The following discussion and analysis contains forward-looking statements within
the meaning of the federal securities laws, and should be read in conjunction
with the disclosures we make concerning risks and other factors that may affect
our business and operating results. You should read this information in
conjunction with the unaudited Condensed Consolidated Financial Statements and
the notes thereto included in this Quarterly Report on Form 10-Q, and the
audited Consolidated Financial Statements and notes thereto included in Part II,
Item 8 of our Annual Report on Form 10­K for the fiscal year ended July 2, 2021.
See also "Forward-Looking Statements" immediately prior to Part I, Item 1 in
this Quarterly Report on Form 10-Q.

Unless otherwise indicated, references herein to specific years and quarters are
to our fiscal years and fiscal quarters. As used herein, the terms "we," "us,"
"our," and the "Company" refer to Western Digital Corporation and its
subsidiaries.

Our Company

We are on a mission to unlock the potential of data by harnessing the possibility to use it. With both Flash and HDD franchises, underpinned by advancements in memory technologies, we create breakthrough innovations and powerful data storage solutions that enable the world to actualize its aspirations.



Our fiscal year ends on the Friday nearest to June 30 and typically consists of
52 weeks. Approximately every five to six years, we report a 53-week fiscal year
to align the fiscal year with the foregoing policy. Fiscal years 2022, which
ends on July 1, 2022, and 2021, which ended on July 2, 2021, are each comprised
of 52 weeks, with all quarters presented consisting of 13 weeks.

Key Developments

Joint Venture Contamination Incident



In February 2022, contamination of certain material used in manufacturing
processes occurred at Flash Ventures' fabrication facilities in both Yokkaichi
and Kitakami, Japan which resulted in damage to inventory units in production, a
temporary disruption to production operations and a reduction in our flash wafer
availability. During the three and nine months ended April 1, 2022, we incurred
charges of $203 million related to this contamination incident that were
recorded in Cost of revenue and primarily consisted of scrapped inventory and
rework costs, decontamination and other costs needed to restore the facilities
to normal capacity, and under absorption of overhead costs. We are evaluating
potential options for recovery.

Tax Resolution



As previously disclosed, we have received statutory notices of deficiency and
notices of proposed adjustments from the IRS with respect to fiscal years 2008
through 2015. During the three months ended April 1, 2022, new information
became available which required us to re-measure our unrecognized tax benefits
for this IRS matter. Subsequent to April 1, 2022, we and the IRS tentatively
reached a basis for resolving this matter. Additional information is provided in
our discussion of Income tax expense in our results of operations below, as well
as in Part I, Item 1, Note 13, Income Tax Expense, of the Notes to the Condensed
Consolidated Financial Statements, and in the "Short- and Long-Term
Liquidity--Unrecognized Tax Benefits" section below.

Financing Activities



In fiscal 2022, we continued to execute on our commitment to reduce our overall
debt levels and Fitch Ratings, Inc. raised our Company credit rating to
investment grade in December 2021. We fully repaid our Term Loan B-4 in October
2021 and shortly thereafter initiated a series of transactions to further reduce
our debt levels and better stagger the maturities of our debt. In December 2021,
we issued $500 million aggregate principal amount of 2.850% senior unsecured
notes due February 1, 2029 (the "2029 Notes") and issued $500 million aggregate
principal amount of 3.100% senior unsecured notes due February 1, 2032 (the
"2032 Notes"). We used the proceeds from these notes offerings and available
cash to voluntarily repay $1.21 billion of our Term Loan A-1 and reduce its
principal amount to $3.0 billion as of December 31, 2021. In January 2022, we
amended and restated our existing loan agreement to provide for, among other
things: (i) the issuance of a new $3.0 billion Term Loan A-2 maturing in January
2027 to replace our previously existing Term Loan A-1; (ii) the availability of
a new $2.25 billion revolving credit facility maturing in January 2027 to
replace our previously existing $2.25 billion revolving credit facility; and
(iii) additional covenant flexibility and other modifications. Upon completion
of these transactions, over 85% of the principal
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amount of our debt is now due in 2026 or later. We believe this new debt
structure gives us greater financial stability and flexibility to manage our
business over the longer term.

Additional information regarding our indebtedness, including the principal
repayment terms, interest rates, covenants and other key terms of our
outstanding indebtedness, is included in Part I, Item 1, Note 8, Debt, of the
Notes to Condensed Consolidated Financial Statements in this Quarterly Report on
Form 10-Q and in Part II, Item 8, Note 6, Debt, of the Notes to Consolidated
Financial Statements included in our Annual Report on Form 10-K for the fiscal
year ended July 2, 2021.

