Western Digital těží z AI inferencí a Agentic AI, které zvyšují trvalou poptávku po úložištích. Firma už dodává 40TB ePMR disky a 44TB HAMR má být na trhu v první polovině kalendářního roku 2027.
Key Takeaways Western Digital is benefiting as AI inference and Agentic AI drive persistent data storage demand.WDC is ramping 40TB ePMR drives, while its 44TB HAMR product remains on track for 2027.UltraSMR could reach 60% of nearline exabyte shipments by fiscal 2027, supporting WDC's capacity growth. As AI models become larger, inference workloads expand and businesses generate mountains of AI-created content, the amount of data that must be stored, accessed and retained continues to rise. Western Digital Corporation (WDC - Free Report) is becoming a durable long-term beneficiary of the data explosion. The shift from AI training to inference and Agentic AI is creating a more persistent and data-intensive storage opportunity. Training creates the initial data foundation, while inference continuously generates and retains prompts, outputs, logs and context.
As Agentic AI expands into multistep workflows, data volumes and retention needs continue to rise. Moreover, physical AI, autonomous vehicles, robotics and industrial automation are driving additional demand for synthetic data generation and storage. Together, these trends could make AI a structural, long-term driver of capacity-oriented storage demand for WDC. As AI workloads shift from deployment to sustained use, storage demand is becoming less about one-time infrastructure builds and more about the compounding of data—a key secular growth driver for WDC. Roughly 80% of hyperscale data-center data remains on HDDs, reflecting their scale, cost efficiency and power advantages for long-term storage.
This trend plays to WDC’s technology strengths. The company began shipping 40TB ePMR drives in June and is ramping volume production, while its 44TB HAMR product remains on track for the first half of calendar 2027. UltraSMR is also expected to account for about 60% of nearline exabyte shipments by the end of fiscal 2027. Beyond capacity, Western Digital is advancing high-bandwidth drives that target up to 8x the throughput of current drives without a comparable increase in power consumption, with sampling underway at five customers.
WDC vs. Rivals: Who is Winning the AI Storage Boom?Seagate Technology (STX - Free Report) is benefiting from the rapid increase in data creation, retention and reuse across cloud and enterprise environments. AI inference and agentic applications require persistent historical context, while physical AI applications such as robotics and autonomous vehicles are expected to generate significant volumes of video and sensor data. These trends reinforce the role of cost-efficient HDDs within tiered storage architectures. Data center revenues increased 57% year over year to $2.93 billion in the June quarter, while nearline exabyte shipments advanced 43% to 195 exabytes. Cloud demand has now increased sequentially for three consecutive years and enterprise OEM demand is also broadening.
NetApp, Inc. (NTAP - Free Report) is benefiting from higher enterprise spending on AI-ready storage, with all-flash, Public Cloud and Keystone demand broadening across customer types. Customers are standardizing on NetApp for mission-critical workloads, including GPU-intensive AI pipelines, and reported share gains tied to product innovation and go-to-market execution. It also saw demand across high-performance flash, capacity flash and block-optimized storage as customers modernized adjacent data infrastructure for AI. NetApp is positioning its unified data platform to activate enterprise data for AI without requiring data movement. AI is also driving broader modernization of databases and unstructured data environments, expanding the opportunity beyond dedicated AI infrastructure.
WDC Price Performance, Valuation and EstimatesIn the past year, shares of WDC have surged 394.5% compared with the Zacks Computer-Storage Devices industry’s growth of 391.4%.
Image Source: Zacks Investment Research
Going by the price/earnings ratio, the company’s shares currently trade at 20.86 forward earnings compared with 10.67 for the industry.
Image Source: Zacks Investment Research
WDC’s estimate revisions are currently on an upward trajectory. The Zacks Consensus Estimate for WDC’s earnings for fiscal 2027 has been revised upward by 7.5% to $20.03 over the past 60 days, while the same for fiscal 2028 has gone up 7.6% to $34.74.
Image Source: Zacks Investment Research
Currently, Western Digital has a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Western Digital ve fiskálním roce 2026 vygenerovala 3,51 miliardy USD volného cash flow a vrátila akcionářům 3,1 miliardy USD prostřednictvím dividend a zpětných odkupů. Na první čtvrtletí fiskálního roku 2027 čeká výnosy 4,1 miliardy USD a non-GAAP EPS 4,00 USD.
Key Takeaways Western Digital ended fiscal 2026 with $3.51 billion in free cash flow and about $500 million in net cash.WDC returned $3.1 billion to shareholders in fiscal 2026 through dividends and share repurchases.WDC expects fiscal Q1 revenue of $4.1 billion, plus or minus $100 million, and non-GAAP EPS of $4.00. Western Digital Corporation (WDC - Free Report) entered fiscal 2027 with stronger cash generation and a net cash position after a year of significant shareholder returns. In fiscal 2026, operating cash flow reached $3.93 billion, up 132% year over year, while free cash flow (FCF) rose 145% to $3.51 billion. With fiscal 2026 revenues of $12.9 billion, FCF margin was about 27%. Capital expenditures totaled $418 million for the year.
The company returned $3.1 billion to shareholders during fiscal 2026 through dividends and share repurchases. In the fiscal fourth quarter, Western Digital generated $1.4 billion in operating cash flow and $1.3 billion in free cash flow, equal to a 34% FCF margin. It reported repurchases of 2.3 million shares for $1 billion and paid $54 million in dividends. Management noted that the repurchase figures included $328 million used to settle the conversion premium on certain convertible notes in cash instead of stock, avoiding roughly 773,000 new shares. Western Digital also monetized its remaining 1.7 million SanDisk Corporation (SNDK - Free Report) shares by exchanging them for 4.8 million Western Digital shares.
At fiscal year-end, Western Digital held $1.6 billion in cash and $1.1 billion in debt, resulting in a net positive cash position of about $500 million. On the last earnings call, management highlighted that there was no change to the company’s strategy and reaffirmed its commitment to returning FCF to shareholders through dividends and share repurchases. The board also declared a 15- cents-per-share dividend payable Sept. 17, 2026, to shareholders of record on Sept. 8.
For the first quarter of fiscal 2027, Western Digital expects revenue of $4.1 billion, plus or minus $100 million, gross margin of 55-56%, operating expenses of $390-$400 million, interest and other expenses of about $15 million, a 17% tax rate and non-GAAP EPS of $4.00, plus or minus 15 cents, based on roughly 388 million diluted shares.
Management stated that demand and favorable pricing to continue, while investments are being made in heads, media operations and automation without adding unit-capacity capital expenditures. Western Digital is on track to ship its 44-terabyte HAMR product in the first half of calendar 2027.
Taking a Look at WDC’s CompetitorsSeagate Technology (STX - Free Report) delivered strong profitability and cash flow in fiscal 2026, supported by operating leverage, pricing and disciplined spending. Non-GAAP operating margin expanded to 44.6% from 26.2% a year earlier, while June-quarter free cash flow reached $1.12 billion, or about 31% of revenues. Fiscal 2026 FCF hit a record $3.1 billion. Financial flexibility also improved as gross debt fell $1.4 billion, leaving net leverage at 0.4 times adjusted EBITDA. Seagate later retired $1 billion of high-yield notes and plans to eliminate the remaining convertible notes, reducing interest expense and supporting shareholder returns and future technology investments and growth initiatives.
SanDisk’s strong cash generation supports continued shareholder returns and technology investments. Adjusted free cash flow reached $5.04 billion in fourth-quarter fiscal 2026, representing a 56% margin, excluding $1.94 billion of NBM prepayments and deposits. The company ended fiscal 2026 with $4.76 billion in cash and no long-term debt. Sandisk repurchased $4.5 billion of shares during the quarter and expanded its authorization by $14 billion, leaving $15.5 billion available. Management plans to invest in BiCS8 and BiCS10 while maintaining buybacks. Fiscal 2027 capital spending is expected to decline to roughly 6% of revenues.
WDC Price Performance, Valuation and EstimatesIn the past year, shares of WDC have surged 406% compared with the Zacks Computer-Storage Devices industry’s growth of 392.8%.
Image Source: Zacks Investment Research
Going by the price/earnings ratio, the company’s shares currently trade at 20.86 forward earnings compared with 10.67 for the industry.
Image Source: Zacks Investment Research
WDC’s estimate revisions are currently on an upward trajectory. The Zacks Consensus Estimate for the company’s earnings for fiscal 2027 has been revised upward by 7.5% to $20.03 over the past 60 days, while the same for fiscal 2028 has gone up 7.6% to $34.74.
Image Source: Zacks Investment Research
Currently, Western Digital has a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Seagate má už zafixované ceny i konfigurace pro celý kalendářní rok 2027 a většina nearline kapacity je vyprodaná i do roku 2028. Firma tak těží z boomu datových center pro AI.
Western Digital (WDC +2.14%) CEO Irving Tan said in late January that the company was "pretty much sold out for calendar '26." On the same fiscal second-quarter earnings call, he pointed to firm purchase orders from its top seven customers covering this year's hard-drive production. And multiyear agreements went further -- the company had them in place with three of its top five customers, two running through calendar 2027 and one through calendar 2028.
But Western Digital isn't the outlier.
The artificial intelligence (AI) data center build-out has storage buyers committing for years ahead. Seagate Technology (STX +6.49%) says most of its nearline exabytes (the high-capacity storage cloud data centers run on) are already allocated into calendar 2028. And Sandisk (SNDK -0.12%) has buyers locked in for over half of the memory it expects to ship this fiscal year, with price floors attached.
Here's what each company has signed, and where I'd put $2,000 today.
Image source: Getty Images.
1. Western Digital: sold out, but not fully signedBy late April, Tan was saying agreement durations had stretched into calendar 2028 and calendar 2029.
Western Digital's fiscal fourth-quarter revenue (for the three months ended July 3, 2026) reached $3.75 billion, up 44% from a year earlier. Non-GAAP (adjusted) gross margin jumped about 13 percentage points year over year, to 54.4%, and earnings per share more than doubled. Management guided for fiscal first-quarter revenue to grow 42% to 49% year over year, or about $4.1 billion at the midpoint.
Cloud customers supplied 89% of revenue in the fiscal third quarter -- this is overwhelmingly a data-center business now.
However, the multiyear agreements cover only some top customers (three of the top five, as of January). And Western Digital hasn't said how much of its demand beyond this year they lock in.
Shares cost about 14 times fiscal 2028's expected earnings (that fiscal year ends in mid-2028). That isn't a rich price if the contracted growth arrives. But the risk, I think, sits in the years the contracts don't cover, when pricing could reset lower.
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2. Seagate: pricing is locked for all of 2027Seagate goes further. On its July earnings call, management said its build-to-order contracts already spell out product configurations and pricing for all of calendar 2027. Based on supply agreements in hand, most of the company's nearline exabyte supply is allocated into calendar 2028.
Growth is accelerating as those commitments stack up. Revenue for fiscal 2026 totaled $12.2 billion, up 34%, and the fiscal fourth quarter alone produced $3.63 billion, a 48% year-over-year jump. Adjusted gross margin hit 52.7%, up from 37.9%, and non-GAAP earnings per share of $5.71 was up 120%. Guidance calls for about $4.1 billion of fiscal first-quarter revenue, which implies about 56% year-over-year growth.
That acceleration is the part I keep coming back to. After all, with volumes and prices signed well in advance, a 56% outlook is largely a description of business already in hand.
At about 15 times its expected fiscal 2028 earnings, Seagate costs about what Western Digital does relative to profits. Arguably, more of Seagate's profits are already under contract.
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3. Sandisk: floors under half its shipmentsSandisk's commitments run deepest of the three. The flash memory maker has signed 10 long-term supply agreements covering eight customers.
Management expects over half of its fiscal 2027 volumes (the year now underway) to fall under the agreements, and about two-thirds of fiscal 2028's. And the contracts carry price floors. Even with every variable price at its floor, the agreements add up to at least $93.9 billion of revenue.
The floors haven't been tested by a falling market yet, though. And the boom they lock in is extraordinary: Sandisk's fiscal 2026 revenue climbed 175%, reaching $20.25 billion, on higher memory prices and a shift toward data-center customers.
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Which one would I buy?A $2,000 budget buys about four shares of Western Digital at around $467 as of this writing, two of Seagate, or one of Sandisk.
My pick is Seagate. Its contracts already fix pricing for all of calendar 2027, and most of its nearline capacity is spoken for into the year after that. Growth is accelerating, too.
Western Digital is riding the same boom at a similar price relative to expected earnings. But it hasn't shown how much of its supply beyond this year is locked in the way Seagate has, so I view that stock as a hold today. Sandisk may have the strongest protection of the three, but its floors haven't been through a downturn. I'd want to see that test first.
Of course, no contract makes the AI build-out permanent. If data-center spending slows, storage stocks could fall hard, signed volumes or not. Ultimately, though, given $2,000 to put into storage today, I'd buy Seagate.
Avala Global LP ve 2. čtvrtletí koupila 189 100 akcií společnosti Western Digital za zhruba 120,782 milionu USD. Podíl ve firmě tak činí 4,5 % portfolia.
Avala Global LP bought a new position in shares of Western Digital Corporation (NASDAQ:WDC – Free Report) during the second quarter, according to the company in its most recent 13F filing with the Securities and Exchange Commission. The firm bought 189,100 shares of the data storage provider’s stock, valued at approximately $120,782,000. Western Digital accounts for 4.5% of Avala Global LP’s portfolio, making the stock its 7th largest holding. Avala Global LP owned 0.05% of Western Digital at the end of the most recent quarter.
