Seagate Technology shares jumped around 3% on Wednesday after the data storage giant reported fiscal fourth-quarter results that handily beat expectations and issued a strong forecast for the coming year. The stock rebounded from an 8.5% drop the prior session, as investors cheered the company’s AI-fueled growth and improving profitability.
For the quarter, Seagate posted adjusted earnings of $5.71 per share, more than double the $2.59 recorded a year earlier and well above the $5.10 consensus estimate from FactSet. Revenue surged 49% year-over-year to $3.6 billion, exceeding the $3.5 billion analyst forecast. GAAP net income climbed to $1.29 billion from $488 million a year ago, while gross margins expanded to 52.3% (GAAP) and 52.7% (non-GAAP).
Annual figures were equally impressive: fiscal 2026 revenue rose 34% to $12.2 billion, GAAP net income more than doubled to $3.18 billion, and free cash flow hit a record $3.1 billion. Seagate also cut $1.4 billion in debt during the year and returned $810 million to shareholders via dividends and buybacks. The board declared a quarterly dividend of $0.74 per share.
Looking ahead, Seagate forecast adjusted earnings of $7.30 per share for the fiscal first quarter of 2027, far above Wall Street’s $5.85 estimate, with revenue expected at $4.1 billion versus the $3.8 billion consensus. CEO Dave Mosley credited AI’s accelerating data generation for “durable long-term demand for mass capacity storage.”
The results prompted several analysts to raise price targets, citing stronger pricing power and the adoption of heat-assisted magnetic recording (HAMR) technology. Bernstein SocGen upped its target from $1,000 to $1,350, Rosenblatt from $1,300 to $1,400, Citi to $1,300, and Wells Fargo to $1,180. Morningstar said Seagate is entering a multi-year period of higher-margin, more predictable growth, with nearline storage capacity fully committed through 2026 and discussions for 2028 already underway.
