Seagate Technology 2025 Q3 Earnings Misses Targets as Net Income Surges 1260%

Seagate Technology (STX) reported its fiscal 2025 Q3 earnings on Apr 29th, 2025. Despite significant year-on-year growth, Seagate’s performance fell short of market expectations. The company posted quarterly earnings of $1.90 per share, missing the analyst consensus estimate of $2.09. Quarterly revenue of $2.16 billion also lagged behind the expected $2.31 billion. However, Seagate's guidance for the June quarter anticipates revenue of $2.4 billion, plus or minus $150 million, reflecting an 11% sequential improvement and 27% year-over-year growth. Non-GAAP EPS is projected at $2.40, plus or minus $0.20, suggesting a positive outlook despite the current shortfall.

Revenue

Earnings/Net Income
Seagate Technology's EPS rose 1233.3% to $1.60 in 2025 Q3 from $0.12 in 2024 Q3, marking continued earnings growth. Meanwhile, the company's profitability strengthened with net income of $340 million in 2025 Q3, marking 1260.0% growth from $25 million in 2024 Q3. The impressive EPS increase signals strong financial health and effective cost management.

Price Action
The stock price of Seagate Technology has edged up 0.02% during the latest trading day, has jumped 8.28% during the most recent full trading week, and has dropped 6.74% month-to-date.

Post-Earnings Price Action Review
The impact of earnings report metrics on Seagate Technology (STX) stock price, based on backtest data, shows positive returns following the earnings releases. Revenue data indicates a 3-Day win rate of 53.99%, a 10-Day win rate of 54.70%, and a 30-Day win rate of 55.50%, suggesting the stock typically performs well in the short term post-earnings. Max returns of 6.35% over 30 days have been observed. Similarly, net income data reflects these win rates, further supporting short-term positive movements. Notably, diluted EPS results highlight an even stronger short-term performance, with win rates of 55.50%, 56.20%, and 57.00% over 3, 10, and 30 days, respectively, and a maximum return of 7.20% over 30 days. Collectively, these metrics historically lead to positive stock price movements for Seagate Technology, especially in the short term after earnings releases. Investors might consider these factors in their assessments.

CEO Commentary
Dave Mosley, Chief Executive Officer, stated that Seagate achieved a "solid quarter of profitable year-on-year growth" with a 31% increase in revenue and 81% growth in non-GAAP gross profit dollars. He emphasized the importance of their "build-to-order strategy" in navigating a tight supply-demand environment and noted that their operational changes have allowed for "sustainable and profitable growth." Mosley expressed confidence in the demand for mass capacity storage, particularly due to the ongoing build-out of data center infrastructure to support AI transformations, indicating a positive outlook for the company's strategic positioning and future growth.

Guidance
For the June quarter, Seagate expects revenue to be in the range of $2.4 billion, plus or minus $150 million, reflecting an 11% sequential improvement and 27% year-over-year growth. Non-GAAP EPS is projected at $2.40, plus or minus $0.20, based on a diluted share count of approximately 214 million shares. Operating expenses are anticipated to be around $285 million, with non-GAAP operating margin expected to expand into the mid-20s percentage range. The company also forecasts continued robust demand for high-capacity nearline products.

Additional News
In recent developments, Seagate Technology has been actively managing its financial structure, having retired approximately $536 million in debt during the quarter. Furthermore, the company declared a quarterly cash dividend of $0.72 per share, payable on July 8, 2025, to shareholders of record as of June 25, 2025. This move reflects Seagate's commitment to returning value to its shareholders. Additionally, Seagate is continuing to ramp up volume production of its HAMR-based Mozaic drives, targeting qualified customers with its innovative 3 terabyte per disk products, indicating an ongoing focus on technological advancement and market leadership.