Seagate Technology Holdings Plc
Q4 2026 Earnings
Market Reaction
S&P 500 over the same 30 days: +5.47%.
Did STX Beat Earnings? Q4 2026 Results
Seagate Technology Holdings delivered a blowout fiscal fourth quarter, posting non-GAAP diluted EPS of $5.71 against a consensus estimate of $5.09, a beat of 12.11% that extended the company's streak of topping analyst EPS expectations to four consecutive quarters. Revenue of $3.63 billion cleared the $3.49 billion consensus by roughly 4% and surged 48.5% from the year-ago period, fueled by exceptional cloud data center demand for mass-capacity hard disk drives. The engine behind the outperformance was pricing power and operating leverage, with GAAP gross margin expanding to 52.3% from 37.4% a year earlier and GAAP net income climbing to $1.29 billion from $488 million. Free cash flow of $1.12 billion for the quarter allowed Seagate to continue deleveraging aggressively, retiring $1.40 billion in debt across the full fiscal year. While some investors have questioned the durability of hyperscaler storage spending, management sees no signs of a pullback, guiding fiscal Q1 2027 revenue to $4.10 billion and non-GAAP diluted EPS of $7.30, with AI-driven data generation cited as a durable long-term demand catalyst.
- Robust cloud data center demand
- Disciplined execution and pricing power
- AI-driven data generation increasing mass capacity storage demand
- Significant operating leverage as revenue scaled
- Non-GAAP gross margin expansion to 52.7% from 37.9% year-over-year
“Seagate's strong fourth quarter exceeded our expectations for revenue and non-GAAP EPS, capping a fiscal 2026 in which we grew annual revenue 34%, delivered record profitability, and generated a record $3.1 billion in free cash flow. Our performance is being driven by robust cloud data center demand and disciplined execution, and we see the momentum continuing in 2027.”
Seagate Technology CEO, on the earnings call
Forward Guidance & Outlook
For fiscal Q1 2027, Seagate guided revenue of $4.1 billion plus or minus $100 million and non-GAAP diluted EPS of $7.30 plus or minus $0.20. Guidance includes the estimated net dilutive impact from Exchangeable Senior Notes due 2028 and assumes minimal expected impact from global tariff policies and/or the current conflict in the Middle East. Non-GAAP EPS guidance excludes estimated share-based compensation expenses of $0.26 per share. CEO Dave Mosley stated the company sees momentum continuing into 2027, driven by durable long-term demand for mass capacity storage as AI accelerates data generation.
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Figures from SEC filings and company reports. Not investment advice.