Seagate Tops Q1 2027 Estimates but Guides to $4.8B Next Quarter
As seen on the 24/7 Wall St. homepage on October 27, 2026.
Guidance is the reason to stay interested: management sees $4.8 billion in revenue next quarter as HAMR drives record profitability. A double beat and 61% revenue growth were not enough to hold the stock after the filing hit.
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Seagate Technology posted adjusted diluted EPS of $7.68 for its fiscal first quarter of 2027, beating expectations on both earnings and revenue. It was the fifth consecutive quarter in which the company topped EPS estimates, a streak running from Q2 2025 through this report.
Seagate's HAMR-based Mozaic platform drove non-GAAP gross margin to 57.8% as value-based pricing and a richer product mix took hold. Microsoft Azure qualified the Mozaic technology ahead of the quarter's close, adding credibility to the hyperscale demand thesis management has been building.
Free cash flow of $1.48 billion funded aggressive balance sheet work, with Seagate retiring debt principal and cutting total liabilities from the year-ago level while shareholders' equity expanded sharply. The company also returned cash to shareholders through buybacks and raised its quarterly dividend to $0.76 per share.
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Management guided fiscal Q2 2027 revenue to $4.80 billion and non-GAAP diluted EPS of $9.20, implying continued sequential acceleration. CEO Dave Mosley said data creation, retention, and reuse continue to compound storage demand, and that long-term customer visibility reinforces the company's view of a multi-year growth phase.
Despite the double beat and the strong forward guidance, the stock declined after the filing hit, suggesting the market had priced in an ambitious outcome. Risks flagged by management include tariffs, evolving global trade policy, macroeconomic factors, and an outstanding settlement obligation with the U.S. Department of Commerce Bureau of Industry and Security.
Mentioned: STX