Western Digital (NASDAQ:WDC) Announces Quarterly Earnings Results, Beats Estimates By $0.25 EPS

Western Digital (NASDAQ:WDC) announced its quarterly earnings data on Wednesday. The data storage provider reported $3.56 earnings per share for the quarter, beating the consensus estimate of $3.31 by $0.25, FiscalAI reports. Western Digital had a return on equity of 42.95% and a net margin of 55.29%.The business had revenue of $3.75 billion during the quarter, compared to analyst estimates of $3.70 billion. During the same period in the prior year, the company earned $1.66 earnings per share. Western Digital’s revenue was up 43.8% compared to the same quarter last year. Western Digital updated its Q1 2027 guidance to 3.850-4.150 EPS.

Here are the key takeaways from Western Digital’s conference call:

• Strong fiscal 2026 performance: Revenue rose 36% to $12.9 billion, while gross margin expanded to 49.1%, EPS more than doubled to $10.22, and free cash flow reached $3.5 billion.
• Demand and outlook remain robust: Fourth-quarter revenue increased 44% year over year to $3.75 billion, and management forecast fiscal Q1 2027 revenue of $4.1 billion plus or minus $100 million, with EPS of approximately $4.
• AI is driving durable storage demand: WD expects inference, agentic AI, physical AI, autonomous vehicles, and continued cloud growth to compound data-storage requirements, with more than 80% of hyperscale data-center data currently stored on HDDs.
• Technology roadmap supports capacity and margin growth: The company began ramping 40-terabyte ePMR drives, expects 44-terabyte HAMR shipments in the first half of calendar 2027, and targets more than 25% annual exabyte growth alongside roughly 10% long-term annual cost-per-terabyte declines.
• Capital returns remain a priority: WD ended the quarter with $500 million of net cash, repurchased $1 billion of stock during the quarter, and declared a $0.15-per-share dividend.

Western Digital Stock Performance

NASDAQ WDC traded down $29.39 during trading hours on Wednesday, hitting $519.17. The company had a trading volume of 9,391,189 shares, compared to its average volume of 8,921,373. The firm has a market capitalization of $178.95 billion, a price-to-earnings ratio of 31.00 and a beta of 2.14. Western Digital has a 52 week low of $73.14 and a 52 week high of $799.87. The firm has a 50 day simple moving average of $569.37 and a 200 day simple moving average of $413.52.

Trending Headlines about Western Digital

Here are the key news stories impacting Western Digital this week:

• Positive Sentiment: Western Digital reported fiscal fourth-quarter EPS of $3.56, exceeding the analyst consensus of $3.31, while revenue of $3.75 billion topped the $3.70 billion estimate. Profit increased more than elevenfold year over year, supported by continued demand for memory and data-storage technology. Western Digital Profit Surges as Revenue Grows
• Positive Sentiment: Management issued first-quarter fiscal 2027 EPS guidance of $3.85–$4.15, above the $3.63 consensus estimate, and revenue guidance of $4.0–$4.2 billion, ahead of the $3.9 billion forecast. The outlook signals continued strength in storage demand and the AI infrastructure buildout.
• Positive Sentiment: The quarter’s 55.29% net margin and 42.95% return on equity reinforce the company’s improved profitability and operating momentum.
• Neutral Sentiment: Analysts had already expected a strong quarter, with forecasts reflecting higher EPS and revenue than the prior year. As a result, the earnings beat and above-consensus guidance may have been insufficient to exceed elevated investor expectations. Western Digital Earnings Are Imminent
• Negative Sentiment: The stock fell after the report, suggesting investors were selling the news or wanted an even stronger outlook. Western Digital had reportedly gained more than 222% year to date, leaving the shares vulnerable to profit-taking and a high valuation near a 31 price-to-earnings ratio. WDC Earnings: Western Digital Stock Falls Despite Strong Financial Results

Analyst Upgrades and Downgrades

Several brokerages recently weighed in on WDC. Zacks Research raised Western Digital from a “hold” rating to a “strong-buy” rating in a report on Wednesday, May 6th. Cantor Fitzgerald upped their price objective on shares of Western Digital from $660.00 to $900.00 and gave the company an “overweight” rating in a report on Monday, June 29th. Bank of America increased their target price on shares of Western Digital from $610.00 to $732.00 and gave the stock a “buy” rating in a research report on Wednesday, July 1st. Evercore reissued an “outperform” rating and issued a $575.00 price target on shares of Western Digital in a research report on Tuesday, May 26th. Finally, Weiss Ratings upgraded shares of Western Digital from a “buy (b-)” rating to a “buy (b)” rating in a research note on Monday, July 13th. Two analysts have rated the stock with a Strong Buy rating, eighteen have given a Buy rating and four have assigned a Hold rating to the stock. Based on data from MarketBeat, Western Digital currently has a consensus rating of “Moderate Buy” and a consensus target price of $520.32.

Insider Activity

In other Western Digital news, insider Cynthia L. Tregillis sold 808 shares of the firm’s stock in a transaction on Tuesday, July 21st. The shares were sold at an average price of $529.63, for a total value of $427,941.04. Following the completion of the transaction, the insider directly owned 114,539 shares of the company’s stock, valued at $60,663,290.57. This trade represents a 0.70% decrease in their position. The sale was disclosed in a document filed with the Securities & Exchange Commission, which is available at this link. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, Director Bruce E. Kiddoo sold 750 shares of Western Digital stock in a transaction on Thursday, May 28th. The shares were sold at an average price of $528.52, for a total value of $396,390.00. Following the sale, the director directly owned 3,903 shares of the company’s stock, valued at $2,062,813.56. This represents a 16.12% decrease in their position. The disclosure for this sale is available in the SEC filing. Insiders have sold a total of 5,093 shares of company stock worth $2,751,337 over the last ninety days. Company insiders own 0.18% of the company’s stock.

Institutional Inflows and Outflows

Several hedge funds and other institutional investors have recently modified their holdings of WDC. Compound Planning Inc. lifted its position in Western Digital by 16.6% during the fourth quarter. Compound Planning Inc. now owns 6,058 shares of the data storage provider’s stock valued at $1,044,000 after purchasing an additional 863 shares during the last quarter. Corient Private Wealth LLC raised its position in shares of Western Digital by 210.7% during the 4th quarter. Corient Private Wealth LLC now owns 181,049 shares of the data storage provider’s stock valued at $31,189,000 after buying an additional 122,779 shares in the last quarter. Mercer Global Advisors Inc. ADV lifted its holdings in shares of Western Digital by 17.8% during the 4th quarter. Mercer Global Advisors Inc. ADV now owns 142,676 shares of the data storage provider’s stock worth $24,579,000 after acquiring an additional 21,540 shares during the last quarter. Virtue Capital Management LLC purchased a new position in Western Digital in the fourth quarter worth $392,000. Finally, Vident Advisory LLC increased its stake in Western Digital by 33.5% in the fourth quarter. Vident Advisory LLC now owns 11,392 shares of the data storage provider’s stock valued at $1,963,000 after acquiring an additional 2,861 shares during the last quarter. Hedge funds and other institutional investors own 92.51% of the company’s stock.

About Western Digital

Western Digital Corporation is a global data storage company that designs, manufactures and sells a broad range of storage devices and systems for personal, enterprise and cloud applications. Headquartered in San Jose, California, the company develops hard disk drives (HDDs), solid-state drives (SSDs), NAND flash components and finished storage products used in PCs, external storage, servers, network-attached storage (NAS) and embedded systems.

Its product portfolio spans consumer and commercial markets, including internal and external HDDs and SSDs, removable flash memory products and storage platforms for data center and enterprise environments.