Western Digital reported fiscal second-quarter revenue of $3.017 billion, up 25% year-over-year and 7% sequentially. GAAP gross margin expanded by 800 basis points to 45.7%, while non-GAAP gross margin rose 770 basis points to 46.1%. Operating income climbed 62% year-over-year to $908 million on a GAAP basis and 72% to $1.019 billion on a non-GAAP basis. Diluted GAAP earnings per share were $4.73, compared with $1.27 a year ago, and non-GAAP EPS reached $2.13, up 78% year-over-year. Net income attributable to common shareholders rose to $1.802 billion, a 296% increase over the prior year’s $455 million.

Management attributed the outperformance to robust data center spending and accelerated adoption of high-capacity hard disk drives for artificial intelligence workloads. Shipments of high-capacity drives grew by more than 30% year-over-year, and customers across hyperscale cloud providers increased order volumes to secure supply for 2026 deployments. Free cash flow generation remained strong at over $1.1 billion, driven by disciplined working capital management and higher margins.

For the fiscal third quarter, Western Digital guided to non-GAAP revenue of $3.2 billion, plus or minus $100 million, with a non-GAAP gross margin range of 47% to 48% and non-GAAP EPS of $2.30, ±$0.15. The company forecast operating expenses of $380 million to $390 million and a tax rate of approximately 16%. The board declared a quarterly cash dividend of $0.125 per share, payable March 18, 2026, and reiterated its commitment to returning more than 100% of free cash flow through dividends and share repurchases.