Flash Ventures

In January 2022, we entered into additional agreements with Kioxia regarding
Flash Ventures' investment in a new wafer fabrication facility, known as "Y7",
located in Yokkaichi, Japan. The primary purpose of Y7 is to provide clean room
space to continue the transition of existing flash-based wafer capacity to newer
technology nodes. Output from Y7 is expected to begin in the first half of
fiscal year 2023. Our share of the initial commitment for Y7 is expected to
result in equipment investments and start-up costs totaling approximately $140
million, to be incurred primarily through the second half of fiscal year 2022.
We also agreed to pay, among other items, future building depreciation payments
of $482 million as follows: $142 million in fiscal year 2022, $314 million in
fiscal year 2023 and $26 million in fiscal year 2024, to be credited against
future wafer charges.

Business Structure

Historically, our company had been managed and reported under a single operating
segment. Late in the first quarter of fiscal 2021, the Chief Executive Officer,
who is our Chief Operating Decision Maker, announced a decision to reorganize
our business by forming two separate product business units: flash-based
products ("Flash") and hard disk drives ("HDD"). The new structure is intended
to provide each business unit with focus and responsibility for identifying
current and future customer requirements while driving the strategy, roadmap,
pricing and overall profitability for their respective product areas. To align
with the new operating model and business structure, we made management
organizational changes and implemented new reporting modules and processes to
provide discrete information to manage the business. Effective July 3, 2021,
management finalized its assessment of our operating segments and concluded that
we now have two reportable segments: Flash and HDD.

Our broad portfolio of technology and products address multiple end markets. In
the fiscal first quarter of 2022, we refined the end markets we report to be
"Cloud", "Client" and "Consumer". Cloud represents a large and growing end
market comprised primarily of products for public or private cloud environments
and end customers, which we believe we are uniquely positioned to address as the
only provider of both flash and hard drive products. Through the Client end
market, we provide our original equipment manufacturer ("OEM") and channel
customers a broad array of high-performance flash and hard drive solutions
across personal computer, mobile, gaming, automotive, virtual reality headsets,
at-home entertainment, and industrial spaces. The Consumer end market is
highlighted by our broad range of retail and other end-user products, which
capitalize on the strength of our product brand recognition and vast points of
presence around the world.

The discussion and analysis included under Results of Operations below reflects our new business unit structure and end markets discussed above.

COVID-19 Pandemic and Operational Update



As the ongoing COVID-19 pandemic has evolved, we have implemented and maintained
more thorough sanitation practices as outlined by health organizations and
supported vaccination efforts. We continually monitor and update our practices
based on recommendations from health organizations to ensure the continued
safety of our employees and business partners as we continue to return to site.
In addition, the responses to COVID-19 taken by others in the supply chain have
increased the costs of their services which have in turn impacted our
operations. We incurred incremental charges primarily related to logistics,
absorption and other factory-related costs of approximately $59 million and $185
million, and $33 million and $94 million during the three and nine months ended
April 1, 2022 and April 2, 2021, respectively, which were recorded in Cost of
revenue.

The technology hardware and semiconductor industries continued to face supply
chain disruptions and component shortages during the quarter that negatively
impacted both our customers' ability to ship products, and our ability to build
products. In order to meet our end customers' demand, we are incurring increased
component costs in addition to COVID-related expenses, which we expect to weigh
primarily on our hard drive gross margins through the first half of calendar
year 2022. While these supply disruptions may continue for the near term, we
ultimately expect that they will be transitory as demand for our products
remained solid during the COVID-19 pandemic, with work-from-home, distance
learning, and at home entertainment driving demand for cloud environments, new
devices, and retail products.
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The COVID-19 environment remains dynamic with outbreaks in various geographies
including China, where we experienced a temporary lockdown. We will continue to
actively monitor the situation and may take further actions altering our
business operations that we determine are in the best interests of our
employees, customers, partners, suppliers, and stakeholders, or as required by
federal, state, or local authorities. See "The COVID-19 pandemic could
negatively affect our business" and "We are dependent on a limited number of
qualified suppliers who provide critical services, materials or components, and
a disruption in our supply chain could negatively affect our business" in Part
I, Item 1A, Risk Factors, of our Annual Report on Form 10-K for the fiscal year
ended July 2, 2021 for more information regarding the risks we face as a result
of the COVID-19 pandemic and supply chain disruptions.

