Core Viewpoint - Seagate Technology reported strong fiscal second-quarter results for 2026, highlighting record revenue, profitability, and demand across data center markets, driven by the ramp-up of heat-assisted magnetic recording (HAMR) products and a strategic focus on high-capacity nearline drives [3][6][2]. Financial Performance - Seagate's fiscal Q2 revenue reached $2.83 billion, marking a 7% sequential increase and a 22% year-over-year growth [7][6]. - Non-GAAP gross margin was reported at 42.2%, up 210 basis points sequentially, while non-GAAP operating margin expanded to 31.9%, an increase of 290 basis points [7][10]. - Non-GAAP earnings per share (EPS) stood at $3.11, reflecting a 19% quarter-over-quarter increase [7][10]. Product and Capacity Developments - The company shipped 190 exabytes in the quarter, a 26% increase year-over-year, with data center shipments accounting for 87% of the total volume [8][9]. - Seagate's nearline drive capacities increased by 22% year-over-year, approaching 23 terabytes per drive, with cloud customers averaging even higher capacities [6][10]. - Quarterly HAMR shipments exceeded 1.5 million units, with Mozaic 3 drives qualified with major U.S. cloud service providers (CSPs) and Mozaic 4 qualification on track [5][6]. Cash Flow and Debt Management - The company generated $607 million in free cash flow, the highest in eight years, and ended the quarter with over $1 billion in cash and cash equivalents [12][13]. - Seagate retired approximately $500 million of exchangeable senior notes and returned $154 million to shareholders through dividends, improving its net leverage ratio to 1.1x [13][12]. Future Outlook - For the March quarter, Seagate guided revenue to approximately $2.9 billion, representing a 34% year-over-year improvement at the midpoint, with non-GAAP operating margin expected to approach the mid-30s percentage range [14][15]. - Management anticipates that data center demand will offset typical seasonality in the edge IoT market, with expectations for further expansion in free cash flow driven by operational efficiency [16][14]. Pricing and Supply Agreements - Seagate has established purchase orders for all quarters of calendar 2026, with volume and pricing well defined, while indications for calendar 2027 volumes are positive but pricing remains unconfirmed [18][17]. - Executives noted that customer behavior is improving planning, enhancing visibility and factory planning for Seagate [19][17].

Nasdaq futures popped, leading Wall Street stocks higher on Wednesday as investors braced for the Federal Reserve’s latest policy decision and potentially pivotal earnings from megacap tech giants. Contracts on the tech-heavy Nasdaq 100 (NQ=F) climbed about 0,8%, while those on the Dow Jones Industrial Average (YM=F) hovered just above the flat line. S&P 500 futures (ES=F) rose 0.3%, eyeing another record on the heels of an all-time closing high. Attention now turns to Wednesday’s Fed announcement, the ...

Financial Data and Key Metrics Changes - Seagate reported December quarter revenue of $2.83 billion, representing a 7% sequential increase and a 22% year-over-year increase [15] - Non-GAAP gross margin improved to 42.2%, up 210 basis points sequentially, while non-GAAP operating margin expanded by 290 basis points to 31.9% [15][19] - Non-GAAP EPS was $3.11, reflecting a 19% increase quarter-over-quarter [15][20] Business Line Data and Key Metrics Changes - The data center market accounted for 87% of shipment volume, with 165 exabytes shipped, up 4% sequentially and 31% year-over-year [16] - Average cloud nearline drive capacities increased to nearly 26 terabytes in the December quarter, with a strong demand for higher capacity drives [17] - The edge IoT market contributed $601 million, supported by seasonal improvements in consumer products [17] Market Data and Key Metrics Changes - Demand for high-capacity nearline drives in global cloud data centers continued to grow, with nearline capacity fully allocated through calendar year 2026 [7] - The average nearline drive capacity rose by 22% year-over-year, approaching 23 TB per drive [8] - Video applications are driving significant demand, with platforms like YouTube seeing 20 million video uploads daily, up from 2 million three years ago [8] Company Strategy and Development Direction - Seagate's HAMR technology roadmap is positioned to meet growing demand and improve total cost of ownership (TCO) for customers [12][14] - The company aims to maintain supply discipline while satisfying exabyte growth through advancements in areal density without increasing unit production volume [7] - Seagate is focused on expanding profitability through a higher capacity product mix, supported by strong demand from AI applications [13][24] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the strong demand environment, particularly from global cloud customers, and expects data center demand to offset typical seasonality [22][23] - The company anticipates revenue for the March quarter to be in the range of $2.9 billion ±$100 million, representing a 34% year-over-year improvement [23] - Management highlighted the importance of maintaining pricing discipline and the potential for flat to slightly increased pricing in the future [28][71] Other Important Information - Seagate generated over $600 million in free cash flow, the highest level in eight years, and retired $500 million in gross debt [15][21] - The company expects to continue improving profitability and cash generation throughout calendar 2026 [24] - Seagate's net leverage ratio improved to 1.1 times, with expectations for further reduction as profitability increases [22] Q&A Session Summary Question: Can you provide more detail on gross margins going forward? - Management indicated that pricing will be dictated by demand, with potential for flat to slightly up pricing as capacity increases [28] Question: How do you see the pricing dynamics evolving? - Management noted that demand remains strong, and discussions with customers are focused on future planning [35] Question: What is the expected growth rate for exabyte shipments in 2026? - Management did not provide specific guidance for 2026 but indicated a mid-20% growth expectation for nearline exabytes [60] Question: How is the transition to HAMR technology progressing? - The transition is on track, with six out of eight major cloud service providers qualified for HAMR products [48] Question: What portion of your LTAs has fixed pricing agreements? - Management confirmed that for 2026, volume and pricing are well defined, but pricing for 2027 has not yet been fixed [96]

