SAN JOSE, Calif., Jan 29, 2026, 13:35 (PST)
- Western Digital expects roughly $3.2 billion in revenue for its fiscal third quarter, following a 25% jump in sales during Q2.
- Seagate’s strong earnings this week boosted the data-storage sector, fueling Western Digital’s share surge ahead of its own report.
- Following the spin-off of its flash division SanDisk, Western Digital is now pushing high-capacity hard drives aimed at AI and cloud data centers.
Western Digital (WDC) reported a 25% rise in quarterly revenue and projects fiscal third-quarter sales near $3.2 billion, driven by steady demand for its high-capacity hard drives in data centers. The company posted adjusted earnings of $2.13 per share and free cash flow of $653 million for the quarter ending Jan. 2. Shares slipped about 0.5% in after-hours trading. 1
The numbers come after a strong rally in storage suppliers, driven by cloud companies ramping up capacity for AI model training and deployment. Seagate, Western Digital’s main competitor, beat expectations with adjusted earnings of $3.11 per share on $2.82 billion in revenue. Western Digital shares climbed on Wednesday, as investors took Seagate’s results as a positive signal, Benzinga reported. 2
Western Digital is reshaping its AI storage pitch following the spin-off of its flash-memory unit SanDisk, with plans to highlight AI-focused storage at an upcoming Innovation Day, according to Simply Wall St. The stock last changed hands near $279.7, climbing 15.6% over the past week and soaring 55.7% in the last month. It currently trades about 22% above the average analyst price target noted by the site. 3
“Western Digital’s solid results this quarter showcase our disciplined approach to capitalizing on AI-driven data demand,” Chief Executive Irving Tan said. He added the company has returned over 100% of its free cash flow to shareholders via buybacks and dividends.
CFO Kris Sennesael said, “Our business continues to strengthen,” projecting a non-GAAP gross margin between 47% and 48% and non-GAAP earnings around $2.30 per share for the current quarter, based on the midpoint of the company’s guidance. Non-GAAP excludes certain expenses that can obscure quarter-to-quarter results.
Western Digital posted a GAAP gross margin of 45.7% for the quarter, with operating cash flow hitting $745 million. The board announced a cash dividend of 12.5 cents per share, set for payment on March 18 to shareholders of record as of March 5.
Analysts mostly stuck to their forecasts ahead of the report, a TradingView “key facts” note showed, even as the stock surged into earnings. The note also highlighted that Western Digital missed revenue targets five times over the past two years. 4
A Yahoo Finance report noted that Western Digital’s shares hit $284 during intraday trading on Wednesday, before pulling back slightly to close roughly 10.8% higher. The upbeat results from Seagate helped drive momentum across the sector that day. 5
Western Digital and Seagate provide hard disk drives, or HDDs — spinning disks that remain the go-to for bulk storage in large data centers thanks to their low cost per unit of capacity. Demand shifts quickly, depending on whether cloud customers ramp up or scale back.
Western Digital wrapped up its planned spin-off of the Flash business in February 2025, spinning off SanDisk as an independent company, the firm announced then. With that move, Western Digital’s earnings are now more closely linked to the hard-drive market cycle. 6
But the rally leaves almost no margin for error. Western Digital flagged in its earnings release that fluctuations in demand, trade restrictions, supplier hiccups, and tough pricing competition could still weigh on its results.
Western Digital filed a Form 8-K on Thursday, including its earnings press release as an exhibit. Company executives were set to review the results and provide guidance during a conference call later that day. 7
