Earnings
Seagate beats the top of its own guidance as revenue jumps 61%, and forecasts $4.8 billion for the December quarter
The hard-drive maker's fiscal first-quarter sales and margins cleared the range it set in July, and it used the cash to cut gross debt to $1.6 billion.
HedgeWeekly News Desk ·
Seagate Technology reported revenue of $4.23 billion for its fiscal first quarter ended October 2, up about 61% from $2.63 billion a year earlier, according to results filed with the SEC. Non-GAAP earnings were $7.68 a diluted share, against $2.61 a year ago, and GAAP earnings were $7.59.
Both figures landed above the range the company set in July, when it guided to revenue of $4.1 billion, plus or minus $100 million, and non-GAAP earnings of $7.30 a share, plus or minus 20 cents. Non-GAAP gross margin widened to 57.8%, from 52.7% in the June quarter and 40.1% a year earlier. Chief executive Dave Mosley said demand was strengthening and that value-based pricing and supply discipline should support profitable growth.
Operating cash flow was $1.69 billion and free cash flow $1.48 billion. Seagate bought back $400 million of stock, raised its quarterly dividend to 76 cents from 74 cents, and retired about $1.2 billion of debt in the quarter plus a further $750 million after it ended, leaving gross debt of $1.6 billion.
For the December quarter, Seagate guided to revenue of $4.8 billion, plus or minus $100 million, about 13% above the quarter just reported, and non-GAAP earnings of $9.20 a share, plus or minus 20 cents. For investors weighing doubts over AI infrastructure spending, the release is evidence that demand for mass-capacity storage is still lifting both volumes and pricing; the next test is whether margins keep expanding as Seagate ramps its HAMR-based drives while holding back supply.