New York, May 19, 2026, 10:04 (EDT)
Seagate Technology shares dropped for a second day Tuesday, after a sharp fall Monday. CEO Dave Mosley said new factories would “take too long,” raising doubts about how quickly the company can meet AI demand. The stock was down about 2.3% at $723.81 on Nasdaq, following Monday’s close at $740.84. Investing.com
Supply is now the question, not demand. Hard-disk drive (HDD) makers are seeing AI boost demand for their lower-cost storage tech in data centers. But with investors worried about whether these companies can meet that demand, stocks are taking a hit when capacity looks tight.
Seagate’s Mosley told the JPMorgan Global Technology, Media and Communications Conference on Monday that demand forecasts are now “significantly higher,” the Wall Street Journal reported in a market note. The company’s calendar had the JPMorgan session at 9:45 a.m. ET on May 18. Wall Street Journal
Seagate shares dropped 6.87% on Monday. The stock opened at $801, dipped to $710.11 before closing out at $740.84. About 4.9 million shares changed hands, according to historical data.
Seagate CEO Mosley said demand is holding up. He said the company is ramping up output with tech upgrades, moving to higher-capacity platters and adding equipment at current sites instead of building new plants. The main tech bet is HAMR—heat-assisted magnetic recording—which uses heat to put more data on each platter.
Seagate is putting numbers behind its approach. The company posted fiscal third-quarter revenue of $3.11 billion, a GAAP gross margin of 46.5%, and free cash flow of $953 million, which is the cash left after capital spending. For the fiscal fourth quarter, Seagate is guiding to revenue of $3.45 billion, give or take $100 million, and non-GAAP diluted earnings per share of $5.00, plus or minus 20 cents. The non-GAAP numbers leave out some items.
Seagate CEO Mosley called this a “new era of structural growth” in the earnings release, pointing to rising data demand from AI as a positive for storage. That’s the upside for bulls. But in Tuesday’s trading, shares showed some caution. Tight supply keeps prices up, but investors also get nervous about lost sales when products are hard to find. Seagate Investors
S&P 500 and Nasdaq started lower on Tuesday, with chip stocks a drag, Reuters said. Inflation concerns also stuck around. In memory and storage, Western Digital slipped 1.9%. Sandisk ticked up 0.4% and Micron added 0.2%.
Strong competition is still in play. Earlier this month, Reuters reported that Sandisk, Western Digital and Seagate each cited steady AI-driven storage demand. Seagate and Western Digital execs also said their capacity was either allocated or sold out through 2026.
The downside is looking more defined. If cloud buyers can’t get enough drives, some sales might just get pushed out. If AI infrastructure spending pulls back, supply discipline could quickly turn into too much capacity hanging over the market. Seagate’s April guidance counted on just a small impact from tariffs and Middle East conflict at the time of release, so there’s still a risk there.
Seagate is set to put that message to the test as management plans to speak at TD Cowen’s tech conference on May 27 and at Bank of America’s global tech conference on June 2. The company will also meet with investors at both events.
