Seagate's Strong Forecast Boosts Storage Stocks
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 1 hour ago
0mins
Source: Newsfilter
- Strong Enterprise AI Spending: Seagate's forecast of $3.45 billion in fourth-quarter revenue, surpassing the $3.16 billion estimate, indicates sustained enterprise spending on AI equipment, bolstering investor confidence in data storage demand.
- Surge in Storage Stocks: Seagate shares soared 16% in after-hours trading, with Western Digital up 10%, Micron Technology rising 3%, and SanDisk increasing 4%, collectively adding $60 billion to their market value, reflecting optimism in the storage sector.
- Rising Memory Prices: The surge in demand for high-bandwidth memory due to data centers has led to a chip shortage, prompting companies to scramble for hardware to support their AI initiatives, benefiting hard drive manufacturers like Seagate.
- Positive Market Reaction: Despite the Nasdaq falling nearly 1% due to concerns over AI growth, Seagate's strong earnings report led to a 0.2% rise in Nasdaq futures, indicating traders' expectations for a rebound in tech stocks.
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Analyst Views on STX
Wall Street analysts forecast STX stock price to fall
18 Analyst Rating
14 Buy
3 Hold
1 Sell
Moderate Buy
Current: 595.860
Low
150.00
Averages
310.39
High
465.00
Current: 595.860
Low
150.00
Averages
310.39
High
465.00
About STX
Seagate Technology Holdings plc provides mass-data storage infrastructure solution. The Company’s principal products are hard disk drives, commonly referred to as disk drives, hard drives (HDDs). In addition to HDDs, the Company produces a range of data storage products, including solid state drives (SSDs), solid state hybrid drives, storage subsystems, as well as a scalable edge-to-cloud mass data platform. Its HDD products are designed for mass capacity storage and legacy markets. Mass capacity storage involves use cases, such as hyperscale data centers and public clouds, as well as emerging use cases. The Company’s HDD and SSD product portfolio includes Serial Advanced Technology Attachment, Serial Attached SCSI and Non-Volatile Memory Express based designs to support a variety of mass capacity and legacy applications. Its systems portfolio includes storage subsystems for enterprises, cloud service providers, scale-out storage servers and original equipment manufacturers.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
Seagate Technology's Earnings Growth Outlook is Optimistic
- Strong Market Demand: In Q2 of fiscal 2026, data center customers accounted for 87% of Seagate Technology's shipments, indicating robust demand for high-capacity hard disk drives (HDDs) and solid-state drives (SSDs), which is expected to persist into 2026 and beyond, providing sustained revenue growth for the company.
- Upward Earnings Guidance: Seagate's non-GAAP earnings per share jumped 53% year-over-year to $3.11 in Q2 of fiscal 2026, with guidance for fiscal 2026 set at $3.40, indicating a remarkable 79% increase, which highlights the company's strengthening profitability.
- Price Increases Driving Profits: The shortage of HDDs led to a 60% price increase for high-capacity storage drives between November 2025 and February 2026, positioning Seagate favorably in negotiations with customers, and suggesting that its earnings growth may exceed analysts' expectations of 58% for fiscal 2027.
- Investment Value Realization: With a current P/E ratio of 33, below the tech sector's 43, and considering its earnings growth rate significantly outpaces the market, Seagate's stock price could rise by 50% by the end of 2026, potentially turning a $1,000 investment into $1,500.
See More
Seagate's Strong Forecast Boosts Storage Stocks
- Strong Enterprise AI Spending: Seagate's forecast of $3.45 billion in fourth-quarter revenue, surpassing the $3.16 billion estimate, indicates sustained enterprise spending on AI equipment, bolstering investor confidence in data storage demand.
- Surge in Storage Stocks: Seagate shares soared 16% in after-hours trading, with Western Digital up 10%, Micron Technology rising 3%, and SanDisk increasing 4%, collectively adding $60 billion to their market value, reflecting optimism in the storage sector.
- Rising Memory Prices: The surge in demand for high-bandwidth memory due to data centers has led to a chip shortage, prompting companies to scramble for hardware to support their AI initiatives, benefiting hard drive manufacturers like Seagate.
- Positive Market Reaction: Despite the Nasdaq falling nearly 1% due to concerns over AI growth, Seagate's strong earnings report led to a 0.2% rise in Nasdaq futures, indicating traders' expectations for a rebound in tech stocks.