Financial Data and Key Metrics Changes - Seagate reported December quarter revenue of $2.83 billion, up 7% sequentially and 22% year-over-year, setting new records for profitability metrics [15][24] - Non-GAAP gross margin increased to 42.2%, up 210 basis points sequentially, while non-GAAP operating margin expanded by 290 basis points to 31.9% [15][19] - Non-GAAP EPS was $3.11, reflecting a 19% increase quarter-over-quarter [15][20] Business Line Data and Key Metrics Changes - The data center market accounted for 87% of shipment volume, with 165 exabytes shipped, up 4% sequentially and 31% year-over-year [16] - Average cloud nearline drive capacities rose to nearly 26 TB in the December quarter, indicating a shift towards higher capacity drives [17] - The edge IoT market contributed $601 million, supported by seasonal improvements in consumer products [17] Market Data and Key Metrics Changes - Demand for high-capacity nearline drives in global cloud data centers continued to grow, with nearline capacity fully allocated through calendar year 2026 [7][16] - Video applications are driving significant demand, with platforms like YouTube seeing 20 million video uploads daily, up from 2 million three years ago [8] - The strategic value of data is increasing, particularly with the rise of AI applications that require large volumes of historic data [9] Company Strategy and Development Direction - Seagate's HAMR technology roadmap is positioned to meet growing demand and improve total cost of ownership (TCO) for customers [12][14] - The company aims to maintain supply discipline while satisfying exabyte growth through advancements in areal density without increasing unit production volume [7][12] - Seagate is focused on expanding profitability through a higher capacity product mix, supported by strong demand from AI applications [13][24] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the strong demand environment, particularly from global cloud customers, and expects data center demand to offset typical seasonality [22][23] - The company anticipates continued sequential improvement in revenue and profitability throughout calendar 2026 [24] - Management highlighted the importance of maintaining predictable supply and pricing strategies as they transition to higher capacity products [28][70] Other Important Information - Seagate generated over $600 million in free cash flow, the highest level in eight years, and retired $500 million in gross debt [15][21] - The company expects capital expenditures for fiscal year 2026 to remain within the target range of 4%-6% of revenue [21][102] - Cash and cash equivalents totaled just over $1 billion, with ample liquidity of $2.3 billion [21] Q&A Session Summary Question: Can you provide more detail on gross margins going forward? - Management indicated that pricing will be dictated by demand, with potential for flat to slightly up pricing as capacity increases [28][29] Question: How do you see the pricing dynamics evolving? - Management noted that strong demand is leading to better discussions with customers about future pricing, with expectations for flat to slightly up pricing [34][70] Question: What is the expected growth rate for exabyte shipments in 2026? - Management did not provide specific guidance for 2026 but indicated a mid-20% growth rate for nearline exabytes based on historical performance [58] Question: How is the transition to HAMR technology progressing? - Management reported successful qualification of major cloud service providers and expects to ramp up production of 4 TB per disk drives [47][91] Question: What portion of your LTAs has fixed pricing agreements? - Management confirmed that pricing and volume for 2026 are well defined, with ongoing discussions for 2027 [96][97]

Seagate Technology forecast third-quarter revenue and profit above Wall Street expectations on Tuesday, benefiting from strong demand for its data storage devices as enterprises scale up their use of ... ...

SUPPLEMENTAL FINANCIAL INFORMATION Q2FY26 JANUARY 27, 2026 Safe Harbor Statement and Use of Non-GAAP Financial Information This document and our other communications regarding our quarterly financial results contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements provide current expectations of future events based on certain assumptions and include any statement that does not directly relate to any historical fact. Forward-loo ...

