Why Did Western Digital Stock Crash After Earnings?

Western Digital (NASDAQ: WDC) banal plunged 11.7% done 10:30 a.m. ET Thursday contempt beating connected some income and net past night.

In its fiscal Q4 2026 update, analysts had expected Western Digital to study lone $3.29 per stock connected income of little than $3.7 billion. In fact, WD earned $3.56 per stock connected income of $3.75 billion.

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Western Digital Q4 earnings: by the numbers

What's incorrect with that? Not a lot!

Growing request for machine representation of each types to enactment the artificial quality gyration drove Western Digital's income up 44% twelvemonth implicit year, and produced GAAP net of $8.21 per stock -- up 1,125% twelvemonth implicit year. (The "$3.56" per stock nett was lone a non-GAAP fig -- but adjacent non-GAAP net much than doubled.)

What's more, WD's Q4 numbers showed the institution accelerating successful the year's last quarter. Full-year income grew "only" 36%, and full-year GAAP net were up "only" 446%!

What's adjacent for Western Digital stock?

Nor is Western Digital slowing down. Turning to guidance, the machine representation specializer expects income to turn astatine slightest 42% and possibly arsenic accelerated arsenic 49% successful fiscal Q1 2027. (That's the 4th we are successful now.) Taken astatine the midpoint, that's adjacent much acceleration from the already accelerating gait acceptable successful Q4.

Notably, this guidance exceeded expert expectations, which has WD pegged for betwixt $4 cardinal and $4.2 cardinal successful Q1 sales, and (presumably non-GAAP again) net betwixt $3.85 and $4.15.

In short, there's a batch to similar astir Western Digital's study past night, and precise small for investors to beryllium upset about. Investors are incorrect to merchantability it contiguous -- and I expect today's losses to reverse successful abbreviated order.

Should you bargain banal successful Western Digital close now?

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