Western Digital Coproration WDC is set to report fiscal second-quarter 2025 results on Jan. 29.

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The Zacks Consensus Estimate for earnings is pegged at $1.75 per share, which moved down 8.4% in the past 60 days. WDC reported a loss per share of 69 cents in the prior-year quarter.

The consensus estimate for revenues is currently pegged at $4.26 billion, indicating an increase of 40.4% from the prior-year quarter’s figure.  

The company's earnings surpassed the Zacks Consensus Estimate in each of the trailing four quarters, delivering an average surprise of 63.9%.  In the past year, shares have gained 12.8% compared with the industry’s growth of 11.1%.

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Factors Shaping Upcoming Results for WDC

Recently, WDC provided preliminary results for its fiscal second quarter. Western Digital's revenues for the fiscal second quarter are now expected to be at the mid-point of its previously issued guidance of $4.20 billion to $4.40 billion, which was given in the first quarter of fiscal 2025.

WDC now expects non-GAAP diluted earnings per share (EPS) to be at the lower end of the prior guidance of $1.75 to $2.05. This adjustment indicates a more challenging pricing environment in Western Digital's Flash business.

Prevailing global macroeconomic uncertainties, intensifying competition in the storage space and increasing expenses remain concerning. For the fiscal second quarter, WDC expects non-GAAP operating expenses to be between $695 million and $715 million. 

Western Digital Corporation Price and EPS Surprise

Western Digital Corporation price-eps-surprise | Western Digital Corporation Quote

Nonetheless, Western Digital’s fiscal second-quarter performance is likely to have been cushioned by momentum in HDD, driven by improving nearline demand and higher pricing from cloud customers. The strength in demand for UltraSMR drives and enterprise SSD offerings bodes well. Momentum in demand for SanDisk premium brand is likely to have acted as another tailwind.

Growth opportunities in data storage owing to the AI data cycle have been emerging as key catalysts for players in the storage industry including Western Digital. WDC remains focused on aligning its product portfolio with these growth opportunities across various end markets to ease volatility. 

The Zacks Consensus Estimate for fiscal second-quarter HDD revenues is pegged at $2.36 billion. The Zacks Consensus Estimate for Flash revenues is pegged at $1.88 billion for the same.

What the Zacks Model Unveils About WDC

Our proven model does not conclusively predict an earnings beat for Western Digital this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the odds of an earnings beat. This is not the case here.

Western Digital presently has an Earnings ESP of -0.14% and a Zacks Rank #5 (Strong Sell). You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

Stocks to Consider

Here are a few stocks that you may want to consider as our model shows that these have the right combination of elements to post an earnings beat this season.

V.F. Corporation VFC currently has an Earnings ESP of +4.30% and a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here. 

VFC is scheduled to report quarterly earnings on Jan. 29. The Zacks Consensus Estimate for VFC’s to-be-reported quarter’s earnings and revenues is pegged at 34 cents per share and $2.75 billion, respectively. Shares of VFC have gained 50.2% in the past year.

Logitech International S.A. LOGI presently has an Earnings ESP of +2.83% and a Zacks Rank #2. LOGI is scheduled to report quarterly numbers on Jan. 28. The Zacks Consensus Estimate for LOGI’s to-be-reported quarter’s earnings and revenues is pegged at $1.38 per share and $1.24 billion, respectively. Shares of LOGI have risen 8.6% in the past year.

ServiceNow, Inc. NOW has an Earnings ESP of +0.91% and a Zacks Rank #2 at present. NOW is scheduled to report quarterly figures on Jan. 29. The Zacks Consensus Estimate for NOW’s to-be-reported quarter’s earnings and revenues is pegged at $3.58 per share and $2.95 billion, respectively. Shares of NOW have increased 42.9% in the past year.

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