Several other large investors have also added to or reduced their stakes in WDC. Norges Bank purchased a new stake in shares of Western Digital in the fourth quarter worth $788,729,000. Northern Trust Corp raised its position in shares of Western Digital by 11.2% during the 3rd quarter. Northern Trust Corp now owns 3,805,463 shares of the data storage provider’s stock valued at $456,884,000 after purchasing an additional 384,103 shares during the period. Soroban Capital Partners LP lifted its stake in shares of Western Digital by 1,926.3% during the 2nd quarter. Soroban Capital Partners LP now owns 3,061,134 shares of the data storage provider’s stock valued at $195,882,000 after buying an additional 2,910,062 shares in the last quarter. AQR Capital Management LLC lifted its stake in shares of Western Digital by 70.4% during the 4th quarter. AQR Capital Management LLC now owns 2,972,703 shares of the data storage provider’s stock valued at $512,107,000 after buying an additional 1,228,661 shares in the last quarter. Finally, UBS AM a distinct business unit of UBS ASSET MANAGEMENT AMERICAS LLC boosted its holdings in Western Digital by 6.0% in the 4th quarter. UBS AM a distinct business unit of UBS ASSET MANAGEMENT AMERICAS LLC now owns 2,809,409 shares of the data storage provider’s stock worth $483,977,000 after buying an additional 159,167 shares during the period. Hedge funds and other institutional investors own 92.51% of the company’s stock.
Western Digital News Summary Here are the key news stories impacting Western Digital this week:
Positive Sentiment: Western Digital disclosed exchange agreements covering approximately $191 million of its 3.00% convertible notes due 2028. The transaction will provide holders with cash and shares, potentially reducing debt, although the stock component could create some dilution. The exchanges are expected to close on or after September 2. Western Digital convertible notes article Positive Sentiment: Investors continue to see support from AI, cloud and data-center demand. Western Digital recently reported quarterly revenue of $3.75 billion, up 43.8% year over year, and non-GAAP EPS of $3.56 versus the $3.31 consensus. Management’s next-quarter outlook also points to continued strong growth. Western Digital debt exchange and AI demand analysis Positive Sentiment: A hammer chart pattern suggests technical support after the stock’s recent decline, while upward earnings-estimate revisions may improve the likelihood of a near-term rebound. Western Digital bottoming pattern article Neutral Sentiment: Analyst sentiment remains broadly favorable, with a consensus “Moderate Buy” rating and a median recent price target of approximately $597.50. However, targets vary widely, reflecting uncertainty around valuation and execution. Negative Sentiment: Western Digital is assessing potential effects from new U.S. sanctions related to Iran, including possible compliance costs, supply-chain disruptions and impacts on contract manufacturing or shipments. Western Digital Iran sanctions exposure article Negative Sentiment: Insider activity has been heavily weighted toward sales, including transactions by executives and directors. The reported sales were made under pre-arranged trading plans, reducing their significance, but they remain a potential overhang for sentiment. Negative Sentiment: Broader caution toward highly valued AI and memory stocks, ahead of Nvidia’s earnings, and concerns about potential Chinese memory competition could pressure sector valuations and future pricing. Western Digital Stock Up 4.0% Shares of Western Digital stock opened at $468.88 on Thursday. Western Digital Corporation has a twelve month low of $77.90 and a twelve month high of $799.87. The business has a 50-day moving average price of $538.41 and a 200-day moving average price of $438.22. The firm has a market cap of $161.61 billion, a price-to-earnings ratio of 19.37 and a beta of 2.14. Western Digital (NASDAQ:WDC – Get Free Report) last posted its earnings results on Wednesday, August 5th. The data storage provider reported $3.56 EPS for the quarter, topping analysts’ consensus estimates of $3.31 by $0.25. Western Digital had a return on equity of 48.15% and a net margin of 72.95%.The company had revenue of $3.75 billion for the quarter, compared to the consensus estimate of $3.70 billion. During the same period in the previous year, the business earned $1.66 earnings per share. The firm’s revenue for the quarter was up 43.8% on a year-over-year basis. Western Digital has set its Q1 2027 guidance at 3.850-4.150 EPS. On average, equities analysts expect that Western Digital Corporation will post 19.65 EPS for the current fiscal year.
Western Digital Dividend Announcement The company also recently announced a quarterly dividend, which will be paid on Thursday, September 17th. Stockholders of record on Tuesday, September 8th will be given a dividend of $0.15 per share. This represents a $0.60 dividend on an annualized basis and a dividend yield of 0.1%. The ex-dividend date is Tuesday, September 8th. Western Digital’s dividend payout ratio is currently 2.48%.
Wall Street Analysts Forecast Growth A number of brokerages have issued reports on WDC. JPMorgan Chase & Co. increased their price target on Western Digital from $530.00 to $650.00 and gave the stock an “overweight” rating in a research note on Friday, June 12th. Bank of America upped their price objective on Western Digital from $610.00 to $732.00 and gave the stock a “buy” rating in a research note on Wednesday, July 1st. Zacks Research upgraded Western Digital from a “hold” rating to a “strong-buy” rating in a research report on Wednesday, May 6th. Citigroup cut their target price on Western Digital from $800.00 to $740.00 and set a “buy” rating for the company in a research report on Friday, August 7th. Finally, Melius Research set a $1,050.00 price target on Western Digital and gave the stock a “buy” rating in a report on Monday, June 29th. Two investment analysts have rated the stock with a Strong Buy rating, eighteen have given a Buy rating and five have issued a Hold rating to the stock. According to MarketBeat.com, the stock has an average rating of “Moderate Buy” and an average price target of $534.56.
Get Our Latest Stock Report on WDC
Insider Activity In related news, insider Vidyadhara K. Gubbi sold 2,475 shares of the firm’s stock in a transaction on Monday, June 1st. The shares were sold at an average price of $556.24, for a total value of $1,376,694.00. Following the completion of the transaction, the insider directly owned 85,154 shares of the company’s stock, valued at approximately $47,366,060.96. This trade represents a 2.82% decrease in their ownership of the stock. The transaction was disclosed in a document filed with the SEC, which can be accessed through this hyperlink. Also, CEO Irving Tan sold 20,000 shares of the business’s stock in a transaction on Tuesday, August 11th. The stock was sold at an average price of $444.97, for a total transaction of $8,899,400.00. Following the completion of the sale, the chief executive officer owned 575,966 shares in the company, valued at $256,287,591.02. This represents a 3.36% decrease in their position. The disclosure for this sale is available in the SEC filing. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. In the last ninety days, insiders sold 24,634 shares of company stock worth $11,357,073. 0.18% of the stock is currently owned by insiders.
Western Digital Profile (Free Report)
Western Digital Corporation is a global data storage company that designs, manufactures and sells a broad range of storage devices and systems for personal, enterprise and cloud applications. Headquartered in San Jose, California, the company develops hard disk drives (HDDs), solid-state drives (SSDs), NAND flash components and finished storage products used in PCs, external storage, servers, network-attached storage (NAS) and embedded systems.
Its product portfolio spans consumer and commercial markets, including internal and external HDDs and SSDs, removable flash memory products and storage platforms for data center and enterprise environments.
Read More Five stocks we like better than Western Digital Williams-Sonoma’s Quarter Gave Bulls More Than Just a Beat-and-Raise Alcoa’s Gallium Project Opens a New Door Beyond Aluminum Oura’s $16 Billion IPO Could Put a New Price on Wearable Tech Can Tesla’s Flying Roadster Distract From Its Real Risks? Want to see what other hedge funds are holding WDC? Visit HoldingsChannel.com to get the latest 13F filings and insider trades for Western Digital Corporation (NASDAQ:WDC – Free Report).
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Algert Global LLC purchased a new position in Western Digital Corporation (NASDAQ:WDC – Free Report) in the second quarter, according to its most recent Form 13F filing with the Securities and Exchange Commission (SEC). The institutional investor purchased 7,875 shares of the data storage provider’s stock, valued at approximately $5,030,000.
Other institutional investors and hedge funds have also bought and sold shares of the company. Norges Bank bought a new stake in shares of Western Digital during the 4th quarter valued at $788,729,000. Northern Trust Corp lifted its position in Western Digital by 11.2% during the 3rd quarter. Northern Trust Corp now owns 3,805,463 shares of the data storage provider’s stock valued at $456,884,000 after acquiring an additional 384,103 shares during the period. Soroban Capital Partners LP lifted its position in Western Digital by 1,926.3% during the 2nd quarter. Soroban Capital Partners LP now owns 3,061,134 shares of the data storage provider’s stock valued at $195,882,000 after acquiring an additional 2,910,062 shares during the period. AQR Capital Management LLC boosted its stake in Western Digital by 70.4% during the fourth quarter. AQR Capital Management LLC now owns 2,972,703 shares of the data storage provider’s stock worth $512,107,000 after acquiring an additional 1,228,661 shares in the last quarter. Finally, UBS AM a distinct business unit of UBS ASSET MANAGEMENT AMERICAS LLC grew its holdings in Western Digital by 6.0% in the fourth quarter. UBS AM a distinct business unit of UBS ASSET MANAGEMENT AMERICAS LLC now owns 2,809,409 shares of the data storage provider’s stock worth $483,977,000 after purchasing an additional 159,167 shares during the period. 92.51% of the stock is currently owned by hedge funds and other institutional investors.
Analysts Set New Price Targets A number of equities analysts have weighed in on the stock. Zacks Research raised shares of Western Digital from a “hold” rating to a “strong-buy” rating in a research note on Wednesday, May 6th. Citigroup cut their price target on Western Digital from $800.00 to $740.00 and set a “buy” rating on the stock in a research note on Friday, August 7th. Melius Research set a $1,050.00 price objective on Western Digital and gave the company a “buy” rating in a research report on Monday, June 29th. JPMorgan Chase & Co. lifted their price objective on Western Digital from $530.00 to $650.00 and gave the company an “overweight” rating in a research note on Friday, June 12th. Finally, Cantor Fitzgerald increased their target price on Western Digital from $660.00 to $900.00 and gave the stock an “overweight” rating in a research note on Monday, June 29th. Two investment analysts have rated the stock with a Strong Buy rating, eighteen have given a Buy rating and five have given a Hold rating to the stock. According to data from MarketBeat.com, the company currently has a consensus rating of “Moderate Buy” and an average target price of $534.56.
Check Out Our Latest Stock Analysis on Western Digital Western Digital Stock Down 1.5% Shares of NASDAQ WDC opened at $462.00 on Friday. The firm has a market cap of $159.24 billion, a P/E ratio of 19.08 and a beta of 2.14. Western Digital Corporation has a twelve month low of $77.90 and a twelve month high of $799.87. The company has a 50 day moving average of $532.72 and a 200 day moving average of $439.49.
Western Digital (NASDAQ:WDC – Get Free Report) last posted its earnings results on Wednesday, August 5th. The data storage provider reported $3.56 EPS for the quarter, topping analysts’ consensus estimates of $3.31 by $0.25. Western Digital had a return on equity of 48.15% and a net margin of 72.95%.The business had revenue of $3.75 billion during the quarter, compared to analyst estimates of $3.70 billion. During the same quarter last year, the company earned $1.66 EPS. The company’s quarterly revenue was up 43.8% compared to the same quarter last year. Western Digital has set its Q1 2027 guidance at 3.850-4.150 EPS. As a group, equities analysts expect that Western Digital Corporation will post 19.65 earnings per share for the current fiscal year.
Western Digital Announces Dividend The business also recently announced a quarterly dividend, which will be paid on Thursday, September 17th. Investors of record on Tuesday, September 8th will be issued a $0.15 dividend. The ex-dividend date is Tuesday, September 8th. This represents a $0.60 annualized dividend and a yield of 0.1%. Western Digital’s dividend payout ratio (DPR) is currently 2.48%.
Key Western Digital News Here are the key news stories impacting Western Digital this week:
Positive Sentiment: Western Digital’s AI- and cloud-storage growth thesis remains intact. Industry momentum from AI infrastructure, cloud computing, the Internet of Things and automotive applications is supporting expectations for continued demand. 3 Storage Devices Stocks to Buy as the Industry Gains Momentum Positive Sentiment: A recent exchange of approximately $191 million of 3% convertible notes due 2028 is viewed as constructive liability management because it can reduce debt, although issuing shares may create some dilution. What’s Going on With Western Digital Stock on Wednesday? Positive Sentiment: Western Digital recently reported revenue growth of 44% year over year to $3.75 billion and earnings of $3.56 per share, exceeding estimates. Its next-quarter earnings guidance of $3.85 to $4.15 per share also supports the bullish fundamental case. Positive Sentiment: Technical and analyst indicators remain favorable: a recent hammer chart pattern suggested potential support, while upward earnings-estimate revisions and a bullish Wall Street consensus point to possible longer-term recovery. Western Digital May Find a Bottom Soon Insiders Place Their Bets In other news, insider Cynthia L. Tregillis sold 1,007 shares of the firm’s stock in a transaction on Thursday, August 27th. The stock was sold at an average price of $478.36, for a total value of $481,708.52. Following the transaction, the insider directly owned 112,155 shares in the company, valued at $53,650,465.80. This trade represents a 0.89% decrease in their position. The transaction was disclosed in a filing with the SEC, which is available at this link. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, CEO Irving Tan sold 20,000 shares of Western Digital stock in a transaction on Tuesday, August 11th. The stock was sold at an average price of $444.97, for a total value of $8,899,400.00. Following the completion of the sale, the chief executive officer directly owned 575,966 shares of the company’s stock, valued at $256,287,591.02. The trade was a 3.36% decrease in their position. The disclosure for this sale is available in the SEC filing. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. In the last quarter, insiders sold 26,117 shares of company stock valued at $12,053,353. Company insiders own 0.18% of the company’s stock.
