Seagate Reports Record Free Cash Flow Amid AI Demand Surge

Seagate Technology Holdings reported a significant increase in free cash flow, reaching $953 million in the third quarter of fiscal year 2026, which is a 57% sequential rise and the highest in ten years. This was driven by a strong operational performance, particularly in the datacenter segment, which generated $2.5 billion, constituting about 80% of total revenue and reflecting a year-over-year growth of 55%.

The company has revised its annual revenue growth forecast to at least 20%, supported by the growing demand for data storage related to AI applications. Despite an insider sale by an executive, Seagate's stock rose as investors focused on the strong growth outlook. The debt-to-equity ratio stands at 3.82, indicating elevated financial leverage amidst ongoing financial challenges.