What it does
Seagate Technology Holdings plc makes mass-capacity data-storage products. It designs and manufactures hard disk drives (HDDs), storage systems and related solutions that let customers preserve, access, manage and reuse large quantities of digital data. HDDs store data on spinning magnetic disks; Seagate positions them as a scalable and energy-efficient option where customers need large storage capacity.
The company serves two end markets. Data Center products go to hyperscale operators, cloud service providers (CSPs), original equipment manufacturers (OEMs) and enterprises. They support AI-enabled cloud computing, business-critical systems, content delivery, backup and archive workloads. Its data-center portfolio includes HDDs with capacities up to 44TB and storage systems up to 3.5PB.
Its Edge IoT products are used where data is created or processed closer to its source, rather than only in a central data center. These drives range from 1TB to 32TB and serve video and image systems, network-attached storage, industrial automation, smart infrastructure, personal computers, gaming, streaming, creative workflows and backup.
Seagate was founded in 1979 and is headquartered in Cupertino. Dr. William D. Mosley is Board Chair and Chief Executive Officer. The company is organized under the laws of Ireland and employed 30,000 people as of July 3, 2026, including approximately 25,000 in Asia. [item1]
How it makes money
Seagate earns revenue by selling HDDs, storage systems and related products through direct and indirect channels. Its business is principally driven by the Data Center market, while Edge IoT addresses industrial, commercial and consumer uses. The company sells data-center products primarily to CSPs, OEMs, distributors and enterprises; Edge IoT products go primarily through OEMs, distributors, retailers and third-party resellers.
For major data-center buyers, master purchase agreements set the commercial framework, while individual purchase orders and demand forecasts schedule deliveries. For selected high-capacity nearline drives, the company works with key customers on longer-term demand forecasts and supply commitments, including cancellation-charge provisions in some cases. Management said on the call that build-to-order contracts establish configurations and pricing for nearline shipments through calendar 2027, and that most nearline exabyte supply is allocated under long-term agreements through calendar 2028, with some cloud agreements extending through calendar 2030. [item1] [call_prepared]
Revenue is affected by the volume of storage capacity shipped, product mix and pricing. In fiscal 2026, higher nearline exabytes shipped and pricing actions drove a revenue increase of approximately 34%, or $3.1 billion. Gross margin also benefited from pricing actions and a shift toward higher-capacity products. Distributor agreements are non-exclusive and generally include sales programs, limited return rights and price protection; retail sales include branded storage products sold directly to retailers or through distributors.
Fiscal 2026 revenue was approximately $12.2 billion; September-quarter fiscal 2027 revenue was $4.2 billion. [item7] [call_prepared]
Customers and how it sells
Seagate’s Data Center customers include CSPs, hyperscale cloud operators, OEMs, distributors and enterprises. Many major OEM and hyperscale customers buy under master purchase agreements. Management said on the call that data-center customers accounted for 90% of shipped capacity in the September quarter, and global cloud customers accounted for the vast majority of data-center revenue and exabyte demand. [call_prepared]
The company also sells Edge IoT products to OEMs, distributors, retailers and third-party resellers serving industrial, commercial and consumer markets. Its retail channel targets casual users, gamers and creative professionals. Distributor arrangements are non-exclusive.
Revenue is attributed to the billing location. In FY2026, the United States generated $6.1 billion, or 50.4% of revenue; Singapore generated $4.9 billion, or 40.0%; and The Netherlands generated $1.2 billion, or 9.55%. The United States grew 39.4%, Singapore 29.8%, and The Netherlands 26.1% from FY2025. [item1]
Microsoft is a customer that already deploys Seagate HAMR drives. Management said on the call that Microsoft qualified a joint Seagate and Broadcom configuration using HAMR-based Mozaic drives with shingled magnetic recording (SMR) and Broadcom connectivity infrastructure. [call_prepared]
| Region | Revenue, FY2026 | Share | Change on the year |
|---|---|---|---|
| United States | $6.1 billion | 50.4% | 39.4% |
| Singapore | $4.9 billion | 40.0% | 29.8% |
| The Netherlands | $1.2 billion | 9.55% | 26.1% |
| Other | $4.0 million | 0.03% | 0.00% |
Suppliers and costs
Seagate designs and manufactures many critical HDD technologies itself, including read/write heads, magnetic recording media and other core components. It also uses strategic suppliers and contract manufacturers for selected components and assembly. Certain components and raw materials are available from a limited number of suppliers, and the company may use long-term supply arrangements to support availability and manufacturing continuity. [item1]
Component manufacturing, subassembly, final test and assembly take place in China, Malaysia, Northern Ireland, Singapore, Thailand and the United States. Production depends on commodities and specialty materials, including rare earth elements, precious metals and specialized alloys. Changes in customer demand, supplier capacity, component availability, commodity prices and transport costs can affect operations and costs.