See More
Stock Market Declines on OpenAI Fears and Rising Oil Prices
- Market Volatility Drivers: The stock market experienced a decline at the open due to fears surrounding OpenAI and rising oil prices, reflecting investor caution towards tech stocks, which could impact overall market sentiment and investment decisions.
- AI Stocks Performance: Despite the overall market downturn, AI stocks like Seagate and Bloom Energy showed strong performance following earnings reports, indicating robust growth potential driven by technological innovation and market demand.
- Oil Price Impact: The rise in oil prices not only exacerbates market uncertainty but may also lead to increased inflationary pressures, potentially affecting consumer spending and corporate profits, further influencing stock market performance.
- Investor Sentiment Shifts: Although the market faced significant losses at the open, it managed to pare losses later, suggesting that investors are still seeking opportunities amid uncertainty, which could lead to short-term market fluctuations.
See More
U.S. Stocks Close Lower, Weighed Down by Tech Sector
- Tech Sector Decline: Technology stocks fell broadly as concerns about the return on massive AI investments grew, with OpenAI missing its new user and sales targets, putting pressure on shares of partners like Nvidia and Oracle, which negatively impacted market sentiment.
- Positive Economic Data: Despite the market downturn, the U.S. consumer confidence index unexpectedly rose to 92.8, surpassing expectations, indicating economic resilience that could provide support for the market.
- Surging Oil Prices: WTI crude oil prices jumped over 3% to a two-week high amid escalating tensions between the U.S. and Iran in the Strait of Hormuz, potentially exacerbating the global energy crisis and pushing inflation expectations higher.
- Fed Policy Expectations: The market anticipates that the Federal Reserve will keep interest rates unchanged at the upcoming meeting, focusing on oil prices and inflation dynamics, reflecting a cautious outlook on the economic landscape.
See More
Earnings Reports Drive Stock Price Movements for Multiple Companies
- Booking Holdings Adjusts Outlook: Booking Holdings lowered its full-year adjusted earnings per share growth forecast to the 'low to mid-teens' from the previous 'mid-teens,' primarily due to lagging impacts from the Middle East conflict, resulting in a nearly 4% drop in shares.
- Mondelez Exceeds Expectations: Mondelez International reported first-quarter adjusted earnings of 67 cents per share and revenue of $10.08 billion, both surpassing analyst expectations, which led to a 2% increase in its stock price.
- Starbucks Raises Forecast: Starbucks increased its global and U.S. same-store sales outlook to at least 5% and raised its adjusted earnings forecast to a range of $2.25 to $2.45 per share, causing its stock to jump nearly 5%.
- O-I Glass Lowers Guidance: O-I Glass slashed its full-year earnings guidance to a range of $1 to $1.50 per share from a previous estimate of $1.65 to $1.90, resulting in a 19% plunge in its stock price.
See More
Micron Shares Rise 2.7% in After-Hours Trading Following Seagate's Quarterly Results
- MicroN's Performance: MicroN reported a 2.7% increase in extended trade following their quarterly results.
- Seagate's Impact: The results are linked to Seagate's performance, indicating a potential influence on MicroN's trading activity.
See More
Seagate Technology's Earnings Growth Outlook is Optimistic
- Strong Market Demand: In Q2 of fiscal 2026, data center customers accounted for 87% of Seagate Technology's shipments, indicating robust demand for high-capacity hard disk drives (HDDs) and solid-state drives (SSDs), which is expected to persist into 2026 and beyond, providing sustained revenue growth for the company.
- Upward Earnings Guidance: Seagate's non-GAAP earnings per share jumped 53% year-over-year to $3.11 in Q2 of fiscal 2026, with guidance for fiscal 2026 set at $3.40, indicating a remarkable 79% increase, which highlights the company's strengthening profitability.
- Price Increases Driving Profits: The shortage of HDDs led to a 60% price increase for high-capacity storage drives between November 2025 and February 2026, positioning Seagate favorably in negotiations with customers, and suggesting that its earnings growth may exceed analysts' expectations of 58% for fiscal 2027.
