Western Digital Corp (NASDAQ:WDC) shares are trading higher on Wednesday as investors react to strong results from peer Seagate Technology Holdings (NASDAQ:STX), which delivered a better‑than‑expected quarter ahead of Western Digital's own earnings release on Thursday.
Seagate’s Success Sets New Benchmark
Seagate posted adjusted earnings of $3.11 per share for its second-quarter, topping the $2.81 consensus estimate. Revenue came in at $2.82 billion, also above expectations. The company reported a non‑GAAP gross margin of 42.2%, while generating $723 million in operating cash flow and $607 million in free cash flow.
The company also issued upbeat guidance for the third-quarter, projecting adjusted earnings of $3.20 to $3.60 per share, ahead of the $2.96 consensus. Revenue between $2.80 billion and $3.0 billion.
Western Digital will report fiscal second‑quarter 2026 results on Thursday. Analysts expect second-quarter earnings of $1.88 per share and revenue of about $2.9 billion, which would represent roughly 20% year‑over‑year growth at the midpoint.
Last quarter, the company delivered $2.82 billion in revenue, up 27% from a year earlier, along with non‑GAAP EPS of $1.78 and $599 million in free cash flow.
Similarities Between The Two Companies
Both Western Digital and Seagate can benefit from the same industry tailwinds, including strong cloud and data‑center demand fueled by rapid AI‑driven data creation. Western Digital CEO Irving Tan recently noted that "as AI accelerates data creation," the company's innovation and operational discipline position it well to capture new opportunities and deliver long‑term value.
Seagate's strong results point to favorable conditions across the storage market. The momentum could carry into Western Digital's upcoming report, particularly in high‑capacity drive demand and improving profitability.
WDC Price Action: Western Digital shares were up 12.23% at $283.55 at the time of publication on Wednesday. The stock is trading at a new 52-week high, according to Benzinga Pro.
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