reduce purchases of our products, experience financial difficulties or terminate their relationships with us, our revenues and results of operations would be adversely affected.
Our distributors’ and retailers’ ability to access credit to fund their operations may also affect their purchases of our products. If prices decline significantly in this distribution channel or our distributors or retailers reduce purchases of our products, experience financial difficulties or terminate their relationships with us, our revenues and results of operations would be adversely affected.
Our future effective tax rate may also be affected by a variety of factors, including changes in our business or statutory rates, the mix of earnings in countries with differing statutory tax rates, available tax incentives, credits and deductions, the expiration of statutes of limitations, changes in accounting principles, adjustments to income taxes upon finalization of tax returns, increases in expenses not deductible for tax purposes, the estimates of our deferred tax assets and liabilities and deferred tax asset valuation allowances, changing interpretation of existing laws or regulations, the impact of accounting for business combinations, as well as changes in the domestic or international organization of our business and structure.
Our future effective tax rate may also be affected by a variety of factors, including changes in our business or statutory rates, the mix of earnings in countries with differing statutory tax rates, available tax incentives, credits and deductions, the expiration of statutes of limitations, changes in accounting principles, adjustments to income taxes upon finalization of tax returns, increases in expenses not deductible for tax purposes, the estimates of our deferred tax assets and liabilities and deferred tax asset valuation allowances, changing interpretations of existing laws or regulations, the impact of accounting for business combinations, as well as changes in the domestic or international organization of our business and structure. 30 Table of Contents RISKS RELATED TO INTELLECTUAL PROPERTY AND OTHER PROPRIETARY RIGHTS We may be unable to protect our intellectual property rights, which could adversely affect our business, financial condition and results of operations .
Also, many of these direct and indirect component suppliers are geographically concentrated, making our supply chain more vulnerable to regional disruptions such as severe weather, local or global health issues or pandemics, acts of terrorism, war and an unpredictable geopolitical climate, which have materially impacted, and may in the future impact the production, availability and transportation of many components.
Also, many of these direct and indirect component suppliers are geographically concentrated, making our supply chain more vulnerable to regional disruptions such as severe weather, local or global health issues or pandemics, acts of terrorism, war and an unpredictable geopolitical climate.
If actual demand for our products is lower than the forecast, we may also experience excess and obsolescence of inventory, higher inventory carrying costs, factory underutilization charges and manufacturing rework costs, which have resulted in and could in the future result in material and adverse effects on our financial condition and results of operations.
If we fail to forecast demand accurately or if there is a partial or complete reduction in long term demand for our products, we may also experience excess and obsolescence of inventory, higher inventory carrying costs, factory underutilization charges and manufacturing rework costs, which have resulted in and could in the future result in material and adverse effects on our financial condition and results of operations.
In addition, difficulties with implementing new technology systems, such as ERP, delays in our timeline for planned improvements, significant system failures or our inability to successfully modify our IT systems, policies, procedures or monitoring tools to respond to changes in our business needs in the past have caused and in the future may cause disruptions in our business operations, increase security risks, and may have a material and adverse effect on our business, financial condition and results of operations.
In addition, difficulties with implementing and maintaining new technology systems, such as ERP, delays in our timeline for planned improvements, significant system failures or our inability to successfully modify our IT systems, policies, procedures or monitoring tools to respond to changes in our business needs in the past have caused and in the future may cause disruptions in our business operations, increase security risks, and may have a material and adverse effect on our business, financial condition and results of operations. 33 Table of Contents RISKS RELATED TO HUMAN CAPITAL AND CORPORATE RESPONSIBILITY The loss of or inability to attract, retain and motivate key executive officers and employees could negatively impact our business prospects .
Similarly, Singapore may impose taxes on dividends of cash from our subsidiaries to the parent company. If we are unable to access our cash or we are required to pay taxes to repatriate such cash, our business and operations may be harmed, or we may need to seek other sources of liquidity.
If we are unable to access our cash or we are required to pay taxes to repatriate such cash, our business and operations may be harmed, or we may need to seek other sources of liquidity.
Given the length of development and qualification programs and unpredictability of the sales cycle, we may be unable to accurately forecast product demand, which may result in excess inventory and associated inventory reserves or write-downs, which could harm our business, financial condition and results of operations.
Given the length of development and qualification programs and unpredictability of the sales cycle, we may be unable to accurately forecast product demand, which may result in excess inventory and associated inventory reserves or write-downs, which could harm our business, financial condition and results of operations. 20 Table of Contents We experience seasonal declines in the sales of our consumer products during the second half of our fiscal year which may adversely affect our results of operations.
The declaration and payment of any future dividends is at the discretion of our Board of Directors. Our previously announced share repurchase program was paused in the December 2022 quarter, remained paused through the end of fiscal year 2024 and there are no assurances as to if and when the program will resume.
The declaration and payment of any future dividends is at the discretion of our Board of Directors. Our previously announced share repurchase program was paused in the December 2022 quarter and remained paused through the end of fiscal year 2025.
Risks Related to Information Technology, Data and Information Security • We could suffer a loss of revenue and increased costs, exposure to significant liability including legal and regulatory consequences, reputational harm and other serious negative consequences in the event of cyber-attacks, ransomware or other cyber security breaches or incidents that disrupt our operations or result in unauthorized access to, or the loss, corruption, unavailability or dissemination of proprietary or confidential information of our customers or about us or other third parties. • We must successfully implement our new global enterprise resource planning system and maintain and upgrade our information technology (“IT”) systems, and our failure to do so could have a material and adverse effect on our business, financial condition and results of operations.
Risks Related to Information Technology, Data and Information Security • We could suffer a loss of revenue and increased costs, exposure to significant liability including legal and regulatory consequences, reputational harm and other serious negative consequences in the event of cyber-attacks, ransomware or other cyber security breaches or incidents that disrupt our operations, cause widespread outages, and/or result in unauthorized access to, or the loss, corruption, unavailability or dissemination of proprietary or confidential information of our customers or about us or other third parties. • We must maintain and upgrade our global enterprise resource planning system and other information technology (“IT”) systems, and our failure to do so could have a material and adverse effect on our business, financial condition and results of operations. 16 Table of Contents Risks Related to Human Capital and Corporate Responsibility • The loss of or inability to attract, retain and motivate key executive officers and employees could negatively impact our business prospects. • We are subject to risks related to corporate and social responsibility that could adversely affect our reputation and performance.
Other factors that have affected and may continue to affect our ability to anticipate or meet the demand for our products and adversely affect our results of operations include: • competitive product announcements or technological advances that result in excess supply when customers cancel purchases in anticipation of newer products; • variable demand resulting from unanticipated upward or downward pricing pressures; • our ability to successfully qualify, manufacture and sell our data storage products; • changes in our product mix, which may adversely affect our gross margins; • key customers deferring or canceling purchases or delaying product acceptances, or unexpected increases in their orders; • manufacturing delays or interruptions, particularly at our manufacturing facilities in China, Malaysia, Northern Ireland, Singapore, Thailand or the United States; • limited access to components that we obtain from a single or a limited number of suppliers; and • the impact of changes in foreign currency exchange rates on the cost of producing our products and the effective price of our products to non-U.S. customers.
Other factors that have affected and may continue to affect our ability to anticipate or meet the demand for our products and adversely affect our results of operations include: • competitive product announcements or technological advances that result in excess supply when customers cancel purchases in anticipation of newer products; • variability in demand due to end market conditions, including fluctuations in adoption rates of emerging technologies such as artificial intelligence, shifts in customer preferences and broader economic trends; • variable demand resulting from unanticipated upward or downward pricing pressures; • our ability to successfully qualify, manufacture and sell our data storage products; • changes in our product mix, which may adversely affect our gross margins; • key customers deferring or canceling purchases or delaying product acceptances, or unexpected increases in their orders; • manufacturing delays or interruptions, particularly at our manufacturing facilities in China, Malaysia, Northern Ireland, Singapore, Thailand or the United States; • limited access to components that we obtain from a single or a limited number of suppliers; and • the impact of changes in trade policy, including tariffs, and/or foreign currency exchange rates on the cost of producing our products and the effective price of our products to our customers. 19 Table of Contents Changes in demand for computer systems, data storage subsystems and consumer electronic devices has previously caused, and may in the future cause, a decline in demand for our products.
Our products could be shipped to restricted end-users or for restricted end-uses by third parties, including potentially our channel partners, despite our precautions. In addition, if our partners fail to obtain appropriate import, export or re-export licenses or permits, we may also be adversely affected, through reputational harm as well as other negative consequences including government investigations and penalties.
In addition, if our partners fail to obtain appropriate import, export or re-export licenses or permits, we may also be adversely affected, through reputational harm as well as other negative consequences including government investigations and penalties.
Volatility in fuel costs, political instability or constraints and increases in the costs or reliability of air transportation may lead us to develop alternative shipment methods, which could disrupt our ability to receive raw materials, or ship finished products, and as a result our business and results of operations may be harmed.
Volatility in fuel costs, political instability or constraints and increases in the costs or reliability of air transportation may lead us to develop alternative shipment methods, which could disrupt our ability to receive raw materials, or ship finished products, and as a result our business and results of operations may be harmed. 21 Table of Contents We may not be able to execute acquisitions, divestitures and other significant transactions successfully and we may have difficulty or fail to successfully integrate acquired companies.
