Seagate Technology Surges 73% in 2025: AI and Data Center Demand Fuel Growt

Published Date : 07/07/2025 

Seagate Technology has seen a remarkable 73% increase in its stock value in 2025, driven by the surging demand for data center storage and AI workloads. This article explores the factors behind Seagate's success and its potential for future growth. 

Seagate Technology (NASDAQ: STX) has registered an outstanding rally on the stock market in 2025, rising an incredible 73% year to date and beating the Nasdaq Composite index's 7% return by a massive margin. This impressive performance can be attributed to robust growth in the demand for storage in data centers running artificial intelligence (AI) workloads. Let's dig into how AI is fueling Seagate's growth and see how it could pave the way for more upside in this technology stock.

Seagate Technology's revenue in the first nine months of its fiscal 2025 increased almost 43% year over year to $6.65 billion. Even better, the company's non-GAAP (adjusted) income from operations has jumped more than fourfold during this period, thanks to higher margins. Management attributes this fantastic growth to the healthy demand for mass capacity storage in the cloud, which has created a tight supply environment and led to an increase in prices. Management remarked on the company's April earnings call that the growing storage demand 'aligns with the cloud capex investment cycle and ongoing build-out of data center infrastructure to support AI transformations.'

Specifically, 90% of the storage in large-scale data centers is done with hard drives because of their cost efficiency and scalability. With the storage requirement in data centers expected to more than double between 2024 and 2028, Seagate estimates this could push annual revenue for the data center storage market to $23 billion by 2028, up from $13 billion last year. Seagate is in a solid position to make the most of this growth opportunity considering its 40% share of the global storage market. Not surprisingly, Seagate's outlook for the recently concluded fiscal fourth quarter was an impressive one. The company guided for $2.4 billion in revenue at the midpoint of its range, along with $2.40 per share in earnings. The top-line guidance is good for a 27% year-over-year increase, while earnings are on track to more than double from the prior-year period's reading of $1.05 per share.

Seagate's strong financial performance and strategic positioning in the data center storage market make it an attractive investment opportunity. The company's focus on AI and cloud infrastructure aligns perfectly with the current trends in the tech industry, positioning it for continued growth in the coming years. As more businesses and organizations adopt AI technologies, the demand for reliable and cost-effective storage solutions will only continue to rise, further benefiting Seagate's bottom line. 

Frequently Asked Questions (FAQS): 

Q: What is the main driver behind Seagate Technology's stock performance in 2025?

A: The main driver behind Seagate Technology's stock performance in 2025 is the robust growth in the demand for data center storage, particularly for AI workloads. This has led to a significant increase in revenue and earnings.

Q: How much has Seagate Technology's stock increased in 2025?

A: Seagate Technology's stock has increased by 73% in 2025, significantly outperforming the Nasdaq Composite index.

Q: What percentage of the global storage market does Seagate hold?

A: Seagate holds a 40% share of the global storage market, positioning it as a leader in the industry.

Q: What is Seagate's revenue forecast for the fiscal fourth quarter of 2025?

A: Seagate's revenue forecast for the fiscal fourth quarter of 2025 is $2.4 billion at the midpoint of its range, representing a 27% year-over-year increase.

Q: How is the demand for data center storage expected to change in the coming years?

A: The demand for data center storage is expected to more than double between 2024 and 2028, driven by the increasing adoption of AI technologies and the need for more robust cloud infrastructure. 

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