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Seagate Technology — Supplemental Financial Information — Fiscal First Quarter 2027 (Q1 FY2027)
Seagate Technology (STX) · 14 slides · Filed Oct 27, 2026
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Slide 1 — SUPPLEMENTAL
SUPPLEMENTAL FINANCIAL INFORMATION Q1FY27 OCTOBER 27, 2026
Slide 2 — Safe Harbor Statement and Use of Non-GAAP Financial Information
Seagate | 2 Safe Harbor Statement and Use of Non-GAAP Financial Information This document and our other communications regarding our quarterly financial results contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements provide current expectations of future events based on certain assumptions and include any statement that does not directly relate to any historical fact. Forward-looking statements include, among other things, statements about the Company’s plans, programs, strategies, prospects, and opportunities; financial outlook for future periods, expectations regarding our ability to service debt and continue to generate free cash flow; expectations regarding our ability to make timely quarterly payments under the settlement agreement with the U.S. Department of Commerce’s Bureau of Industry and Security; expectations regarding logistical, macroeconomic, or other factors affecting the Company, including uncertainty related to tariffs, trade restrictions, or evolving global trade policy; expectations regarding market demand for the Company’s products, our visibility into such demand and our ability to optimize our level of production and meet market and industry expectations and the effects of these future trends on the Company’s financial and operational performance; anticipated shifts in technology and storage industry trends, and anticipated demand and performance of new storage product introductions, including HAMR-based products; our ability to successfully integrate acquisitions with our existing business; and expectations regarding the Company’s business strategy and performance, as well as dividend issuance plans for future periods. Forward-looking statements generally can be identified by words such as “expects,” “intends,” “plans,” “anticipates,” “believes,” “estimates,” “predicts,” “projects,” “should,” “may,” “will,” “will continue,” “can,” “could” or the negative of these words, variations of these words and comparable terminology, in each case, intended to refer to future events or circumstances. However, the absence of these words or similar expressions does not mean that a statement is not forward-looking. Forward-looking statements are subject to various uncertainties and risks that could cause our actual results to differ materially from historical experience and our present expectations or projections. These risks and uncertainties include, but are not limited to, those described under the captions “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in the Company’s latest periodic report on Form 10-Q or Form 10-K filed with the U.S. Securities and Exchange Commission. Undue reliance should not be placed on the forward-looking statements in this press release, which are based on information available to us on, and which speak only as of, the date hereof. The Company undertakes no obligation to update forward-looking statements to reflect events or circumstances after the date they were made, unless required by applicable law. To supplement the consolidated financial statements presented in accordance with U.S. generally accepted accounting principles (GAAP), the Company uses non-GAAP measures of gross profit, gross margin, operating expenses, income from operations, operating margin, net income, diluted EPS, free cash flow, EBITDA, adjusted EBITDA and the last twelve months (LTM) adjusted EBITDA, which are adjusted from results based on GAAP to exclude certain benefits, expenses, gains and losses. A full discussion of these adjustments can be found in the earnings press release for the Company’s most recent fiscal quarter. These non-GAAP financial measures are provided to enhance the user’s overall understanding of the Company’s current financial performance and its prospects for the future. Specifically, the Company believes non-GAAP results provide useful information to both management and investors as these non-GAAP results exclude certain benefits, expenses, gains and losses that it believes are not indicative of its core operating results and because it is similar to the approach used in connection with the financial models and estimates published by financial analysts who follow the Company. These non-GAAP financial measures are used by management to assess the Company’s performance, allocate resources and plan for future periods. These non-GAAP financial measures should only be considered as supplemental to results prepared in accordance with GAAP, and not considered as a substitute or replacement for, or superior to, GAAP results. These non-GAAP measures may differ from the non-GAAP measures reported by other companies.