If our transitions to more advanced technologies, including the transition to HDDs utilizing HAMR technology, require development and production cycles that are longer than anticipated or if we otherwise fail to implement new HDD technologies successfully, we may lose sales and market share, which could significantly harm our financial results and reputation.
If our transitions to more advanced technologies, including the transition to HDDs utilizing HAMR technology, require development, qualification or production cycles that are longer than anticipated or if we otherwise fail to implement new HDD technologies successfully, we may lose sales and market share, which could significantly harm our financial results and reputation. 17 Table of Contents We cannot assure you that we will be among the leaders in time-to-market with new products or that we will be able to successfully qualify new products with our customers in the future.
If a significant transaction or regulatory impact involving any of our key customers results in the loss of or reduction in purchases by these key customers, it could have a material and adverse effect on our business, results of operations and financial condition.
If a significant transaction or regulatory impact involving any of our key customers results in the loss of or reduction in purchases by these key customers, it could have a material and adverse effect on our business, results of operations and financial condition. 18 Table of Contents We are dependent on sales to distributors and retailers, which may increase price erosion and the volatility of our sales .
Disruptions in the economic, environmental, political, legal or regulatory landscape in the countries where we operate may have a material and adverse impact on our manufacturing and sales operations.
Disruptions in the economic, environmental, political, legal or regulatory landscape in the countries where we operate may have a material and adverse impact on our manufacturing and sales operations. Disruptions in financial markets and the deterioration of global economic conditions have had and may continue to have an impact on our sales to customers and end-users.
Reduced demand, particularly from our key cloud and enterprise customers as a result of a significant change in macroeconomic conditions or other factors, may result in a significant reduction or cancellation of their purchases from us, which has in the past and may in the future materially and adversely impact our business and financial condition. 18 Table of Contents Our manufacturing process requires us to make significant product-specific investments in inventory for production at least three to six months in advance.
Reduced demand, particularly from our key cloud and enterprise customers as a result of a significant change in macroeconomic conditions or other factors, may result in a significant reduction or cancellation of their purchases from us, which has in the past and may in the future materially and adversely impact our business and financial condition.
Our restructuring efforts and other measures to reduce costs may not yield the intended benefits and may be unsuccessful or disruptive to our business operations which may materially and adversely affect our financial results. We may not be able to execute acquisitions, divestitures and other significant transactions successfully and we may have difficulty or fail to successfully integrate acquired companies.
Our restructuring efforts and other measures to reduce costs may not yield the intended benefits and may be unsuccessful or disruptive to our business operations which may materially and adversely affect our financial results.
Further, if our customers experience shortages of components or materials used in their products it could result in a decrease in demand for our products and have an adverse effect on our results of operations. 22 Table of Contents We have cancelled purchase commitments with suppliers and incurred costs associated with such cancellations, and if revenues fall or customer demand decreases significantly, we may seek to cancel or may otherwise not meet our purchase commitments to certain suppliers in the future, which could result in damages, penalties, disputes, litigation, increased manufacturing costs or excess inventory.
We have cancelled purchase commitments with suppliers and incurred costs associated with such cancellations, and if revenues fall or customer demand decreases significantly, we may seek to cancel or may otherwise not meet our purchase commitments to certain suppliers in the future, which could result in damages, penalties, disputes, litigation, increased manufacturing costs or excess inventory.
Even if we were not found to have violated such laws, the political and media scrutiny surrounding any governmental investigation of us could cause us significant expense and reputational harm. Such collateral consequences could have a material adverse impact on our business, results of operations, financial condition and cash flows.
Even if we were not found to have violated such laws, the political and media scrutiny surrounding any governmental investigation of us could cause us significant expense and reputational harm.
Our investment decisions in adding new manufacturing capacity require significant planning and lead time, and a failure to accurately forecast demand for our products could cause us to over-invest or under-invest, which would lead to excess capacity, underutilization charges, or impairments. Sales to the legacy markets remain an important part of our business.
We are dependent on our long-term investments to manufacture adequate products. Our investment decisions in adding new manufacturing capacity require significant planning and lead time, and a failure to accurately forecast demand for our products could cause us to over-invest or under-invest, which would lead to excess capacity, underutilization charges, or impairments.
We and our vendors may be unable to anticipate or prevent these attacks and other threats, react in a timely manner, or implement adequate preventive measures, and we and they may face delays in detection or remediation of, or other responses to, security breaches and other security-related incidents.
We anticipate that these threats will continue to grow in scope and complexity over time due to the development and deployment of increasingly advanced tools and techniques. 32 Table of Contents We and our vendors may be unable to anticipate or prevent these attacks and other threats, react in a timely manner, or implement adequate preventive measures, and we and they may face delays in detection or remediation of, or other responses to, security breaches and other security-related incidents.
Our results of operations in one or more future quarters may fail to meet the expectations of investment research analysts or investors, which could cause an immediate and significant decline in our market value. Any cost reduction initiatives that we undertake may not deliver the results we expected and these actions may adversely affect our business .
Our results of operations in one or more future quarters may fail to meet the expectations of investment research analysts or investors, which could cause an immediate and significant decline in our market value. 25 Table of Contents If we do not adequately control our costs or if any cost reduction initiatives that we undertake do not deliver the results we expect, we will not be able to compete effectively and our financial condition may be adversely impacted.
We have been adversely affected by reduced, delayed, loss of or canceled purchases by, one or more of our key customers, including large hyperscale data center companies and CSPs. Some of our key customers, such as OEM customers including large hyperscale data center companies and CSPs, account for a large portion of our revenue in our mass capacity markets.
Some of our key customers, such as OEM customers including large hyperscale data center companies and CSPs, account for a large portion of our revenue in our mass capacity markets.
We also often aim to lead the market in new technology deployments and leverage unique and customized technology from single source suppliers who are early adopters in the emerging market.
These factors have materially impacted, and may in the future impact the production, availability and transportation of many components. We also often aim to lead the market in new technology deployments and leverage unique and customized technology from single source suppliers who are early adopters in the emerging market.
Therefore, we cannot be certain that we will be able to protect our intellectual property rights in jurisdictions outside the United States . 30 Table of Contents We are at times subject to intellectual property proceedings and claims which could cause us to incur significant additional costs or prevent us from selling our products, and which could adversely affect our results of operations and financial condition .
We are at times subject to intellectual property proceedings and claims which could cause us to incur significant additional costs or prevent us from selling our products, and which could adversely affect our results of operations and financial condition .
We rely on sole or a limited number of direct and indirect suppliers for some or all of these components and rare earth elements that we do not manufacture, including substrates for recording media, read/write heads, ASICs, preamplifiers, spindle motors, printed circuit boards, suspension assemblies and NAND flash memory.
Our efforts to control our costs, including capital expenditures, may also affect our ability to obtain or maintain such inputs and equipment, which could affect our ability to meet future demand for our products. 22 Table of Contents We rely on sole or a limited number of direct and indirect suppliers for some or all of these components and rare earth elements that we do not manufacture, including substrates for recording media, read/write heads, ASICs, preamplifiers, spindle motors, printed circuit boards, suspension assemblies and NAND flash memory.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeAs part of our overall risk mitigation strategy, we maintain insurance coverage that is intended to address certain aspects of cybersecurity risks, however, such insurance may not be sufficient in type or amount to cover us against claims related to security breaches and incidents, cyberattacks and other related matters.
Biggest changeAs part of our overall risk mitigation strategy, we maintain insurance coverage that is intended to address certain aspects of cybersecurity risks, however, such insurance may not be sufficient in type or amount to cover us against claims related to security breaches and incidents, cyberattacks and other related matters. 35 Table of Contents In addition, we maintain a third-party cyber risk management process for vendors including, among other things, a security assessment and contracting program for vendors based on our assessment of their risk profile and periodic monitoring regarding adherence to applicable cybersecurity standards.
Our CISO reports to our CIO who, in turn, reports directly to our CFO. Our CISO is an experienced cybersecurity executive with more than 20 years of experience building and leading cybersecurity, risk management, and information technology teams. 35 Table of Contents
Our CISO reports to our CIO who, in turn, reports directly to our CFO. Our CISO is an experienced cybersecurity executive with more than 20 years of experience building and leading cybersecurity, risk management, and information technology teams. 36 Table of Contents
For additional information about these risks, see Part I, Item 1A, "Risk Factors" in this Annual Report on Form 10-K. 34 Table of Contents Governance Our Board of Directors (the “Board”) considers cybersecurity risk as part of its risk oversight function and has delegated to the Audit and Finance Committee of the Board (the “Audit and Finance Committee”) oversight of cybersecurity and other information technology risks, including our plans designed to mitigate cybersecurity risks and to respond to data breaches.
Governance Our Board of Directors (the “Board”) considers cybersecurity risk as part of its risk oversight function and has delegated to the Audit and Finance Committee of the Board (the “Audit and Finance Committee”) oversight of cybersecurity and other information technology risks, including our plans designed to mitigate cybersecurity risks and to respond to data breaches.
