Seagate's Strong Earnings Lift Storage Sector, Implications for Western Digital
Seagate Technology delivered strong fourth-quarter results, surpassing analyst expectations with a 48% year-over-year revenue increase driven by demand from cloud data centers and hyperscalers. The performance has boosted investor confidence in the storage sector and lifted Seagate's stock price significantly over two days. As one of only two major players in high-capacity hard disk drives (HDDs), alongside Western Digital, Seagate’s success signals robust industry health. Western Digital is set to report its Q4 earnings on August 5 with guidance projecting $3.65 billion in revenue and a significant rise in non-GAAP gross margin and EPS compared to the prior year. The company has also generated strong free cash flow recently, supporting capital returns and debt reduction efforts. Despite recent gains, Western Digital's stock remains below its 52-week high. However, there is risk that much of Seagate’s positive momentum may already be reflected in Western Digital’s share price ahead of the earnings report.
Topics: AI infrastructure hard disk drives (HDD) market performance storage