$STX · Seagate Technology Holdings plc
Seagate Technology reported FQ1 2027 results with revenue of $4.233B, GAAP diluted EPS of $7.59, and record free cash flow of $1.5B. Gross margin expanded to 57.3% GAAP (57.8% non-GAAP) from 39.4% a year ago. The company guided FQ2 2027 revenue to $4.8B ± $100M and non-GAAP diluted EPS to $9.20 ± $0.20, while raising the quarterly dividend 3% to $0.76 per share.
- Revenue of $4.233B surged 61% YoY from $2.629B in the year-ago quarter.
- GAAP gross margin hit 57.3% vs 39.4% a year ago; non-GAAP gross margin reached 57.8%.
- GAAP diluted EPS of $7.59 compared to $2.43 in FQ1 2026; non-GAAP EPS was $7.68.
- Cash flow from operations was $1.69B and free cash flow was $1.5B — both company records for a September quarter.
- Retired $1.2B of principal debt during the quarter; post-quarter debt retirement of $750M brought gross debt to $1.6B.
Extended-hours trading shows shares at $620.00, down 7.16% from the regular-session close of $667.85, despite record revenue, margins, and free cash flow. The selloff suggests the market is reacting negatively to the Q2 guidance — revenue of $4.8B and non-GAAP EPS of $9.20 — which may have fallen short of elevated expectations given the stock's ~$152B market cap.
Seagate's 61% revenue surge and record margins confirm the storage cycle is in full expansion, but the after-hours selloff signals that even blockbuster results couldn't satisfy the $152B valuation's embedded expectations.
Seagate's 61% YoY revenue growth and 57.3% GAAP gross margin reflect the ongoing mass-capacity storage upcycle driven by hyperscale cloud demand. The HAMR-based Mozaic product roadmap positions the company to capture exabyte demand growth while maintaining supply discipline — a dynamic also benefiting peer Western Digital.
Forward-looking statements flag tariff, trade restriction, and global trade policy uncertainty as key risks. The company also notes that material items impacting GAAP-to-non-GAAP reconciliation — including debt transaction gains/losses and impairment charges — cannot be reasonably predicted and may be material to future results.