Western Digital (WDC)

 

During the year ended June 27, 2008, a large percentage of our revenue came from sales to our top 10 customers, which accounted for 47% of our revenue. These customers have a variety of suppliers to choose from and therefore can make substantial demands on us, including demands on product pricing and on contractual terms, which often results in the allocation of risk to us as the supplier. Even if we successfully qualify a product with a customer, the customer generally is not obligated to purchase any minimum volume of products from us and may be able to cancel an order or terminate its relationship with us at any time. Our ability to maintain strong relationships with our principal customers is essential to our future performance. If we lose a key customer, if any of our key customers reduce their orders of our products or require us to reduce our prices before we are able to reduce costs, if a customer is acquired by one of our competitors or if a key customer suffers financial hardship, our operating results would likely be harmed. In addition, if customer pressures require us to reduce our pricing such that our gross margins are diminished, we could decide not to sell our products to a particular customer, which could result in a decrease in our revenue.

 

 

During the year ended June 27, 2008, a large percentage of
our revenue came from sales to our top 10 customers, which
accounted for 47% of our revenue. These customers have a variety
of suppliers to choose from and therefore can make substantial
demands on us, including demands on product pricing and on
contractual terms, which often results in the allocation of risk
to us as the supplier. Even if we successfully qualify a product
with a customer, the customer generally is not obligated to
purchase any minimum volume of products from us and may be able
to cancel an order or terminate its relationship with us at any
time. Our ability to maintain strong relationships with our
principal customers is essential to our future performance. If
we lose a key customer, if any of our key customers reduce their
orders of our products or require us to reduce our prices before
we are able to reduce costs, if a customer is acquired by one of
our competitors or if a key customer suffers financial hardship,
our operating results would likely be harmed. In addition, if
customer pressures require us to reduce our pricing such that
our gross margins are diminished, we could decide not to sell
our products to a particular customer, which could result in a
decrease in our revenue.

 

 

During 2007, a large percentage of our revenue came from sales to our top 10 customers, which accounted for 47% of our revenue. One of these customers, Dell, accounted for more than 10% of our revenue. These customers have a variety of suppliers to choose from and therefore can make substantial demands on us, including demands on product pricing and on contractual terms, which often results in the allocation of risk to us as the supplier. Even if we successfully qualify a product with a customer, the customer generally is not obligated to purchase any minimum volume of products from us and may be able to cancel an order or terminate its relationship with us at any time. Our ability to maintain strong relationships with our principal customers is essential to our future performance. If we lose a key customer, if any of our key customers reduce their orders of our products or require us to reduce our prices before we are able to reduce costs, if a customer is acquired by one of our competitors or if a key customer suffers financial hardship then our operating results would likely be harmed. In addition, if customer pressures require us to reduce our pricing such that our gross margins are diminished, we could decide not to sell our products to a particular customer, which could result in a decrease in our revenue.

 

 

A majority of our revenue comes from about a dozen customers. For example, during 2006, one customer, Dell, accounted for more than 12% of our revenue, and sales to our top 10 customers, including Dell, accounted for 47% of revenue. These customers have a variety of suppliers to choose from and therefore can make substantial demands on us, including demands on product pricing and on contractual terms, which often results in the allocation of risk to us as the supplier. Even if we successfully qualify a product with a customer, the customer generally is not obligated to purchase any minimum volume of products from us and may be able to cancel an order or terminate its relationship with us at any time. Our ability to maintain strong relationships with our principal customers is essential to our future performance. If we lose a key customer, if any of our key customers reduce their orders of our products or require us to reduce our prices before we are able to reduce costs, if a customer is acquired by one of our competitors or if a key customer suffers financial hardship then our operating results would likely be harmed. In addition, if customer pressures require us to reduce our pricing such that our gross margins are diminished, we could decide not to sell our products to a particular customer, which could result in a decrease in our revenue.