Seagate Is Up 4.7% After Earnings: Everything You Need to Know

"Seagate Technology ( NASDAQ: STX) delivered a commanding earnings beat on Tuesday, posting Q1 results that crushed expectations and signaled robust demand for high-capacity storage tied to AI infrastructure buildout. Revenue hit $2.63 billion, beating the $2.55 billion consensus by 3.1%, while non-GAAP EPS of $2.61 exceeded the $2.40 estimate and the high end of guided range. The stock traded at $223 at the close, but is now trading for nearly $233 after hours."

"The real story here is velocity. Revenue climbed 21% year-over-year from $2.17 billion, driven by strong demand for high-capacity storage products powering AI applications across cloud infrastructure. Gross profit surged 45% to $1.04 billion, with non-GAAP gross margin hitting a record 40.1%. Operating income jumped 72% to $694 million, and net income rose 80% to $549 million. This isn't just a beat. It's a signal that the storage industry has decisively moved past the 2023-24 downturn."

"The Mozaic HAMR (Heat-Assisted Magnetic Recording) product line now qualifies with five of the world's largest cloud customers. That's the competitive moat investors should watch. CEO Dave Mosley emphasized this point: "We are ramping shipments of our areal density-leading Mozaic HAMR products, which are now qualified with five of the world's largest cloud customers." This qualification represents validation that Seagate's next-generation technology is production-ready and winning in the market."

Seagate reported Q1 revenue of $2.63 billion and non-GAAP EPS of $2.61, both above consensus estimates. Revenue rose 21% year-over-year to $2.63 billion, driven by strong demand for high-capacity storage for AI infrastructure. Gross profit increased 45% to $1.04 billion and non-GAAP gross margin reached 40.1%. Operating income and net income rose 72% and 80% respectively. Mozaic HAMR products are qualified with five of the world's largest cloud customers, signaling production readiness and competitive advantage. Operating cash flow surged 460% to $532 million and free cash flow reached $427 million. The company returned $182 million via dividends and buybacks. Cash and equivalents declined.

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