This Artificial Intelligence (AI) Stock Quietly Outperformed Nvidia in 2025. It Can Continue Soaring in 2026.

• The request for information retention is expanding astatine an unthinkable gait acknowledgment to AI adoption successful the cloud.

• The terms of information retention products has been expanding owed to a shortage of supply.

• Seagate Technology is experiencing steadfast maturation acknowledgment to favorable end-market dynamics.

• 10 stocks we similar amended than Seagate Technology Plc ›

Nvidia has been 1 of the apical artificial quality (AI) stocks connected the marketplace implicit the past 3 years, with shares rising by an unthinkable 1,220%. However, 2025 wasn't arsenic lucrative arsenic the erstwhile 2 years for its investors.

Though Nvidia roseate astir 39% successful 2025, it was outpaced by galore different companies benefiting successful antithetic ways from the AI roar -- among them, Seagate Technology (NASDAQ: STX). Shares of the shaper of integer retention devices specified arsenic hard-disk drives (HDDs) and solid-state drives (SSDs) are up by a singular 225% successful the past year.

Let's see what fueled that unthinkable emergence and measure whether Seagate banal has country to alert higher successful 2026.

Seagate gets 80% of its gross from selling information halfway retention products that are deployed by unreality computing companies and enterprises, and absorption anticipates robust information halfway request for the adjacent mates of years.

On the October net call, absorption said that AI-driven request for HDD retention is truthful beardown that its accumulation capableness for 2026 is adjacent to sold out. What's more, CEO William Mosley said that the "longer word agreements that we person with our planetary information halfway customers supply wide visibility done calendar 2027, reinforcing our presumption that these favorable request conditions volition persist."

Market probe steadfast IDC estimates that planetary information procreation could summation by much than fivefold betwixt 2020 and 2028, driven by the increasing usage of AI applications. As a result, the request for information halfway retention could much than treble betwixt 2024 and 2028, sending Seagate's addressable marketplace successful this conception from $13 cardinal successful 2024 to astir $23 cardinal by the extremity of the forecast period.

At the aforesaid time, Seagate is benefiting from a favorable pricing environment. Its accumulation capableness for this twelvemonth is mostly committed, and this is an industrywide phenomenon. The representation shortage that's emerging owed to robust AI-driven request is boosting prices of retention chips. The declaration terms of HDDs jumped an estimated 4% successful the 4th quarter, arsenic reported by Tom's Hardware.

This inclination could proceed successful the caller year, paving the mode for much terms hikes. So, it won't beryllium astonishing to spot the outstanding improvements successful Seagate's gross and net proceed this year.