Western Digital Company Profile (Free Report)
Western Digital Corporation is a global data storage company that designs, manufactures and sells a broad range of storage devices and systems for personal, enterprise and cloud applications. Headquartered in San Jose, California, the company develops hard disk drives (HDDs), solid-state drives (SSDs), NAND flash components and finished storage products used in PCs, external storage, servers, network-attached storage (NAS) and embedded systems.
Its product portfolio spans consumer and commercial markets, including internal and external HDDs and SSDs, removable flash memory products and storage platforms for data center and enterprise environments.
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Western Digital ve 4. čtvrtletí zvýšila výnosy o 44 % na 3,75 miliardy USD a překonala odhady zisku i marže. Na 1. čtvrtletí fiskálního roku 2027 čeká výnosy kolem 4,1 miliardy USD, plus minus 100 milionů USD.
Key Takeaways Western Digital posted 44% Q4 revenue growth, an earnings beat and a 54.4% non-GAAP gross margin.WDC sees Q1 fiscal 2027 revenue near $4.1B, with a non-GAAP gross margin of 55%-56% and EPS near $4.Western Digital's 40TB ePMR is in volume production, with 44TB and 50TB HAMR ramps planned for 2027. Western Digital Corporation (WDC - Free Report) ended fiscal 2026 with a fourth-quarter earnings beat, 44% revenue growth and sharply higher margins. The results give the company a strong starting point for fiscal 2027. The next test is execution. Higher-capacity drives must ramp on schedule if WDC is to translate rising cloud and artificial intelligence storage demand into sustained revenue, margin and earnings growth.
WDC's Q4 Beat Shows Demand and Pricing StrengthFourth-quarter revenues reached $3.75 billion, up 44% year over year and above the Zacks Consensus Estimate of $3.70 billion. Non-GAAP earnings of $3.56 per share topped the consensus mark of $3.35 and increased 109%.
Non-GAAP gross margin expanded 1,310 basis points year over year to 54.4%. A richer mix of higher-capacity drives, favorable pricing and manufacturing discipline helped lift profitability, while blended price per terabyte increased by the high teens.
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Western Digital Guides to Another Growth StepFor the first quarter of fiscal 2027, management expects revenues of $4.1 billion, plus or minus $100 million. At the midpoint, that represents about 45% year-over-year growth.
Western Digital also projects non-GAAP gross margin of 55%-56% and earnings of $4 per share, plus or minus 15 cents. The outlook implies another step up from fourth-quarter profitability if demand and pricing remain favorable.
WDC's 40TB ePMR Ramp Moves Into VolumeWestern Digital began shipping next-generation energy-assisted perpendicular magnetic recording drives with capacities up to 40 terabytes in the fiscal fourth quarter. The company has entered volume production with two customers.
Management expects the platform to account for about half of nearline bits by the third quarter of fiscal 2027. Higher capacity per drive should allow WDC to deliver more exabytes without a corresponding increase in unit volumes.
Western Digital's HAMR Timeline Becomes the Next TestThe roadmap calls for 44-terabyte heat-assisted magnetic recording products in the first half of calendar 2027 and 50-terabyte products in the second half. Customer qualification and manufacturing execution therefore remain central to the fiscal 2027 setup.
UltraSMR adoption is advancing as well. Western Digital expects the technology to represent about 60% of nearline exabyte shipments as fiscal 2027 ends, making the sequencing of multiple product transitions important to capacity and cost gains.
WDC's AI Storage Demand Broadens the OpportunityManagement sees inference, agentic artificial intelligence and physical artificial intelligence as persistent storage drivers because these workloads continuously create and retain data. High-bandwidth drives are also sampling with five customers, potentially extending HDD economics into higher-throughput workloads.
The theme is broader than WDC. Seagate Technology Holdings plc (STX - Free Report) reported fiscal fourth-quarter 2026 revenues of $3.6 billion as a mass-capacity storage provider, while Sandisk Corporation (SNDK - Free Report) said fiscal 2026 Datacenter revenues increased 437%, illustrating demand across different storage technologies.
Growth Scores Reinforce WDC's Execution SetupWDC's fiscal 2027 opportunity is substantial, but the product roadmap raises the execution bar. The company must sustain pricing, qualify new platforms and convert higher-capacity drives into the exabyte growth and margin expansion embedded in its outlook.
The stock currently carries a Zacks Rank #2 (Buy), along with a Growth Score of A and Momentum Score of A. Those scores favor growth and momentum characteristics, while the Value Score of F and VGM Score of C point to a less attractive value profile and a mixed combined reading. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Western Digital ve fiskálním roce 2026 zvýšil tržby o 36 % a non-GAAP EPS o 104 %. Pro 1. čtvrtletí fiskálního roku 2027 čeká tržby 4,1 mld. USD v polovině rozpětí, EPS 4 USD a non-GAAP hrubou marži 55 %–56 %.
Key Takeaways Western Digital's fiscal 2026 revenues rose 36%, while non-GAAP EPS increased 104% year over year.WDC expects Q1 fiscal 2027 revenues of $4.1B at the midpoint, $4 EPS and a 55%-56% gross margin.Western Digital trades above industry multiples as key ePMR, UltraSMR and HAMR ramps raise execution risk. Western Digital Corporation (WDC - Free Report) enters fiscal 2027 with sharply higher earnings expectations. Fiscal 2026 revenues rose 36% and non-GAAP earnings per share increased 104%, providing a strong base for the next leg of growth.
The trade-off is valuation. WDC trades above its industry on several common multiples, leaving less room for weaker demand, pricing or product execution.
WDC's Earnings Growth Is AcceleratingNear-term guidance supports that trajectory. For the first quarter of fiscal 2027, management expects $4.1 billion of revenues at the midpoint, earnings of $4 per share and a 55%-56% non-GAAP gross margin.
Western Digital's AI Exposure Supports DemandCloud generated $3.3 billion, or 89% of fourth-quarter fiscal 2026 revenues, and grew 43% year over year. Management sees AI inference, agentic AI and physical AI increasing retained data volumes and expects exabyte demand growth of more than 25%.
Seagate Technology Holdings plc (STX - Free Report) also cited cloud data-center demand and AI-driven data growth as mass-capacity storage drivers. Sandisk Corporation (SNDK - Free Report) reported fiscal 2026 Datacenter revenues up 437%, showing that data-infrastructure spending is benefiting multiple storage technologies.
WDC's Roadmap Could Extend Margin GainsWestern Digital expects its 40-terabyte ePMR platform to represent about half of nearline bits by the third quarter of fiscal 2027. UltraSMR is expected to reach about 60% of nearline exabyte shipments as fiscal 2027 ends.
Cost per terabyte declined about 8% year over year in the fiscal fourth quarter. Management continues to target roughly 10% annual reductions over the medium to long term as higher-capacity products scale, supporting further margin expansion.
Western Digital's Valuation Raises the BarWDC trades at 22.9X forward earnings versus 10.3X for its industry. Its price-to-sales multiple is 12.3X versus 5.4X for the industry, while its 17.9X price-to-book multiple exceeds the industry's 15.0X.
That premium can be supported by rapid growth, but it leaves less valuation protection if demand, pricing or technology transitions fall short of expectations.
WDC's Risks Complicate the Buy DecisionCustomer concentration remains a source of volatility because Cloud accounts for 89% of revenues and large customers do not purchase on a linear schedule. Different product mixes can also create quarter-to-quarter swings in exabyte growth.
Execution risk runs through the roadmap. The 40-terabyte ePMR ramp, wider UltraSMR adoption and 44-terabyte HAMR introduction must progress on schedule for Western Digital to capture the expected capacity and cost benefits.
Strong Growth Signals Offset WDC's Weak Value ScoreWDC still presents a favorable growth case, but the premium valuation makes the setup less forgiving. Investors must weigh rapid earnings expansion and rising storage demand against the execution required to support those expectations.
The stock currently carries a Zacks Rank #2 (Buy). Its Growth Score of A and Momentum Score of A indicate favorable growth and momentum characteristics, supporting the near-term profile.
The Value Score of F signals a weaker value profile, while the VGM Score of C reflects a mixed combined reading across value, growth and momentum. The balance remains constructive, but valuation discipline is warranted. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
B. Metzler seel. Sohn & Co. AG ve druhém čtvrtletí koupila 69 916 akcií společnosti Western Digital za zhruba 44,7 milionu USD. Zájem o WDC roste i mezi dalšími velkými investory.
B. Metzler seel. Sohn & Co. AG acquired a new stake in shares of Western Digital Corporation (NASDAQ:WDC – Free Report) during the second quarter, according to its most recent disclosure with the Securities and Exchange Commission (SEC). The firm acquired 69,916 shares of the data storage provider’s stock, valued at approximately $44,657,000.
Several other large investors have also recently modified their holdings of WDC. Norges Bank bought a new stake in shares of Western Digital in the 4th quarter valued at about $788,729,000. Soroban Capital Partners LP lifted its position in Western Digital by 1,926.3% in the second quarter. Soroban Capital Partners LP now owns 3,061,134 shares of the data storage provider’s stock valued at $195,882,000 after purchasing an additional 2,910,062 shares during the last quarter. Polar Capital Holdings Plc purchased a new stake in shares of Western Digital during the third quarter valued at approximately $221,800,000. Deutsche Bank AG purchased a new stake in shares of Western Digital during the second quarter valued at approximately $885,565,000. Finally, Value Aligned Research Advisors LLC bought a new position in shares of Western Digital in the first quarter worth approximately $350,403,000. Hedge funds and other institutional investors own 92.51% of the company’s stock.
Western Digital Trading Up 1.5% NASDAQ:WDC opened at $469.05 on Friday. Western Digital Corporation has a 12 month low of $74.42 and a 12 month high of $799.87. The company has a 50-day moving average price of $554.31 and a 200-day moving average price of $433.12. The stock has a market cap of $161.67 billion, a price-to-earnings ratio of 19.37 and a beta of 2.14.
Western Digital (NASDAQ:WDC – Get Free Report) last issued its quarterly earnings data on Wednesday, August 5th. The data storage provider reported $3.56 EPS for the quarter, topping the consensus estimate of $3.31 by $0.25. Western Digital had a net margin of 72.95% and a return on equity of 48.15%. The business had revenue of $3.75 billion during the quarter, compared to analyst estimates of $3.70 billion. During the same period last year, the business posted $1.66 earnings per share. Western Digital’s quarterly revenue was up 43.8% compared to the same quarter last year. Western Digital has set its Q1 2027 guidance at 3.850-4.150 EPS. Equities analysts forecast that Western Digital Corporation will post 19.65 EPS for the current fiscal year. Western Digital Dividend Announcement The company also recently disclosed a quarterly dividend, which will be paid on Thursday, September 17th. Shareholders of record on Tuesday, September 8th will be issued a $0.15 dividend. The ex-dividend date is Tuesday, September 8th. This represents a $0.60 dividend on an annualized basis and a yield of 0.1%. Western Digital’s dividend payout ratio is 2.48%.
Analyst Upgrades and Downgrades Several research analysts recently commented on WDC shares. Robert W. Baird set a $630.00 target price on shares of Western Digital in a research note on Thursday, August 6th. Wall Street Zen cut shares of Western Digital from a “strong-buy” rating to a “buy” rating in a research report on Sunday, August 16th. Rosenblatt Securities cut their price target on shares of Western Digital from $900.00 to $800.00 and set a “buy” rating on the stock in a report on Thursday, August 6th. Weiss Ratings cut shares of Western Digital from a “buy (b)” rating to a “buy (b-)” rating in a research report on Tuesday, August 11th. Finally, Barclays increased their target price on shares of Western Digital from $450.00 to $620.00 and gave the stock an “overweight” rating in a report on Wednesday, May 27th. Two analysts have rated the stock with a Strong Buy rating, eighteen have given a Buy rating and five have given a Hold rating to the stock. According to data from MarketBeat.com, Western Digital presently has an average rating of “Moderate Buy” and an average target price of $534.56.
View Our Latest Report on WDC
Insider Transactions at Western Digital In other Western Digital news, insider Cynthia L. Tregillis sold 808 shares of the firm’s stock in a transaction that occurred on Tuesday, July 21st. The shares were sold at an average price of $529.63, for a total transaction of $427,941.04. Following the completion of the transaction, the insider owned 114,539 shares of the company’s stock, valued at approximately $60,663,290.57. This trade represents a 0.70% decrease in their ownership of the stock. The sale was disclosed in a document filed with the Securities & Exchange Commission, which is accessible through this link. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, insider Vidyadhara K. Gubbi sold 2,475 shares of the business’s stock in a transaction that occurred on Monday, June 1st. The stock was sold at an average price of $556.24, for a total value of $1,376,694.00. Following the completion of the sale, the insider directly owned 85,154 shares in the company, valued at approximately $47,366,060.96. This represents a 2.82% decrease in their ownership of the stock. The SEC filing for this sale provides additional information. Over the last three months, insiders sold 24,679 shares of company stock worth $11,451,605. Corporate insiders own 0.18% of the company’s stock.