Russia Sanctions



In February 2022, the U.S. and other countries imposed sanctions on Russia. In
accordance with these sanctions, we have ceased shipments to distributors for
customers located in Russia. Our revenue from distributors for customers in
Russia have not been significant. We have no material assets or operations in
Russia.


Results of Operations

Third Quarter and Nine Month Overview

The following table sets forth, for the periods presented, selected summary information from our Condensed Consolidated Statements of Operations by dollars and percentage of net revenue(1):


                                                                                    Three Months Ended
                                                   April 1,                          April 2,
                                                     2022                              2021                     $ Change            % Change
                                                                                     ($ in millions)
Revenue, net                              $ 4,381            100.0  %       $ 4,137            100.0  %       $     244                     6  %
Cost of revenue                             3,200             73.0            3,046             73.6                154                     5
Gross profit                                1,181             27.0            1,091             26.4                 90                     8
Operating Expenses:
Research and development                      572             13.1              555             13.4                 17                     3
Selling, general and administrative           281              6.4              287              6.9                 (6)                   (2)
Employee termination, asset impairment,
and other charges                               4              0.1              (68)            (1.6)                72                  (106)
Total operating expenses                      857             19.6              774             18.7                 83                    11
Operating income                              324              7.4              317              7.7                  7                     2
Interest and other income (expense):
Interest income                                 1                -                2                -                 (1)                  (50)
Interest expense                              (75)            (1.7)             (81)            (2.0)                 6                    (7)
Other income (loss), net                       12              0.3               11              0.3                  1                     9
Total interest and other expense, net         (62)            (1.4)             (68)            (1.6)                 6                    (9)
Income before taxes                           262              6.0              249              6.0                 13                     5
Income tax expense                            237              5.4               52              1.3                185                   356
Net income                                $    25              0.6          $   197              4.8               (172)                  (87)



(1) Percentages may not total due to rounding.


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                                                                                     Nine Months Ended
                                                    April 1,                           April 2,
                                                      2022                               2021                    $ Change            % Change
                                                                                      ($ in millions)
Revenue, net                              $ 14,265            100.0  %       $ 12,002            100.0  %       $  2,263                    19  %
Cost of revenue                              9,836             69.0             9,047             75.4               789                     9
Gross profit                                 4,429             31.0             2,955             24.6             1,474                    50
Operating Expenses:
Research and development                     1,725             12.1             1,645             13.7                80                     5
Selling, general and administrative            851              6.0               808              6.7                43                     5
Employee termination, asset impairment,
and other charges                               24              0.2               (43)            (0.4)               67                  (156)
Total operating expenses                     2,600             18.2             2,410             20.1               190                     8
Operating income                             1,829             12.8               545              4.5             1,284                   236
Interest and other income (expense):
Interest income                                  4                -                 6                -                (2)                  (33)
Interest expense                              (229)            (1.6)             (246)            (2.0)               17                    (7)
Other income (expense), net                      8              0.1                26              0.2               (18)                  (69)
Total interest and other expense, net         (217)            (1.5)             (214)            (1.8)               (3)                    1
Income before taxes                          1,612             11.3               331              2.8             1,281                   387
Income tax expense                             413              2.9               132              1.1               281                   213
Net income                                $  1,199              8.4          $    199              1.7             1,000                   503

(1) Percentages may not total due to rounding.


































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The following table sets forth, for the periods presented, a summary of our
segment information:

                                                 Three Months Ended            Nine Months Ended
                                               April 1,       April 2,      April 1,       April 2,
                                                 2022           2021          2022           2021
                                                                 ($ in millions)
Net revenue:
Flash                                        $   2,243       $ 2,175       $  7,353       $  6,287
HDD                                              2,138         1,962          6,912          5,715
Total net revenue                            $   4,381       $ 4,137       $ 14,265       $ 12,002
Gross profit:
Flash                                        $     798       $   653       $  2,665       $  1,752
HDD                                                592           491          2,061          1,462

Unallocated corporate items:
Contamination related charges                     (203)            -           (203)             -
Amortization of acquired intangible assets           -           (39)           (65)          (293)
Stock-based compensation expense                   (13)          (14)           (36)           (41)

Recoveries from a power outage incident              7             -              7             75

