Seagate reports $4.233 billion in first-quarter revenue and forecasts higher revenue for next quarter
Key Facts
Seagate reported revenue of $4.233 billion in fiscal first-quarter 2027, ended October 2, 2026, compared with $2.629 billion in the same period a year earlier, according to the company's results published via MarketScreener. Revenue exceeded the previous quarterly guidance of $4.1 billion, with a $100 million margin of variation. Chief Executive Dave Mosley described the quarter as delivering "record profitability and the highest free cash flow for the company" in a September quarter. The company generated $1.7 billion in operating cash flow and $1.5 billion in free cash flow. The results put revenue, margin and cash-flow growth at the forefront of the company's announcement, while management linked the improvement to an increasingly favorable demand environment.
GAAP gross margin widened to 57.3% in fiscal first-quarter 2027, from 39.4% in the year-earlier period. On a non-GAAP basis, the margin was 57.8%, compared with 40.1%. GAAP net income was about $1.761 billion, and diluted earnings per share were $7.59. On a non-GAAP basis, net income was $1.781 billion and diluted earnings per share were $7.68. These figures follow a GAAP gross margin of about 52.3% in fiscal fourth-quarter 2026, compared with 37.4% in the year-earlier quarter. Fiscal fourth-quarter revenue was $3.629 billion, versus $2.444 billion a year earlier.
Mosley said the accumulation of data creation, retention and reuse continues to bolster demand for storage. He added that customers' long-term demand visibility supports expectations for a continuing multiyear growth phase. In its fiscal 2026 results, he said artificial intelligence is accelerating data generation and increasing its value, and that the company sees sustainable long-term demand for mass-capacity storage. Seagate also recorded annual revenue growth of 34% in fiscal 2026, with Mosley then attributing the performance to strong demand from cloud data centers and disciplined execution. In its latest earnings announcement, the company pointed to an improving demand environment, long-term demand for storage and supply discipline alongside value-based pricing. The company did not directly attribute the quarter's improved results to artificial intelligence spending.
Seagate returned $568 million to shareholders during the quarter through dividends and share repurchases. It repaid about $1.2 billion of principal during the period, then repaid an additional $750 million after it ended. The board announced on October 27, 2026, an increase of about 3% in the quarterly cash dividend to $0.76 per share. The dividend is scheduled to be paid on January 7, 2027, to shareholders of record on December 23, 2026. These steps combine returning capital to shareholders with reducing debt, alongside the strong cash flows the company reported. Mosley had described free cash flow in the September quarter as the highest in the company's history.
Seagate expects revenue of $4.8 billion, plus or minus $100 million, in fiscal second-quarter 2027. It also expects non-GAAP diluted earnings per share of $9.20, with a margin of variation of $0.20. The forecast follows first-quarter revenue exceeding previous guidance of $4.1 billion, with a $100 million margin of variation. The investor call to discuss first-quarter results is scheduled for October 27, 2026, at 2:00 p.m. Pacific time, or 5:00 p.m. Eastern time. The announced cash dividend will be paid on January 7, 2027, to shareholders of record on December 23, 2026.