TLDR
STX stock climbs 3.67% to $667.85, then slides 6.02% in after-hours trading.
Seagate revenue jumps 61% to $4.23B as demand for mass-capacity storage grows.
GAAP net income surges to $1.76B, while quarterly earnings reach $7.59 a share.
Seagate generates $1.5B in free cash flow and cuts gross debt to just $1.6B.
Seagate raises its quarterly dividend 3% to $0.76 after strong cash generation.
Seagate Technology (STX) reported strong fiscal first-quarter 2027 earnings, with revenue reaching $4.2 billion and profits rising sharply. The stock gained 3.67% to $667.85 during regular trading, adding $23.64 before reversing course after the closing bell. However, shares dropped 6.02% to $627.64 in after-hours trading despite the company’s stronger financial performance.
Seagate Technology Holdings plc, STX
Seagate Technology Revenue Jumps 61% as Profit Margins Expand
Seagate reported revenue of $4.23 billion for the quarter ended October 2, 2026, compared with $2.63 billion last year. This represented approximately 61% annual growth, supported by stronger demand for mass-capacity data storage. Meanwhile, rising storage requirements across cloud infrastructure and data-intensive applications supported the company’s business outlook.
GAAP gross margin climbed to 57.3%, compared with 39.4% during the same quarter last year. Additionally, non-GAAP gross margin reached 57.8%, up from 40.1% a year earlier. These improvements reflected stronger profitability as Seagate expanded revenue and maintained its pricing strategy.
Operating margins also improved significantly, highlighting the company’s ability to convert higher sales into earnings. GAAP operating margin reached 48.8%, compared with 26.4% in the previous year’s quarter. Similarly, non-GAAP operating margin increased to 50.7% from 29.0%, reflecting substantial gains in operating efficiency.
Seagate Earnings Surge as Net Income Exceeds $1.7 Billion
Seagate reported GAAP net income of $1.76 billion, compared with $549 million in fiscal first-quarter 2026. Consequently, diluted GAAP earnings per share increased to $7.59 from $2.43 a year earlier. Non-GAAP earnings per share also climbed to $7.68, compared with $2.61 in the previous year.
Meanwhile, non-GAAP net income reached $1.78 billion, compared with $583 million during the comparable quarter. The company attributed its profitability gains to stronger storage demand, disciplined supply management, and value-based pricing. Furthermore, Seagate continues developing heat-assisted magnetic recording technology to increase storage capacity and address growing customer requirements.
Seagate also generated $1.7 billion in operating cash flow during the quarter, supporting its financial position. Free cash flow reached $1.5 billion, marking the company’s highest quarterly level for the September period. These results strengthened Seagate’s capacity to reduce debt, fund operations, and distribute capital to shareholders.
Seagate Reduces Debt and Raises Quarterly Dividend
Seagate retired approximately $1.2 billion in principal debt during the quarter, reducing gross debt to $2.4 billion. Subsequently, the company retired another $750 million, bringing gross debt down to approximately $1.6 billion. Meanwhile, cash and cash equivalents totaled $1.3 billion at the quarter’s end.
The company also returned $568 million to shareholders through dividends and share repurchases during the reporting period. Additionally, its board increased the quarterly cash dividend by approximately 3% to $0.76 per share. Seagate will distribute the dividend on January 7, 2027, to shareholders holding shares on December 23, 2026.
Seagate’s financial results reflect rising demand for high-capacity storage and continued improvements in profitability. Its HAMR technology roadmap supports higher storage density as customers expand their data storage requirements. However, the after-hours stock decline contrasted with the company’s earnings growth and stronger balance sheet.
The post Seagate Technology (STX) Stock: Surges as $4.2B Revenue and Strong Profits Lift Q1 Earnings appeared first on Blockonomi .
