Financial Data and Key Metrics - Revenue for Q1 2025 was $2.17 billion, up 15% sequentially and 49% year-over-year [6][15] - Non-GAAP EPS was $1.58, at the high end of the guidance range [6][15] - Non-GAAP gross margin expanded by 240 basis points sequentially to 33.3%, the highest level in over a decade [7][18] - Non-GAAP operating income increased 35% sequentially to $442 million, with a non-GAAP operating margin of 20.4% [15] - Free cash flow generation was $27 million, with expectations for improvement in the December quarter [19] Business Line Data and Key Metrics - HDD exabyte shipments grew 20% sequentially to 128 exabytes, with revenue increasing 16% to $2 billion [15] - Mass capacity revenue grew 21% sequentially to $1.7 billion, driven by strong nearline cloud demand and enterprise sales [15][16] - Mass capacity shipments totaled 128 exabytes, up 23% sequentially, representing a record 93% of total HDD exabyte shipments [16] - Legacy product sales totaled $270 million, representing 12% of total revenue, while other businesses held steady at $164 million [17] Market Data and Key Metrics - Cloud demand for nearline drives remained robust, particularly from U.S. cloud providers, with positive global demand trends [8] - Enterprise and OEM markets saw the first meaningful uptick in nearline demand after a period of stability, with average capacity per enterprise drive reaching a new record high [9] - VIA markets remained stable, with a shift towards higher capacity drives due to longer data retention needs and increased video analytics [10] Company Strategy and Industry Competition - The company is focusing on ramping its final PMR platform, expanding Mozaic adoption, and executing its Mozaic product roadmap to address mass capacity storage needs [12] - HAMR technology is expected to play a vital role in supporting future demand growth, with qualifications progressing well and shipments expected to ramp by mid-2025 [13] - The company is confident in its technology leadership, with plans to extend its HAMR roadmap to 4+ terabytes per disc, further reducing cost per terabyte [14] Management Commentary on Operating Environment and Future Outlook - Management highlighted a favorable demand environment, with strong cloud demand and improving enterprise and OEM markets [6][8] - The company expects significant revenue growth for fiscal 2025, with seasonal demand fluctuations typical for the March quarter [7] - Management expressed confidence in the company's ability to drive profitable growth, supported by its build-to-order model and technology roadmap [7][14] Other Important Information - The company increased its quarterly dividend by nearly 3%, reflecting confidence in future opportunities [7] - Inventory increased to $1.4 billion, with material staged to support improving mass capacity demand [20] - The company closed the quarter with $2.7 billion in available liquidity, including an undrawn revolving credit facility [20] Q&A Session Summary Question: Demand visibility and seasonality for the March quarter [24] - The company has good demand visibility through its build-to-order model, with confidence in bookings for the next year [25] - Seasonality in some markets is expected, but cloud demand remains predictable with low inventory buffers [25] Question: Market share and pricing environment [28] - Market share is seen as an outcome of the company's strategy, with a focus on predictability and profitability rather than pushing for market share [29] - The pricing environment remains positive, with ongoing improvements in gross margin driven by mix and pricing actions [31] Question: Cyclicality and gross margin upside [33] - The company has improved its processes to manage supply and demand, with a focus on cost reduction and aerial density gains to drive gross margin expansion [34] Question: Gross margin expansion in the December quarter [36] - Gross margin expansion is expected to continue, driven by pricing actions and the ramp of the latest PMR products, though the pace may moderate compared to previous quarters [37] Question: HAMR qualification and customer feedback [38] - The company is confident in the progress of HAMR qualifications, with multiple global cloud and enterprise customers now testing the technology [39] - Feedback from customers has reinforced the value proposition of the Mozaic platform [40] Question: Impact of HAMR ramp on gross margins [43] - HAMR is expected to be accretive to gross margins in the near term, with cost per terabyte below that of PMR [45] Question: Operating expenses and share repurchase plans [47] - Operating expenses increased due to variable compensation, with expectations to remain flat through the rest of the fiscal year [47] - The company plans to address debt maturing in January with cash on hand, with share buybacks likely further in the future [47] Question: Capacity outlook and technology transitions [50] - The company plans to expand exabyte capacity through technology transitions, leveraging higher capacity points to drive efficiency and cost reduction [51] Question: Nearline demand visibility and seasonality [53] - Nearline demand visibility extends out to nine months, with mass capacity demand expected to remain strong through the front half of the year [53] - Seasonality is expected in the legacy and VIA markets, with the March quarter typically being weaker [54] Question: Capacity management and component changes [60] - The company is focused on technology transitions rather than adding more units, with aerial density gains allowing for more efficient capacity expansion [61] Question: Unit shipments and idle capacity [63] - The company did not provide specific unit shipment guidance but noted that factories are relatively full, with a focus on transitioning to higher capacity products [64] - Idle capacity is minimal, with high utilization rates in both ads and media fabs [74] Question: Build-to-order visibility and SMR mix [77] - The majority of build-to-order agreements are fully committed by customers, providing strong visibility [79] - SMR is primarily used by a few cloud and client server customers, with the company focusing on maximizing factory utilization [78] Question: AI and PC refresh cycle [72] - The company sees potential for AI-driven PC refresh cycles, particularly for creative professionals, though the timing remains uncertain [73]

