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what it is
Seagate sells hard drives, which are the giant metal boxes storing the world’s photos, backups, and AI data.
how it gets paid
Last year Seagate Tech made $9.1B in revenue. data center drives was the main engine at $7.0B, or 77% of sales.
why it's growing
Revenue grew 38.9% last year. Gains were fueled by strong demand from the data center market.
what just happened
Seagate posted December-quarter EPS of $3.11, ahead of the $2.75 estimate.
At a glance
B+ balance sheet — decent shape, but not bulletproof
15/100 earnings predictability — expect surprises
46.2x trailing p/e — you're paying up for this one
0.8% dividend yield — cash in your pocket every quarter
35.0% return on capital — every dollar works hard here
xvary composite: 56/100 — below average
What they do
Seagate sells hard drives, which are the giant metal boxes storing the world’s photos, backups, and AI data.
Seagate wins because bulk storage is still a scale game. It runs at a 26.0% operating margin and 35.0% return on capital, according to the company profile data. Return on capital → profit earned on each dollar invested → so what: your business is hard to copy when every dollar you put in throws off 35 cents.
How they make money
$9.1B
annual revenue · their business grew +38.9% last year
data center drives
$7.0B
+28.0%
desktop drives
$0.8B
+22.0%
notebook drives
$0.7B
+22.0%
gaming, tv, and consumer electronics
$0.6B
+22.0%
The products that matter
manufactures and sells data storage hardware
Hard Disk Drives
$9.1B revenue · +4.2% growth
it is the entire $9.1B business, and that concentration is both the appeal and the risk — when storage demand rises, the whole company moves with it.
100% of revenue
Key numbers
21.4x
fy2027 eps
At $374.33, the stock is about 21.4 times the $17.50 FY2027 EPS estimate, so you are paying today for a strong 2027.
26.0%
operating margin
Operating margin → money left after running the business → so what: Seagate keeps 26 cents of each sales dollar before interest and taxes.
35.0%
return on capital
Return on capital → profit from invested money → so what: this is far above the 15% level many good businesses aim for.
$446
18-month target
The 18-month target is $446 versus a current $374.33, which implies about 19% upside if execution stays hot.
Financial health
B+
strength
- balance sheet grade B+ — solid but not elite
- risk rank 3 — safer than 50% of stocks
- price stability 35 / 100
- long-term debt $3.5B (4% of capital)
- net profit margin 25.6% — keeps 26 cents of every dollar in revenue
- return on equity 45% — $0.45 profit for every $1 investors have put in
B+ — functional but not a standout on the balance sheet.
Total return vs. market
You invested $10,000 in STX 3 years ago → it's now worth $64,720.
The index would have given you $14,540.
source: institutional data · total return
What just happened
beat estimates
Seagate posted December-quarter EPS of $3.11, ahead of the $2.75 estimate.
Revenue rose 22% to $2.825 billion. Data center demand did the heavy lifting, with that business up 28% vs. prior year to $2.2 billion.
$2.825B
revenue
$3.11
eps
26.0%
gross margin
the number that mattered
The $2.2 billion data-center number mattered most because it was roughly 78% of quarterly revenue and explains the whole quarter.
-
seagate technology released better-than-expected results for the december quarter.
-
the world’s largest manufacturer of hard-disk drives reported a 22% jump in revenues for the period, to $2.825 billion, its best quarterly showing since december 2022.
-
gains were fueled by strong demand from the data center market, with related business up 28% vs. prior year, to $2.2 billion.
-
meanwhile, adjusted earnings soared 53%, to $3.11 a share, a new company record, helped along by an 880-basis-point increase in operating the margin, to 31.9%.
-
the remainder of fiscal 2026 is firming up nicely (year ends june 26th).
source: company earnings report, 2026
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What could go wrong
the #1 risk is data-center storage demand whiplash.
high
data-center demand cools after the surge
the recent numbers were driven by data center demand, including $2.2B of revenue in the latest quarter. if that slows, the rebound math changes fast.
hits the core growth engine behind the latest 22% quarterly revenue jump
high
one-product concentration
hard disk drives are the whole company. there is no second segment here to offset a bad storage cycle.
all $9.1B of revenue sits in the same basic business line
med
margin snapback
operating margin expanded 880 basis points to 31.9%. great when it happens. painful if it reverses.
earnings look much less impressive if margin gives back recent gains
med
litigation and regulatory overhang
the existing company copy flags industry litigation and regulatory risk. the data here is thin, so treat this as a watch item rather than a fully quantified thesis-breaker.
hard to model precisely, but still worth monitoring because the setup is concentrated
Seagate is still essentially a one-product company, so a real slowdown would pressure all $9.1B of revenue at once.
source: institutional data · regulatory filings · risk analysis
Pay attention to
metric
data center revenue
the latest quarter printed $2.2B here. if that number stalls, the whole rebound story gets less convincing.
trend
operating margin
31.9% operating margin was a major step up. watch whether Seagate can hold onto more of that improvement next quarter.
calendar
the rest of fiscal 2026
management says demand is firming up into year-end. the next report needs to confirm that, not just repeat it.
risk
regulatory and litigation updates
the page data flags this issue without much detail. if disclosures get more specific, it becomes more important.
Analyst rankings
short-term outlook
average
momentum score 3 — in human-speak, analysts see a normal setup here, not a near-term breakout signal.
risk profile
average
stability score 3 — about middle of the pack. not a bunker stock, not total chaos.
chart momentum
top 5%
technical score 1 — the chart is strong even if the underlying business is still cyclical.
earnings predictability
15 / 100
low predictability — you should expect the numbers to move around more than a typical mega-cap compounder.
source: institutional data
Institutional activity
institutions have been net buying for 3 consecutive quarters — 524 buyers vs. 370 sellers in 4q2025. total institutional holdings: 0.2B shares. net buying for 3 quarters.
source: institutional data
Price targets
3-5 year target range
$263
$629
$374
current price
$446
target midpoint · +19% from current · 3-5yr high: $395 (+40% · 9% ann'l return)
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