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Seagate Beats Q1 Expectations, Raises Outlook on AI-Fueled Cloud Demand

AI build-outs by cloud providers are reviving demand for Seagate’s high-capacity drives.

Overview

  • Seagate reported fiscal first-quarter revenue of $2.63 billion and adjusted EPS of $2.61, topping Wall Street estimates.
  • The company guided the December quarter to $2.60–$2.80 billion in revenue (midpoint $2.70 billion) and adjusted EPS of $2.55–$2.95 (about $2.75 at the midpoint), both above consensus.
  • Management cited stronger orders from cloud customers supporting generative AI and noted inventory levels have normalized after a prior supply glut.
  • Shares rose roughly 3%–4% in extended trading and are up about 160% year to date as investors price in sustained AI-driven storage demand.
  • CEO Dave Mosley said high-capacity cloud HDD output is largely under contract through 2026 with visibility into 2027, while product transitions such as HAMR-based drives aim to boost density rather than unit capacity.