The data storage company posted $3.11 billion in Q3 revenue and projected $3.45 billion for the current quarter, well above analyst estimates
Seagate $STX Technology reported third-quarter revenue of $3.11 billion and raised its forecast for the next quarter, pointing to higher demand for data storage as more companies use artificial intelligence.
For the quarter ending April 3, Seagate’s GAAP diluted earnings per share were $3.27, up from $1.57 a year ago. On a non-GAAP basis, diluted EPS was $4.10, compared to $1.90 last year. Analysts expected revenue of $2.96 billion and non-GAAP EPS of about $3.97, according to Reuters.
GAAP gross margin was 46.5%, up from 35.2% a year earlier. Non-GAAP gross margin reached 47.0%, compared to 36.2% last year. Seagate $STX generated $1.1 billion in cash flow from operations and $953 million in free cash flow for the quarter.
During the quarter, Seagate $STX paid off about $641 million in debt and returned $191 million to shareholders through dividends and stock buybacks. At the end of the quarter, the company had $1.1 billion in cash and cash equivalents.
Looking ahead to the fiscal fourth quarter, Seagate set a revenue target of $3.45 billion, with a range of $100 million in either direction, well ahead of the $3.16 billion Wall Street had anticipated, according to Reuters. On an adjusted per-share basis, the company is targeting $5.00 in earnings, with a variance of $0.20.
"Seagate delivered outstanding March quarter results, exceeding the high end of our revenue and EPS guidance, achieving record margin performance, and generating close to $1 billion in free cash flow," CEO Dave Mosley said in a statement. "We believe Seagate is entering a new era of structural growth as AI applications amplify data creation and support sustained storage demand."
The earnings report sent Seagate shares up roughly 17% in premarket trading, lifting prices across the storage sector. Rival Western Digital $WDC advanced 9% and SanDisk added 7%, while memory chipmaker Micron $MU Technology moved higher by approximately 4%.
The board announced a quarterly cash dividend of $0.74 per share, to be paid on July 7, 2026, to shareholders who are on record as of June 24, 2026.