Slide 3 — $4.2B
Seagate | 3 Delivered record profitability and EPS, supported by sustained Data Center demand, favorable pricing and strong operational execution Revenue $4.2B Record Gross Margin1 57.8% +510 bps QoQ | +1,770 bps YoY Record Operating Margin1 50.7% +610 bps QoQ | +2,170 bps YoY Record EPS1 $7.68 +194% YoY | Above guidance Generated record free cash flow and significantly strengthened the balance sheet Operating Cash Flow $1.7B Up 218% YoY Balance Sheet $1.3B cash • Reduced gross debt2 to $2.4B, down 53% YoY 1. Figures presented are non-GAAP, please refer to the "Reconciliation Tables" section for a reconciliation of each non-GAAP measure included in this presentation to the most comparable GAAP measure. 2. Gross debt refers to principal outstanding. Q1FY27 Financial Highlights $1.5B Up 246% YoY +61% YoY | Above guidance Free Cash Flow1
Slide 4 — Markets and Technology Highlights
Seagate | 4 Markets and Technology Highlights • Data Center represented 90% of exabyte shipments at 198EB, up ~24% YoY • Vast majority of Data Center nearline supply allocated through CY28, with some cloud supply agreements extending through CY30 • Data Center revenue of $3.4B, up 63% YoY with sustained Cloud and Enterprise/OEM demand • Cloud remains the primary demand driver, with 12 consecutive quarters of revenue growth • Enterprise/OEM revenue grew for the sixth consecutive quarter, increasing double digits both sequentially and YoY as demand strengthened across hybrid-cloud environments • Executing our technology roadmap anchored by HAMR technology to address exabyte growth by increasing capacity per drive rather than increasing drive unit production • Mozaic 4 ramping with two leading CSPs, additional CSP and Enterprise/OEM qualifications expected to complete in the coming months • Mozaic 5 qualification shipments on track to begin toward the end of CY27 • Demonstrated 8TB per disk in the lab, reinforcing the scalability of the Mozaic platform
Slide 5 — Quarterly Financial Trends
Seagate | 5 Quarterly Financial Trends Q1FY26 Q2FY26 Q3FY26 Q4FY26 Q1FY27 QoQ YoY Results (non-GAAP)1 Revenue ($M) 2,629 2,825 3,112 3,629 4,233 17% 61% Gross Margin % 40.1% 42.2% 47.0% 52.7% 57.8% 5.1 ppt 17.7 ppt Operating Expenses ($M) 291 290 296 293 300 2% 3% Operating Margin % 29.0% 31.9% 37.5% 44.6% 50.7% 6.1 ppt 21.7 ppt Net Income ($M) 583 702 934 1,319 1,781 35% 205% Diluted EPS $2.61 $3.11 $4.10 $5.71 $7.68 35% 194% End of Qtr Actual Share Count (M) 214 218 224 227 230 1% 7% Diluted Shares O/S for EPS1 (M) 223 226 228 231 232 0% 4% Cash and Cash Equivalents ($M) 1,112 1,046 1,146 1,704 1,258 -26% 13% Debt2 ($M) 4,994 4,499 3,863 3,565 2,351 -34% -53% Cash Flow From Operations ($M) 532 723 1,114 1,305 1,690 30% 218% Capital Expenditures3 ($M) 105 116 161 187 211 13% 101% Free Cash Flow1 ($M) 427 607 953 1,118 1,479 32% 246% Dividends Per Share Paid $0.72 $0.72 $0.74 $0.74 $0.74 LTM Dividend Paid ($M) 606 612 621 634 649 LTM Shares Repurchased ($M) 29 29 59 176 547 NOTE: Minor changes and calculation variances are due to rounding. 1. See ‘Reconciliation Tables’ section for GAAP reconciliation. 2. Principal outstanding less unamortized discount and debt issuance cost. 3. Capital Expenditures is cash paid for the acquisition of property, equipment, and leasehold improvements.