Accordingly, there can be no assurance that we have not experienced undetected security breaches or incidents, or that we will not experience a security breach or incident in the future.
Accordingly, there can be no assurance that we have not experienced undetected security breaches or incidents, or that we will not experience a security breach or incident in the future. For additional information about these risks, see Part I, Item 1A, "Risk Factors" in this Annual Report on Form 10-K.
Removed
In addition, we maintain a third-party cyber risk management process for vendors including, among other things, a security assessment and contracting program for vendors based on our assessment of their risk profile and periodic monitoring regarding adherence to applicable cybersecurity standards.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeOur material manufacturing, product development and marketing and administrative facilities at June 28, 2024 are as follows: Location Building(s) Owned or Leased Approximate Square Footage Primary Use Europe Northern Ireland Springtown Owned 479,000 Manufacture of recording heads United States California Leased 575,000 Product development, marketing and administrative and operational offices Colorado Leased 533,000 Product development, administrative and operational offices Minnesota Owned/Leased 1,168,000 Manufacture of recording heads and product development Asia China Wuxi Leased 707,000 Manufacture of drives and drive subassemblies Malaysia Johor Owned (1) 631,000 Manufacture of substrates Singapore Woodlands Owned/Leased (1) 1,511,000 Manufacture of media, administrative and operational offices Ayer Rajah Leased 440,000 Product development, administrative and operational offices Thailand Korat Owned/Leased 2,706,000 Manufacture of drives and drive subassemblies Teparuk Owned/Leased 453,000 Manufacture of drive subassemblies ___________________________________ (1) Land leases for these facilities expire on various dates through 2068.
Biggest changeOur material manufacturing, product development and marketing and administrative facilities at June 27, 2025 are as follows: Location Building(s) Owned or Leased Approximate Square Footage Primary Use Europe Northern Ireland Springtown Owned 479,000 Manufacture of recording heads United States California Leased 650,000 Product development, marketing and administrative and operational offices Colorado Leased 533,000 Product development, administrative and operational offices Minnesota Owned/Leased 1,168,000 Manufacture of recording heads and product development Asia China Wuxi Leased 707,000 Manufacture of drives and drive subassemblies Malaysia Johor Owned (1) 631,000 Manufacture of substrates Singapore Woodlands Owned/Leased (1) 1,543,000 Manufacture of media, administrative and operational offices Ayer Rajah Leased 440,000 Product development, administrative and operational offices Thailand Korat Owned/Leased 2,706,000 Manufacture of drives and drive subassemblies Teparuk Owned/Leased 453,000 Manufacture of drive subassemblies ___________________________________ (1) Land leases for these facilities expire on various dates through 2068.
As of June 28, 2024, we owned or leased a total of approximately 9.6 million square feet of space worldwide. We believe that our existing properties are in good operating condition and are suitable for the operations for which they are used.
As of June 27, 2025, we owned or leased a total of approximately 9.7 million square feet of space worldwide. We believe that our existing properties are in good operating condition and are suitable for the operations for which they are used.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeThe following table sets forth information with respect to all repurchases of our ordinary shares made during the fiscal year ended June 28, 2024, including statutory tax withholdings related to vesting of employee equity awards (in millions, except average price paid per share): Period Total Number of Shares Repurchased (1) Average Price Paid per Share (1) Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs 1st Quarter through 3rd Quarter of Fiscal Year 2024 1 — 1 $ 1,891 March 30, 2024 through April 26, 2024 — — — 1,891 April 27, 2024 through May 31, 2024 — — — 1,890 June 1, 2024 through June 28, 2024 — — — 1,883 Through 4th Quarter of Fiscal Year 2024 1 1 $ 1,883 ___________________________________ (1) For the fiscal year 2024, the total number of shares repurchased is approximately 1 million, primarily related to the tax withholding from the vesting of restricted stock units.
Biggest changeThe following table sets forth information with respect to all repurchases of our ordinary shares made during the fiscal year ended June 27, 2025, including statutory tax withholdings related to vesting of employee equity awards (in millions, except average price paid per share): Period Total Number of Shares Repurchased (1) Average Price Paid per Share (1) Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs Approximate Dollar Value of Shares that May Yet Be Purchased Under the Plans or Programs (2) 1st Quarter through 3rd Quarter of Fiscal Year 2025 0.4 100.62 0.4 $ 1,840 March 29, 2025 through April 25, 2025 — — — 1,840 April 26, 2025 through May 23, 2025 — — — 5,000 May 24, 2025 through June 27, 2025 0.1 129.25 0.1 4,991 Through 4th Quarter of Fiscal Year 2025 0.5 0.5 $ 4,991 ___________________________________ (1) For the fiscal year 2025, the total number of shares repurchased is approximately 0.5 million, primarily related to the tax withholding from the vesting of restricted stock units.
The graph assumes that on June 28, 2019, $100 was invested in our ordinary shares and $100 was invested in each of the other two indices, w ith dividends reinvested on the date of payment without payment of any commissions. Dollar amounts in the graph are rounded to the nearest whole dollar.
The graph assumes that on July 3, 2020, $100 was invested in our ordinary shares and $100 was invested in each of the other two indices, w ith dividends reinvested on the date of payment without payment of any commissions. Dollar amounts in the graph are rounded to the nearest whole dollar.
We did not sell any of our equity securities during fiscal year 2024 that were not registered under the Securities Act of 1933, as amended. Performance Graph The performance graph below shows the cumulative total shareholder return on our ordinary shares for the period from June 28, 2019 to June 28, 2024.
We did not sell any of our equity securities during fiscal year 2025 that were not registered under the Securities Act of 1933, as amended. Performance Graph The performance graph below shows the cumulative total shareholder return on our ordinary shares for the period from July 3, 2020 to June 27, 2025.
Computer Hardware 100.00 172.98 263.92 263.30 370.43 415.35 Dividends Our ability to pay dividends in the future will be subject to, among other things, general business conditions within the data storage industry, our financial results, the impact of paying dividends on our credit ratings and legal and contractual restrictions on the payment of dividends by our subsidiaries to us or by us to our ordinary shareholders, including restrictions imposed by covenants on our debt instruments. 37 Table of Contents Certain Taxation Considerations Under Singapore Law Dividend distributions by Seagate to its shareholders are not subject to withholding tax, as Singapore currently does not levy a withholding tax on dividend distributions.
Computer Hardware 100.00 152.57 152.21 214.14 240.11 233.35 Dividends Our ability to pay dividends in the future will be subject to, among other things, general business conditions within the data storage industry, our financial results, the impact of paying dividends on our credit ratings and legal and contractual restrictions on the payment of dividends by our subsidiaries to us or by us to our ordinary shareholders, including restrictions imposed by covenants on our debt instruments. 38 Table of Contents Certain Taxation Considerations Under Singapore Law Dividend distributions by Seagate to its shareholders are not subject to withholding tax, as Singapore currently does not levy a withholding tax on dividend distributions.
ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Market Information Our ordinary shares trade on the NASDAQ Global Select Market under the symbol “STX.” As of July 30, 2024, there were approximately 467 holders of record of our ordinary shares.
ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES Market Information Our ordinary shares trade on the NASDAQ Global Select Market under the symbol “STX”. As of July 29, 2025, there were approximately 447 holders of record of our ordinary shares.
The performance shown in the graph represents past performance and should not be considered an indication of future performance. 6/28/2019 7/3/2020 7/2/2021 7/1/2022 6/30/2023 6/28/2024 Seagate Technology Holdings plc $ 100.00 $ 105.72 $ 202.47 $ 165.96 $ 155.86 $ 269.17 S&P 500 100.00 107.51 151.36 135.29 161.80 201.54 Dow Jones U.S.
The performance shown in the graph represents past performance and should not be considered an indication of future performance. 7/3/2020 7/2/2021 7/1/2022 6/30/2023 6/28/2024 6/27/2025 Seagate Technology Holdings plc $ 100.00 $ 191.51 $ 156.97 $ 147.42 $ 254.60 $ 358.36 S&P 500 100.00 140.79 125.85 150.51 187.47 215.89 Dow Jones U.S.
Repurchases of Equity Securities All repurchases are effected as redemptions in accordance with our Constitution. As of June 28, 2024, $1.9 billion remained available for repurchase under the existing repurchase authorization limit authorized by our Board of Directors.
Repurchases of Equity Securities All repurchases are effected as redemptions in accordance with our Constitution.