Western Digital Profile (Free Report)
Western Digital Corporation is a global data storage company that designs, manufactures and sells a broad range of storage devices and systems for personal, enterprise and cloud applications. Headquartered in San Jose, California, the company develops hard disk drives (HDDs), solid-state drives (SSDs), NAND flash components and finished storage products used in PCs, external storage, servers, network-attached storage (NAS) and embedded systems.
Its product portfolio spans consumer and commercial markets, including internal and external HDDs and SSDs, removable flash memory products and storage platforms for data center and enterprise environments.
Further Reading Five stocks we like better than Western Digital 3 Energy Stocks Raising Dividends as the Sector Surges 5 Reasons the S&P 500 Could Keep Rallying Through Year-End Walmart’s Post-Earnings Drop Could Be a Buying Opportunity The Trade Desk’s Earnings Miss Raises a Bigger Question About Its AI Future Want to see what other hedge funds are holding WDC? Visit HoldingsChannel.com to get the latest 13F filings and insider trades for Western Digital Corporation (NASDAQ:WDC – Free Report).
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Western Digital ve 4. čtvrtletí fiskálního roku 2026 zvýšila tržby z cloudu o 43 % na 3,3 miliardy USD a hrubou marži zvedla o 1 310 bazických bodů na 54,4 %. Pro 1. čtvrtletí fiskálního roku 2027 očekává tržby 4,1 miliardy USD, tedy meziročně o 45 % více.
Key Takeaways Western Digital's cloud revenue surged 43% as demand for higher-capacity nearline drives strengthened.Higher-capacity sales and better pricing lifted WDC's gross margin by 1,310 bps year over year.WDC expects fiscal Q1 2027 revenue of $4.1 billion, up 45% year over year. Western Digital Corporation (WDC - Free Report) has entered fiscal 2027 with a favorable combination of strong storage demand, improving pricing and better visibility across its key end markets – Cloud, Consumer and Client. Its latest performance suggests that the recovery in its HDD business is gaining broader momentum, while the rapid expansion of AI and cloud infrastructure is creating a structural driver of demand for high-capacity storage.
Cloud is the centerpiece of WDC’s growth strategy. In the fourth quarter of fiscal 2026, cloud revenue accounted for 89% of total revenue. It rose 43% year over year to $3.3 billion, driven by strong demand for higher-capacity nearline drives and a more favorable pricing environment. Improving pricing is also helping WDC translate stronger storage volumes into better profitability. WDC reported a non-GAAP gross margin of 54.4%, up 1,310 basis points (bps) year over year. Higher-capacity drive sales, improved pricing and manufacturing discipline boosted results, with the average price per terabyte increasing from the high single digits to the high teens year over year. If WDC can maintain pricing discipline while continuing to introduce higher-capacity products, margin expansion could remain an important earnings catalyst.
Although Cloud remains dominant, WDC is seeing encouraging trends across its other end markets. Revenues from the Client end market were up 61% year over year, while the Consumer end market rallied 38%. Both markets benefited from stronger exabyte growth and improved pricing. Fueled by robust demand, improving long-term visibility and favorable pricing across its end markets, WDC anticipates first-quarter fiscal 2027 revenues of $4.1 billion (+/- $100 million), up 45% year over year.
However, competition is another consideration. Seagate Technology (STX - Free Report) remains a formidable rival, particularly in high-capacity HDDs and emerging HAMR technology. Any improvement in competitors' supply or technology could put pressure on pricing.
Can WDC Outpace Seagate and Other Storage Rivals?Seagate is banking on strong data center demand, HAMR adoption and pricing discipline. Management expects cloud spending and AI-led storage demand to remain healthy. Demand visibility remains strong, with most nearline capacity allocated through 2028 and customer commitments extending into 2029. Seagate expanded non-GAAP gross margin for the 13th consecutive quarter as fiscal fourth quarter non-GAAP gross margin reached 52.7%, up 1,480 bps year over year. Driven by HDD demand, AI adoption, the Mozaic rollout and disciplined pricing, it expects fiscal first-quarter revenue at $4.1 billion (+/-100 million), up 56% year over year at the midpoint.
Super Micro Computer (SMCI - Free Report) profitability continues to vary sharply with customer and product mix. Non-GAAP gross margin rose to 17.6% in fourth-quarter fiscal 2026 from 10.1% in the prior quarter, but management said about 75% of the sequential improvement came from favorable mix, including contracts that shifted into fiscal 2027. Lower tariff costs and inventory reserves accounted for the rest. For first-quarter fiscal 2027, management expects gross margin of only 10.4% to 10.8%, indicating that the fourth-quarter level is not expected to persist. AI solutions accounted for approximately 60% of revenues compared with more than 80% in the prior quarter, primarily because of the timing of large AI project ramps.
WDC Price Performance, Valuation and EstimatesIn the past year, shares of WDC have surged 566.9% compared with the Zacks Computer-Storage Devices industry’s growth of 460.5%.
Image Source: Zacks Investment Research
Going by the price/earnings ratio, the company’s shares currently trade at 23.62 forward earnings compared with 10.03 for the industry.
Image Source: Zacks Investment Research
WDC’s estimate revisions are currently on an upward trajectory. The Zacks Consensus Estimate for WDC’s earnings for fiscal 2027 has been revised upward by 9.3% to $20.03 over the past 60 days, while the same for fiscal 2028 has gone up 7.6% to $34.74.
Image Source: Zacks Investment Research
Currently, Western Digital has a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Western Digital ve 4. čtvrtletí zvýšil tržby o 44 % na 3,75 miliardy USD díky silné poptávce po úložištích. Na 1. čtvrtletí FY27 očekává tržby 4,1 miliardy USD a hrubou marži 55–56 %.
Key Takeaways Western Digital's Q4 revenues rose 44% as strong storage demand fueled top-line growth. WDC expects Q1 FY27 revenues of $4.1B and gross margins of 55%-56%, signaling continued momentum.Strong cash flow and margin expansion could support WDC's earnings growth and further share-price upside. With the rise of artificial intelligence (AI), NVIDIA Corporation (NVDA - Free Report) has emerged as a prime beneficiary, with its shares soaring and helping the company surpass a $5-trillion market capitalization. The rally has been fueled by incessant demand for NVIDIA’s advanced chips and CUDA software platform.
Given NVIDIA’s remarkable AI-driven growth, investors would be tempted to buy the stock. However, NVIDIA’s gains have been subdued this year, up only 16.7%. Even though the broader tech sector has remained resilient, investors are increasingly concerned about a potential slowdown in AI spending and its impact on NVIDIA’s earnings, which have so far remained phenomenal.
Tighter restrictions on chip exports to China and stiff competition could also weigh on NVIDIA’s growth trajectory. Against this not-so-encouraging backdrop, investors should consider other beneficiaries in the AI ecosystem, such as Western Digital Corporation (WDC - Free Report) , whose shares have surged 154.5% this year and have further room to scale upward.
Western Digital continues to benefit from AI-driven demand for high-capacity data storage. Let’s explore in detail why Western Digital could be a smart buy now –
WDC’s AI Tailwinds and Earnings Growth Create Further Upside Western Digital recently reported revenues of $3.75 billion in the fiscal fourth quarter of 2026, up 44% from a year ago, according to the company’s press release. The company’s top-line growth isn’t due to cost-cutting or acquisitions; it is primarily driven by strong demand for storage products.
Further, the company expects revenues of $4.1 billion for the first quarter of fiscal 2027, plus or minus $100 million. At the midpoint, this would represent 42-49% year-over-year growth, indicating that revenue growth is expected to carry into fiscal 2027, and the robust performance reported last quarter wasn’t just a temporary surge.
As storage continues to become a strong component of the AI infrastructure buildout, Western Digital is poised to gain further. The company is therefore forecasting a healthy non-GAAP gross margin of 55-56% for the fiscal first quarter of 2027, up from 54.4% reported in the fiscal fourth quarter of 2026.
Further, margin expansion, along with strong revenue growth, could enhance Western Digital’s operating leverage, translating into faster growth in operating income and earnings. The company has generated a strong free cash flow of $1.28 billion in the fiscal fourth quarter of 2026, providing the company greater financial flexibility to reinvest in research and development, strengthen the balance sheet, and fund growth initiatives.
Hence, strong revenue growth, margin expansion and robust cash flow are expected to continue to boost Western Digital’s earnings growth and support further upside in its share price. Brokers also see greater upside potential in Western Digital.
The average short-term price target for WDC stock is $664.77, representing a 53.1% upside from its last closing price of $434.30. The highest price target stands at $1,050, suggesting a potential upside of 141.8%.
Image Source: Zacks Investment Research
Therefore, it’s prudent for investors to place bets on Western Digital at the current levels to capitalize on its upside potential. Consequently, the company’s expected earnings growth rate for the current year is 84.4%. The Zacks Consensus Estimate of $18.85 for WDC’s earnings per share is up 165.1% year over year.
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Western Digital currently has a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks Rank #1 (Strong Buy) stocks here.
Western Digital ve fiskálním roce 2026 zvýšil hrubou marži na 49,1 % díky vyšším kapacitám disků a lepším cenám. Firma čeká další zlepšení s náběhem ePMR disků až 40TB, které už začala dodávat ve 4. fiskálním čtvrtletí, a 44TB HAMR produktů.
Key Takeaways WDC's gross margin rose to 49.1% in fiscal 2026, driven by higher-capacity drives and pricing.Next-gen ePMR drives up to 40TB are expected to reach 50% of nearline bits by fiscal 2027's third quarter.WDC's cost per terabyte fell 8%, while 44TB HAMR products could support further margin gains. Western Digital Corporation (WDC - Free Report) is seeing higher-capacity drives play an increasingly important role in improving its margins. The company reported strong financial performance in fiscal 2026, with gross margin expanding 970 basis points (bps) to 49.1%. In the fiscal fourth quarter, gross margin increased 1,310 bps year over year to 54.4%. The improvement was driven by a mix shift toward higher-capacity drives, favorable pricing across the portfolio and disciplined execution in manufacturing operations.
The company began shipping its next-generation ePMR hard drives with capacities of up to 40 terabytes in the fiscal fourth quarter and expects a strong ramp over the following quarters. On the latest earnings call, management highlighted that the company is on track for these drives to account for 50% of nearline bits by the third quarter of fiscal 2027. The greater availability of higher-capacity drives is expected to provide additional opportunities for pricing while enabling the company to ship more capacity into the market.
Higher-capacity drives are also helping Western Digital improve its cost structure. Cost per terabyte declined approximately 8% year over year in the fiscal fourth quarter, while the company expects its long-term cost per terabyte to decline about 10% annually. Management attributed this reduction primarily to the transition toward higher-capacity drives and improved areal density. As the company executes its technology and product road map, including next-generation ePMR and HAMR products, cost per terabyte is expected to continue declining over time.
At the same time, higher-capacity drives provide more value to customers through better total cost of ownership, allowing Western Digital to increase price per terabyte while reducing cost per terabyte. Management stated this combination as a key factor supporting further gross margin improvement. The company reported incremental gross margins of 75% in fiscal 2026 compared with 60% in fiscal 2025, and ended the fourth quarter with year-over-year incremental gross margin of 84% to 85%. It expects approximately 80% to 81% incremental gross margin in the first quarter of fiscal 2027. Western Digital anticipates non-GAAP gross margin in the range of 55-56% for the first quarter.
Western Digital expects continued gross-margin improvement as it ramps higher-capacity ePMR drives and introduces 44-terabyte HAMR products. Management believes these product transitions can support more exabyte shipments at better pricing while reducing costs over time, providing a basis for continued margin expansion.
Taking a Look at WDC’s CompetitorsSeagate Technology Holdings plc’s (STX - Free Report) fourth-quarter fiscal 2026 non-GAAP gross margin reached 52.7%, up 570 bps sequentially and 1,480 bps year over year. The company expanded non-GAAP gross margin for the 13th consecutive quarter. Non-GAAP operating margin rose to 44.6% from 26.2% in the year-ago quarter, highlighting the scalability of the company’s operating model. Free cash flow reached $1.12 billion in the June quarter, representing a margin of approximately 31%, while fiscal 2026 free cash flow climbed to a record $3.1 billion. Management expects cash generation to improve sequentially throughout fiscal 2027, supported by revenue growth, pricing, operating leverage and capital expenditures maintained within 4–6% of revenues.
Sandisk Corporation’s (SNDK - Free Report) fourth-quarter fiscal 2026 non-GAAP gross margin expanded to 84.6% from 78.4% in the previous quarter and 26.4% reported in the year-ago quarter. The result exceeded management’s 79-81% guidance. Non-GAAP operating margin rose to 79.2% from 70.9%, reflecting strong revenue growth and cost leverage. Adjusted free cash flow totaled $5.04 billion, excluding $1.94 billion of customer prepayments and deposits related to the new business models. For the first quarter of fiscal 2027, Sandisk expects revenues of $10.3-$10.8 billion. Non-GAAP gross margin is expected between 83% and 85%.
WDC Price Performance, Valuation and EstimatesIn the past year, shares of WDC have surged 479% compared with the Zacks Computer-Storage Devices industry’s growth of 348%.
Image Source: Zacks Investment Research
Going by the price/earnings ratio, the company’s shares currently trade at 20.86 forward earnings compared with 9.43 for the industry.
