Seagate's revenue rose 61% and its forecast for next quarter came in well above estimates. Teradyne's revenue rose 70%. Seagate was quoted about 3.8% lower early Wednesday and Teradyne about 3%.
Earnings | FinancialMarkets.com | October 28, 2026
Tickers: STX, TER, WDC, MU, SMH
Tuesday evening produced two clean beats from companies selling into AI infrastructure. Neither was rewarded.
Seagate: strong numbers, a stock already well off its high
Seagate reported fiscal first-quarter revenue of $4.23 billion, up 61% from $2.63 billion a year earlier and above the roughly $4.13 billion analysts expected. Adjusted earnings were $7.68 a share against an estimate of about $7.40. The adjusted gross margin rose to 57.8% from 40.1%, and the adjusted operating margin reached 50.7%. Free cash flow was $1.5 billion, and Seagate raised its dividend about 3% to 76 cents.
The company called it "record profitability and our highest ever free cash flow in the September quarter." For the current quarter, it guided to revenue of $4.8 billion, plus or minus $100 million, and adjusted earnings of $9.20 a share, plus or minus 20 cents, well above the $8.61 analysts had expected.
The stock had closed up 3.7% at $667.85 on Tuesday before the release. It traded as low as $613.50 after hours and was quoted around $642 early Wednesday, about 3.8% lower.
The common explanation is profit-taking after a strong run. But Seagate entered the report about 42% below its 52-week high of $1,145, and below its 50-day average of about $810. That makes the reaction harder to explain as a simple sell-the-news trade. Investors may be weighing how long margins this high can last.
Teradyne: record memory test, flat sequentially
Teradyne reported third-quarter revenue of $1.31 billion, up 70% from $769 million a year earlier, and adjusted earnings of $2.29 a share, above the $2.08 analysts expected. It pointed to "record revenue in Memory and Integrated Systems Test driven by all things AI."
For the fourth quarter, Teradyne guided to revenue of $1.25 billion to $1.35 billion and adjusted earnings of $1.95 to $2.25 a share, a midpoint of $2.10 against the $2.03 estimate.
The detail that may matter more is the sequence. Third-quarter revenue was slightly below the $1.33 billion of the second quarter, and the fourth-quarter guidance midpoint of $1.30 billion is about the same again. Year-over-year growth is very strong, but the business has stopped accelerating from quarter to quarter.
Teradyne closed up 4.8% at $323.68 on Tuesday and was quoted about 3% lower early Wednesday. Its call is at 8:30 a.m. Eastern.
Same night, different market
The reactions contrasted with Seoul, where SK Hynix rose nearly 11% on Wednesday after its own record quarter. Taken together, investors appear to be paying for upside surprises in memory but asking more of companies whose results already sit near the top of expectations.
What would change the picture
For Seagate, evidence on the call that pricing and the ramp of its newest drive technology support current margins. For Teradyne, signs that orders are accelerating again after a flat third quarter and a flat fourth-quarter forecast.
What to watch
Teradyne's call on Wednesday morning, the opening prices of both stocks, Western Digital and Micron for read-through, and Microsoft and Alphabet capital spending plans after the close.