Seagate Expects Stronger-Than-Estimated Quarterly Results Due to High Data Storage Demand

• Seagate forecast Q3 revenue of $2.90 billion (plus or minus $100 million), exceeding analyst estimates of $2.77 billion
• Tech firms are investing hundreds of billions of dollars into AI data centers, creating demand for storage solutions that combine performance and cost-efficiency at exabyte-scale
• Morningstar analysts expect the hard disk drive industry to grow at a low-teens average rate over the next several years as prices fall but storage volume shipped increases

Summary: Seagate Technology Q3 Forecast Beats Estimates on AI-Driven Storage Demand

Key Financial Highlights:

• Q3 revenue forecast: $2.90 billion (±$100 million) vs. $2.77 billion estimate
• Q2 revenue: $2.83 billion, beating estimates of $2.73 billion
• Q2 adjusted earnings: $3.11 per share, exceeding consensus expectations

Main Driver:

Seagate Technology is experiencing robust demand for data storage devices as enterprises expand artificial intelligence infrastructure. Tech companies are investing hundreds of billions of dollars in data centers to train and run large language models, which require massive storage capacity for vast data quantities.

Market Context:

CEO Dave Mosley emphasized that AI applications are amplifying data creation and value, driving demand for storage solutions offering "performance and cost-efficiency at exabyte-scale." Morningstar analysts project the hard disk drive industry will grow at a "low-teens average rate over the next several years," with prices declining but storage volumes increasing.

Sector Implications:

The strong forecast underscores the broader trend of hardware suppliers benefiting from the AI infrastructure boom. As data centers scale up to support generative AI and large language models, storage providers like Seagate are positioned as critical enablers of this technological transformation.

Timing:

Results announced January 27, with reference to a £115 million investment in next-generation hard drive development at Seagate's Northern Ireland facility in September 2025.

The forecast beat reflects growing enterprise recognition that AI deployment requires substantial backend storage infrastructure, positioning Seagate favorably in the evolving AI ecosystem.