Total unallocated corporate items                 (209)          (53)          (297)          (259)
Consolidated gross profit                    $   1,181       $ 1,091       $  4,429       $  2,955
Gross margin:
Flash                                             35.6  %       30.0  %        36.2  %        27.9  %
HDD                                               27.7  %       25.0  %        29.8  %        25.6  %
Consolidated gross margin                         27.0  %       26.4  %        31.0  %        24.6  %



Our disaggregated revenue information is as follows:



                                       Three Months Ended              Nine Months Ended
                                     April 1,         April 2,      April 1,       April 2,
                                       2022             2021          2022           2021
                                                        (in millions)

Revenue by End Market
Cloud                            $    1,774          $  1,423      $   5,919      $  3,728
Client                                1,732             1,767          5,439         5,386
Consumer                                875               947          2,907         2,888
Total Revenue                    $    4,381          $  4,137      $  14,265      $ 12,002

Revenue by Geography
Asia                             $    2,400          $  2,215      $   7,685      $  6,702
Americas                              1,377             1,009          4,398         3,033
Europe, Middle East and Africa          604               913          2,182         2,267
Total Revenue                    $    4,381          $  4,137      $  14,265      $ 12,002



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Net Revenue

The increases in consolidated net revenue for the three and nine months ended
April 1, 2022 from the comparable periods in the prior year reflect increases in
exabytes of Flash and HDD sold as further discussed below. The revenue increases
driven by exabyte growth were partially offset by declines in the average price
per gigabyte of storage for both Flash and HDD as product mix shifted.

Despite the disruption to our Flash production from the contamination event at
Flash Ventures' fabrication facilities in both Yokkaichi and Kitakami, Japan,
Flash revenue increased 3% for the three months ended April 1, 2022 from the
comparable period in the prior year, primarily driven by a 9% increase in
exabytes sold, partially offset by a decline in the average price per gigabyte.
The higher exabytes sold primarily reflected the ramp of our latest BiCS5 flash
solutions. Higher volume was also driven by strong demand in gaming along with a
growing brand recognition of WD_Black based products in our Consumer market.
Flash revenue increased 17% for the nine months ended April 1, 2022 from the
comparable period in the prior year, primarily driven by a 24% increase in
exabytes sold, partially offset by a decline in the average price per gigabyte.
The increase in exabytes for the nine-month period was largely attributable to
the same factors noted above for the three-month period.

HDD revenue increased 9% for the three months ended April 1, 2022 from the
comparable period in the prior year, primarily driven by a 20% increase in
exabytes sold, partially offset by a decline in the average price per gigabyte
as noted above. The increase in exabytes sold was due to continued demand for
our latest generation energy assisted drives among our public and private cloud
customers. The strong demand in Cloud was partly offset by a decline in HDD
exabytes sold in our Client and Consumer end markets due to continued pressure
in the commercial channel related to component issues impacting our customers'
ability to ship product and greater component sourcing constraints within our
own operations, and customers transitioning to client SSD. HDD revenue increased
21% for the nine months ended April 1, 2022 from the comparable period in the
prior year, primarily driven by a 33% increase in exabytes sold, partially
offset by a decline in the average price per gigabyte as noted above. The
increase in exabytes for the nine-month period was largely attributable to the
same factors noted above for the three-month period.

The increase in Cloud revenue for the three months ended April 1, 2022 from the
comparable period in the prior year was led by demand for HDD capacity
enterprise drives, including growth in our 18-terabyte capacity drives and ramp
of our 20-terabyte capacity drives. The growth was partially offset by lower
revenues from enterprise SSDs primarily caused by the supply impact as a result
of the contamination event mentioned above and lower revenues from smart video
hard drives. In Client, the slight decrease in revenues for the three months
ended April 1, 2022 from the comparable period in the prior year reflected
declines in both client SSD and client HDD revenue, as a result of the supply
chain disruptions noted previously, partially offset by the ramp of 5G phones.
In Consumer, the slight decrease in revenues for the three months ended April 1,
2022 from the comparable period in the prior year reflected declines in both
Flash and HDD as a result of short term demand weakness outside the U.S. tied to
geopolitical events in Europe, as well as COVID-related lockdowns in China.