Slide 6 — Quarterly Financial Trends Continued
Seagate | 6 Quarterly Financial Trends Continued Q1FY26 Q2FY26 Q3FY26 Q4FY26 Q1FY27 QoQ YoY Revenue by End Market ($M) 2,629 2,825 3,112 3,629 4,233 17% 61% Data Center1 2,114 2,224 2,500 2,933 3,449 18% 63% As a % of total revenue 80% 79% 80% 81% 81% 0 ppt 1 ppt Edge IoT1 515 601 612 697 784 13% 52% As a % of total revenue 20% 21% 20% 19% 19% 0 ppt -1 ppt HDD Exabyte Capacity Shipped 182 190 199 218 220 1% 21% Nearline 159 165 175 195 198 1% 24% Non - Nearline 22 25 24 23 22 -3% 1% NOTE: Minor calculation variances are due to rounding. 1. Data Center is comprised of nearline products sold into cloud, enterprise, VIA customers and systems; Edge IoT end markets are comprised of all other products.
Slide 7 — Guidance Q2FY27
Seagate | 7 Guidance Q2FY27 At the mid point of the guidance: o Operating Expense (non-GAAP) expected to be ~$300 million o Tax Expense (non-GAAP) expected to be ~16% of income before taxes o Diluted Shares O/S for EPS (non-GAAP) expected to be ~233 million Q2FY27 Revenue $4.8 billion ± $100 million Operating Margin1 (non-GAAP) Towards mid 50% range of revenue Diluted Earnings Per Share1,2 (non-GAAP) $9.20 ± $0.20 1. We have not reconciled our guidance for non-GAAP financial measures for fiscal second quarter 2027 to the most directly comparable GAAP measure, other than estimated share-based compensation expenses, because material items that may impact these measures are out of our control and/or cannot be reasonably predicted, including, but not limited to, net (gain) loss from debt transactions, strategic investment losses (gains) or impairment charges, income tax adjustments on these measures, and other charges or benefits that may arise. The amounts of these measures are not currently available but may be material to future results. A reconciliation of our historical non-GAAP financial measures to their nearest GAAP equivalent is contained in this release. 2. Guidance regarding non-GAAP diluted earnings per share excludes known pre-tax charges related to estimated share-based compensation expenses of $0.30 per share.
Slide 8 — Debt Capital Structure
Seagate | 8 Debt Capital Structure o $2.6B Liquidity1, $1.3B cash, $1.3B revolving credit facility o Reduced gross debt2 to $2.4B, down 53% YoY o Extinguished an additional $750M in high yield senior notes subsequent to Q1FY27 Q1FY26 Q2FY26 Q3FY26 Q4FY26 Q1FY27 Net Debt ($M)2 3,934 3,500 2,759 1,899 1,125 LTM Cash Interest Expense ($M) 312 302 295 281 272 LTM Adjusted EBITDA ($M)3 2,682 3,053 3,721 4,708 6,094 Total Leverage Ratio on Net Debt4 1.5x 1.1x 0.7x 0.4x 0.2x Debt Metrics NOTE: Minor calculation variances are due to rounding. For the capitalized terms included but not defined here, please see the Credit Agreement filed with the SEC. 1. Liquidity levels include both Cash and cash equivalents and revolver. 2. Debt refers to principal outstanding and net debt refers to principal outstanding less cash and cash equivalents. 3. EBITDA is defined as net income before income tax expense, interest expense, interest income, depreciation and amortization. Adjusted EBITDA excludes certain benefits, expenses, gains, losses and other extraordinary charges. LTM adjusted EBITDA is defined as the total of last twelve months adjusted EBITDA. See ‘Reconciliation Tables’ section for reconciliation of Net Income to adjusted EBITDA. 4. Also known as “total net leverage ratio”, which reflects Net Debt divided by LTM Adjusted EBITDA. $360 $136 $586 $61 $750 $490 FY27 FY28 FY29 FY30 FY31 FY32 FY33 FY34 FY35 Debt Maturity as of Q1FY27 ($2.4B Principal Outstanding) Senior Notes ($M) Extinguished reduction of senior notes in October 2026 ($M)