Added
(2) The Company’s Board of Directors increased the authorization for the repurchase of its outstanding shares to $5 billion on May 21, 2025. As of June 27, 2025, $5.0 billion remained available for repurchase under the existing repurchase authorization limit authorized by our Board of Directors.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

50 edited+12 added−25 removed22 unchanged
Biggest changeResults of Operations We list in the tables below summarized information from our Consolidated Statements of Operations by dollar amounts and as a percentage of revenue: Fiscal Years Ended (Dollars in millions) June 28, 2024 June 30, 2023 Revenue $ 6,551 $ 7,384 Cost of revenue 5,015 6,033 Gross profit 1,536 1,351 Product development 654 797 Marketing and administrative 460 491 Amortization of intangibles — 3 BIS settlement penalty — 300 Restructuring and other, net (30) 102 Income (loss) from operations 452 (342) Other expense, net (7) (154) Income (loss) before income taxes 445 (496) Provision for income taxes 110 33 Net Income (loss) $ 335 $ (529) 39 Table of Contents Fiscal Years Ended June 28, 2024 June 30, 2023 Revenue 100 % 100 % Cost of revenue 77 82 Gross margin 23 18 Product development 10 11 Marketing and administrative 7 7 Amortization of intangibles — — BIS settlement penalty — 4 Restructuring and other, net — 1 Operating margin 6 (5) Other expense, net — (2) Income (loss) before income taxes 6 (7) Provision for income taxes 2 — Net Income (loss) 4 % (7) % Revenue The following table summarizes information regarding consolidated revenues by channel, geography, and market and HDD exabytes shipped by market and price per terabyte: Fiscal Years Ended June 28, 2024 June 30, 2023 Revenues by Channel (%) OEMs 75 % 74 % Distributors 15 % 15 % Retailers 10 % 11 % Revenues by Geography (%) (1) Asia Pacific 53 % 45 % Americas 35 % 41 % EMEA 12 % 14 % Revenues by Market (%) Mass capacity 72 % 66 % Legacy 18 % 21 % Other 10 % 13 % HDD Exabytes Shipped by Market Mass capacity 355 380 Legacy 43 61 Total 398 441 HDD Price per Terabyte $ 15 $ 15 ________________________________________________ (1) Revenue is attributed to geography based on the bill from location. 40 Table of Contents Fiscal Years Ended (Dollars in millions) June 28, 2024 June 30, 2023 Change % Change Revenue $ 6,551 $ 7,384 $ (833) (11) % Revenue in fiscal year 2024 decreased approximately 11%, or $833 million, from fiscal year 2023, primarily due to a decrease in exabytes shipped as a result of lower broad-based market demand, slightly offset by an increase in revenue driven by favorable pricing actions undertaken by the Company.
Biggest changeResults of Operations We list in the tables below summarized information from our Consolidated Statements of Operations by dollar amounts and as a percentage of revenue: Fiscal Years Ended (Dollars in millions) June 27, 2025 June 28, 2024 Revenue $ 9,097 $ 6,551 Cost of revenue 5,897 5,015 Gross profit 3,200 1,536 Product development 724 654 Marketing and administrative 561 460 Restructuring and other, net 25 (30) Income from operations 1,890 452 Other expense, net (377) (7) Income before income taxes 1,513 445 Provision for income taxes 44 110 Net income $ 1,469 $ 335 40 Table of Contents Fiscal Years Ended June 27, 2025 June 28, 2024 Revenue 100 % 100 % Cost of revenue 65 77 Gross margin 35 23 Product development 8 10 Marketing and administrative 6 7 Restructuring and other, net — — Operating margin 21 6 Other expense, net (4) — Income before income taxes 17 6 Provision for income taxes 1 2 Net income 16 % 4 % 41 Table of Contents Revenue The following table summarizes information regarding consolidated revenues by channel, geography, and market and HDD exabytes shipped by market and price per terabyte: Fiscal Years Ended June 27, 2025 June 28, 2024 Revenues by Channel (%) OEMs 80 % 75 % Distributors 12 % 15 % Retailers 8 % 10 % Revenues by Geography (%) (1) Asia Pacific 41 % 53 % Americas 49 % 35 % EMEA 10 % 12 % Revenues by Market (%) Mass capacity 81 % 72 % Legacy 12 % 18 % Other 7 % 10 % HDD Exabytes Shipped by Market Mass capacity 552 355 Legacy 43 43 Total 595 398 HDD Price per Terabyte $ 14 $ 15 ________________________________________________ (1) Revenue is attributed to geography based on the bill from location.
Our Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) is provided in addition to the accompanying Consolidated Financial Statements and notes to assist readers in understanding our results of operations, financial condition and cash flows. Our MD&A is organized as follows: • Overview of Fiscal Year 2024.
Our Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) is provided in addition to the accompanying Consolidated Financial Statements and notes to assist readers in understanding our results of operations, financial condition and cash flows. Our MD&A is organized as follows: • Overview of Fiscal Year 2025.
During fiscal year 2024, we repurchased approximately 1 million of our ordinary shares including shares withheld for statutory tax withholdings related to vesting of employee equity awards. See “Item 5.
During fiscal year 2025, we repurchased approximately 1 million of our ordinary shares including shares withheld for statutory tax withholdings related to vesting of employee equity awards. See “Item 5.
We are not aware of any downgrades, losses or other significant deterioration in the fair value of our cash equivalents from the values reported as of June 28, 2024. For additional information on risks and factors that could impact our ability to fund our operations and meet our cash requirements among others, see “Part I, Item 1A.
We are not aware of any downgrades, losses or other significant deterioration in the fair value of our cash equivalents from the values reported as of June 27, 2025. For additional information on risks and factors that could impact our ability to fund our operations and meet our cash requirements among others, see “Part I, Item 1A.
Below, we discuss these policies further, as well as the estimates and judgments involved. We also have other accounting policies and accounting estimates relating to warranty, uncollectible customer accounts, valuation of inventories, assessing goodwill and other long-lived assets for impairment, valuation of share-based payments and restructuring.
Below, we discuss these policies further, as well as the estimates and judgments involved. We also have other accounting policies and accounting estimates relating to warranty, valuation of inventories, assessing goodwill and other long-lived assets for impairment, valuation of share-based payments and restructuring.
These estimates and judgments occur in the calculation of tax credits, recognition of income and deductions and calculation of specific tax assets and liabilities, which arise from differences in the timing of recognition of revenue and expense for income tax and financial statement purposes, as well as tax liabilities associated with uncertain tax positions.
These estimates and judgments occur in the calculation of tax credits, recognition of income and deductions and 47 Table of Contents calculation of specific tax assets and liabilities, which arise from differences in the timing of recognition of revenue and expense for income tax and financial statement purposes, as well as tax liabilities associated with uncertain tax positions.
In evaluating our ability to recover our deferred tax assets, in full or in part, we consider all available positive and negative evidence, including our past operating results, and our forecast of future earnings, future taxable income and prudent and 46 Table of Contents feasible tax planning strategies.
In evaluating our ability to recover our deferred tax assets, in full or in part, we consider all available positive and negative evidence, including our past operating results, and our forecast of future earnings, future taxable income and prudent and feasible tax planning strategies.
Highlights of events in fiscal year 2024 that impacted our financial position. • Results of Operations. Analysis of our financial results comparing fiscal years 2024 and 2023. • Liquidity and Capital Resources.
Highlights of events in fiscal year 2025 that impacted our financial position. • Results of Operations. Analysis of our financial results comparing fiscal years 2025 and 2024. • Liquidity and Capital Resources.
As part of the Settlement Agreement with BIS, quarterly payments of $15 million are made over the course of five years beginning October 31, 2023, of which $60 million is expected to be paid within one year and $195 million thereafter. Refer to “Item 8. Financial Statements and Supplementary Data— Note 14.
As part of the Settlement Agreement with BIS, quarterly payments of $15 million are made over the course of five years beginning October 31, 2023, of which $60 million is expected to be paid within one year and $135 million thereafter. Refer to “Item 8. Financial Statements and Supplementary Data— Note 13.
As of June 28, 2024, we had unconditional purchase obligations of app roximately $1.2 billion, primarily related to purchases of inventory components with our suppliers. We expect $1.2 billion of these co mmitments to be paid within one year. In addition, we also had certain long-term market share based non-cancellable inventory purchase commitments as of June 28, 2024.
As of June 27, 2025, we had unconditional purchase obligations of app roximately $1.3 billion, primarily related to purchases of inventory components with our suppliers. We expect $1.2 billion of these co mmitments to be paid within one year. In addition, we also had certain long-term market share based non-cancellable inventory purchase commitments as of June 27, 2025.
Cash Used in Financing Activities Net cash used in financing activities of $473 million for fiscal year 2024 was primarily attributable to the following activities: • $1.3 billion repurchases of long-term debt; • $585 million in dividends paid to our shareholders; • $128 million debt fees relating to issuance of long-term debt and capped call transaction; and • $38 million taxes paid related to net share settlement of equity awards; partially offset by • $1.5 billion in net proceeds from the issuance of long-term debt; and • $66 million in proceeds from the issuance of ordinary shares under employee stock plans.
Net cash used in financing activities of $473 million for fiscal year 2024 was primarily attributable to the following activities: • $1.3 billion repurchases of long-term debt; • $585 million in dividend payments; • $128 million debt fees relating to issuance of long-term debt and capped call transactions; and • $38 million taxes paid related to net share settlement of equity awards; partially offset by • $1.5 billion in proceeds from the issuance of long-term debt; and • $66 million in proceeds from the issuance of ordinary shares under employee stock plans.
Discussions of year-to-year comparisons between fiscal years 2023 and 2022 are not included in this Annual Report on Form 10-K and can be found in Part II, Item 7 of our Annual Report on Form 10-K for the fiscal year ended June 30, 2023, which was filed with the SEC on August 4, 2023.
Discussions of year-to-year comparisons between fiscal years 2024 and 2023 are not included in this Annual Report on Form 10-K and can be found in Part II, Item 7 of our Annual Report on Form 10-K for the fiscal year ended June 28, 2024, which was filed with the SEC on August 2, 2024.