Management said on the call that internally produced component costs were declining with technology transitions, but externally sourced component costs were higher than a year earlier and partly offset those reductions. The company also said transitions can bring higher scrap, weaker initial yields and lost manufacturing capacity before yields recover. [call_qa]
- Revenue$12.2B
- Cost of revenue−$6.6B
- Research and development−$755.0M
- Selling, general and administrative−$577.0M
- Other operating costs−$132.0M
- Operating income$4.1B
Competitive position
Seagate competes globally with HDD manufacturers Western Digital Corporation and Toshiba Electronics Devices & Storage Corporation. It also competes with NAND flash suppliers that provide or enable alternative storage technologies, and with storage-system and solutions providers. Customers compare capacity, performance, reliability, quality, total cost of ownership, energy efficiency, supply continuity, security, technical support and the ability to meet changing workload requirements. [item1]
Seagate’s technology roadmap centers on areal density: increasing the data stored on a disk surface. Its Mozaic platform uses its implementation of heat-assisted magnetic recording (HAMR), proprietary photonics and other technologies to increase drive capacity. The company also develops multi-actuation, channel coding and signal-processing technologies aimed at improving data throughput and system performance. It held approximately 3,036 U.S. patents and 226 patents in non-U.S. jurisdictions as of July 3, 2026. [item1]
Our reading: Vertical integration is a meaningful moat because Seagate designs and manufactures key HDD technologies and can coordinate development, design and manufacturing during technology transitions. [item1]
Our reading: The areal-density and HAMR roadmap is a meaningful moat source, but its value depends on customer qualification, production yields and the pace of competitors’ technology transitions. [item1] [item1a] [call_qa]
Our reading: Long-term nearline supply agreements can support customer relationships and production planning, but they do not remove competition on technology, cost, reliability or supply continuity. [item1] [call_prepared]
| Competitor | Where they compete | Threat (our reading) |
|---|---|---|
| Western Digital Corporation | Global HDD manufacturing and data storage | High |
| Toshiba Electronics Devices & Storage Corporation | Global HDD manufacturing and data storage | High |
Growth opportunities
Seagate ties its growth plans to the expanding creation, retention and reuse of digital data. The company cites an expectation that the global datasphere will grow at approximately 27% annually through 2030 to around 718 zettabytes annually. It expects cloud infrastructure expansion, data-center modernization, distributed computing, AI-enhanced applications, longer data retention, replication and regulatory requirements to support long-term demand for mass-capacity storage. [item1]
Management said on the call that the technology roadmap is expected to support nearline exabyte supply growth in the mid-20% range on a compound basis. The approach is to increase capacity per disk through areal-density gains rather than depend on higher drive-unit production. The company shipped 789 exabytes of HDD capacity in fiscal 2026. [call_prepared] [item7]
Mozaic 4, which offers up to 44TB, is ramping with two leading CSPs. The company expects additional qualifications across global CSPs and enterprise OEM customers, and expects HAMR to represent roughly 50% of its nearline exabyte shipment run rate exiting calendar 2026. Mozaic 5 is designed to deliver more than 50TB using a 10-disc platform; the company expects customer qualification shipments toward the end of calendar 2027. [call_prepared]
Management also said on the call that it recently demonstrated 8TB per disk in a laboratory. [call_prepared]
- $11.7BFY2022
- $7.4BFY2023
- $6.6BFY2024
- $9.1BFY2025
- $12.2BFY2026
Structural risks
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Product transition and acceptance risk: Revenue growth and market share depend on introducing products on time, achieving customer qualification, meeting specifications and compatibility requirements, and reaching acceptable yields, quality and margins. [item1a]
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Demand and pricing risk: Data-center investment schedules, AI adoption, IT spending, technology transitions and macroeconomic conditions can change demand. Industry capacity, new product introductions and customer demand can also affect pricing. [item1] [item1a]
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Customer-order risk: Key customers can defer or cancel purchases, delay product acceptance or alter orders. The company’s results can vary with customer procurement and deployment schedules. [item1] [item1a]
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Supply-chain and manufacturing risk: Limited-source components, raw-material shortages, cost increases, logistics disruption and interruptions at facilities in China, Malaysia, Northern Ireland, Singapore, Thailand or the United States can harm production and operating results. [item1] [item1a]
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Technology-substitution and intellectual-property risk: NAND flash memory and other alternative technologies compete with HDDs. The company may be unable to protect its intellectual property, and the industry has intellectual-property litigation and licensing activity. [item1] [item1a]
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Financial and regulatory risk: Substantial leverage can reduce flexibility in an economic downturn. Trade policies, tariffs, foreign-exchange changes, environmental requirements and other laws or governmental policies can increase expenses or adversely affect results. [item1a]
Bottom line
Our reading
Our reading: Seagate is a mass-capacity storage manufacturer whose economics are increasingly tied to data-center nearline demand, higher-capacity product mix and contracted customer allocations rather than consumer storage alone. [item1] [call_prepared]
Our reading: Its vertical integration and HAMR-based areal-density roadmap can increase storage supplied per disk, while qualification timing, manufacturing yields, limited-source inputs, customer investment cycles and alternative storage technologies remain central execution constraints. [item1] [item1a] [call_qa]
Our reading: Long-term nearline agreements provide planning visibility, but the business remains exposed to changes in data-center demand and the cost and execution of technology transitions. [call_prepared] [item1a]