Western Digital Corporation (WDC)

Debt-to-capital ratio

		Jun 30, 2024	Jun 30, 2023	Jun 30, 2022	Jun 30, 2021	Jun 30, 2020
Long-term debt	US$ in thousands	5,684,000	5,857,000	7,022,000	8,474,000	9,289,000
Total stockholders’ equity	US$ in thousands	10,818,000	10,964,000	12,221,000	10,721,000	9,551,000
Debt-to-capital ratio		0.34	0.35	0.36	0.44	0.49

June 30, 2024 calculation

Debt-to-capital ratio = Long-term debt ÷ (Long-term debt + Total stockholders’ equity)
= $5,684,000K ÷ ($5,684,000K + $10,818,000K)
= 0.34

The debt-to-capital ratio of Western Digital Corporation has exhibited a declining trend over the past five years, decreasing from 0.49 in June 2020 to 0.34 in June 2024. This indicates that the company has been gradually reducing its reliance on debt to fund its operations and investments in relation to its total capital structure. A lower debt-to-capital ratio signifies a stronger financial position and lower risk for the company, as it indicates a smaller proportion of debt in relation to total capital.

The decreasing trend in the debt-to-capital ratio may suggest that Western Digital has been actively managing its debt levels and working towards a more balanced capital structure. It could reflect efforts by the company to reduce financial risk, improve liquidity, and enhance overall financial stability. However, it is essential to consider the reasons behind this trend, such as changes in the company's capital structure, debt management strategies, and overall financial performance.

Overall, the declining debt-to-capital ratio of Western Digital Corporation demonstrates a positive trajectory in terms of managing debt levels and capital structure, which could contribute to improved financial health and sustainability in the long term.