Core Viewpoint - Seagate Technology Holdings Plc. reported strong second-quarter earnings, exceeding analyst expectations in both earnings per share and revenue, indicating robust operational performance and demand in the data center market [2][3]. Financial Performance - Quarterly earnings were reported at $3.11 per share, surpassing the analyst consensus estimate of $2.81 by 10.52% [2]. - Revenue for the quarter reached $2.83 billion, exceeding the Street estimate of $2.73 billion and showing an increase from $2.33 billion in the same period last year [2]. Operational Highlights - The company achieved new records for gross margin, operating margin, and non-GAAP EPS, reflecting strong operational execution and the durability of data center demand [3]. - The ongoing ramp of HAMR-based Mozaic products contributed positively to the performance [3]. Future Outlook - For the third quarter, Seagate expects adjusted EPS to be between $3.20 and $3.60, compared to the analyst estimate of $2.96, and revenue is projected to be between $2.8 billion and $3 billion, exceeding the analyst estimate of $2.77 billion [4].

Core Insights - Western Digital Corporation (WDC) and Micron Technology (MU) are significant players in the memory and storage ecosystem, benefiting from the demand for NAND flash and data-center solutions driven by AI and cloud computing [2][3] - Both companies are positioned to capitalize on global data growth, but they operate in distinct segments of the data storage market [3] Western Digital (WDC) - WDC is traditionally known for HDDs and enterprise storage systems, with a growing focus on flash memory, particularly through its ePMR and UltraSMR products [3][5] - The company is experiencing increased demand for its storage solutions due to the rise of AI and data-driven workloads, leading to strong shipments of high-capacity drives [6] - WDC anticipates non-GAAP revenues of $2.9 billion for the fiscal second quarter, representing a 20% year-over-year increase [7] - The company has returned $785 million to shareholders through buybacks and dividends since launching its capital return program [8] - WDC faces challenges due to a heavy debt burden, which limits its flexibility for acquisitions and requires strong cash flow generation [10] Micron Technology (MU) - Micron is focused on DRAM, HBM, and NAND flash, benefiting from a tight supply environment driven by AI adoption and data center growth [11] - The total addressable market for HBM is projected to reach $100 billion by 2028, prompting Micron to increase capital expenditures and supply investments [11] - Micron's data center NAND revenue exceeded $1 billion in the fiscal first quarter, supported by strong demand for its SSD portfolio [13] - The company maintains a strong balance sheet with $12 billion in cash and investments, allowing for strategic acquisitions and shareholder returns [14] - Micron's earnings estimates for fiscal 2026 have been revised up 90.5% to $33.08, reflecting strong growth expectations [19] Performance and Valuation - Over the past year, MU and WDC have seen stock gains of 340.9% and 283.1%, respectively [17] - MU's shares trade at a forward P/E ratio of 10.62, significantly lower than WDC's 25.59, indicating a more attractive valuation [18] - The Zacks Consensus Estimate for MU's earnings has seen substantial upward revisions, while WDC's estimates have seen modest increases [24] Investment Considerations - Micron is viewed as the growth engine in the sector, while Western Digital may represent a turnaround opportunity, with investment choices depending on risk profiles and market confidence [25]

Core Viewpoint - Seagate Technology (STX) is experiencing significant growth driven by AI demand for storage solutions, with its stock reaching new all-time highs and a substantial increase in market value [1][5]. Company Overview - Seagate Technology is valued at $76.5 billion and is one of the largest manufacturers of hard disk drives in the U.S., producing various storage products including solid state drives [1]. - The company's storage products are essential for managing and storing large datasets used in artificial intelligence models [2]. Stock Performance - STX shares have increased by over 230% in the past 52 weeks, with a recent trading price of $358.29 [5][6]. - The stock has achieved a new all-time high of $370.47 on January 26 and has gained 29.49% since a "Buy" signal was issued on November 28 [3][4]. - Seagate has a 100% "Buy" technical opinion from Barchart, indicating strong market momentum [5][6]. Technical Indicators - The stock has a Weighted Alpha of +325.50 and a Relative Strength Index (RSI) of 70.56, suggesting strong upward momentum [6]. - A technical support level is identified around $346.04 [7]. Financial Metrics - Seagate has a trailing price-earnings ratio of 41.5x [8]. - Analysts project earnings growth of 46.7% in 2026 and 53.4% in 2027 [8].

Seagate Technology Holdings PLC Earnings Preview: A Look into the FutureSeagate Technology Holdings PLC (NASDAQ:STX) is a leading figure in the data storage industry, renowned for its hard disk drives and storage solutions. As the company gears up to unveil its quarterly earnings on January 27, 2026, after the market closes, Wall Street analysts have set the earnings per share (EPS) expectation at $2.78 and anticipate revenue to be around $2.73 billion. This announcement is eagerly awaited, considering the ...