Image Source: Zacks Investment Research
WDC’s estimate revisions are on an upward trajectory. The Zacks Consensus Estimate for WDC’s earnings for fiscal 2026 has been revised north by 4.96% to $18.85 over the past 60 days, while the same for fiscal 2027 has gone up 17.76% to $35.48.
Image Source: Zacks Investment Research
Currently, Western Digital has a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 (Strong Buy) Rank stocks here.
Western Digital oznámila za čtvrtletí upravený zisk na akcii 3,56 USD a tržby 3,75 miliardy USD, obojí nad odhady. Firma zároveň zvýšila výhled na fiskální 1. čtvrtletí 2027.
CoreCap Advisors LLC boosted its holdings in Western Digital Corporation (NASDAQ:WDC – Free Report) by 89.7% in the 2nd quarter, according to the company in its most recent filing with the Securities and Exchange Commission. The firm owned 3,862 shares of the data storage provider’s stock after purchasing an additional 1,826 shares during the quarter. CoreCap Advisors LLC’s holdings in Western Digital were worth $2,467,000 at the end of the most recent quarter.
Other hedge funds and other institutional investors have also bought and sold shares of the company. Rakuten Securities Inc. raised its holdings in shares of Western Digital by 4,070.0% in the 2nd quarter. Rakuten Securities Inc. now owns 417 shares of the data storage provider’s stock worth $27,000 after acquiring an additional 407 shares during the last quarter. Avion Wealth raised its stake in shares of Western Digital by 163.8% in the fourth quarter. Avion Wealth now owns 182 shares of the data storage provider’s stock worth $31,000 after purchasing an additional 113 shares during the last quarter. Valley Wealth Managers Inc. purchased a new stake in shares of Western Digital in the first quarter worth approximately $32,000. Swiss RE Ltd. bought a new position in shares of Western Digital in the fourth quarter valued at approximately $32,000. Finally, BOKF NA lifted its holdings in shares of Western Digital by 6,700.0% in the third quarter. BOKF NA now owns 272 shares of the data storage provider’s stock valued at $33,000 after purchasing an additional 268 shares in the last quarter. Institutional investors own 92.51% of the company’s stock.
Western Digital News Summary Here are the key news stories impacting Western Digital this week:
Positive Sentiment: Western Digital reported adjusted earnings of $3.56 per share, above the $3.31 consensus estimate, while revenue increased 43.8% year over year to $3.75 billion, also exceeding forecasts. Western Digital Q4 Earnings Beat as Revenue Jumps 44% on Cloud Demand Positive Sentiment: Management cited strong cloud and AI-related storage demand, pricing gains and adoption of higher-capacity products. The company said some AI customers are negotiating storage capacity commitments through 2031, providing long-term demand visibility. Western Digital Says AI Customers Are Already Negotiating Storage Deals Through 2031 Positive Sentiment: Fiscal first-quarter 2027 revenue guidance of $4.0 billion to $4.2 billion and adjusted EPS guidance of $3.85 to $4.15 were above consensus estimates. Several analysts maintained bullish views, including Baird, which raised its price target to $630. Western Digital Earns Buy Rating as Analyst Lifts Price Target to $630 Analyst Upgrades and Downgrades Several equities research analysts recently issued reports on the company. Susquehanna upped their price target on Western Digital from $360.00 to $500.00 and gave the stock a “neutral” rating in a report on Wednesday, July 8th. Citigroup boosted their price target on shares of Western Digital from $685.00 to $800.00 and gave the stock a “buy” rating in a report on Monday, July 13th. The Goldman Sachs Group reiterated a “neutral” rating and issued a $400.00 price objective on shares of Western Digital in a research note on Friday, May 1st. Weiss Ratings raised shares of Western Digital from a “buy (b-)” rating to a “buy (b)” rating in a research report on Monday, July 13th. Finally, Zacks Research upgraded Western Digital from a “hold” rating to a “strong-buy” rating in a research note on Wednesday, May 6th. Two investment analysts have rated the stock with a Strong Buy rating, eighteen have assigned a Buy rating and five have assigned a Hold rating to the company’s stock. Based on data from MarketBeat.com, Western Digital currently has a consensus rating of “Moderate Buy” and a consensus price target of $536.96.
Read Our Latest Stock Report on WDC
Western Digital Trading Down 13.0% Shares of WDC stock opened at $451.52 on Friday. The stock has a market capitalization of $155.63 billion, a P/E ratio of 18.65 and a beta of 2.14. The firm’s 50 day moving average is $567.55 and its 200 day moving average is $417.23. Western Digital Corporation has a 12 month low of $73.14 and a 12 month high of $799.87.
Western Digital (NASDAQ:WDC – Get Free Report) last posted its earnings results on Tuesday, August 4th. The data storage provider reported $3.56 earnings per share (EPS) for the quarter, topping the consensus estimate of $3.31 by $0.25. Western Digital had a return on equity of 50.22% and a net margin of 72.95%.The firm had revenue of $3.75 billion for the quarter, compared to the consensus estimate of $3.70 billion. During the same quarter in the prior year, the business posted $1.66 earnings per share. The business’s quarterly revenue was up 43.8% on a year-over-year basis. On average, equities analysts predict that Western Digital Corporation will post 17.77 EPS for the current year.
Western Digital Dividend Announcement The company also recently announced a quarterly dividend, which will be paid on Thursday, September 17th. Investors of record on Tuesday, September 8th will be issued a dividend of $0.15 per share. This represents a $0.60 dividend on an annualized basis and a yield of 0.1%. The ex-dividend date of this dividend is Tuesday, September 8th. Western Digital’s dividend payout ratio is 3.58%.
Insiders Place Their Bets In other Western Digital news, insider Cynthia L. Tregillis sold 808 shares of the firm’s stock in a transaction on Tuesday, July 21st. The shares were sold at an average price of $529.63, for a total value of $427,941.04. Following the completion of the transaction, the insider directly owned 114,539 shares of the company’s stock, valued at $60,663,290.57. This trade represents a 0.70% decrease in their position. The sale was disclosed in a document filed with the Securities & Exchange Commission, which is available at this link. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, insider Vidyadhara K. Gubbi sold 2,475 shares of the stock in a transaction on Monday, June 1st. The stock was sold at an average price of $556.24, for a total value of $1,376,694.00. Following the completion of the sale, the insider owned 85,154 shares in the company, valued at $47,366,060.96. This trade represents a 2.82% decrease in their position. Additional details regarding this sale are available in the official SEC disclosure. Insiders have sold 5,093 shares of company stock worth $2,751,337 in the last three months. 0.18% of the stock is currently owned by corporate insiders.
About Western Digital (Free Report)
Western Digital Corporation is a global data storage company that designs, manufactures and sells a broad range of storage devices and systems for personal, enterprise and cloud applications. Headquartered in San Jose, California, the company develops hard disk drives (HDDs), solid-state drives (SSDs), NAND flash components and finished storage products used in PCs, external storage, servers, network-attached storage (NAS) and embedded systems.
Its product portfolio spans consumer and commercial markets, including internal and external HDDs and SSDs, removable flash memory products and storage platforms for data center and enterprise environments.
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Sandisk a Western Digital v předobchodní fázi prudce klesly, protože jejich výhled tržeb sice překonal odhady, ale nestačil vysokým očekáváním trhu. Sandisk odepsal 9,2 % a Western Digital 14,6 %.
Semiconductor chips are seen on a printed circuit board in this illustration picture taken February 17, 2023. REUTERS/Florence Lo/Illustration/File Photo Purchase Licensing Rights, opens new tab
Aug 6 (Reuters) - Data storage companies tumbled in premarket trading on Thursday after quarterly results from Sandisk and Western Digital failed to sustain momentum in an industry that has become one of Wall Street's hottest bets this year.
Shares of Sandisk (SNDK.O), opens new tab lost 9.2% to trade at $1,226.04, while Western Digital (WDC.O), opens new tab shed 14.6% and was last changing hands at $443.3.
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After the closing bell on Wednesday, both Sandisk and Western Digital forecast quarterly revenue that beat estimates compiled by LSEG, but fell short of high market expectations.
The reaction underscores the high bar set for the market's AI favorites after stellar gains this year, with even strong earnings and upbeat forecasts failing to satisfy investors.
Sandisk has soared more than fivefold this year and Western Digital has more than tripled on bets that data storage and memory chipmakers could be among the biggest beneficiaries of Big Tech's AI spending spree.
Both Sandisk and Western Digital have far outpaced a near-70% rise in the Philadelphia SE Semiconductor Index (.SOX), opens new tab and a 12.8% gain in the benchmark S&P 500 (.SPX), opens new tab.
A global shortage of high-end memory chips has fueled a sharp rise in chip prices, filling the coffers of industry players.
But even as demand for AI data-center components shows few signs of easing, investors are punishing companies at the slightest hint that the growth may normalize.
DEMAND ROBUST, BUT SKEPTICISM COULD LINGERBrokerage RBC Capital Markets said while Sandisk's long-term customer agreements were helping extend visibility into its business, it expects "investor skepticism to continue."
Margins could be near peaks and price growth was moderating, the brokerage said.
Sandisk forecast first-quarter revenue between $10.3 billion and $10.8 billion, while Western Digital expects $4.1 billion, plus or minus $100 million, in Q1 revenue.
Peer Seagate Technology (STX.O), opens new tab fell 3.6%. Memory chipmaker Micron Technology <MU.O>, which vaulted into the industry's upper echelons after topping $1 trillion in market value in late May, was down 3.7%.
U.S.-listed shares of SK Hynix slid 6.2%. Intel (INTC.O), opens new tab fell 1.2%, AMD (AMD.O), opens new tab was off 1% and Marvell Technology (MRVL.O), opens new tab lost 1.1%.
Still, analysts see data center demand continuing to lift these firms. At Sandisk, revenue from data centers rose more than 400% in 2026 over 2025. It doubled in the fourth quarter, compared to the third quarter.
Reporting by Purvi Agarwal and Niket Nishant in Bengaluru; Editing by Pooja Desai
Our Standards: The Thomson Reuters Trust Principles., opens new tab
Western Digital uspořádala konferenční hovor k výsledkům za 4. fiskální čtvrtletí 2026. Společnost uvedla, že prezentace bude vycházet z ne-GAAP výsledků z pokračujících operací.
Western Digital Corporation (WDC) Q4 2026 Earnings Call August 5, 2026 4:30 PM EDT
Company Participants
Ambrish Srivastava - Vice President of Investor Relations
Tiang Yew Tan - CEO & Director
Kris Sennesael - Executive VP & CFO
Conference Call Participants
Christopher Muse - Cantor Fitzgerald & Co., Research Division
Amit Daryanani - Evercore ISI Institutional Equities, Research Division
Aaron Rakers - Wells Fargo Securities, LLC, Research Division
Wamsi Mohan - BofA Securities, Research Division
Sreekrishnan Sankarnarayanan - TD Cowen, Research Division
Michael Cadiz - Citigroup Inc., Research Division
Erik Woodring - Morgan Stanley, Research Division
Benjamin Reitzes - Melius Research LLC
Karl Ackerman - BNP Paribas, Research Division
Ananda Baruah - Loop Capital Markets LLC, Research Division
Presentation
Operator
Good afternoon, and welcome to the Western Digital's Fourth Quarter Fiscal 2026 Conference Call. [Operator Instructions] Please note, this event is being recorded. I would now like to turn the conference over to Mr. Ambrish Srivastava, Vice President of Investor Relations. Please go ahead.
Ambrish Srivastava
Vice President of Investor Relations
Thank you, and good afternoon, everyone. Joining me today are Irving Tan, WD's Chief Executive Officer; and Kris Sennesael, WD's Chief Financial Officer. Before we begin, please note that today's discussion will contain forward-looking statements based on management's current assumptions and expectations, which are subject to various risks and uncertainties.
These forward-looking statements include expectations for our product portfolio, our business plans and performance, ongoing market trends and our future financial results. We assume no obligation to update these statements. Please refer to our most recent annual report on Form 10-K and our other filings with the SEC for more information on the risks and uncertainties that could cause actual results to differ materially from expectations.
In our prepared remarks, our comments will be related to non-GAAP results on a continuing operations basis, unless stated otherwise. Reconciliations between the non-GAAP and
Western Digital Corp. (NASDAQ:WDC) posted its fourth-quarter results after Wednesday’s closing bell, beating Wall Street estimates on the top and bottom lines.
Here’s a look at the details inside the report.
WDC stock is moving. Watch the price action here. Western Digital Q4 Details Western Digital reported quarterly earnings of $3.56 per share, which beat the Street estimate of $3.29 by 7.88%, according to Benzinga Pro data.
Quarterly revenue came in at $3.75 billion, which beat the consensus estimate of $3.69 billion and was up from $2.61 billion in the same period last year.
“Fiscal 2026 was an outstanding year for WD, characterized by broadening demand, deeper customer engagement, and disciplined execution across all end markets. As the cloud and other data-intensive workloads continue to expand, we remain confident in the long-term growth trajectory of our business, further margin expansion, and strong free cash flow generation,” said Kris Sennesael, CFO of Western Digital.
Looking AheadWestern Digital expects first quarter adjusted EPS of $3.85 to $4.15, versus the $3.81 estimate, and revenue of $4 billion to $4.2 billion, versus the $4.01 billion analyst estimate.
“For our fiscal first quarter of 2027, at the midpoint of the ranges provided in the table below, we expect revenue of $4.1 billion, non-GAAP gross margin of 55.5%, and non-GAAP EPS of $4,” Sennesael said.