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS The following is a discussion of the Company’s financial condition, changes in financial condition and results of operations for the fiscal years ended June 28, 2024 and June 30, 2023.
ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS The following is a discussion of the Company’s financial condition, changes in financial condition and results of operations for the fiscal years ended June 27, 2025 and June 28, 2024.
During the third quarter of fiscal year 2024, we established Singapore as our principal executive offices. Our parent holding company owns various U.S. and non-Singaporean subsidiaries that operate in multiple non-Singaporean income tax jurisdictions.
We established Singapore as our principal executive offices in fiscal year 2024. Our parent holding company owns various U.S. and non-Singaporean subsidiaries that operate in multiple non-Singaporean income tax jurisdictions.
Accordingly, fiscal year 2024 and 2023 both comprised of 52 weeks and ended on June 28, 2024 and June 30, 2023, respectively. Fiscal year 2026 will be comprised of 53 weeks and will end on July 3, 2026.
Accordingly, fiscal year 2025 and 2024 both comprised of 52 weeks and ended on June 27, 2025 and June 28, 2024, respectively. Fiscal year 2026 will be comprised of 53 weeks and will end on July 3, 2026.
Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities-Repurchases of Our Equity Securities.” As of June 28, 2024, $1.9 billion remained available for repurchase under our existing repurchase authorization limit. We may limit or terminate the repurchase program at any time. All repurchases are effected as redemptions in accordance with our Constitution.
Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities-Repurchases of Our Equity Securities.” As of June 27, 2025, $5.0 billion remained available for repurchase under our existing repurchase authorization limit. We may limit or terminate the repurchase program at any time. All repurchases are effected as redemptions in accordance with our Constitution.
We record estimated variable consideration at the time of revenue recognition as a reduction to revenue. Variable consideration generally consists of sales incentive programs, such as price protection and volume incentives aimed at increasing customer demand.
We record estimated variable consideration at the time of revenue recognition as a reduction to revenue. Variable consideration generally consists of expected rebates to be provided in relation to sales incentive programs, such as price protection and volume incentives aimed at increasing customer demand.
For additional information on risks and factors that could impact our ability to fund our operations and meet our cash requirements, among others, see “Part I, Item 1A.
For additional information on risks and factors that could impact our ability to fund our operations and meet our cash requirements, among others, see “Part I, Item 1A. Risk Factors” of this Annual Report.
Risk Factors” of this Annual Report. 44 Table of Contents Cash Requirements and Commitments Our liquidity requirements are primarily to meet our working capital, product development and capital expenditure needs, to fund scheduled payments of principal and interest on our indebtedness, and to fund our quarterly dividend and any future strategic investments.
Cash Requirements and Commitments Our liquidity requirements are primarily to meet our working capital, product development and capital expenditure needs, to fund scheduled payments of principal and interest on our indebtedness, and to fund our quarterly dividend and any future strategic investments.
Liquidity Sources Our primary sources of liquidity as of June 28, 2024, consist of: (1) approximately $1.4 billion in cash and cash equivalents, (2) cash we expect to generate from operations and (3) $1.5 billion available for borrowing under our senior unsecured revolving credit facility (“Revolving Credit Facility”), which is part of our Credit Agreement (as defined below).
Liquidity Sources Our primary sources of liquidity as of June 27, 2025, consist of: (1) approximately $891 million in cash and cash equivalents, (2) cash we expect to generate from operations and (3) $1.3 billion available for borrowing under our senior unsecured revolving credit facility (“Revolving Credit Facility”), which is part of our New Credit Agreement (as defined in “Item 8.
Our income tax provision recorded for fiscal years 2024 differed from the provision for income taxes that would be derived by applying the Singaporean statutory rate of 17% to income before income taxes, primarily due to the net effect of (i) changes in valuation allowance and (ii) current year generation of research credits.
Our income tax provision recorded for fiscal years 2025 differed from the provision for income taxes that would be derived by applying the Singaporean statutory rate of 17% to income before income taxes, primarily due to the net effect of (i) tax benefits related to earnings generated in jurisdictions that are subject to tax incentive programs and (ii) changes in valuation allowance. 43 Table of Contents Our income tax provision recorded for fiscal years 2024 differed from the provision for income taxes that would be derived by applying the Singaporean statutory rate of 17% to income before income taxes, primarily due to the net effect of (i) changes in valuation allowance and (ii) current year generation of research credits.
Income Taxes Fiscal Years Ended (Dollars in millions) June 28, 2024 June 30, 2023 Change % Change Provision for income taxes $ 110 $ 33 $ 77 233 % We recorded an income tax provis ion of $110 million fo r fiscal year 2024 compared to an income tax provision of $33 million for fiscal year 2023 .
Income Taxes Fiscal Years Ended (Dollars in millions) June 27, 2025 June 28, 2024 Change % Change Provision for income taxes $ 44 $ 110 $ (66) (60) % We recorded an income tax provis ion of $44 million fo r fiscal year 2025 compared to an income tax provision of $110 million for fiscal year 2024 .
As of June 28, 2024, future interest payments on this outstanding debt is estimated to be approximately $2.0 billion, of which $323 million is expected to be paid within one year.
As of June 27, 2025, future interest payments on this outstanding debt is estimated to be approximately $1.8 billion, of which $313 million is expected to be paid within one year.
Divestiture ” for more details), $40 million from the sale of assets and $14 million from the sale of investments, offset by payments for the purchase of property, equipment and leasehold improvements of $254 million. 43 Table of Contents In fiscal year 2023, we received $217 million for net cash investing activities, which was primarily due to proceeds of $534 million from the sale of assets, offset by payments for the purchase of property, equipment and leasehold improvements of $316 million.
In fiscal year 2024, we received $126 million for net cash investing activities, which was primarily due to the proceeds from the sale of SoC operations of $326 million, $40 million from the sale of assets and $14 million from the sale of investments, offset by payments for the purchase of property, equipment and leasehold improvements of $254 million.
Legal, Environmental and Other Contingencies ” for more details. Restructuring During the fiscal year ended June 28, 2024, we made cash payments of $116 million, primarily related to workforce reduction costs under our restructuring plans.
Legal, Environmental and Other Contingencies ” for more details. 46 Table of Contents Restructuring During the fiscal year ended June 27, 2025, we made cash payments of $14 million, primarily related to workforce reduction costs under our restructuring plans. As of June 27, 2025, the future cash payments related to our remaining active restructuring plans were immaterial.
Analysis of changes in our balance sheets and cash flows and discussion of our financial condition, including potential sources of liquidity, material cash requirements and their general purpose. • Critical Accounting Policies and Estimates. Accounting policies and estimates that we believe are important to understanding the assumptions and judgments incorporated in our reported financial results.
Analysis of changes in our balance sheets and cash flows and discussion of our financial condition, including potential sources of liquidity, material cash requirements and their general purpose. • Critical Accounting Policies and Estimates.
Our worldwide operating income is either subject to varying rates of income tax or is exempt from income tax due to tax incentive programs we operate under in Singapore and Thailand. These tax incentives are scheduled to expire in whole or in part at various dates through fiscal year 2036.
Our worldwide operating income is either subject to varying rates of income tax or is exempt from income tax due to tax incentive programs we operate under in Singapore and Thailand .
Net cash used in financing activities of $988 million for fiscal year 2023 was primarily attributable to the following activities: • $1.6 billion repurchases of long-term debt; • $582 million in dividend payments; and • $408 million in payments for repurchases of our ordinary shares; partially offset by • $1.6 billion in proceeds from the issuance of long-term debt; and • $68 million in proceeds from the issuance of ordinary shares under employee stock plans.
Cash Used in Financing Activities Net cash used in financing activities of $1.3 billion for fiscal year 2025 was primarily attributable to the following activities: • $1.1 billion repurchases of long-term debt; • $600 million in dividend payments; • $54 million taxes paid related to net share settlement of equity awards; and • $14 million debt fees relating to issuance and repurchase of long-term debt; partially offset by • $400 million in net proceeds from the issuance of long-term debt; and • $72 million in proceeds from the issuance of ordinary shares under employee stock plans.
For a further discussion of the uncertainties and business risks, see “Part I, Item 1A. Risk Factors” of our Annual Report. Regulatory settlement On April 18, 2023, our subsidiaries Seagate Technology LLC and Seagate Singapore International Headquarters Pte.
For a further discussion of the uncertainties and business risks, see “Part I, Item 1A. Risk Factors” of our Annual Report.
However, we believe our sources of cash will continue to be sufficient to fund our operations and meet our cash requirements for the next 12 months.
We operate in some countries that have restrictive regulations over the movement of cash and/or foreign exchange across their borders. However, we believe our sources of cash will continue to be sufficient to fund our operations and meet our cash requirements for the next 12 months.
Total sales programs were 16% and 17% of gross revenue in fiscal years 2024 and 2023, respectively. Adjustments to revenues due to under or over accruals for sales programs related to revenues reported in prior periods were approximately 1% of gross revenue in fiscal years 2024 and 2023, respectively. Income Taxes.
