Seagate Earnings Beat, Raises Q4 Guidance
Seagate earnings topped estimates as the company raised Q4 guidance tied to AI-driven storage demand, supporting investor focus on margins and cash flow.
KEY TAKEAWAYS
- Reported fiscal Q3 revenue $3.1 billion and non-GAAP EPS $4.1, beating consensus.
- Raised fiscal Q4 guidance and tied outlook to sustained AI-driven storage demand.
- Generated $953 million free cash flow and retired $641 million of debt.
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Seagate Technology Holdings plc (STX) reported fiscal third-quarter results that topped expectations, driven by AI-driven data growth that boosted margins and cash flow. The company also raised its fiscal fourth-quarter guidance above Street estimates.
Quarterly Results and Capital Deployment
Seagate said in a Business Wire press release at 16:05 ET on April 28, 2026, that revenue for the quarter ended April 3 reached $3.1 billion. GAAP diluted earnings per share (EPS) were $3.27, while non-GAAP EPS was $4.10, surpassing the consensus of $3.47. The company achieved record margin performance, with GAAP gross margin at 46.5% and non-GAAP gross margin at 47.0%.
Operating cash flow totaled $1.1 billion, and free cash flow was $953 million. This enabled Seagate to retire $641 million of debt and return $191 million to shareholders through dividends and share repurchases. The company described these moves as disciplined capital allocation supported by strong cash generation. Results exceeded the high end of prior revenue and EPS guidance.
Guidance and AI-Driven Storage Demand
Seagate projected fiscal fourth-quarter revenue of $3.5 billion, plus or minus $100 million, and non-GAAP diluted EPS of $5.00, plus or minus $0.20. The guidance reflects sustained storage demand from AI data creation and includes an estimated net dilutive impact from Exchangeable Senior Notes due 2028. The company expects minimal impact from global tariff policies and the Middle East conflict as of the release date.
Chair and Chief Executive Dave Mosley said the company is entering “a new era of structural growth as AI applications amplify data creation and support sustained storage demand.” He highlighted Seagate’s strategy of delivering higher-capacity, energy- and capital-efficient storage at scale, driven by product and capacity trends at large data centers.
