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Seagate Shares Fall 8.6% After Hours Despite Revenue Jump

Seagate reported a 61% jump in quarterly revenue, record profitability and guidance for a further step up, but its shares fell in after-hours trading after the results.

Seagate Technology (NASDAQ: STX) shares fell 8.6% in after-hours trading today after the data storage maker reported record profitability for its fiscal first quarter.

Revenue rose 61% from a year earlier, and the company guided to higher sales again next quarter.

STX.US

Revenue for the quarter ended the 2nd of October was $4.233bn, against $2.629bn a year earlier. The non-GAAP gross margin widened to 57.8% from 40.1%, and the non-GAAP operating margin reached 50.7% from 29.0%.

Non-GAAP earnings per share were $7.68, up from $2.61. GAAP net income, the standard accounting measure, more than tripled to $1.761bn from $549m, and GAAP earnings per share were $7.59 against $2.43.

Free cash flow, the cash left after capital spending, reached $1.479bn against $427m a year ago. Seagate retired about $1.2bn of debt in the quarter, leaving gross debt at $2.4bn at quarter end. It retired a further $750m after the quarter closed, taking gross debt to $1.6bn. Interest expense halved to $41m from $80m.

It returned $568m to shareholders through dividends and buybacks and raised its quarterly dividend about 3% to $0.76 a share from $0.74. That is payable on the 7th of January to holders on record on the 23rd of December.

For the fiscal second quarter, Seagate guided to revenue of $4.8bn, plus or minus $100m, about 13% above this quarter. It expects non-GAAP earnings per share of $9.20, plus or minus $0.20, roughly 20% above the latest figure.

Bar chart showing Seagate quarterly revenue rising from $2.629bn in fiscal Q1 2026 to $4.233bn in fiscal Q1 2027, with a third bar, shown as guidance, at a $4.8bn midpoint for fiscal Q2 2027
Seagate quarterly revenue, $bn: fiscal Q1 2026, fiscal Q1 2027 and the midpoint of fiscal Q2 guidance. Source: Seagate

Chief executive Dave Mosley pointed to the company’s HAMR-based product roadmap, supply discipline and value-based pricing, and described demand this way:

Data creation, retention and reuse continue to compound storage demand with long term customer demand visibility reinforcing our view of a multi-year growth phase.

Dave Mosley, chief executive, Seagate

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