WDC Stock Price Activity: According to data from Benzinga Pro, Western Digital stock was down 8.89% to $473 in Wednesday’s extended trading.
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Western Digital Corporation (NASDAQ:WDC) will release its fourth quarter earnings report after the closing bell on Wednesday, Aug. 5.
Analysts expect the San Jose, California-based company to report quarterly earnings of $3.30 per share, up from $1.66 per share in the year-ago period. The consensus estimate for Western Digital’s quarterly revenue is $3.7 billion. It reported $2.6 billion last year, according to Benzinga Pro.
On April 30, Western Digital posted better-than-expected third-quarter earnings.
Western Digital shares rose 4.1% to close at $548.56 on Tuesday.
Benzinga readers can access the latest analyst ratings on the Analyst Stock Ratings page. Readers can sort by stock ticker, company name, analyst firm, rating change or other variables.
Let’s have a look at how Benzinga’s most-accurate analysts have rated the company in the recent period.
Considering buying WDC stock? Here’s what analysts think:
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Western Digital oznámí výsledky za fiskální 4. čtvrtletí 2026 a odhaduje tržby na 3,65 miliardy USD, tedy meziročně o zhruba 40 % více. Firma těží z poptávky po AI a hyperscale úložištích i z růstu marží.
Key Takeaways Western Digital reports fiscal Q4 2026 results Aug. 5, with revenue growth guided near 40% year over year.WDC expects AI, hyperscale demand, HDD pricing and margin expansion to support another strong quarter.WDC strengthened its balance sheet, raised dividends and continues share repurchases amid solid cash flow. Western Digital Corporation (WDC - Free Report) is set to report fiscal fourth-quarter 2026 results on Wednesday, after market close.
The Zacks Consensus Estimate for earnings is pegged at $3.35, suggesting a rise of 101.8% from the year-ago reported number. Management projects non-GAAP earnings of $3.25 (+/- 15 cents).
The consensus estimate for revenues is currently pegged at $3.7 billion, suggesting a 42.2% jump from the prior-year quarter’s figure. With strong demand, pricing and improved visibility across cloud, consumer and client segments, WDC expects revenue of $3.65 billion (+/- $100 million), implying about 40% year-over-year growth at the midpoint.
The company's earnings surpassed the Zacks Consensus Estimate in each of the trailing four quarters, delivering an average surprise of 11.6%.
Image Source: Zacks Investment Research
WDC’s Earnings WhispersOur proven model predicts 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 exactly the case here. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
Western Digital presently has an Earnings ESP of +3.22% and a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.
What Could Drive Another Earnings Beat for WDC in Q4?Following the separation of its flash memory business into Sandisk (SNDK - Free Report) in 2025, Western Digital has become a pure-play HDD company, making its financial performance increasingly tied to enterprise storage, hyperscale cloud spending and the rapid expansion of AI infrastructure. During its previous earnings report, management emphasized that virtually every AI workload ultimately increases long-term demand for enterprise HDDs, supporting sustained growth.
WDC is advancing high-capacity drives, including 44TB HAMR and 40TB ePMR, with plans beyond 100TB. Adoption of UltraSMR technology is expanding, with three major customers qualifying, supporting capacity growth. In May, WDC integrated post-quantum cryptographic capabilities into its next-generation Ultrastar UltraSMR hard drives. Specifically, these drives are already undergoing qualification with multiple hyperscale customers, signaling that large-scale cloud and AI infrastructure providers are taking quantum-era security threats seriously. In June, it demonstrated its Ultrastar HDD portfolio, featuring technologies such as UltraSMR, ePMR and HAMR at the Computex Event.
Aside from individual drives, it showcased a range of platform solutions designed for cloud providers, AI companies, neo-cloud operators and high-performance HPC environments, including Ultrastar Data Series JBOD systems, OpenFlex EBOF and RapidFlex NVMe-oF controllers. WD emphasizes predictable pricing to enable long-term customer planning, with recent high single-digit price increases. Long-term agreements extend into 2029, with flexible pricing for volume beyond contractual base requirements. Margin expansion remains a key strength. For the upcoming quarter, WDC expects non-GAAP gross margin to be between 51% and 52%. Non-GAAP operating expenses are projected to be $385-$395 million and interest and other expenses are expected to be approximately $10 million.
The company consistently generates impressive cash flow, supporting dividends and shareholder returns. WD has strengthened its balance sheet by reducing debt, including $3.1 billion from SNDK share monetization. It increased dividends by 20% and plans to continue share repurchases, maintaining a strong free cash flow margin. To sum up, Western Digital could outperform expectations on sustained hyperscale and AI-driven storage demand, favorable HDD pricing, strong free cash flow generation and improving enterprise storage spending.
However, Western Digital faces risks from customer concentration, potential weakness in enterprise IT spending and the cyclical nature of the storage industry, where pricing can shift rapidly if supply outpaces demand. In addition, the company faces intense competition from peers like Seagate Technology Holdings plc (STX - Free Report) and Micron Technology (MU - Free Report) , which could pressure pricing and market share.
WDC Stock vs. IndustryWDC’s shares have rallied 604.9% in the past year, outperforming the Zacks Computer-Storage Devices industry’s rise of 354.2%. The stock has also outpaced the Zacks Computer & Technology sector and the S&P 500’s growth of 25.9% and 21.2%, respectively.
Image Source: Zacks Investment Research
STX has gained 453% while MU and SNDK have soared 663.7% and 2757.7% respectively.
Key Valuation Metric of WDCGoing by the price/earnings ratio, the company’s shares currently trade at 27.13 forward earnings compared with 10.34 for the industry.
Image Source: Zacks Investment Research
MU, STX and SNDK are trading at multiples of 5.43X, 23.85X and 6.64X, respectively.
Should Investors Buy WDC Shares Before Earnings?Western Digital appears well-positioned heading into the fiscal fourth-quarter earnings. The company benefits from several powerful long-term trends: AI-driven storage demand, expanding hyperscale investments, improving enterprise HDD pricing, strong margin expansion, robust free cash flow generation and a focused HDD business following the Sandisk spin-off.
The combination of storage demand, improving profitability, disciplined HDD supply and stronger enterprise spending creates a favorable backdrop for continued earnings growth. If WDC delivers another earnings beat and reinforces confidence in sustained demand, the company could strengthen its position as a compelling pick for investors seeking exposure to the rapidly expanding AI infrastructure ecosystem.
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52-Week Range$69.30▼
$799.87Dividend Yield0.13%
P/E Ratio27.27
Price Target$520.32
Few stocks capture the euphoria and the anxiety of the artificial intelligence (AI) storage boom quite like Western Digital Corporation NASDAQ: WDC. Through the middle of last month, the stock had been one of the market's standout performers of the year, riding relentless demand for data storage to enormous gains. Yet the past few weeks have been a sharp reminder that nothing goes up in a straight line.
Shares have fallen around 40% from June’s high as the wider AI trade has wobbled, with investors growing nervous that elevated valuations across the storage and memory space may have run ahead of themselves. However, even after that drop, Western Digital shares are still up significantly for the year to date, which rather neatly frames the question facing investors today.
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With the company due to report earnings on Aug. 5, is this pullback a chance to buy one of the AI theme's biggest winners at a discount, or a warning that the storage rally is finally running out of road?
Western Digital’s Bull Case Still Starts With AI Storage DemandLet’s start with why the stock ran so hard in the first place. Western Digital sits at the heart of one of the most powerful supply-and-demand imbalances in tech right now. The explosion of AI infrastructure has sent demand for high-capacity storage soaring, while supply has remained tight, handing manufacturers like Western Digital significant pricing power.
That dynamic has been showing up throughout the business. Revenue has been growing rapidly year over year, while the company has generated enough cash to hike its dividend and buy back a meaningful chunk of stock.
Wall Street Has Not Given Up on the AI Storage TradeThe analyst community has clearly taken note, with Morgan Stanley recently raising its price target to $650, arguing that conservative margin guidance leaves ample room for another beat. Alongside Citigroup’s refreshed price target of $800 from earlier this month, and the nearly 40% that implies, it’s easy to see why Western Digital has a consensus rating of Moderate Buy.
Crucially, the tailwinds driving these bullish updates all look durable. Data center capital spending is projected to keep climbing for years to come, driven by the same AI buildout that has powered the storage rally so far. The thinking is that if this demand holds, Western Digital's pricing power should hold with it.
Earnings Will Test the Margin StoryWestern Digital Stock Forecast Today12-Month Stock Price Forecast:
$520.32
18.27% Upside
Moderate Buy
Based on 24 Analyst Ratings
Current Price$439.93High Forecast$1,050.00Average Forecast$520.32Low Forecast$163.00Western Digital Stock Forecast Details
That makes the upcoming earnings report an important test. The single most-watched number will be gross margin, which has become the clearest signal of whether the company's pricing power is still expanding.
Management has guided to a healthy gross margin, and any sign it is coming in ahead of that, or being guided higher still, would go a long way toward confirming the bull case. Continued expansion would tell investors that the tight-supply story remains intact and that the recent sell-off was little more than sentiment-driven noise. On the other hand, a softer read would give the bears exactly the ammunition they have been looking for.
Beyond margins, investors will also be listening closely to what management says about pricing and supply heading into the back half of the year. In a story built almost entirely on the supply-demand imbalance, any hint that the imbalance is starting to ease would matter far more than the headline revenue and earnings figures.
Valuation Still Leaves Little Room for ErrorFor all the strength in the underlying dynamics, the bears have some legitimate points, and none is stronger than Western Digital’s valuation. Even after the recent pullback, the stock still trades at a meaningful premium to both its own historical averages and its sector peers.
When a stock goes into an earnings report still priced so richly, the room for error is minuscule, and any disappointment, even if the results themselves are still solid, can be punished quickly.
Investors Have to Decide How Much Risk to Take Before EarningsThis is where it’s hard to ignore the risk/reward profile after such a sell-off, especially as the analyst community has remained so bullish, with targets rising even as the stock has fallen in recent weeks.
If the demand proves as durable as the bulls believe, a 40% pre-earnings pullback could end up looking like a golden entry opportunity in hindsight. For investors who believe the AI buildout is still in its early innings, buying quality on weakness has tended to pay off throughout this cycle, and it could be a smart move to consider again now.
Should You Invest $1,000 in Western Digital Right Now?Before you consider Western Digital, you'll want to hear this.
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Key Takeaways Western Digital expects stronger Q4 revenues as AI storage demand from cloud and enterprise customers grows. WDC projects higher gross margins, supported by enterprise HDD demand and favorable pricing. Analysts see upside for WDC, with strong earnings growth forecasts and price targets above current levels. NVIDIA Corporation (NVDA - Free Report) has delivered muted gains this year, up only 10.9% despite posting encouraging quarterly results. This is primarily because after several years of exceptional gains, investors’ expectations have become exceptionally high. Consequently, even upbeat quarterly results have not been able to drive the stock significantly higher.
NVIDIA’s state-of-the-art Blackwell chips and CUDA software platform fueled its exceptional growth. However, investors are increasingly questioning whether NVIDIA can remain the market leader as competition intensifies from rivals like Advanced Micro Devices, Inc. (AMD - Free Report) . Moreover, any slowdown in AI infrastructure spending by hyperscale cloud providers could weigh on NVIDIA’s margins. U.S. controls on the sale of cutting-edge artificial intelligence (AI) chips to China have already limited NVIDIA’s access to an important market, creating pressure on margins.
The ongoing geopolitical uncertainties have also made investors cautious about investing in large-cap AI stocks, including NVIDIA. The company’s heavy dependency on Taiwan Semiconductor Manufacturing Company Limited (TSM - Free Report) for chip production has heightened concerns about potential supply-chain disruptions. Additionally, NVIDIA’s current lofty valuations have left little room for multiple expansion, prompting some investors to remain cautious despite its strong operating performance.
Although NVIDIA’s amazing rally seems to have run its course for new investors, the broader AI ecosystem continues to offer compelling growth opportunities. They may consider AI infrastructure player Western Digital Corporation (WDC - Free Report) , known for supplying enterprise storage solutions for AI workloads. Its shares have soared 201.8% so far this year and appear well positioned to extend its rally. Let’s explore why Western Digital could be the next standout performer –
WDC’s AI Storage Boom Could Drive the Next Leg Higher An increase in demand for Western Digital’s high-value enterprise hard disk drives (eHDDs) and a favorable pricing environment have helped the company post revenues of $3.34 billion in the fiscal third quarter of 2026, up 45% year over year, per the press release.
Most importantly, revenues are expected to improve to about $3.65 billion, plus or minus $100 million, in the fiscal fourth quarter of 2026, a telltale sign that demand for AI infrastructure remains strong, as enterprises and cloud providers continue to expand storage capacity to accommodate growing AI workloads.
For the fiscal fourth quarter, Western Digital further expects non-GAAP gross margin to reach 51-52%, up from 50.5% in the fiscal third quarter. The expected margin expansion should strengthen the company’s profitability and provide additional financial resources to fund long-term growth initiatives.
Therefore, strong demand for AI infrastructure, revenue growth, and expanding margins would propel Western Digital’s stock higher in the near term. Thus, the company’s expected earnings growth rate for the current year is a solid 104.3%. The Zacks Consensus Estimate of $10.07 for WDC’s earnings per share is up 54.9% year over year.