Slide 9 — We Build Value in a Data-Driven World
Seagate | 9 We Build Value in a Data-Driven World Microsoft Validates HAMR and SMR Solution at Hyperscale Microsoft Azure Storage qualifies Broadcom HBA with Seagate HAMR + SMR, validating a configuration designed to simplify SMR deployment at hyperscale. How Data Requirements Are Reshaping AI Infrastructure As retained data becomes a source of context and competitive advantage, infrastructure increasingly follows the realities of data. Why Context Shapes The Economics Of AI Is AI’s next constraint economics? The future value of AI depends on preserving and reusing context. Seagate on the New Value of Data CEO Dave Mosley shares his perspective on the growing value of enterprise data and the critical role of storage in supporting AI at scale at the 65 Summit: AI Unleashed 2026. Learn more at https://www.seagate.com
Slide 10 — Reconciliation Tables
Seagate | 10 Seagate | 10 Reconciliation Tables
Slide 11 — Seagate |
Seagate | 11 Reconciliation of GAAP Gross Profit to Non-GAAP Gross Profit ($M) Q1FY26 Q2FY26 Q3FY26 Q4FY26 Q1FY27 GAAP Gross Profit $ 1,037 $ 1,176 $ 1,447 $ 1,898 $ 2,427 Amortization of acquired intangible assets 3 2 2 1 2 Share-based compensation related charges 14 13 14 13 18 Non-GAAP Gross Profit $ 1,054 $ 1,191 $ 1,463 $ 1,912 $ 2,447 GAAP Gross Margin % 39.4% 41.6% 46.5% 52.3% 57.3% Non-GAAP Gross Margin % 40.1% 42.2% 47.0% 52.7% 57.8% Reconciliation of GAAP Operating Expenses to Non-GAAP Operating Expenses ($M) Q1FY26 Q2FY26 Q3FY26 Q4FY26 Q1FY27 GAAP Operating Expenses $ 343 $ 333 $ 449 $ 339 $ 363 Acquisition-related charges (1) — — — — Legal settlement — — (105) — — Restructuring and other, net (13) (3) (7) (4) (4) Share-based compensation related charges (38) (40) (40) (41) (59) Other charges — — (1) (1) — Non-GAAP Operating Expenses $ 291 $ 290 $ 296 $ 293 $ 300 Reconciliation of GAAP Income From Operations to Non-GAAP Income From Operations ($M) Q1FY26 Q2FY26 Q3FY26 Q4FY26 Q1FY27 GAAP Income From Operations $ 694 $ 843 $ 998 $ 1,559 $ 2,064 Acquisition-related charges 1 — — — — Amortization of acquired intangible assets 3 2 2 1 2 Legal settlement — — 105 — — Restructuring and other, net 13 3 7 4 4 Share-based compensation related charges 52 53 54 54 77 Other charges — — 1 1 — Non-GAAP Income From Operations $ 763 $ 901 $ 1,167 $ 1,619 $ 2,147 GAAP Operating Margin % 26.4 % 29.8 % 32.1 % 43.0 % 48.8 % Non-GAAP Operating Margin % 29.0 % 31.9 % 37.5 % 44.6 % 50.7 %
Slide 12 — Seagate |
