Seagate Technology reported results for the first quarter of fiscal 2027 that came in above market expectations on both revenue and earnings. The company posted $4.23 billion in revenue, up about 61% from a year earlier and ahead of the $4.11 billion consensus. Adjusted earnings per share reached $7.68, topping the expected $7.39. Seagate said demand for its data storage products kept rising as AI infrastructure buildouts continued.
Profitability also improved sharply. GAAP gross margin climbed to 57.3% from 39.4% a year earlier, while non-GAAP operating margin rose to 50.7% from 29%. Operating cash flow for the quarter was $1.69 billion, and free cash flow came to $1.479 billion, up about 246% year over year. The company said both gross margin and free cash flow hit record highs.
For the second fiscal quarter, Seagate forecast revenue of $4.8 billion, plus or minus $100 million, and adjusted EPS of $9.20, plus or minus $0.20, both above market expectations. CEO Dave Mosley said AI-driven demand for data creation, storage and reuse continues to grow, and that the company’s HAMR technology will raise hard drive storage density. Even so, MSX.COM data showed Seagate shares fell more than 8% in after-hours trading. The stock closed regular trading at $667.85 and was up nearly 150% year to date.
Seagate Technology reported fiscal 2027 first-quarter results that beat market expectations on both revenue and earnings. Revenue reached $4.23 billion, up about 61% year over year and above the $4.11 billion expected by the market. Adjusted earnings per share came in at $7.68, ahead of the $7.39 consensus.
The company said demand for its data storage products continued to grow as AI infrastructure construction expanded. On profitability, first-quarter GAAP gross margin rose to 57.3% from 39.4% a year earlier, while non-GAAP operating margin increased to 50.7% from 29%.
Cash flow and second-quarter outlook
Quarterly operating cash flow reached $1.69 billion. Free cash flow was $1.479 billion, up about 246% from a year earlier. Seagate said both gross margin and free cash flow hit record highs.
For the second quarter, the company expects revenue of $4.8 billion, plus or minus $100 million, and adjusted earnings per share of $9.20, plus or minus $0.20. Both figures were above market expectations.
CEO comments on AI demand and HAMR
CEO Dave Mosley said demand tied to AI-driven data creation, storage and reuse continues to rise, and that Seagate’s HAMR technology will further increase hard drive storage density.
Despite the earnings beat and stronger-than-expected guidance, MSX.COM data showed Seagate shares fell more than 8% at one point in after-hours trading. The stock closed the regular session at $667.85 and had gained nearly 150% since the start of the year.
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