Image Source: Zacks Investment Research
Brokers also remain optimistic about Western Digital’s growth outlook, with the average short-term price target for WDC stock at $638.27, representing a 14.3% upside from its last closing price of $558.30. The highest price target stands at $1,050, suggesting a potential upside of 88.1%.
Image Source: Zacks Investment Research
Western Digital currently has a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks Rank #1 stocks here.
Andra AP fonden reduced its stake in Western Digital Corporation (NASDAQ:WDC – Free Report) by 68.6% during the 1st quarter, according to the company in its most recent filing with the SEC. The fund owned 81,737 shares of the data storage provider’s stock after selling 178,663 shares during the quarter. Andra AP fonden’s holdings in Western Digital were worth $22,109,000 at the end of the most recent reporting period.
Other institutional investors have also recently added to or reduced their stakes in the company. Wilkerson Advisory Group LLC grew its stake in shares of Western Digital by 114.7% in the first quarter. Wilkerson Advisory Group LLC now owns 249 shares of the data storage provider’s stock valued at $67,000 after buying an additional 133 shares in the last quarter. MWA Asset Management acquired a new position in Western Digital during the 1st quarter worth about $101,000. Convergence Investment Partners LLC purchased a new position in Western Digital during the 1st quarter valued at about $5,457,000. Legacy Wealth Managment LLC ID grew its position in Western Digital by 105,371.4% in the 1st quarter. Legacy Wealth Managment LLC ID now owns 7,383 shares of the data storage provider’s stock valued at $1,997,000 after acquiring an additional 7,376 shares in the last quarter. Finally, Florida Financial Advisors LLC grew its position in Western Digital by 26.4% in the 1st quarter. Florida Financial Advisors LLC now owns 12,455 shares of the data storage provider’s stock valued at $3,369,000 after acquiring an additional 2,602 shares in the last quarter. Institutional investors and hedge funds own 92.51% of the company’s stock.
More Western Digital News Here are the key news stories impacting Western Digital this week:
Positive Sentiment: Western Digital is benefiting from a rebound in memory stocks as investors step back in after last week’s selloff, improving sentiment across the semiconductor group. Micron Jumps 5%, SanDisk Rises 6%, Western Digital Climbs 4% as Memory Stocks Rebound With Chips Positive Sentiment: Morgan Stanley’s view that the memory-stock selloff created a strong entry point is encouraging dip-buying in Western Digital and other chip names. The Memory Stock Sell-Off Created a ‘Strong Entry Point,’ Says Morgan Stanley. Investors Are Buying In. Neutral Sentiment: Western Digital Malaysia was recognized for advancing sustainable AI infrastructure, which supports the company’s AI narrative but is unlikely to be the main stock-moving catalyst today. WD Malaysia Recognized for Advancing Sustainable AI Infrastructure Western Digital Trading Up 2.1% Western Digital stock opened at $487.42 on Tuesday. The stock has a market cap of $168.00 billion, a P/E ratio of 29.10 and a beta of 2.11. The company has a fifty day simple moving average of $560.32 and a 200-day simple moving average of $388.23. Western Digital Corporation has a 12-month low of $66.04 and a 12-month high of $799.87.
Western Digital (NASDAQ:WDC – Get Free Report) last posted its earnings results on Thursday, April 30th. The data storage provider reported $2.72 EPS for the quarter, beating the consensus estimate of $2.39 by $0.33. The firm had revenue of $3.34 billion for the quarter, compared to analyst estimates of $3.25 billion. Western Digital had a return on equity of 42.95% and a net margin of 55.29%.Western Digital’s revenue for the quarter was up 45.5% compared to the same quarter last year. During the same quarter in the prior year, the company posted $1.36 earnings per share. Western Digital has set its Q4 2026 guidance at 3.100-3.400 EPS. As a group, sell-side analysts forecast that Western Digital Corporation will post 9.61 earnings per share for the current fiscal year.
Western Digital Increases Dividend The firm also recently announced a quarterly dividend, which was paid on Wednesday, June 17th. Stockholders of record on Friday, June 5th were given a dividend of $0.15 per share. This is a boost from Western Digital’s previous quarterly dividend of $0.12. The ex-dividend date of this dividend was Friday, June 5th. This represents a $0.60 annualized dividend and a dividend yield of 0.1%. Western Digital’s dividend payout ratio is 3.58%.
Insiders Place Their Bets In other Western Digital news, CEO Irving Tan sold 20,000 shares of the firm’s stock in a transaction that occurred on Friday, May 1st. The shares were sold at an average price of $411.84, for a total transaction of $8,236,800.00. Following the sale, the chief executive officer owned 598,150 shares of the company’s stock, valued at approximately $246,342,096. This trade represents a 3.24% decrease in their ownership of the stock. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which can be accessed through this link. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, Director Bruce E. Kiddoo sold 750 shares of the business’s stock in a transaction that occurred on Thursday, May 28th. The stock was sold at an average price of $528.52, for a total transaction of $396,390.00. Following the sale, the director owned 3,903 shares of the company’s stock, valued at $2,062,813.56. This represents a 16.12% decrease in their position. Additional details regarding this sale are available in the official SEC disclosure. Insiders have sold 28,959 shares of company stock worth $12,631,666 in the last three months. 0.18% of the stock is owned by company insiders.
Analyst Ratings Changes WDC has been the topic of several research reports. Wells Fargo & Company increased their price target on shares of Western Digital from $575.00 to $730.00 and gave the stock an “overweight” rating in a research report on Friday, July 10th. UBS Group reissued a “neutral” rating and issued a $560.00 price target on shares of Western Digital in a research report on Monday, July 13th. Weiss Ratings raised Western Digital from a “buy (b-)” rating to a “buy (b)” rating in a research report on Monday, July 13th. Morgan Stanley increased their price objective on Western Digital from $488.00 to $650.00 and gave the company an “overweight” rating in a research note on Monday, June 15th. Finally, Susquehanna lifted their target price on Western Digital from $360.00 to $500.00 and gave the company a “neutral” rating in a report on Wednesday, July 8th. Two analysts have rated the stock with a Strong Buy rating, eighteen have issued a Buy rating and four have issued a Hold rating to the company’s stock. According to MarketBeat.com, Western Digital presently has an average rating of “Moderate Buy” and an average target price of $520.32.
View Our Latest Stock Report on WDC
Western Digital Profile (Free Report)
Western Digital Corporation is a global data storage company that designs, manufactures and sells a broad range of storage devices and systems for personal, enterprise and cloud applications. Headquartered in San Jose, California, the company develops hard disk drives (HDDs), solid-state drives (SSDs), NAND flash components and finished storage products used in PCs, external storage, servers, network-attached storage (NAS) and embedded systems.
Its product portfolio spans consumer and commercial markets, including internal and external HDDs and SSDs, removable flash memory products and storage platforms for data center and enterprise environments.
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Bessemer Group Inc. boosted its stake in shares of Western Digital Corporation (NASDAQ:WDC – Free Report) by 23.0% during the 1st quarter, according to its most recent Form 13F filing with the SEC. The institutional investor owned 15,465 shares of the data storage provider’s stock after purchasing an additional 2,896 shares during the period. Bessemer Group Inc.’s holdings in Western Digital were worth $4,184,000 at the end of the most recent quarter.
Several other institutional investors and hedge funds also recently bought and sold shares of WDC. Norges Bank bought a new position in shares of Western Digital in the fourth quarter worth about $788,729,000. Northern Trust Corp grew its stake in shares of Western Digital by 11.2% during the 3rd quarter. Northern Trust Corp now owns 3,805,463 shares of the data storage provider’s stock valued at $456,884,000 after acquiring an additional 384,103 shares during the period. Soroban Capital Partners LP increased its holdings in Western Digital by 1,926.3% in the 2nd quarter. Soroban Capital Partners LP now owns 3,061,134 shares of the data storage provider’s stock worth $195,882,000 after acquiring an additional 2,910,062 shares in the last quarter. AQR Capital Management LLC increased its holdings in Western Digital by 70.4% in the 4th quarter. AQR Capital Management LLC now owns 2,972,703 shares of the data storage provider’s stock worth $512,107,000 after acquiring an additional 1,228,661 shares in the last quarter. Finally, UBS AM a distinct business unit of UBS ASSET MANAGEMENT AMERICAS LLC raised its stake in Western Digital by 6.0% during the 4th quarter. UBS AM a distinct business unit of UBS ASSET MANAGEMENT AMERICAS LLC now owns 2,809,409 shares of the data storage provider’s stock worth $483,977,000 after acquiring an additional 159,167 shares during the period. 92.51% of the stock is currently owned by hedge funds and other institutional investors.
Key Headlines Impacting Western Digital Here are the key news stories impacting Western Digital this week:
Positive Sentiment: Western Digital is benefiting from a rebound in memory stocks as investors step back in after last week’s selloff, improving sentiment across the semiconductor group. Micron Jumps 5%, SanDisk Rises 6%, Western Digital Climbs 4% as Memory Stocks Rebound With Chips Positive Sentiment: Morgan Stanley’s view that the memory-stock selloff created a strong entry point is encouraging dip-buying in Western Digital and other chip names. The Memory Stock Sell-Off Created a ‘Strong Entry Point,’ Says Morgan Stanley. Investors Are Buying In. Neutral Sentiment: Western Digital Malaysia was recognized for advancing sustainable AI infrastructure, which supports the company’s AI narrative but is unlikely to be the main stock-moving catalyst today. WD Malaysia Recognized for Advancing Sustainable AI Infrastructure Insider Activity at Western Digital In related news, CEO Irving Tan sold 20,000 shares of the business’s stock in a transaction dated Friday, May 1st. The stock was sold at an average price of $411.84, for a total value of $8,236,800.00. Following the sale, the chief executive officer directly owned 598,150 shares in the company, valued at approximately $246,342,096. The trade was a 3.24% decrease in their ownership of the stock. The transaction was disclosed in a filing with the Securities & Exchange Commission, which is accessible through this hyperlink. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, Director Bruce E. Kiddoo sold 750 shares of the firm’s stock in a transaction that occurred on Thursday, May 28th. The shares were sold at an average price of $528.52, for a total value of $396,390.00. Following the transaction, the director owned 3,903 shares of the company’s stock, valued at $2,062,813.56. This represents a 16.12% decrease in their position. The SEC filing for this sale provides additional information. Insiders sold 28,959 shares of company stock worth $12,631,666 over the last 90 days. Company insiders own 0.18% of the company’s stock.
Analyst Upgrades and Downgrades Several brokerages have weighed in on WDC. JPMorgan Chase & Co. lifted their price target on shares of Western Digital from $530.00 to $650.00 and gave the company an “overweight” rating in a report on Friday, June 12th. Fox Advisors cut shares of Western Digital from an “overweight” rating to an “equal weight” rating in a research note on Monday, June 22nd. Rosenblatt Securities upped their target price on shares of Western Digital from $340.00 to $500.00 and gave the stock a “buy” rating in a report on Friday, May 1st. Susquehanna increased their price target on Western Digital from $360.00 to $500.00 and gave the stock a “neutral” rating in a research note on Wednesday, July 8th. Finally, Melius Research set a $1,050.00 price target on Western Digital and gave the stock a “buy” rating in a research note on Monday, June 29th. Two analysts have rated the stock with a Strong Buy rating, eighteen have given a Buy rating and four have assigned a Hold rating to the company’s stock. Based on data from MarketBeat, the stock has an average rating of “Moderate Buy” and a consensus target price of $520.32.
View Our Latest Stock Report on Western Digital
Western Digital Price Performance Western Digital stock opened at $487.42 on Tuesday. The stock has a market cap of $168.00 billion, a P/E ratio of 29.10 and a beta of 2.11. Western Digital Corporation has a 1 year low of $66.04 and a 1 year high of $799.87. The firm’s 50 day moving average price is $560.32 and its 200-day moving average price is $388.23.
Western Digital (NASDAQ:WDC – Get Free Report) last released its earnings results on Thursday, April 30th. The data storage provider reported $2.72 EPS for the quarter, topping the consensus estimate of $2.39 by $0.33. The firm had revenue of $3.34 billion for the quarter, compared to the consensus estimate of $3.25 billion. Western Digital had a net margin of 55.29% and a return on equity of 42.95%. The company’s quarterly revenue was up 45.5% compared to the same quarter last year. During the same quarter in the previous year, the firm earned $1.36 earnings per share. Western Digital has set its Q4 2026 guidance at 3.100-3.400 EPS. As a group, equities analysts expect that Western Digital Corporation will post 9.61 EPS for the current year.
Western Digital Increases Dividend The business also recently declared a quarterly dividend, which was paid on Wednesday, June 17th. Shareholders of record on Friday, June 5th were paid a $0.15 dividend. This represents a $0.60 annualized dividend and a yield of 0.1%. The ex-dividend date was Friday, June 5th. This is an increase from Western Digital’s previous quarterly dividend of $0.12. Western Digital’s dividend payout ratio is presently 3.58%.
Western Digital Profile (Free Report)
Western Digital Corporation is a global data storage company that designs, manufactures and sells a broad range of storage devices and systems for personal, enterprise and cloud applications. Headquartered in San Jose, California, the company develops hard disk drives (HDDs), solid-state drives (SSDs), NAND flash components and finished storage products used in PCs, external storage, servers, network-attached storage (NAS) and embedded systems.
Its product portfolio spans consumer and commercial markets, including internal and external HDDs and SSDs, removable flash memory products and storage platforms for data center and enterprise environments.
