Western Digital and Seagate are now both HDD-focused companies, but their reported results are not perfectly comparable: Western Digital separated its Flash business into Sandisk in February 2025, while the two companies use different labels for their end markets. For investors, the useful comparison is business exposure, customer concentration, capacity and pricing, margins, cash generation, debt and disclosed risks—not revenue alone. FY2026 results were strong at both, but they do not establish which stock is cheaper or the better investment.
What each company sells—and why the comparison changed
Western Digital after the Sandisk separation
Western Digital completed the separation of its Flash business on February 21, 2025. Sandisk became the independent company holding that business, while Western Digital continued with HDDs as its single reportable segment. WD describes its end markets as Cloud, Client and Consumer. Its historical results therefore include a different business scope before and after the separation; comparisons across that date need to account for the change. WD’s FY2026 Form 10-K details its continuing operations and reporting.
Seagate’s HDD business
Seagate’s FY2026 filing describes a business centered on HDDs. Its reported end-market categories are Data Center and Edge IoT. These labels are issuer-defined, so they should not be treated as exactly equivalent to WD’s Cloud, Client and Consumer categories.
How much each company depends on data-center demand
Cloud accounted for 89% of WD’s FY2026 net revenue, and its ten largest customers together accounted for 73%. Three individual customers each represented at least 10% of revenue. Seagate reported that Data Center accounted for 80% of FY2026 revenue. These figures point to substantial exposure at both companies to large data-center buyers and their investment cycles; WD’s customer figures also make individual buyer concentration especially visible.
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WD says cloud storage demand and AI and hybrid-data workloads are supporting demand for higher-capacity drives. That is management’s outlook, not a guaranteed forecast. Higher-capacity drives can bring more manufacturing complexity and longer production lead times.
Seagate shipped 789 exabytes of HDD capacity in FY2026, including 695 exabytes of nearline drives and 94 exabytes of non-nearline drives. Its revenue rose approximately 34% from FY2025, which Seagate attributed primarily to more nearline exabytes shipped, stronger nearline demand and favorable pricing actions. Both fiscal years ended July 3, 2026 and comprised 53 weeks, so the extra week matters when interpreting year-over-year growth.
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FY2026 results: use comparable measures
The companies reported similar revenue scale for the fiscal year ended July 3, 2026. The figures below are issuer-reported U.S. dollars unless noted; fiscal years each comprised 53 weeks. GAAP and non-GAAP measures are not interchangeable.
| Measure | Western Digital | Seagate |
|---|---|---|
| FY2026 revenue | $12.919 billion, net revenue (Western Digital FY2026 Form 10-K) | $12.195 billion (Seagate FY2026 results and filing) |
| Customer or end-market concentration | Cloud: 89% of revenue; top ten customers: 73% (Western Digital FY2026 Form 10-K) | Data Center: 80% of revenue (Seagate FY2026 filing) |
| Gross margin | Not stated here (Western Digital FY2026 Form 10-K) | 45.6% GAAP (Seagate FY2026 results) |
| Net income | Not directly comparable without reconciling separation-related accounting activity and unusual items (Western Digital FY2026 Form 10-K) | $3.184 billion GAAP (Seagate FY2026 results) |
| Operating cash flow | Not stated here (Western Digital FY2026 Form 10-K) | $3.7 billion (Seagate FY2026 results) |
| HDD capacity shipped | Not stated here (Western Digital FY2026 Form 10-K) | 789 exabytes, including 695 exabytes nearline (Seagate FY2026 filing) |
WD’s reported results include separation-related accounting activity, including a large retained-interest item in FY2026, as well as debt-for-equity exchange costs. A headline net income or EPS comparison can therefore mislead unless continuing operations and unusual items are reconciled from both companies’ complete financial statements. Seagate’s FY2026 release provides a reconciliation between its GAAP and non-GAAP measures.