For the quarter ended September 2024, Seagate (STX) reported revenue of $2.17 billion, up 49.1% over the same period last year. EPS came in at $1.58, compared to -$0.22 in the year-ago quarter.The reported revenue represents a surprise of +2.41% over the Zacks Consensus Estimate of $2.12 billion. With the consensus EPS estimate being $1.48, the EPS surprise was +6.76%.While investors closely watch year-over-year changes in headline numbers -- revenue and earnings -- and how they compare to Wall Street expec ...

Seagate (STX) came out with quarterly earnings of $1.58 per share, beating the Zacks Consensus Estimate of $1.48 per share. This compares to loss of $0.22 per share a year ago. These figures are adjusted for non-recurring items.This quarterly report represents an earnings surprise of 6.76%. A quarter ago, it was expected that this electronic storage maker would post earnings of $0.75 per share when it actually produced earnings of $1.05, delivering a surprise of 40%.Over the last four quarters, the company ...

Revenue and Earnings Performance - Revenue increased to $2.17 billion in fiscal Q1 2025, up from $1.45 billion in fiscal Q1 2024[1][3] - GAAP diluted EPS of $1.41 and non-GAAP diluted EPS of $1.58 for fiscal Q1 2025[1][3] - Net income of $305 million in fiscal Q1 2025, compared to a net loss of $184 million in fiscal Q1 2024[3][13] - Net income for Q3 2024 was $305 million, compared to a net loss of $184 million in Q3 2023[14] - Non-GAAP net income was $337 million in Q3 2024, compared to a net loss of $46 million in Q3 2023[18] - Non-GAAP diluted EPS was $1.58 in Q3 2024, up from a loss of $0.22 per share in Q3 2023[18] Gross and Operating Margins - Gross margin expanded to 32.9% (GAAP) and 33.3% (non-GAAP), the highest level in over a decade[1][3] - Operating margin improved to 18.6% (GAAP) and 20.4% (non-GAAP) in fiscal Q1 2025, up from (8.9)% and 2.8% respectively in fiscal Q1 2024[3] - Non-GAAP gross profit increased to $723 million in Q3 2024 from $288 million in Q3 2023, with gross margin improving to 33.3% from 19.8%[17] - Non-GAAP operating income rose to $442 million in Q3 2024, up from $40 million in Q3 2023, with operating margin improving to 20.4% from 2.8%[17] Cash Flow and Dividends - Cash flow from operations of $95 million and free cash flow of $27 million in fiscal Q1 2025[1][4] - Quarterly cash dividend increased by approximately 3% to $0.72 per share[1][5] - Free cash flow was $27 million in Q3 2024, down from $57 million in Q3 2023[18] - Free cash flow is defined as net cash from operating activities less acquisition of property, equipment, and leasehold improvements[29] Guidance and Future Outlook - Guidance for fiscal Q2 2025: revenue of $2.30 billion (±$150 million) and non-GAAP diluted EPS of $1.85 (±$0.20)[6] - Seagate is ramping up production of 28-terabyte nearline drives and expanding qualification of HAMR-based Mozaic products with cloud customers[2] Cash and Cash Equivalents - Cash and cash equivalents totaled $1.2 billion as of September 27, 2024[4] Non-GAAP Adjustments and Exclusions - The company uses non-GAAP measures to exclude certain items that are not part of ongoing operations, such as accelerated depreciation and restructuring charges[15][20] - The company excludes gains, losses, and fees from early redemption of debt and termination of interest rate swaps as they are not part of normal operating performance[22] - Purchase order cancellation fees are excluded as they are inconsistent in amount and frequency and not part of normal operating expenses[23] - Restructuring and other costs, including workforce reduction and facility exits, are excluded to provide a supplemental view of operating performance[24] - Share-based compensation expenses are excluded to enhance comparability with peers and assess underlying business performance[25] - Strategic investment gains, losses, and impairment charges are excluded as they are inconsistent and not part of normal operating expenses[26] - IT transformation costs are excluded as they are inconsistent in amount and frequency[27] - Adjusted EBITDA excludes non-core expenses such as impairment charges, restructuring costs, and share-based compensation[30] Special Transactions and Gains - The company recorded a pre-tax net gain of $313 million from the sale of System-on-Chip Operations in April 2024[21] Adjusted EBITDA - Non-GAAP adjusted EBITDA was $498 million in Q3 2024, compared to $404 million in Q2 2024 and $216 million in Q3 2023[19]