Adjustments to revenues due to under or over accruals for sales programs related to revenues reported in prior periods were less than 1% of gross revenue in fiscal years 2025 and 2024. Income Taxes. We mak e certain estimates and judgments in determining income tax expense for financial statement purposes.
Marketing and administrative expenses for fiscal year 2024 decreased by $31 million from fiscal year 2023 primarily due to a $17 million decrease in compensation and other employee benefits as a result of workforce and temporary salary reductions, a $12 million decrease in advertising costs, a $6 million decrease in outside services expense, a $5 million decrease in travel expense, partially offset by a $7 million recovery in the December 2022 quarter of an accounts receivable previously written off in prior years and a $3 million increase in depreciation expense.
Marketing and administrative expenses for fiscal year 2025 increased by $101 million from fiscal year 2024 primarily due to a $84 million increase in compensation and other employee benefits as a result of the variable compensation expense recognized in fiscal year 2025 and temporary salary reductions in fiscal year 2024, a $7 million increase in travel expenses, a $7 million increase in outside services expense and a $3 million increase in advertising costs.
Divestiture ” for more details; • an increase of $227 million in accounts payable, primarily due to timing of payments; • a decrease of $192 million in accounts receivable, primarily due to lower revenue and higher accounts receivable factoring; and • an increase of $25 million cash proceeds received from the settlement of certain interest rate swap agreements; partially offset by • a decrease of $183 million in accrued expenses primarily due to lower restructuring activities; and • an increase of $99 million in inventories, primarily due to an increase in raw materials and work in progress inventory.
Cash provided by operating activities for fiscal year 2024 was $918 million and includes the effects of net income adjusted for non-cash items including depreciation, amortization, share-based compensation, net gain from business divestiture, and the following major working capital related movements: • an increase of $243 million in other assets and liabilities, primarily related to the restructuring of pre-existing purchase agreements as a result of the sale of SoC operations; • an increase of $227 million in accounts payable, primarily due to timing of payments; • a decrease of $192 million in accounts receivable, primarily due to lower revenue and higher accounts receivable factoring; and • an increase of $25 million cash proceeds received from the settlement of certain interest rate swap agreements; partially offset by • a decrease of $183 million in accrued expenses primarily due to lower restructuring activities; and • an increase of $99 million in inventories, primarily due to an increase in raw materials and work in progress inventory.
Liquidity and Capital Resources The following sections discuss our principal liquidity requirements, as well as our sources and uses of cash and our liquidity and capital resources. Our cash and cash equivalents are maintained in investments with remaining maturities of 90 days or less at the time of purchase.
Our cash and cash equivalents are maintained in investments with remaining maturities of 90 days or less at the time of purchase. The principal objectives of our investment policy are the preservation of principal and maintenance of liquidity. We believe our cash equivalents are liquid and accessible.
Cost of Revenue and Gross Margin Fiscal Years Ended (Dollars in millions) June 28, 2024 June 30, 2023 Change % Change Cost of revenue $ 5,015 $ 6,033 $ (1,018) (17) % Gross profit 1,536 1,351 185 14 % Gross margin 23 % 18 % For fiscal year 2024, gross margin increased compared to the prior fiscal year primarily driven by favorable pricing actions undertaken by the Company and product mix, a $90 million reduction in factory underutilization charges which included the decrease in depreciation expense due to the extension of useful lives of certain manufacturing equipment, a decrease of $47 million in accelerated depreciation expense for certain capital equipment, a decrease of $21 million in order cancellation fees and $7 million pandemic-related lockdown charges in one of our factories in fiscal year 2023 that did not recur in fiscal year 2024, partially offset by lower exabytes shipped.
Cost of Revenue and Gross Margin Fiscal Years Ended (Dollars in millions) June 27, 2025 June 28, 2024 Change % Change Cost of revenue $ 5,897 $ 5,015 $ 882 18 % Gross profit 3,200 1,536 1,664 108 % Gross margin 35 % 23 % For fiscal year 2025, gross margin increased by 12 percentage points compared to the prior fiscal year primarily driven by favorable product mix and pricing actions undertaken by the Company, a decrease of $96 million of supply related purchase order cancellation fees, as well as $160 million of factory underutilization charges and $13 million of accelerated depreciation expense for certain capital equipment that did not recur in fiscal year 2025, partially offset by $13 million of restructuring costs related to an inventory write down due to a discontinued product line in the fiscal year 2025.
Risk Factors” of our Annual Report. 42 Table of Contents Cash and Cash Equivalents As of (Dollars in millions) June 28, 2024 June 30, 2023 Change Cash and cash equivalents $ 1,358 $ 786 $ 572 The following table summarizes results from the Consolidated Statements of Cash Flows for the periods indicated: Fiscal Years Ended (Dollars in millions) June 28, 2024 June 30, 2023 Net cash flow provided by (used in): Operating activities $ 918 $ 942 Investing activities 126 217 Financing activities (473) (988) Effect of foreign currency exchange rates 1 — Net increase in cash, cash equivalents and restricted cash $ 572 $ 171 Cash Provided by Operating Activities Cash provided by operating activities for fiscal year 2024 was $918 million and includes the effects of net income adjusted for non-cash items including depreciation, amortization, share-based compensation, net gain from business divestiture and: • an increase of $243 million in other assets and liabilities, primarily related to the restructuring of pre-existing purchase agreements as a result of the sale of SoC operations.
Cash and Cash Equivalents As of (Dollars in millions) June 27, 2025 June 28, 2024 Change Cash and cash equivalents $ 891 $ 1,358 $ (467) The following table summarizes results from the Consolidated Statements of Cash Flows for the periods indicated: Fiscal Years Ended (Dollars in millions) June 27, 2025 June 28, 2024 Net cash flow provided by (used in): Operating activities $ 1,083 $ 918 Investing activities (276) 126 Financing activities (1,274) (473) Effect of foreign currency exchange rates — 1 Net (decrease) increase in cash, cash equivalents and restricted cash $ (467) $ 572 Cash Provided by Operating Activities Cash provided by operating activities for fiscal year 2025 was $1.1 billion and includes the effects of net income adjusted for non-cash items including depreciation, amortization, share-based compensation, and the following major working capital related movements: • an increase of $513 million in accounts receivable, primarily due to higher revenue and lower accounts receivable factoring; • a decrease of $242 million in accounts payable, primarily due to timing of payments; and • an increase of $201 million in inventory, primarily due to an increase in purchased materials and finished goods inventory; partially offset by 44 Table of Contents • an increase of $207 million in accrued employee compensation, primarily due to an increase in our variable compensation expense.
Operating leases We are a lessee in several operating leases related to real estate facilities for warehouse, office and lab space. As of June 28, 2024, the amount of future minimum rent expense for both occupied and vacated facilities under non-cancelable operating lease contracts was $564 million, of which $63 million is expected to be paid within one year.
As of June 27, 2025, the amount of future minimum rent expense for both occupied and vacated facilities under non-cancelable operating lease contracts was $516 million, of which $64 million is expected to be paid within one year. Refer to “Item 8. Financial Statements and Supplementary Data— Note 6. Leases ” for details.
Outside of one year, we are unable to make a reasonably reliable estimate of when cash settlement with a taxing authority will occur. 45 Table of Contents Dividends On July 23, 2024, our Board of Directors declared a quarterly cash dividend of $0.70 per share, which will be payable on October 7, 2024 to shareholders of record as of the close of business on September 23, 2024.
Dividends On July 29, 2025, our Board of Directors declared a quarterly cash dividend of $0.72 per share, which will be payable on October 9, 2025 to shareholders of record as of the close of business on September 30, 2025.
As of June 28, 2024, we had unconditional commitments of $161 million primarily related to purchases of equipment, of which approximately $99 million is expected to be paid within one y ear. For fiscal year 2025, we expect capital expenditures to be higher than fiscal year 2024.
Capital expenditures We incur material capital expenditures to design and manufacture our products that depend on advanced technologies and manufacturing techniques. As of June 27, 2025, we had unconditional commitments of $151 million primarily related to purchases of equipment, of which approximately $105 million is expected to be paid within one y ear.
Refer to “Item 8. Financial Statements and Supplementary Data— Note 6. Leases ” for details. Long-term debt and interest payments on debt As of June 28, 2024, the future principal payment obligation on our long-term debt was $5.7 billion, of which $479 million will mature within one year.
Long-term debt and interest payments on debt As of June 27, 2025, the future principal payment obligation on our long-term debt was $5.0 billion, which will mature in more than one year.
We believe that our sources of cash will be sufficient to fund our operations and meet our cash requirements for at least the next 12 months.
As of June 27, 2025, we were in compliance with all of the covenants under our debt agreements. Refer to “Part II, Item 8. Financial Statements— Note 4. Debt ” for more details. We believe that our sources of cash will be sufficient to fund our operations and meet our cash requirements for at least the next 12 months.
Cash Used in Investing Activities In fiscal year 2024, we received $126 million for ne t cash investing activities, which was primarily due to the proceeds from the sale of SoC operations of $326 million (refer to “Item 8. Financial Statements and Supplementary Data— Note 18.
Cash Used in Investing Activities In fiscal year 2025, we used $276 million ne t cash for investing activities, which was primarily due to payments for the purchase of property, equipment and leasehold improvements of $265 million and net cash used in the acquisition of Intevac of $47 million, which includes proceeds from the sale of Intevac’s investments post-acquisition (refer to “Item 8.
