Seagate Technology Holdings plc has reported strong financial results for its fiscal first quarter of 2027, exceeding expectations with a revenue of $4.2 billion. This marks a 61% increase from the previous year, driven primarily by robust data-center demand. The company’s non-GAAP earnings per share reached a record $7.68, and its operating margin stood at 50.7%.
Chief Executive Officer Dave Mosley highlighted that the demand for mass-capacity storage, largely from data-center customers, has been a critical factor in this growth. Data-center revenue alone accounted for $3.4 billion, representing 81% of total sales and reflecting an 18% increase from the previous quarter.
Seagate’s overall shipments totaled 220 exabytes during the quarter, with 198 exabytes shipped to data-center clients, indicating that this segment is pivotal to the company’s strategy. Mosley noted that cloud demand is fueled by artificial intelligence applications, where extended data retention and usage have become essential.
Outlook and Strategic Initiatives
Looking ahead, Seagate has raised its guidance for the December quarter, forecasting revenue of $4.8 billion and non-GAAP EPS of $9.20. The company’s debt reduction is nearing completion, allowing for increased shareholder returns, including a planned increase in stock repurchases in 2027, alongside a slightly raised quarterly dividend of $0.76 per share.
Seagate is also actively expanding its Mozaic product line, which utilizes Heat-Assisted Magnetic Recording (HAMR) technology to enhance data storage capacity. The company anticipates that HAMR will account for approximately 50% of its nearline exabyte shipments by the end of 2026, with ongoing developments leading to the introduction of the next-generation Mozaic 5 drives expected in late 2027.
Management expressed confidence in the company’s future performance, noting that demand remains strong and there is no evidence of declining demand or product cancellations. Seagate aims to target a return of 75% of free cash flow to shareholders over time, integrating share repurchases and dividends into its capital return strategy.
As Seagate prepares for the December quarter, the continuing momentum in data-center demand, along with product implementation, positions the company for a potentially successful fiscal year.
