What Happened?
Shares of data storage manufacturer Seagate (NASDAQ:STX) jumped 17.4% in the afternoon session after the company reported strong third-quarter 2025 results that surpassed analyst expectations and provided an upbeat outlook. Revenue for the quarter grew 21.3% year on year to $2.63 billion, and its non-GAAP earnings of $2.61 per share also beat Wall Street estimates. The positive results were supported by a significant improvement in profitability, as the company's operating margin expanded to 26.4%, up from 18.6% in the same quarter last year. Looking ahead, Seagate's guidance for the fourth quarter was also strong. The company projected revenue of $2.7 billion and non-GAAP earnings of $2.75 per share at the midpoints, both figures topping analyst forecasts.
Is now the time to buy Seagate Technology? Access our full analysis report here.
What Is The Market Telling Us
Seagate Technology’s shares are quite volatile and have had 16 moves greater than 5% over the last year. But moves this big are rare even for Seagate Technology and indicate this news significantly impacted the market’s perception of the business.
The previous big move we wrote about was 5 days ago when the stock gained 3.4% on the news that Bernstein SocGen Group raised its price target on the stock, citing accelerating demand for data storage driven by the AI boom. The firm increased its price target to $275 from $250 while keeping an "Outperform" rating. Analysts pointed to the massive data requirements of artificial intelligence as a key growth driver for data storage companies. The brokerage noted that hard disk drives remained the most economic option for data centers to store "cool" data, which is data not frequently accessed. This trend positioned Seagate to benefit from the explosion in data creation. The positive view was part of a broader sentiment that companies involved in data storage have seen their stock prices rise due to increased AI-related demand.
Seagate Technology is up 204% since the beginning of the year, and at $262.74 per share, has set a new 52-week high. Investors who bought $1,000 worth of Seagate Technology’s shares 5 years ago would now be looking at an investment worth $5,513.
Here at StockStory, we certainly understand the potential of thematic investing. Diverse winners from Microsoft (MSFT) to Alphabet (GOOG), Coca-Cola (KO) to Monster Beverage (MNST) could all have been identified as promising growth stories with a megatrend driving the growth. So, in that spirit, we’ve identified a relatively under-the-radar profitable growth stock benefiting from the rise of AI, available to you FREE via this link.