Western Digital Corp. shares surged 7.7% after the data storage company reported fiscal third quarter earnings that beat analyst expectations and announced a new quarterly dividend program.

The company posted adjusted earnings per share of $1.36, significantly above the consensus estimate of $0.79. However, revenue came in at $2.29 billion, falling short of analysts’ projections of $3.86 billion and declining 5% sequentially.

Western Digital (NASDAQ:WDC)’s cloud segment, which accounted for 87% of total revenue at $2.0 billion, saw a 4% sequential decline but grew 38% YoY. The company attributed the YoY growth to the strength of its product portfolio.

"Western Digital executed well in its fiscal third quarter achieving revenue at the high end of our guidance range and gross margin over 40%," said CEO Irving Tan. "Even in a world marked by geopolitical uncertainty and shifting tariff dynamics, one thing remains constant: the exponential growth of data."

The company’s board of directors authorized a new quarterly cash dividend program, declaring an initial dividend of $0.10 per share payable on June 18, 2025.

Looking ahead, Western Digital expects fiscal fourth quarter EPS of $1.45, plus or minus $0.20, versus the consensus of $1.14. Q4 2025 Revenue is expected to be $2.45 billion, plus or minus $150 million, versus the consensus of $2.348 billion.