The increase in Cloud revenue for the nine months ended April 1, 2022 from the
comparable period in the prior year primarily reflects the same drivers noted
above for the three-month period. Client revenue was relatively flat for the
nine months ended April 1, 2022 compared to the prior year, with growth in
mobile (led by 5G growth), gaming, automotive, IOT, and industrial applications
in the first quarter of fiscal 2022, partially offset by declines in both client
SSD and client HDD revenue, as a result of the supply chain disruptions noted
previously. Consumer revenue was relatively flat for the nine months ended April
1, 2022 from the comparable period in the prior year with growth in gaming along
with a growing brand recognition of WD_Black tempered by the slightly weaker
demand in the third quarter noted above.

The changes in net revenue by geography for both the three and nine months ended April 1, 2022 from the comparable periods in the prior year reflect routine variations in the mix of business.



Our top 10 customers accounted for 44% and 43% of our net revenue for the three
and nine months ended April 1, 2022, respectively, compared to 42% and 40% of
our net revenue for the three and nine months ended April 2, 2021, respectively.
For each of the three and nine months ended April 1, 2022 and April 2, 2021, no
single customer accounted for 10% or more of our net revenue.

Consistent with standard industry practice, we have sales incentive and
marketing programs that provide customers with price protection and other
incentives or reimbursements that are recorded as a reduction to gross revenue.
These programs represented 17% and 18% of gross revenues for both the three and
nine months ended April 1, 2022, and 18% and 19% of gross revenues for the three
and nine months ended April 2, 2021, respectively. Adjustments due to changes in
accruals for these programs have generally averaged less than 1% of gross
revenue year over year. The amounts attributed to our sales incentive and
marketing programs generally vary according to several factors including
industry conditions, list pricing strategies,
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seasonal demand, competitor actions, channel mix and overall availability of
products. Changes in future customer demand and market conditions may require us
to adjust our incentive programs as a percentage of gross revenue.

We believe we have made significant progress in strengthening our product
portfolio to meet our customers' growing and evolving storage needs. We have
largely completed qualification of BiCS5 based product for client and consumer
end markets. Additionally, qualification of OptiNAND-based hard drives progress
as planned across multiple cloud and OEM customers and we continue to see an
increase in customer interest in adopting shingled magnetic recording ("SMR")
technology. Combining OptiNAND with our SMR leadership positions us to drive
business results in our capacity enterprise business. For our next generation
3D-flash, we continued commercial shipment of consumer flash devices based on
our 162-layer BiCs6. We expect these developments to contribute to further
revenue growth when supply chain disruptions begin to abate.

Gross Profit and Gross Margin



Consolidated gross profit increased by $90 million for the three months ended
April 1, 2022 from the comparable period in the prior year, which reflects the
increase in revenue in both Flash and HDD and reduced costs as we ramped
production on newer products, partially offset by charges of $203 million
related to the contamination event in the Flash Ventures' fabrication
facilities. Consolidated gross margin increased 0.6 percentage points for the
three months ended April 1, 2022 from the comparable period in the prior year,
which reflects cost reductions as we ramped production on newer products and a
shift in product mix to higher-margin flash drives, partially offset by the
impact of the contamination related charges which represented approximately 4.6
percentage points of gross margin. Flash and HDD gross margin increased by 5.6
and 2.7 percentage points year over year, respectively, reflecting cost
reductions as we ramped production on newer products.

Consolidated gross profit increased by $1.47 billion for the nine months ended
April 1, 2022 from the comparable period in the prior year, which reflects the
increase in revenue in both Flash and HDD, as well as a $228 million decrease in
charges in the current period related to amortization expense on acquired
intangible assets, some of which became fully amortized, partially offset by the
contamination related charges of $203 million noted above. Consolidated gross
margin increased 6.4 percentage points for the nine months ended April 1, 2022
from the comparable period in the prior year, which reflects higher gross margin
in both Flash and HDD as a result of cost reductions as we ramped production on
newer products and a shift in product mix to higher-margin flash drives, as well
as the lower charges for amortization of acquired intangible assets noted above.
Flash and HDD gross margin increased by 8.3 and 4.2 percentage points year over
year, respectively, reflecting cost reductions as we ramped production on newer
products.

Operating Expenses

Research and development ("R&D") expense increased $17 million and $80 million
for the three and nine months ended April 1, 2022, respectively, from the
comparable period in the prior year. The primary increase was due to increased
headcount.

Selling, general and administrative ("SG&A") expense decreased $6 million for
the three months ended April 1, 2022 from the comparable period in the prior
year, primarily reflecting slightly lower variable compensation expense. SG&A
expense increased $43 million for the nine months ended April 1, 2022 from the
comparable period in the prior year and primarily reflected higher outside
professional services.

