$Seagate Tech(STX.US) Seagate Q1 Earnings Report: AI's Massive Storage Demand Ignites Growth!

Ten years ago, in the laptop era, you'd definitely use two brands: SanDisk's USB drives to copy course materials, and Seagate's hard drives to store movies. Got to know many teachers that way.

Originally thought these two companies would be phased out by the times, after all, those are shrinking markets. But who would have thought the US stock market would directly pull these two back to center stage, completely tying them to the AI data center storage super-cycle!

Seagate just released its Q1 2026 earnings report: revenue of $3.11 billion, a massive 44% year-over-year increase, significantly exceeding analyst expectations by $295 million; non-GAAP gross margin of 47.0% hit another record high, non-GAAP EPS of $4.10, far exceeding the expected $3.50 (over 17% higher).

The biggest highlight is the explosion in AI data center storage demand: exabytes shipped 199EB, up 39% year-over-year; HAMR/Mozaic high-capacity hard drives are ramping up production, data center business share continues to dominate the charts.

Free cash flow of $953 million, nearing the $1 billion mark, operating leverage is through the roof, both gross margin and operating leverage are at historical bests!

Even more significant, the company raised its long-term revenue growth guidance to at least 20% annually, completely binding itself to the AI computing power storage infrastructure wave. It is now a core AI infrastructure play!

However, it's important to note that Seagate is not the "next SanDisk," but the most stable capacity infrastructure king within AI infrastructure. SanDisk benefits from performance advantages, Seagate benefits from data volume advantages.