- Investment Value Realization: With a current P/E ratio of 33, below the tech sector's 43, and considering its earnings growth rate significantly outpaces the market, Seagate's stock price could rise by 50% by the end of 2026, potentially turning a $1,000 investment into $1,500.
See More
Seagate's Strong Forecast Boosts Storage Stocks
- Strong Enterprise AI Spending: Seagate's forecast of $3.45 billion in fourth-quarter revenue, surpassing the $3.16 billion estimate, indicates sustained enterprise spending on AI equipment, bolstering investor confidence in data storage demand.
- Surge in Storage Stocks: Seagate shares soared 16% in after-hours trading, with Western Digital up 10%, Micron Technology rising 3%, and SanDisk increasing 4%, collectively adding $60 billion to their market value, reflecting optimism in the storage sector.
- Rising Memory Prices: The surge in demand for high-bandwidth memory due to data centers has led to a chip shortage, prompting companies to scramble for hardware to support their AI initiatives, benefiting hard drive manufacturers like Seagate.
- Positive Market Reaction: Despite the Nasdaq falling nearly 1% due to concerns over AI growth, Seagate's strong earnings report led to a 0.2% rise in Nasdaq futures, indicating traders' expectations for a rebound in tech stocks.
See More
Stock Market Declines on OpenAI Fears and Rising Oil Prices
- Market Volatility Drivers: The stock market experienced a decline at the open due to fears surrounding OpenAI and rising oil prices, reflecting investor caution towards tech stocks, which could impact overall market sentiment and investment decisions.
- AI Stocks Performance: Despite the overall market downturn, AI stocks like Seagate and Bloom Energy showed strong performance following earnings reports, indicating robust growth potential driven by technological innovation and market demand.
- Oil Price Impact: The rise in oil prices not only exacerbates market uncertainty but may also lead to increased inflationary pressures, potentially affecting consumer spending and corporate profits, further influencing stock market performance.
- Investor Sentiment Shifts: Although the market faced significant losses at the open, it managed to pare losses later, suggesting that investors are still seeking opportunities amid uncertainty, which could lead to short-term market fluctuations.
See More
U.S. Stocks Close Lower, Weighed Down by Tech Sector
- Tech Sector Decline: Technology stocks fell broadly as concerns about the return on massive AI investments grew, with OpenAI missing its new user and sales targets, putting pressure on shares of partners like Nvidia and Oracle, which negatively impacted market sentiment.
- Positive Economic Data: Despite the market downturn, the U.S. consumer confidence index unexpectedly rose to 92.8, surpassing expectations, indicating economic resilience that could provide support for the market.
- Surging Oil Prices: WTI crude oil prices jumped over 3% to a two-week high amid escalating tensions between the U.S. and Iran in the Strait of Hormuz, potentially exacerbating the global energy crisis and pushing inflation expectations higher.
- Fed Policy Expectations: The market anticipates that the Federal Reserve will keep interest rates unchanged at the upcoming meeting, focusing on oil prices and inflation dynamics, reflecting a cautious outlook on the economic landscape.
See More
Earnings Reports Drive Stock Price Movements for Multiple Companies
- Booking Holdings Adjusts Outlook: Booking Holdings lowered its full-year adjusted earnings per share growth forecast to the 'low to mid-teens' from the previous 'mid-teens,' primarily due to lagging impacts from the Middle East conflict, resulting in a nearly 4% drop in shares.
- Mondelez Exceeds Expectations: Mondelez International reported first-quarter adjusted earnings of 67 cents per share and revenue of $10.08 billion, both surpassing analyst expectations, which led to a 2% increase in its stock price.
- Starbucks Raises Forecast: Starbucks increased its global and U.S. same-store sales outlook to at least 5% and raised its adjusted earnings forecast to a range of $2.25 to $2.45 per share, causing its stock to jump nearly 5%.
- O-I Glass Lowers Guidance: O-I Glass slashed its full-year earnings guidance to a range of $1 to $1.50 per share from a previous estimate of $1.65 to $1.90, resulting in a 19% plunge in its stock price.
See More
Micron Shares Rise 2.7% in After-Hours Trading Following Seagate's Quarterly Results
- MicroN's Performance: MicroN reported a 2.7% increase in extended trade following their quarterly results.
- Seagate's Impact: The results are linked to Seagate's performance, indicating a potential influence on MicroN's trading activity.
See More
