Seagate Tech (STXN) Q1 2027 Earnings Report
MX:STXN Q1 2027 EPS Results
- Actual EPS
- MXN 144.28
- Consensus EPS
- MXN 139.79
- Beat/Miss
- Beat by +MXN 4.49
- One Year Ago EPS
- MXN 49.03
MX:STXN Q1 2027 Revenue Results
- Actual Revenue
- MXN 79.52B
- Expected Revenue
- MXN 77.93B
- Beat/Miss
- Beat by +MXN 1.59B
- YoY Revenue Growth
- +61.01%
Earnings Announcement Details
- Quarter
- Q1 2027
- Date
- 10/27/2026
- Time
- After Close
- Conference Call
- Tuesday, October 27, 2026
MX:STXN Upcoming Earnings
Seagate Tech's next earnings date is estimated for January 27, 2027, based on past reporting schedules.
Q1 2027 Earnings Call Audio
MX:STXN Q1 2027 Earnings Call
0:00 / 0:00
Q1 2027 Earnings Slide Deck
Q1 2027 Earnings Call Summary
Earnings Call Sentiment|Positive
The call was strongly positive. Seagate reported record revenue, earnings, margins and free cash flow, sustained double-digit growth across its data center and edge IoT markets, strong multiyear customer commitments, progress on its HAMR and Mozaic road map, and a materially strengthened balance sheet. The main challenges were higher external component costs, temporary scrap and yield effects during product transitions, and the fact that physical AI demand has not yet become a meaningful direct contributor. These lowlights were outweighed by the company's results, outlook, demand visibility and capital-return plans.
Company Guidance
Seagate expects December quarter revenue in a range of $4.8 billion, plus or minus $100 million, representing a 7% year-over-year improvement at the midpoint; non-GAAP operating expenses are expected to remain flat at approximately $300 million, non-GAAP operating margin is expected to expand towards the mid-50% range, specifically between 50% and 55%, and non-GAAP EPS is expected to be $9.20 plus or minus $0.20, based on a tax rate of about 16% and non-GAAP diluted share count of 233 million shares. For fiscal 2027, CapEx is expected to remain within the target range of 4% to 6% of revenue, cash generation is expected to further improve throughout fiscal 2027, and annual revenue growth is expected to meaningfully outpace fiscal 2026. Nearline exabyte supply growth is expected in the mid-20% range on a compound basis, with 25% described as the target for exabyte growth; HAMR is expected to represent roughly 50% of nearline exabyte shipment run rate exiting calendar 2026, with Mozaic 4 representing roughly half of those HAMR shipments.
- Record Revenue, Earnings and MarginsSeptember quarter revenue was $4.2 billion, up 17% sequentially and 61% year-over-year. Non-GAAP EPS reached a record $7.68, up 35% quarter-over-quarter and 194% year-over-year. Non-GAAP gross margin increased to a record 57.8%, up 510 basis points sequentially, while non-GAAP operating margin reached a record 50.7%, up 610 basis points.
- Strong Free Cash Flow GenerationOperating cash flow was $1.7 billion and free cash flow was nearly $1.5 billion, up 32% from the prior quarter and more than tripling year-over-year. Management expects cash generation to further improve throughout fiscal 2027, supported by sustained demand, operational efficiencies and CapEx discipline.
- Data Center Demand Remained RobustData center revenue was $3.4 billion, up 18% sequentially and 63% year-over-year, representing 81% of total revenue. Data center shipments totaled 198 exabytes, up 24% year-over-year, and data center customers accounted for 90% of total shipped capacity.
- Cloud and Enterprise OEM MomentumCloud nearline products achieved a 12th consecutive quarter of revenue growth. Enterprise OEM revenue reached its second-highest quarterly level in over a decade, while revenue from enterprise OEM data center markets increased for the sixth consecutive quarter with double-digit growth both sequentially and year-over-year.
- Edge IoT GrowthEdge IoT revenue totaled $784 million, representing 19% of total revenue, and increased 13% sequentially and 52% year-over-year.
- Record Total Exabyte Shipments and Expected December Step-UpSeagate shipped 220 exabytes in total during the September quarter, up 21% year-over-year. Management expects a meaningful increase in capacity shipments in the December quarter as Mozaic 4 qualifications and volume ramps progress.
- Long-Term Demand VisibilityManagement said demand visibility extends beyond 2030. The vast majority of nearline exabyte supply is allocated under long-term supply agreements through calendar 2028, with some cloud customer agreements extending through calendar 2030. Strategic planning discussions extend even further.
- Positive December Quarter OutlookDecember quarter revenue is expected to be $4.8 billion, plus or minus $100 million, representing a 7% year-over-year improvement at the midpoint. Non-GAAP operating expenses are expected to remain approximately $300 million, operating margin is expected to expand toward the mid-50% range, and non-GAAP EPS is expected to be $9.20 plus or minus $0.20.
- Expected Fiscal 2027 Growth and Margin ExpansionManagement expects annual revenue growth to meaningfully outpace fiscal 2026 and expects strong sequential revenue growth and gross margin expansion throughout fiscal 2027. Value-based pricing, product mix and stable operating expenses are expected to support further operating margin improvement.