Product development expenses for fiscal year 2024 decreased by $143 million from fiscal year 2023 primarily due to a $112 million decrease in compensation and other employee benefits as a result of workforce and temporary salary reductions, a $49 million decrease in depreciation expense and a $7 million decrease in materials expense, partially offset by a $24 million increase in lease expense as we sold and leased back certain properties.
Product development expenses for fiscal year 2025 increased by $70 million from fiscal year 2024 primarily due to a $64 million increase in compensation and other employee benefits as a result of the variable compensation expense recognized i n fiscal year 2025 and temporary salary reductions in fiscal year 2024, a $9 million increase in facility costs, a $5 million increase in equipment expense and a $4 million increase in outside services, partially offset by a $13 million decrease in material expenses.
As of June 28, 2024, the Credit Agreement includes two financial covenants: (1) interest coverage ratio and (2) net leverage ratio. We continue to evaluate our debt portfolio and structure to comply with our financial debt covenants. As of June 28, 2024, we were in compliance with all of the covenants under our debt agreements.
The Revolving Credit Facility is available for borrowings, subject to compliance with financial covenants and other customary conditions to borrowing. As of June 27, 2025, the New Credit Agreement includes one financial covenant, net leverage ratio. We continue to evaluate our debt portfolio and structure to comply with our financial debt covenants.
As of June 28, 2024, no borrowings (including swing line loans) were outstanding and no commitments were utilized for letters of credit issued under the Revolving Credit Facility. The Revolving Credit Facility is available for borrowings, subject to compliance with financial covenants and other customary conditions to borrowing.
Financial Statements and Supplementary Data— Note 4. Debt ” for more details). 45 Table of Contents As of June 27, 2025, no borrowings (including swing line loans) were outstanding and no commitments were utilized for letters of credit issued under the Revolving Credit Facility.
Income Tax As of June 28, 2024, we had a liability for unrecognized tax benefits and an accrual for the payment of related interest totaling $8 million, none of which is expected to be settled within one year.
Income Tax As of June 27, 2025, we had an immaterial liability for unrecognized tax benefits, none of which is expected to be settled within one year. Outside of one year, we are unable to make a reasonably reliable estimate of when cash settlement with a taxing authority will occur.
Operating Expenses Fiscal Years Ended (Dollars in millions) June 28, 2024 June 30, 2023 Change % Change Product development $ 654 $ 797 $ (143) (18) % Marketing and administrative 460 491 (31) (6) % Amortization of intangibles — 3 (3) * BIS settlement penalty — 300 (300) * Restructuring and other, net (30) 102 (132) (129) % Operating expenses $ 1,084 $ 1,693 $ (609) ______________________________ *Not a meaningful figure Product Development Expense.
Warranty cost related to new shipments was 0.7%, 0.8% and 0.7% of revenue for the fiscal years 2025 , 2024 and 2023 , respectively. 42 Table of Contents Operating Expenses Fiscal Years Ended (Dollars in millions) June 27, 2025 June 28, 2024 Change % Change Product development $ 724 $ 654 $ 70 11 % Marketing and administrative 561 460 101 22 % Restructuring and other, net 25 (30) 55 * Operating expenses $ 1,310 $ 1,084 $ 226 ______________________________ *Not a meaningful figure Product Development Expense.
For an overview of our business, see “Part I, Item 1. Business.” 38 Table of Contents Overview of Fiscal Year 2024 During fiscal year 2024, we shipped 398 exabytes of HDD storage capacity. We generated revenue of approximately $6.6 billion with a gross margin of 23%. Our operating cash flow was $918 million and we paid $585 million in dividends.
We generated revenue of approximately $9.1 billion with a gross margin of 35% and net income of $1.5 billion. Our operating cash flow was $1.1 billion and we paid $600 million in dividends.
The decrease is partially offset by a $190 million of net gain recognized from the early redemption of debt in fiscal year 2023, a $41 million increase in net loss from equity investments, a $29 million net loss recognized from early redemption of debt and a $19 million net increase in interest expense in fiscal year 2024.
Other expense, net for fiscal year 2024 primarily related to $332 million of interest expense, $52 million loss on investments and $29 million net loss from debt transactions, partially offset by a $313 million gain from the sale of System-on-Chip (“SoC”) operations and $104 million net gain from termination of interest rate swap.
For the distribution and retail channel, these sales incentive programs typically involve estimating the most likely amount of rebates related to a customer's level of sales, order size, advertising or point of sale activity as well as the expected value of price protection adjustments based on historical analysis and forecasted pricing environment.
For the distribution and retail channel, these sales incentive programs typically involve estimating the most likely amount of rebates based on historical price incentives, known future price trends, and channel inventory level. Total sales programs were 14% and 16% of gross revenue in fiscal years 2025 and 2024, respectively.
Removed
We issued $1.5 billion of exchangeable notes to primarily retire our term loans of $1.3 billion . Additionally, in April 2024, we sold certain intellectual property, equipment and other assets related to the design, development and manufacture of our System-on-Chip (“SoC”) products to Avago Technologies International Sales Pte.
Added
Accounting policies and estimates that we believe are important to understanding the assumptions and judgments incorporated in our reported financial results. 39 Table of Contents For an overview of our business, see “Part I, Item 1. Business.” Overview of Fiscal Year 2025 During fiscal year 2025, we shipped 595 exabytes of HDD storage capacity.
Removed
Limited, a subsidiary of Broadcom Inc., for $600 million and we recorded a net gain of $313 million from this business divestiture. In connection with the transaction, the Company also restructured certain pre-existing purchase agreements. Refer to “Item 8. Financial Statements and Supplementary Data— Note 18. Divestiture ” for more details.
Added
We issued $400 million principal amount of senior notes, repaid $479 million principal amount of the 2025 Notes and $505 million of the 2027 Notes, as well as repurchased $99 million principal amount of certain senior notes. Additionally, we acquired Intevac, Inc. (“Intevac”), a supplier of thin-film processing systems, for a net cash outlay of $47 million.
Removed
Recent Developments, Economic Conditions and Challenges During fiscal year 2024, we experienced ongoing recovery within the global cloud market, reflecting continued improvement in end-market demand. Demand recovery for our high capacity nearline drives has been faster than anticipated, which has extended product lead times and led to tighter overall supply conditions.
Added
Recent Developments, Economic Conditions and Challenges During fiscal year 2025, we experienced a significant increase in demand for our high capacity nearline drives primarily from cloud customers. At the same time, we have continued to operate in a dynamic macroeconomic environment marked by rapid shifts in trade policies and increasing geopolitical tensions.
Removed
We continued to exercise cost discipline and implement pricing actions to improve operational efficiency and profitability. We believe that we are in the early stage of an industry-wide demand recovery and AI application deployment, however we expect the macroeconomic environment to remain dynamic and continue to impact our business and results of operations .
Added
These factors may impact our business and results of operations. We will continue to monitor the situation and assess plans to mitigate future risk to the business. Over the long-term we expect our hard drive storage business to benefit from future growth in data demand and data value, including from the adoption of Generative AI applications.
Removed
Ltd entered into the Settlement Agreement with the BIS that resolves BIS’ allegations regarding our sales of hard disk drives to Huawei between August 17, 2020 and September 29, 2021.
Added
Fiscal Years Ended (Dollars in millions) June 27, 2025 June 28, 2024 Change % Change Revenue $ 9,097 $ 6,551 $ 2,546 39 % Revenue in fiscal year 2025 increased approximately 39%, or $2.5 billion, from fiscal year 2024, primarily due to an increase in mass capacity exabytes shipped as we experienced higher demand in particular for our nearline cloud products and favorable pricing actions undertaken by the Company.
Removed
Under the terms of the Settlement Agreement, we agreed to pay $300 million to the BIS in quarterly installments of $15 million over the course of five years beginning October 31, 2023. Refer to “Item 8. Financial Statements and Supplementary Data— Note 14. Legal, Environmental and Other Contingencies ” for more details.
Added
Restructuring and Other, net. We recorded $38 million of restructuring charges in fiscal year 2025, of which $13 million was recorded to Cost of revenue and $25 million recorded to Restructuring and other, net, respectively, primarily related to an inventory write down due to a discontinued product line, employee related termination benefits and right-of-use (“ROU”) asset impairment charges.
Removed
In the fiscal year 2024 , total warranty cost was 0.8% of revenue and included an unfavorable change in estimates of prior warranty accruals of 0.1% of revenue primarily due to changes to our estimated future product return rates.
Added
Other Expense, net Fiscal Years Ended (Dollars in millions) June 27, 2025 June 28, 2024 Change % Change Other expense, net $ 377 $ 7 $ 370 * ______________________________ *Not a meaningful figure Other expense, net for fiscal year 2025 primarily related to $321 million of interest expense and $53 million loss on investments.
Removed
Warranty cost related to new shipments was 0.8%, 0.7% and 0.7% of revenue for the fiscal years 2024 , 2023 and 2022 , respectively.