Seagate | 12 1. Q1FY26, Q2FY26, Q3FY26 and Q4FY26 non-GAAP shares used in diluted EPS calculation excluded approximately 3 million, 2 million, 1 million and 1 million shares, respectively, that are issuable upon conversion of our 2028 exchangeable senior notes using the if-converted method. This is because these dilutive effects are expected to be offset partially by the capped call transactions entered by the Company in conjunction with the issuance of our 2028 exchangeable senior notes in order to reduce the potential dilution to the Company's ordinary shares upon the conversion. Reconciliation of GAAP Net Income to Non-GAAP Net Income ($M) Q1FY26 Q2FY26 Q3FY26 Q4FY26 Q1FY27 GAAP Net Income $ 549 $ 593 $ 748 $ 1,294 $ 1,761 Acquisition-related charges 1 — — — — Amortization of acquired intangible assets 3 2 2 1 2 Legal settlement — — 105 — — Net loss from business divestiture — — 3 — — Net loss from debt transactions 6 66 69 10 44 Restructuring and other, net 13 3 7 4 4 Share-based compensation related charges 52 53 54 54 77 Strategic investment (gains) losses or impairment charges — — — (14) — Other charges — — 1 1 — Income tax adjustments (41) (15) (55) (31) (107) Non-GAAP Net Income $ 583 $ 702 $ 934 $ 1,319 $ 1,781 Reconciliation of GAAP Diluted Net Income Per Share to Non-GAAP Diluted Net Income Per Share ($M) Q1FY26 Q2FY26 Q3FY26 Q4FY26 Q1FY27 GAAP Diluted Net Income Per Share $ 2.43 $ 2.60 $ 3.27 $ 5.58 $ 7.59 Acquisition-related charges — — — — — Amortization of acquired intangible assets 0.01 0.01 0.01 — 0.01 Legal Settlement — — 0.46 — — Net loss from business divestiture — — 0.01 — — Net loss from debt transactions 0.03 0.29 0.30 0.04 0.19 Restructuring and other, net 0.06 0.01 0.03 0.02 0.02 Share-based compensation related charges 0.23 0.23 0.24 0.23 0.33 Strategic investment (gains) losses or impairment charges — — — (0.06) — Other charges — — — — — Income tax adjustments (0.18) (0.07) (0.24) (0.13) (0.46) Non-GAAP diluted sharecount adjustments1 0.03 0.04 0.02 0.03 — Non-GAAP Diluted Net Income Per Share1 $ 2.61 $ 3.11 $ 4.10 $ 5.71 $ 7.68 Shares used in diluted net income per share calculation (M) GAAP 226 228 229 232 232 Non-GAAP diluted sharecount adjustments1 (3) (2) (1) (1) - Non-GAAP 223 226 228 231 232
Slide 13 — Reconciliation of Net Cash Provided by Operating Activities to Free Cash Flow ($M)
Seagate | 13 Reconciliation of Net Cash Provided by Operating Activities to Free Cash Flow ($M) Q1FY26 Q2FY26 Q3FY26 Q4FY26 Q1FY27 Net Cash Provided by Operating Activities $ 532 $ 723 $ 1,114 $ 1,305 $ 1,690 Acquisition of property, equipment and leasehold improvements (105) (116) (161) (187) (211) Free Cash Flow $ 427 $ 607 $ 953 $ 1,118 $ 1,479 Reconciliation of GAAP Net Income to Non-GAAP Adjusted EBITDA ($M) Q1FY26 Q2FY26 Q3FY26 Q4FY26 Q1FY27 GAAP Net Income $ 549 $ 593 $ 748 $ 1,294 $ 1,761 Depreciation and amortization 72 68 66 70 76 Interest expense 80 72 68 64 41 Interest income (7) (7) (6) (10) (7) Income tax expense 65 114 116 211 221 Non-GAAP EBITDA 759 840 992 1,629 2,092 Acquisition-related charges 1 — — — — Legal Settlement — — 105 — — Net loss from business divestiture — — 3 — — Net loss from debt transactions 6 66 69 10 44 Restructuring and other, net 13 3 7 4 4 Share-based compensation related charges 52 53 54 54 77 Strategic investment (gains) losses or impairment charges — — — (14) — Other charges — — 1 1 — Non-GAAP Adjusted EBITDA $ 831 $ 962 $ 1,231 $ 1,684 $ 2,217
Slide 14 — www.seagate.com
www.seagate.com