STX Seagate Technology Holdings PLC

Seagate Technology Inc. (STX) swung to a fiscal second-quarter profit, as improving demand for digital storage led to double-digit-percentage sales growth.

The computer disk-drive maker's revenue topped its recently raised forecast, and the company shipped a record 49.9 million hard-disk drives, up 35% from a year earlier.

Seagate, the world's largest hard-drive maker by sales, has reported a recovery in demand as businesses begin to increase spending on tech products. Both Seagate and rival Western Digital Corp. (WDC) have seen demand for disk drives return even as supplies of the devices remain low, pushing up profits.

Seagate's stock has soared over the past year, reaching a 19-month high of $19.04 in January after falling to all-time lows of under $3 a year ago.

Seagate's shares rose 5.4% to $18.72 in after-hours trading Wednesday after closing down 2.2% amid a broad market selloff.

Chief Executive Steve Luczo attributed the strong results to improved operating efficiency and the company's position in high-performance products, as well as improving demand across the storage market.

For the quarter ended Jan. 1, Seagate reported a profit of $533 million, or $1.03 a share, compared with a loss of $2.82 billion, or $5.80 a share, in the year-earlier period, which included write-downs of $2.32 billion.

Analysts estimated earnings of 65 cents a share, according to a poll by Thomson Reuters.

Revenue climbed 33% to $3.03 billion. In October, Seagate predicted $2.75 billion to $2.85 billion.

Gross margin rose to 30.5% from 13.9%, above the company's long-term forecast of 22% to 26%.

The disk-drive business is known for razor-thin margins and excess capacity, but tight supplies are expected to help boost prices and margins at the company.

Meanwhile, Seagate last month launched a new storage drive based on flash memory instead of a spinning disk. The new solid-state drive is faster and uses less energy.

-By Jerry A. DiColo, Dow Jones Newswires; 212-416-2155; jerry.dicolo@dowjones.com

(Kathy Shwiff contributed to this article.)

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