Western Digital stock slips after strong Q1 and higher outlook

Published on 10/30/2026 at 12:05 | Editorial responsibility: Rafael Müller, Editor-in-Chief AD HOC NEWS

Western Digital stock trades lower despite strong fiscal results and a higher second-quarter outlook. Management points to robust demand and better pricing.

Growth and outlook remain strong

Fiscal first-quarter revenue increased 55 percent year over year to 4.381 billion US dollars.
Non-GAAP gross margin reached 58.1 percent, while adjusted diluted EPS rose 161 percent.
Management expects second-quarter revenue of 5.1 billion US dollars at the midpoint.
The quarterly dividend was raised 17 percent to 0.175 US dollars per share.

Western Digital, US9581021055, Illustration mit AI erstellt.

Western Digital reported strong fiscal first-quarter results on October 22, 2026, and issued an upbeat outlook for the following quarter. The company said revenue, profitability and cash generation benefited from robust customer demand, higher exabyte growth and improved pricing. The Western Digital investor release covers the period ended October 2, 2026.

Quarterly growth accelerates

Revenue reached 4.381 billion US dollars, up 55 percent from 2.818 billion US dollars a year earlier and 17 percent from the prior quarter. GAAP operating income rose 158 percent year over year to 2.046 billion US dollars, while GAAP diluted earnings per share increased 51 percent to 4.63 US dollars.

Adjusted figures showed an even sharper improvement in operating leverage. Non-GAAP gross margin expanded to 58.1 percent from 43.9 percent a year earlier, and adjusted operating margin rose to 49.1 percent from 30.4 percent. Non-GAAP diluted earnings per share climbed 161 percent to 4.64 US dollars, compared with 1.78 US dollars in the year-earlier quarter.

Cash generation also strengthened. Operating cash flow was 1.604 billion US dollars, while free cash flow reached 1.377 billion US dollars. Western Digital repurchased 1.001 billion US dollars of common stock during the quarter and paid 56 million US dollars in dividends.

Higher targets for the next quarter

For fiscal second-quarter 2027, management expects revenue of 5.1 billion US dollars at the midpoint of a range of 5.0 billion to 5.2 billion US dollars. The company guided to a non-GAAP gross margin of 60 percent to 61 percent and adjusted diluted earnings per share of 5.80 US dollars, plus or minus 0.20 US dollars.

Chief Executive Irving Tan said the company was executing through technology transitions and responding to growing storage demand. Chief Financial Officer Kris Sennesael cited robust exabyte growth and improved pricing as drivers of the first-quarter performance. The board also raised the quarterly cash dividend by 17 percent to 0.175 US dollars per share, payable December 17, 2026, to shareholders of record on December 4.

Stock trades below prior close

Western Digital stock traded at 325.35 euros on Lang & Schwarz at 12:01 CET on Friday, October 30, 2026, 5.34 percent below the Xetra close of Thursday, October 29, at 343.70 euros. Investors are weighing the stronger operating outlook against the stock's recent trading level and the company's exposure to demand, pricing and customer concentration in its cloud business.

The real-time quote of Western Digital stock provides the latest trading indication.