Key Takeaways Seagate's mass-capacity revenues jumped 40% in Q4, led by strong nearline cloud demand.HAMR and Mozaic 3+ platform boost storage density, supporting higher profitability.Q4 gross margin hit 37.9%, up nearly 700 bps year over year, with operating income nearly doubling.Seagate Technology Holdings plc (STX) is riding a wave of surging demand from cloud, artificial intelligence (AI) and edge computing. The company’s nearline hard drives remain the backbone of hyperscale cloud storage, with build- ...

Summary of Western Digital (WDC) FY Conference Call Company Overview - **Company**: Western Digital (WDC) - **Focus**: 100% hard drive focused data storage company, heavily tied to cloud services, with 87% of business linked to cloud as of fiscal Q3 [7][8] Key Financial Highlights - **Buyback Program**: Initiated a $2 billion buyback program effective immediately [6] - **Debt Management**: Redeemed $1.8 billion of debt related to 2026 senior notes [7] - **Dividend**: Announced a dividend of $0.40 per share for the year [7] Strategic Priorities 1. **Customer Engagement**: Focus on deeper engagement with major customers, particularly in the cloud sector [10] 2. **Product Innovation**: Commitment to delivering leading-edge products and IP innovations, including transitioning to HAMR technology [11] 3. **Operational Efficiency**: Strong emphasis on operational execution and cost discipline, with hard drive yields improved from 60% to 90% [12] Market Dynamics - **Demand Trends**: Positive demand from cloud and hyperscalers, with strong CapEx spending intentions [13][14] - **Trade and Tariffs**: Potential indirect impacts on retail and enterprise client channels, but no major immediate effects from tariffs noted [16][20] - **Cloud Spending**: Robust outlook for cloud business, with long-term agreements providing visibility into demand through 2026 [22] Growth Projections - **Exabyte Growth**: Projected nearline exabyte growth CAGR of 23% from 2024 to 2028, with 15% from organic cloud growth and 8% from AI-related demand [26] - **Capacity Management**: Focus on aerial density improvements rather than increasing physical capacity, with no plans for additional CapEx [29][37] AI and Data Storage - **AI Workloads**: Hard drives are foundational for AI data lakes, providing cost-effective bandwidth despite limitations in IOPS [32][33] - **Customer Collaboration**: Close partnerships with hyperscale customers to optimize data center architectures for AI workloads [33] Product Roadmap - **Current Products**: Successful ramp-up of 26 terabyte CMR and 32 terabyte ultra SMR drives, with over 1 million units expected to ship [44][46] - **Future Products**: On track for next-gen ePMR based 28 terabyte CMR and 36 terabyte ultra SMR drives in the first half of next year [48] - **HAMR Technology**: Development of HAMR technology with customer feedback indicating confidence in execution timelines [50][52] Financial Performance - **Gross Margins**: Current gross margins exceed 40%, significantly better than previous targets of 31-34% [59] - **Operational Efficiencies**: Improved yields and cost discipline have driven margin expansion [61][62] Capital Allocation Strategy - **Free Cash Flow**: Plans to return 100% of excess free cash flow once net leverage reaches 1x to 1.5x, with a focus on dividends and buybacks [66][67] Conclusion - **Overall Outlook**: Western Digital is positioned for strong growth driven by cloud demand, operational efficiencies, and strategic product innovations, particularly in the AI space. The company is committed to maintaining a disciplined approach to capital allocation and operational execution.