Seagate CFO Gianluca Romano Details HAMR Margin Gains

Seagate is scaling its Heat-Assisted Magnetic Recording technology, with executive leadership pointing to high-capacity enterprise adoption and vertical integration as primary drivers behind expanding margins and rising storage demand.

"Everything is based on data. When you have valuable data, the cost of storage is minimal comparing to recompute that data," said Gianluca Romano, Chief Financial Officer, Seagate, in a Yahoo Finance report.

Production Milestones and Roadmap

During presentations at the Goldman Sachs Communacopia + Technology Conference, according to a conference transcript, Seagate detailed its ongoing rollout schedule for high-density storage hardware. The manufacturer currently ships 30-terabyte HAMR drives to all major hyperscale cloud providers worldwide, while 40-terabyte versions are reaching the two largest hyperscalers.

Looking further ahead, the company outlined plans for a 50-terabyte capacity rollout scheduled for calendar 2027. Volume crossover for HAMR is projected by December of the current year, with the technology expected to account for 80% to 90% of Seagate's total data center volume within approximately two years.

Margin Expansion and Pricing

Financial metrics presented by management show profitability improvements associated with the new drive architecture. Incremental gross margins have exceeded 70%, surpassing the company's prior 50% target.

Additionally, year-over-year price per exabyte grew 11% in Seagate's latest reported quarter, reflecting favorable market pricing dynamics for high-density enterprise storage solutions.

Vertical Integration of Laser Production

To support cost reduction and mitigate supply chain risks, Seagate is bringing laser production for its HAMR recording heads in-house. While first-generation units relied entirely on external component sourcing, second-generation manufacturing incorporates a rising share of internal production.

This supply chain control aims to protect manufacturing margins as adoption scales across the enterprise sector. The shift toward higher-capacity hard disk drives coincides with escalating artificial intelligence data storage requirements, as enterprises preserve training sets rather than incurring the computing costs of regenerating lost information.