Seagate's gross margin jump to 57.8% from 52.7% shows pricing power in a supply-constrained hard-drive market. AI data needs storage, hyperscalers seek capacity, and HAMR packs more terabytes into existing factories; roughly 90% of big-cloud data sits on hard drives. Sales reached $4.2B and next-quarter guidance of $4.8B beats the Street's $4.53B. This cycle looks to be accelerating rather than peaking. Overweight, $1,050 target. x.com  x.com 

Seagate has shown very resilient price action over the last few weeks, with this week's gain double Micron's. x.com 

AI data and content creation could lift Seagate's and Western Digital's cross-cycle earnings even if supply catches up and pressures prices and margins. Western Digital reported hyperscaler demand signals through 2030/31, making 2013-2024 normalized earnings a poor baseline. Still not a huge fan of their stocks given their large premium to memory makers and Toshiba's production ramp. x.com  x.com 

Hard drives from Western Digital and Seagate are shouldering the bulk of the AI revolution's storage, and physical AI taking off would add even more demand. x.com 

Western Digital benefits from HDDs' low storage cost and growing cloud demand, with higher NAND prices adding pricing power. Nearline bit demand normally grows 20-25% with some deflation, while AI data growth now exceeds 30%; HDD costs ~$0.02-$0.03/GB versus ~$0.25 for NAND. Before AI, the consolidated, ~95% cloud-exposed market looked worth a low-to-mid-teens multiple of normalized EPS. Entry barriers are extremely high, but irrational competition among the three players is a risk. x.com  x.com  … Show more

Toshiba's reported plan to expand hard-drive output makes Seagate's and Western Digital's pricing after 2027 much less certain. Their bull case leaned on all three HDD makers holding unit output flat; per Nikkei Asia, Toshiba will spend about ¥60B to double AI data-center HDD capacity by March 2028 and lift its share from just over 10% to 30%. Seagate's 2027 pricing is already contracted, so this hits the multiple rather than next year's numbers. Toshiba has not confirmed the report. x.com  x.com  … Show more

Rising memory contract prices strengthen the case for memory stocks still far below their highs. JPMorgan forecasts Q4 DRAM prices up 13% and NAND up 18%; Micron is 28% below its 52-week high, Seagate 44%, Sandisk 47% and Western Digital 55%. x.com 

Seagate is close to best of breed in memory and storage, with strong free cash flow, a sustainable edge from its HAMR ramp and full entrenchment in data center and cloud. x.com 

Seagate and Western Digital trade at a huge multiple premium to other storage and memory, driven by vibes rather than cash flow, and Toshiba's expansion undermines the stable duopoly that justified it. Per @wallstengine, Toshiba plans about $380M to double HDD capacity for AI data centers by FY2027. Toshiba is a generation behind, with ramp issues, and is not a material near-term threat to profits, but the market will price the broken duopoly. The charts are awful. x.com  x.com  x.com  x.com  x.com 

Seagate is set for another good quarter, with gross margin likely to beat again, as nearline HDD prices rise alongside exabyte growth. Per @NEWS2082680, AI data centers pushed nearline HDD prices up about 10% quarter over quarter in April-June, a huge move. Seagate is growing exabytes through density gains rather than adding heads. x.com