- Mozaic 4 Ramp and HAMR Road MapMozaic 4 drives, offering up to 44 terabytes of capacity, are ramping with two leading cloud service providers. Management expects HAMR to represent roughly 50% of the nearline exabyte shipment run rate exiting calendar 2026, with Mozaic 4 representing roughly half of those HAMR shipments. Additional qualifications are expected over the next couple of months across multiple global CSPs and enterprise OEM customers.
- Mozaic 5 Development ProgressMozaic 5 development remains on track. The product is expected to deliver upwards of 50 terabytes of capacity using Seagate's 10-disk platform, with customer qualification shipments expected to begin toward the end of calendar 2027. Management said it is more optimistic about the pace of the 5-terabyte-per-platter transition than it was the prior quarter and sees a path toward 6 terabytes per platter.
- Areal Density and Photonics ProgressSeagate recently demonstrated 8 terabytes per disk in the lab. Management said its areal-density-driven road map is intended to support nearline exabyte supply growth in the mid-20% range on a compound basis, with exabyte growth driven primarily through higher capacity per disk rather than higher drive unit production.
- Microsoft and Broadcom SMR QualificationMicrosoft qualified a joint Seagate and Broadcom solution combining Seagate's HAMR-based Mozaic drives configured with SMR technology and Broadcom's connectivity infrastructure. Management said the qualification validates an SMR-enabled solution at hyperscale and provides a blueprint for additional capacity gains.
- Pricing Strength and Gross Margin ImprovementNon-GAAP gross profit increased to $2.4 billion, up 28% quarter-over-quarter and more than doubling from $1.1 billion in the year-ago period. Gross margin expansion reflected favorable pricing execution and improving product mix as Mozaic 4 ramps. Management said pricing continues to improve due to its value-based pricing framework and higher external component costs, with pricing more than offsetting the cost increase.
- Balance Sheet StrengtheningSeagate retired $1.2 billion of debt during the September quarter, including the remaining convertible notes and approximately $1 billion of high-yield debt. It subsequently retired an additional $750 million of high-yield senior notes, reducing principal debt to approximately $1.6 billion. Gross debt at quarter-end was approximately $2.4 billion, net leverage was 0.2x, and management expects to be net cash positive exiting calendar 2026.
- Increased Shareholder ReturnsSeagate returned $568 million to shareholders through dividends and share repurchases during the September quarter, roughly twice the amount returned in the June quarter. The quarterly dividend increased approximately 3% to $0.76 per share. The company had $4.4 billion remaining under its share repurchase authorization and expects to significantly increase repurchases beginning in calendar 2027, with a stated long-term capital return model of 75% of free cash flow over time.
- Disciplined Capital IntensityCapital expenditures were $211 million, or 5% of revenue, in the September quarter. Seagate continues to expect fiscal 2027 CapEx to remain within 4% to 6% of revenue while supporting the transition to HAMR, and management said this framework is sufficient to support its planned mid-20% exabyte growth.
- AI-Driven Storage Demand OpportunityManagement said AI adoption is expanding beyond model training toward inference and agentic applications, increasing the need to retain, govern and reuse persistent data. KV cache and more efficient movement of data between application, compute and storage layers were described as additional potential drivers of future storage demand.
- Strong Customer Commitments and Supply TightnessManagement said all production above planned levels is being spoken for, with no observed demand destruction. Supply agreements provide customers with greater assurance and Seagate with visibility, while management said supply is expected to remain fairly tight for its products through the period covered by customer commitments.
MX:STXN Earnings History
| Report Date | Fiscal Quarter | Forecast / EPS | Last Year's EPS | EPS YoY Change | Press Release |
|---|---|---|---|---|---|
| Jan 27, 2027 | 2027 (Q2) | 172.70- | 58.42 | ― | ― |
| Oct 27, 2026 | 2027 (Q1) | 139.79144.28 | 49.03 | 194.25% (+95.25) | |
| Jul 28, 2026 | 2026 (Q4) | 95.81107.27 | 48.66 | 120.46% (+58.61) | |
| Apr 28, 2026 | 2026 (Q3) | 66.0377.02 | 35.69 | 115.79% (+41.33) | |
| Jan 28, 2026 | 2026 (Q2) | 53.3058.42 | 38.14 | 53.20% (+20.29) | |
| Oct 28, 2025 | 2026 (Q1) | 45.1149.03 | 29.68 | 65.19% (+19.35) | |
| Jul 29, 2025 | 2025 (Q4) | 46.0148.66 | 19.73 | 146.67% (+28.93) | |
| Apr 29, 2025 | 2025 (Q3) | 32.6735.69 | 6.2 | 475.76% (+29.49) | |
| Jan 21, 2025 | 2025 (Q2) | 35.2638.14 | 2.25 | 1591.67% (+35.88) | |
| Oct 22, 2024 | 2025 (Q1) | 27.9029.68 | -4.13 | 818.18% (+33.81) |
The table shows recent earnings report dates and whether the forecast was beat or missed. See the change in forecast and EPS from the previous year.
Beat Missed