Haverhill Financial Research · News · Earnings · October 26, 2026
What happens Tuesday
Seagate reports after the close on Tuesday, October 27. One thing to get right before reading the headlines: this is fiscal first quarter 2027, not a third quarter. Seagate's fiscal year ends in early July, so the company is a quarter ahead of the calendar in its own labelling.
Where the business stands
Fiscal 2026, which ended on July 3, brought $12.2 billion of revenue, up 34%, and non-GAAP earnings of $15.58 a share against $8.10 the year before. The fourth quarter alone produced $3.63 billion of revenue, up about 48%, with a non-GAAP gross margin of 52.7% and a non-GAAP operating margin of 44.6%. Free cash flow was $1.12 billion in the quarter and $3.1 billion for the year.
Those are not hard drive margins as anyone understood them a decade ago. For Tuesday's quarter the company has guided to $4.1 billion of revenue, give or take $100 million, and $7.30 of non-GAAP earnings per share, give or take $0.20.
Why it matters
Storage used to be the definition of a commodity business: two surviving manufacturers, a product measured in dollars per terabyte, and margins that disappeared whenever either of them built too much capacity. The last two years broke that pattern. AI systems generate and retain enormous quantities of data, and almost none of it justifies the cost of flash memory. Hard drives are where it ends up.
What makes this cycle different from previous ones is that supply has not responded. Neither remaining manufacturer has added capacity at the pace demand has grown, so pricing has held in a way it never used to. That is the entire explanation for a 44.6% operating margin in a business that historically fought for single digits.
What to watch
The guidance for the following quarter, more than the quarter itself. Seagate's own forecast implies another step up, and the useful question is whether the company sees the same demand into calendar 2027 or begins hedging.
Second, anything on the HAMR transition. Seagate's Mozaic platform uses heat-assisted magnetic recording to push capacity per drive higher, and it is the reason the company believes it can keep the margin structure rather than compete it away. The company has not disclosed exabyte or HAMR unit figures in its releases, so anything specific on the call will be new information.
Third, how much of the margin management is prepared to describe as durable. The 52-week range on the stock runs from $138.30 to $1,145.00, which tells you how violently the market has repriced this business and how much is riding on the answer.
Sources and disclosures
Figures come from Seagate's own fiscal fourth quarter and full-year 2026 results release, filed with the SEC, which also contains the fiscal first quarter 2027 guidance.
Disclosures. Haverhill Financial Research is a publisher of general financial commentary. This article is not personalized investment advice and does not consider any reader's financial situation; readers should do their own research. Nothing here is a recommendation to buy or sell any security. Company figures and guidance can change. The author of this post does not hold a position in Seagate. Data as of October 26, 2026.