Employee termination, asset impairment and other charges for both the three and
nine months ended April 1, 2022 reflect minor actions taken in each period,
while the prior year periods primarily reflected gains related to the
disposition of assets associated with actions taken in earlier periods. For
information regarding Employee termination, asset impairment and other charges,
see Part I, Item 1, Note 15, Employee Termination, Asset Impairment, and Other
Charges of the Notes to Condensed Consolidated Financial Statements included in
this Quarterly Report on Form 10-Q.

Interest and Other Income (Expense)



Total interest and other expense, net for the three months ended April 1, 2022
slightly decreased compared to the prior year, mainly reflecting lower interest
expense primarily resulting from the pay-down of principal on our debt. Total
interest and other expense, net for the nine months ended April 1, 2022
increased slightly compared to the prior year, mainly reflecting unfavorable
exchange rates in the current period mostly offset by lower interest expense
resulting from the pay-down of principal on our debt.

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Income Tax Expense

The Tax Cuts and Jobs Act (the "2017 Act") includes a broad range of tax reform
proposals affecting businesses. We completed our accounting for the tax effects
of the enactment of the 2017 Act during the second quarter of fiscal 2019.
However, the U.S. Treasury and the Internal Revenue Service ("IRS") have issued
tax guidance on certain provisions of the 2017 Act since the enactment date, and
we anticipate the issuance of additional regulatory and interpretive guidance.
We applied a reasonable interpretation of the 2017 Act along with the
then-available guidance in finalizing our accounting for the tax effects of the
2017 Act. Any additional regulatory or interpretive guidance would constitute
new information, which may require further refinements to our estimates in
future periods.

The following table sets forth income tax information from our Condensed Consolidated Statements of Operations by dollar and effective tax rate:


                             Three Months Ended                 Nine Months Ended
                        April 1,             April 2,        April 1,        April 2,
                          2022                 2021            2022            2021
                                               ($ in millions)
Income before taxes   $    262              $    249       $    1,612       $    331
Income tax expense         237                    52              413            132
Effective tax rate          90   %                21  %            26  %          40  %



The primary drivers of the difference between the effective tax rate for the
three and nine months ended April 1, 2022 and the U.S. Federal statutory rate of
21%, are the relative mix of earnings and losses by jurisdiction, the deduction
for foreign derived intangible income, credits, and tax holidays in Malaysia,
the Philippines and Thailand that will expire at various dates during fiscal
years 2024 through 2031. In addition, the effective tax rate for the three and
nine months ended April 1, 2022 includes the discrete effect of a net increase
to the liability for unrecognized tax benefits, which includes interest and
offsetting tax benefits, as a result of ongoing discussions with various taxing
authorities of $194 million and $219 million, respectively.

The primary drivers of the difference between the effective tax rate for the
three and nine months ended April 2, 2021 and the U.S. Federal statutory rate of
21% are the relative mix of earnings and losses by jurisdiction, the deduction
for foreign derived intangible income, credits, and tax holidays in Malaysia,
Philippines and Thailand. In addition, the effective tax rate for the three and
nine months ended April 2, 2021 includes discrete effects for increases to the
liability for unrecognized tax benefits of $35 million as a result of ongoing
discussions with various taxing authorities that are offset in part by a release
of certain unrecognized tax benefits of $22 million as a result of business
realignment activities. The effective tax rate for the nine months ended
April 2, 2021 also includes the discrete effects of net tax deficiencies from
shortfalls of $11 million related to the vesting of stock-based awards and
additional tax expense of $10 million from the re-measurement of deferred tax
liabilities due to restructuring activities, which have no impact on the amount
of income taxes that we paid.

Subsequent to April 1, 2022, we and the IRS tentatively reached a basis for
resolving the statutory notices of deficiency and notices of proposed
adjustments with respect to fiscal years 2008 through 2015. See the "--Short-
and Long-Term Liquidity--Unrecognized Tax Benefits" section below for additional
information related to this matter.

Our future effective tax rate is subject to future regulatory developments and
changes in the mix of our U.S. earnings compared to foreign earnings. Our total
tax expense in future fiscal years may also vary as a result of discrete items
such as excess tax benefits or deficiencies.

For additional information regarding Income tax expense, see Part I, Item 1,
Note 13, Income Tax Expense, of the Notes to Condensed Consolidated Financial
Statements included in this Quarterly Report on Form 10-Q.

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