Analyst's Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, but may initiate a beneficial Long position through a purchase of the stock, or the purchase of call options or similar derivatives in STX over the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article. Disclaim ...

MINNEAPOLIS, MN - JANUARY 03: A general view of the Seagate Technology company offices on January ... [+] 03, 2024 in Minneapolis, Minnesota. (Photo by AaronP/Bauer-Griffin/GC Images)GC ImagesNote: FY’24 ended in June 2024Seagate stock (NASDAQ: STX Stacks ), a company specializing in the design, manufacture, and distribution of electronic data storage solutions and products, is scheduled to report its first-quarter results on Tuesday, October 22. We expect STX’s stock to likely see little to no movement wit ...

Looking for a stock that has been consistently beating earnings estimates and might be well positioned to keep the streak alive in its next quarterly report? Seagate (STX) , which belongs to the Zacks Computer - Integrated Systems industry, could be a great candidate to consider.This electronic storage maker has seen a nice streak of beating earnings estimates, especially when looking at the previous two reports. The average surprise for the last two quarters was 31.11%.For the last reported quarter, Seagat ...

Seagate Technology Holdings plc (STX) is scheduled to report first-quarter fiscal 2025 earnings on Oct. 22.Stay up-to-date with all quarterly releases: See Zacks Earnings Calendar.The Zacks Consensus Estimate for first-quarter fiscal 2025 earnings has been revised upwards by 2.1% in the past 60 days at $1.48 per share. The company reported a non-GAAP loss per share of 22 cents in the prior year quarter. The Zacks Consensus Estimate for revenues is currently pegged at $2.11 billion, indicating a 44.8% uptick ...

Wall Street analysts forecast that Seagate (STX) will report quarterly earnings of $1.48 per share in its upcoming release, pointing to a year-over-year increase of 772.7%. It is anticipated that revenues will amount to $2.11 billion, exhibiting an increase of 44.8% compared to the year-ago quarter.The consensus EPS estimate for the quarter has remained unchanged over the last 30 days. This reflects how the analysts covering the stock have collectively reevaluated their initial estimates during this timefra ...

Seagate Technology Holdings plc (STX) is a leading provider of data storage technology and infrastructure solutions.Seagate reported revenues of $6.55 billion in fiscal 2024. In the fiscal fourth quarter of 2024, non-GAAP revenues of $1.89 billion beat the Zacks Consensus Estimate by 1.5%. The figure increased 18% on a year-over-year basis and 14% sequentially driven by growing demand for mass capacity solutions. Management projected revenues to be $1.85 billion (+/- $150 million) for the fiscal fourth quar ...