Business risks to compare
Both companies disclose risks rather than estimates that a particular loss will occur. The table identifies useful comparison points, not a ranking of likelihood or severity; each company’s latest risk-factor disclosures are the fuller reference.
| Risk area | Western Digital | Seagate | Investor question |
|---|---|---|---|
| Demand and customers | Cloud made up 89% of FY2026 revenue; top ten customers made up 73%, with three customers individually at 10% or more (Western Digital FY2026 Form 10-K). | Data Center made up 80% of FY2026 revenue (Seagate FY2026 filing). | How sensitive are sales to a small number of large buyers and changes in data-center investment? |
| Capacity, mix and pricing | WD says improved pricing and a higher-capacity product mix contributed to gross-margin growth; it identifies greater complexity and longer lead times for higher-capacity products (Western Digital FY2026 Form 10-K). | Nearline drives accounted for 695 of 789 exabytes shipped in FY2026; Seagate cites stronger nearline demand and favorable pricing actions (Seagate FY2026 filing). | Is growth coming from shipped capacity, price, or product mix, and how could those drivers change? |
| Manufacturing and supply | WD identifies limited-source suppliers, subcontractors, manufacturing execution and yields as risks (Western Digital FY2026 Form 10-K). | Seagate lists operational and supply-related uncertainties (Seagate FY2026 filing). | Can each company obtain components, maintain yields and ramp production as planned? |
| Technology and competition | WD identifies competition, technological change, product development and execution of new-product ramps (Western Digital FY2026 Form 10-K). | Seagate identifies technology and market risks and describes a HAMR roadmap in its FY2026 results release. | How much execution risk is embedded in each company’s capacity roadmap? Product targets are forward-looking, not guaranteed outcomes. |
| Trade, legal and regulatory exposure | WD lists tariffs and trade restrictions among its risks (Western Digital FY2026 Form 10-K). | Seagate lists trade policy, export controls, sanctions, litigation and regulatory risks (Seagate FY2026 filing). | How could policy changes or legal matters affect operations, sales or costs? |
Debt, cash flow and shareholder returns
Capital allocation is another area to assess using current balance sheets and share counts. WD used Sandisk share exchanges to reduce debt and repurchased shares in FY2026. Seagate reported $3.6 billion of debt at year-end after reducing debt, alongside dividends and repurchases. These year-end disclosures are starting points, not a current comparison of net debt, interest burden or per-share value.
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For either company, investors can examine whether operating cash generation covers investment needs and shareholder distributions, and how debt, dilution, dividends and buybacks evolve. The figures should be drawn from comparable periods and definitions; the reported Seagate operating cash flow alone does not establish a relative advantage over WD.
Independent reader supportYour contribution helps us test, update, and keep practical guides available for everyone.How to decide whether either stock is attractive
Business quality and stock valuation are separate questions. The FY2026 revenue figures do not say which shares are attractively priced. A stock comparison needs market prices from the same date, current diluted share counts and consistently calculated valuation measures. It should also account for the companies’ different reporting histories and unusual items.
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- Normalize the business comparison. Treat WD’s pre-separation history cautiously, and compare end-market disclosures using each issuer’s own definitions.
- Test demand exposure. Consider the concentration at large cloud and data-center buyers and how a slowdown or a shift in purchasing might affect capacity shipments.
- Separate volume from price and mix. Check whether revenue and margin changes reflect more exabytes, higher pricing, or a shift toward higher-capacity products.
- Review cash generation and balance sheets. Compare cash flow, debt and shareholder returns over matching periods using the latest filings.
- Then assess valuation. Use same-date share prices and diluted share counts; do not infer cheapness or investment merit from revenue, margins or management’s outlook alone.
Seagate CEO Dave Mosley characterized FY2026 in the company’s July 29, 2026 earnings release as a year of 34% annual revenue growth, record profitability and record $3.1 billion free cash flow. That is management’s characterization; investors should distinguish it from the release’s GAAP financial table and its separately reported non-GAAP figures.
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