S&P shifts Western Digital view to negative

S&P said it revised the outlook for Western Digital Corp. to negative.

“Our outlook revision reflects our view that, despite signs of price stabilization, oversupply in the flash memory market will continue to pressure average selling prices (ASP) until early next calendar year, and keep Western Digital’s profitability below historical levels. Given the amount of debt outstanding, we expect Western Digital’s leverage will remain high before meaningful improvement in fiscal 2021. The company ended the Sept. 30 quarter with adjusted leverage at about 4.5x, up from about 1.5x a year ago,” said S&P in a press release.

S&P affirmed Western Digital’s BB+ rating.

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