Added
On July 4, 2025 the One Big Beautiful Bill Act (“OBBBA”) was enacted in the U.S. The OBBBA includes significant provisions, such as the permanent extension of certain expiring provisions of the Tax Cuts and Jobs Act, modifications to the international tax framework, and the restoration of favorable tax treatment for certain business provisions.
Removed
Restructuring and Other, net. Restructuring and other, net for fiscal year 2024 was a benefit of $30 million primarily related to the net gain from the sale and leaseback transaction during the December 2023 quarter.
Added
The legislation has multiple effective dates, with certain provisions effective in fiscal year 2026 and others implemented through fiscal year 2028. We are currently assessing its impact on our consolidated financial statements. Liquidity and Capital Resources The following sections discuss our principal liquidity requirements, as well as our sources and uses of cash and our liquidity and capital resources.
Removed
The restructuring plans were substantially completed by the end of fiscal year 2023. 41 Table of Contents Other Expense, net Fiscal Years Ended (Dollars in millions) June 28, 2024 June 30, 2023 Change % Change Other expense, net $ 7 $ 154 $ (147) (95) % Other expense, net for fiscal year 2024 decreased by $147 million compared to fiscal year 2023 primarily due to a $313 million gain from the sale of SoC operations (refer to “Item 8.
Added
Financial Statements and Supplementary Data— Note 17. Acquisition and Divestiture ” for more details), offset by $10 million from the sale of equity investments, and $25 million from the proceeds of business divestiture.
Removed
Financial Statements and Supplementary Data— Note 18. Divestiture ” for more details), a $104 million of net gain recognized from the termination of interest rate swaps associated with the repayment of term loans and a $5 million net increase in interest income in fiscal year 2024.
Added
For fiscal year 2026, we expect capital expenditures to be higher than fiscal year 2025. Operating leases We are a lessee in several operating leases related to real estate facilities for warehouse, office and lab space.
Removed
Certain tax incentives may be extended if specific conditions are met. Since we established Singapore as our principal executive offices in fiscal year 2024, the Singaporean statutory rate of 17% is used for purposes of the reconciliation between the provision for income taxes at the statutory rate and our effective tax rate.
Added
Subsequent to our Consolidated Balance Sheet date, on June 30, 2025, the conditional conversion feature of the 2028 Notes was triggered in accordance with the terms of the 2028 Notes indenture. Accordingly, the 2028 Notes are exchangeable through September 30, 2025.
Removed
For fiscal years 2023 and 2022, a notional Irish statutory rate of 25% was used.
Removed
Our income tax provision recorded for fiscal year 2023 differed from the provision for income taxes that would be derived by applying the Irish statutory rate of 25% to income before income taxes, primarily due to the net effect of (i) non-Irish earnings generated in jurisdictions that are subject to tax incentive programs and are considered indefinitely reinvested outside of Ireland and (ii) current year generation of research credits.
Removed
The principal objectives of our investment policy are the preservation of principal and maintenance of liquidity. We believe our cash equivalents are liquid and accessible. We operate in some countries that have restrictive regulations over the movement of cash and/or foreign exchange across their borders.
Removed
Refer to “Item 8. Financial Statements and Supplementary Data— Note 18.
Removed
Cash provided by operating activities for fiscal year 2023 was $942 million and includes the effects of net income adjusted for non-cash items including depreciation, amortization, share-based compensation and: • a decrease of $911 million in accounts receivable, primarily due to lower revenue and timing of collections; • a decrease of $425 million in inventories, primarily due to a decrease in units built to align with the prevailing demand environment; and • an increase of $110 million cash proceeds received from the settlement of certain interest rate swap agreements; partially offset by • a decrease of $421 million in accounts payable, primarily due to a decrease in materials purchased; and • a decrease of $152 million in accrued employee compensation, primarily due to cash paid to our employees as part of our variable compensation plans and a decrease in our variable compensation expense.
Removed
Refer to “Part II, Item 8. Financial Statements— Note 4. Debt ” for more details. As of June 28, 2024, cash and cash equivalents held by our subsidiaries was $1.4 billion.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

7 edited+0 added−3 removed7 unchanged
Biggest change(Dollars in millions, except percentages) Fiscal Years Ended Fair Value at June 28, 2024 2025 2026 2027 2028 2029 Thereafter Total Assets Money market funds, time deposits and certificates of deposit Floating rate $ 388 $ — $ — $ — $ — $ — $ 388 $ 338 Average interest rate 5.31 % — % — % — % — % — % 5.31 % Other debt securities Fixed rate $ — $ 15 $ — $ — $ — $ — $ 15 $ 15 Debt Fixed rate $ 479 $ — $ 505 $ 1,500 $ 495 $ 2,750 $ 5,729 $ 6,342 Average interest rate 4.75 % — % 4.88 % 3.50 % 4.09 % 7.38 % 5.64 % Foreign Currency Exchange Risk.
Biggest change(Dollars in millions, except percentages) Fiscal Years Ended Fair Value at June 27, 2025 2026 2027 2028 2029 2030 Thereafter Total Assets Money market funds, time deposits and certificates of deposit Floating rate $ 254 $ — $ — $ — $ — $ — $ 254 $ 254 Average interest rate 4.22 % — % — % — % — % — % 4.22 % Debt Fixed rate $ — $ — $ 1,500 $ 470 $ 638 $ 2,438 $ 5,046 $ 6,318 Average interest rate — % — % 3.50 % 4.09 % 7.14 % 7.31 % 5.86 % Foreign Currency Exchange Risk.
We pay a floating rate, based on SOFR plus an interest rate spread, on the notional amount of the TRS. The TRS is designed to substantially offset changes in the SDCP liabilities due to changes in the value of the investment options made by employees. See “Item 8. Financial Statements and Supplementary Data— Note 8.
We pay a floating rate, based on SOFR plus an interest rate spread, on the notional amount of the TRS. The TRS is designed to substantially offset changes in the SDCP liabilities due to changes in the value of the investment options made by employees. 49 Table of Contents
Our exposure to market risk for changes in interest rates relates primarily to our cash investment portfolio. As of June 28, 2024, we had no available-for-sale investments that had been in a continuous unrealized loss position for a period greater than 12 months. We had no impairments related to credit losses for available-for-sale investments as of June 28, 2024.
Our exposure to market risk for changes in interest rates relates primarily to our cash investment portfolio. As of June 27, 2025, we had immaterial available-for-sale investments, none of which had been in a continuous unrealized loss position for a period greater than 12 months.
(Dollars in millions, except average contract rate) Notional Amount Average Contract Rate Estimated Fair Value (1) Foreign currency forward exchange contracts: Singapore Dollar $ 141 $ 1.35 $ — Chinese Renminbi 29 7.10 1 Thai Baht 21 35.24 (1) British Pound Sterling 9 0.78 — Total $ 200 $ — ___________________________________________________________________________________ (1) Equivalent to the unrealized net gain (loss) on existing contracts.
(Dollars in millions, except average contract rate) Notional Amount Average Contract Rate Estimated Fair Value (1) Foreign currency forward exchange contracts: British Pound Sterling $ 19 $ 0.74 $ — Chinese Renminbi 34 7.14 — Singapore Dollar 127 1.28 — Thai Baht 100 32.49 — Total $ 280 $ — ___________________________________________________________________________________ (1) Equivalent to the unrealized net gain (loss) on existing contracts.
The change in fair value of these contracts is recognized in earnings in the same period as the gains and losses from the remeasurement of the assets and liabilities. All foreign currency forward exchange contracts mature within 12 months. For more information about our debt and use of derivative instruments, see “Item 8. Financial Statements and Supplementary Data— Note 8.
The change in fair value of these contracts is recognized in earnings in the same period as the gains and losses from the remeasurement of the assets and liabilities. All foreign currency forward exchange contracts mature within 12 months. 48 Table of Contents The table below provides information as of June 27, 2025 about our foreign currency forward exchange contracts.
The table below presents principal amounts and related fixed or weighted-average interest rates by year of maturity for our investment portfolio and debt obligations as of June 28, 2024.
We have fixed rate debt obligations, which we enter into for general corporate purposes including capital expenditures and working capital needs. The table below presents principal amounts and related fixed or weighted-average interest rates by year of maturity for our investment portfolio and debt obligations as of June 27, 2025.
Derivative Financial Instruments ” of this Annual Report. 47 Table of Contents The table below provides information as of June 28, 2024 about our foreign currency forward exchange contracts. The table is provided in dollar equivalent amounts and presents the notional amounts (at the contract exchange rates) and the weighted-average contractual foreign currency exchange rates.
The table is provided in dollar equivalent amounts and presents the notional amounts (at the contract exchange rates) and the weighted-average contractual foreign currency exchange rates.
Removed
We have fixed rate debt obligations, which we enter into for general corporate purposes including capital expenditures and working capital needs. We previously entered into certain interest rate swap agreements to convert the variable interest rate on the Term Loans to fixed interest rates.
Removed
The objective of the interest rate swap agreements was to eliminate the variability of interest payment cash flows associated with the variable interest rate under the Term Loans. We designated the interest rate swaps as cash flow hedges. On September 13, 2023, we terminated our interest rate swap agreements as we repaid the Term Loans.
Removed
Derivative Financial Instruments” of this Annual Report. 48 Table of Contents

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