Recommended Stories Five stocks we like better than Western Digital The Ugliest Stocks in the Market Just Got a Very Expensive Vote of Confidence Is Domino’s Stock Serving Up a Buying Opportunity? A $1T Black Hole: SpaceX Eyes Pentagon AI to Break Free Why Gold Miners Could Be the Market’s Biggest Comeback Story Want to see what other hedge funds are holding WDC? Visit HoldingsChannel.com to get the latest 13F filings and insider trades for Western Digital Corporation (NASDAQ:WDC – Free Report).
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Western Digital čeká, že AI poháněný růst dat zvýší dlouhodobou poptávku po HDD na více než 25% CAGR. Firma zároveň po oddělení flash byznysu do SanDisk dál rozvíjí nové technologie HDD pro hyperscalery.
Key Takeaways Western Digital expects AI-driven data growth to boost long-term HDD storage demand above 25% CAGR.WDC sharpened its HDD focus after separating its flash business into Sandisk to serve hyperscalers.WDC is advancing new HDD technologies to improve throughput and support large-scale AI deployments. The surge in data creation is creating a growing opportunity for storage companies, particularly Western Digital Corporation (WDC - Free Report) . The rapid shift from AI training to large-scale inference is driving an explosion in data creation, significantly increasing demand for persistent, scalable, and cost-effective storage—most of which resides on HDDs. Western Digital expects the rise of agentic AI, which autonomously executes workflows, to further accelerate data generation and extend data retention, boosting storage demand across cloud and enterprise environments.
At the same time, synthetic data and physical AI applications, such as robotics and autonomous systems, are creating massive volumes of video, sensor and training data, forming a compounding cycle of data growth. As a result, WDC believes the AI-driven data economy will drive long-term data storage demand at more than 25% CAGR, positioning its high-capacity HDD roadmap to benefit from this trend. WDC’s quarterly trends have shown massive revenue growth, improving gross margins, better pricing discipline and strong enterprise demand. It has also sharpened its focus following the separation of its flash business intoSandisk (SNDK - Free Report) , allowing management to concentrate on advancing HDD technologies and serving hyperscale customers more effectively.
Moreover, AI pipelines increasingly demand higher throughput, an area where flash has traditionally dominated. WD has introduced two industry-first technologies that fundamentally change HDD performance dynamics – High Bandwidth Drive Technology and Dual Pivot Technology. High Bandwidth Drive technology is already in customers’ hands for validation, while HDDs featuring Dual Pivot technology remain in the lab and are slated for introduction in 2028. On the other hand, power-optimized drives are expected to be in customer qualification in 2027, effectively creating a new economic storage tier between warm and cold data, critical for sustainable AI deployments at scale.
However, Western Digital competes with well-funded rivals like Seagate Technology Holdings plc (STX - Free Report) in HDDs and several major NAND manufacturers in flash technologies.
AI Presents Huge Potential: Can WDC Outpace Peers?The rise of AI-driven inference workloads is increasing demand for both cloud and edge storage, with growing interest from sovereign and neo-cloud data centers in Seagate’s enterprise nearline drives and storage systems. Seagate is capitalizing on this trend through its focus on areal-density innovation rather than unit-volume growth. Its HAMR-based Mozaic platform exemplifies this strategy, with the second-generation Mozaic 4+ delivering up to 44TB per drive—more than 30% higher capacity than the first generation. Enhanced by Seagate’s proprietary laser and integrated photonics technology, the platform improves storage density, cost efficiency and scalability, supporting the company’s targeted mid-20% annual data-center exabyte growth.
Sandisk is benefiting from AI-led demand that is lifting enterprise SSD adoption and supporting pricing across NAND end markets. NAND is becoming a critical part of AI inference architectures such as KV cache and RAG, which expands low-latency flash needs beyond the model itself. In February 2026, Sandisk and SK hynix launched a joint initiative to standardize High Bandwidth Flash, a next-generation memory solution designed for the growing demands of AI inference. The effort reflects a broader industry shift from AI model training to inference, where efficient memory systems are critical to handle increasing data workloads and enable future AI infrastructure growth.
WDC Price Performance, Valuation and EstimatesIn the past year, shares of WDC have surged 586.5% compared with the Zacks Computer-Storage Devices industry’s growth of 381.6%.
Image Source: Zacks Investment Research
Going by the price/earnings ratio, the company’s shares currently trade at 24.35 forward earnings compared with 10.63 for the industry.
Image Source: Zacks Investment Research
WDC’s estimate revisions are on an upward trajectory currently. The Zacks Consensus Estimate for WDC’s earnings for fiscal 2026 has been revised north by 0.4% to $10.06 over the past 60 days, while the same for fiscal 2027 has gone up 8.4% to $18.64.
Image Source: Zacks Investment Research
Currently, Western Digital has a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Western Digital čeká ve 4. fiskálním čtvrtletí 2026 tržby kolem 3,65 miliardy USD a vyšší marže díky silné poptávce po AI úložištích. Seagate také očekává tržby kolem 3,45 miliardy USD, tažené růstem poptávky po datových centrech.
Key Takeaways Western Digital expects stronger Q4 FY2026 revenues and higher margins on robust AI storage demand. Seagate projects higher Q4 FY2026 revenues, backed by growing data-center storage demand and cash flow.Western Digital and Seagate project strong earnings growth as AI storage demand remains robust. The boom in artificial intelligence (AI) has led to persistent demand for NVIDIA Corporation’s (NVDA - Free Report) state-of-the-art AI hardware, including graphics processing units and Blackwell chips. That demand propelled NVIDIA to become the world’s most valuable company, with a market capitalization of over $4 trillion, and its stock has delivered strong returns over the past few years.
However, NVIDIA’s growth has led to the company trading at a premium in comparison to most of the other semiconductor players, leaving little room for disappointment if growth derails. A slowdown in AI infrastructure spending by hyperscale cloud providers could impact NVIDIA’s revenue and earnings growth, while competition from rivals like Advanced Micro Devices, Inc. (AMD - Free Report) continues to increase.
At the same time, U.S. export curbs on cutting-edge AI chips to China have constrained NVIDIA’s entry to a key market, potentially pressuring its margins. Additionally, NVIDIA remains exposed to supply-chain disruptions due to its dependency on Taiwan Semiconductor Manufacturing Company Limited (TSM - Free Report) for advanced chip production amid ongoing geopolitical tensions.
Given these challenges, it’s becoming increasingly difficult for NVIDIA to meet sky-high expectations. Thus, investors seeking AI exposure should look for much smaller companies with greater room for expansion. Notable among them are Western Digital Corporation (WDC - Free Report) and Seagate Technology Holdings plc (STX - Free Report) , whose shares have soared 662.8% and 464.5%, respectively, over the past year, outpacing NVIDIA’s gain of 22.6%.
Both Western Digital and Seagate stand to gain from the rapid growth in AI-driven demand for data storage. Let’s take a closer look at the key catalysts that could drive further upside in these AI stocks –
Western Digital’s AI Storage Boom Could Drive Further Upside Rising demand for high-value enterprise hard disk drives and a favorable pricing environment have created a solid growth runway for Western Digital. The company’s revenues totaled $3.34 billion in the fiscal third quarter of 2026, up 45% year over year, according to the company’s press release.
Furthermore, the company expects revenues for the fiscal fourth quarter of 2026 to be about $3.65 billion, plus or minus $100 million. The upbeat guidance reflects robust demand for AI infrastructure, with cloud providers and enterprise customers continuing to invest in high-capacity storage to meet increasing AI workloads.
In the fiscal third quarter, Western Digital’s non-GAAP gross margin rose to 50.5% from 40.1% in the prior-year period. The company projects further margin expansion, with fiscal fourth-quarter non-GAAP gross margin expected to reach 51-52%. The improving gross margin is providing Western Digital with greater financial flexibility to invest in research and development, enhance earnings growth and create long-term value for shareholders.
As a result, the company’s expected earnings growth rate for the current year is 104.1%. The Zacks Consensus Estimate of $10.06 for WDC’s earnings per share (EPS) is up 54.8% year over year.
Image Source: Zacks Investment Research
Seagate’s AI Infrastructure Play Gains Momentum Amid Rising Demand Seagate is well-positioned to sustain its growth momentum, banking on rising data-center storage demand, expanding margins, and robust cash flows. These favorable trends could provide the required upside for Seagate’s shares, strengthening its position as a potential beneficiary of the AI infrastructure boom.
For the fiscal fourth quarter of 2026, Seagate expects revenues of around $3.45 billion, plus or minus $100 million, more than the $3.11 billion reported in the fiscal third quarter of 2026, according to investors.seagate.com.
Moreover, a non-GAAP gross margin of 47% in the fiscal third quarter reflected improved operational execution and enhanced profitability. Additionally, the company’s free cash flow of $953 million in the fiscal third quarter showcased the strength in its core business.
Supported by these trends, Seagate’s expected earnings growth rate for the current year stands at 84.3%, while the Zacks Consensus Estimate of $14.93 for STX’s EPS represents a 47.5% increase from the prior-year period.
Image Source: Zacks Investment Research
Both Western Digital and Seagate currently have a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks Rank #1 stocks here.
Continued supply shortages, dramatic price increases, surging AI demand, and persistent competition across international markets have all contributed to volatility in the computer memory industry. With the impending IPO of China's ChangXin Memory Technologies, the landscape is likely to only become more competitive and uncertain in the near-term. Still, many tech firms are scrambling to secure supply despite an intensifying marketplace and new competition.
The result is an environment that could be beneficial to many participants in the memory storage space, although for different reasons. Makers of hard disk drives (HDDs) face different challenges and opportunities than companies behind NAND flash tools or enterprise solid-state drives (SSDs), for instance. This means that companies including Seagate Technology NASDAQ: STX, Western Digital Corp. NASDAQ: WDC, and Sandisk Corp. NASDAQ: SNDK can all find a niche and, potentially, room for further share price appreciation.
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Seagate's HDD Business Soars, But What Upside Remains?Overall MarketRank™94th Percentile
Analyst RatingModerate Buy
Upside/Downside8.5% Upside
Short Interest LevelHealthy
Dividend StrengthWeak
News Sentiment0.93 Insider TradingSelling Shares
Proj. Earnings Growth91.80%
See Full Analysis
Seagate is a major manufacturer of HDDs, which are increasingly popular among hyperscalers because they remain cheaper alternatives to some other types of memory products. The company is also an emerging leader in heat-assisted magnetic recording (HAMR), an advanced technology that may be poised for a demand surge in the coming years.
This positioning has benefited Seagate's financial performance considerably: in the latest quarter, the company grew revenue by 44% year over year (YOY) to $3.1 billion while achieving a non-GAAP gross margin of 47%. Both top- and bottom-line performance came in well ahead of analyst expectations, as the firm beat predictions for earnings per share (EPS) by a solid 59 cents. HAMR momentum in particular helped to drive some of these gains.
Strong guidance for the foreseeable future and a long-term revenue growth target of at least 20% per year suggest that Seagate may be able to continue to ride this momentum, which has already contributed to shares coming close to tripling year to date (YTD). Even still, analysts expect additional upside, with a consensus price target close to $899, and 22 of 27 ratings for STX are Buys.
What investors might watch out for with this stock are its potential for future growth, given its dramatic rally in recent months, as well as its heavy reliance on HDDs and related technologies.
Western Digital's Cleaner Post-Spin-Off Business Finds Its LegsOverall MarketRank™88th Percentile
Analyst RatingModerate Buy
Upside/Downside1.3% Upside
Short Interest LevelHealthy
Dividend StrengthWeak
News Sentiment0.76 Insider TradingSelling Shares
Proj. Earnings Growth87.71%
See Full Analysis
Western Digital has had almost a year and a half since officially spinning off Sandisk as a separate company focused on flash memory and SSD. The result is a company that is streamlined to focus on enterprise HDDs, with strong pricing and improving profitability metrics. While the firm is likely behind Seagate on its capacity to commercialize HAMR products and has a smaller share of the enterprise HDD space, its long-term agreements give it strong support for years to come.
In the most recent quarter, Western Digital boosted revenue by 45% YOY to $3.3 billion while almost doubling EPS over the same period. Its gross margin of 50.5% is also notable, as the firm was able to cut more than $3 billion in debt and generated close to $1 billion in free cash flow. At the same time, Western Digital has been aggressive about shareholder value returns, repurchasing $752 million in stock last quarter and boosting its dividend in the process.
Like STX, WDC shares have almost tripled YTD, and analysts suspect that this momentum may have stalled somewhat. Still, 20 out of 24 call WDC a Buy heading into the second half of the year.
Sandisk Stock Remains in Focus After Its Spin-OffOverall MarketRank™89th Percentile
Analyst RatingModerate Buy
Upside/Downside11.7% Upside
Short Interest LevelHealthy
Dividend StrengthWeak
News Sentiment0.63 Insider TradingSelling Shares
Proj. Earnings Growth186.42%
See Full Analysis
Investors considering Western Digital will also want to look at how Sandisk has fared after the spin-off. SNDK shares are up some 458% YTD, a massive rally to be sure, but have fallen by more than 27% in the last month. This volatility makes SNDK stand out somewhat in the memory space but could also present opportunities for investors willing to accept the risk.
On the business side, Sandisk has performed exceptionally well: the latest quarter brought several multi-year new business agreements worth tens of billions of dollars, 251% YOY revenue improvement to nearly $6 billion, adjusted free cash flow of almost $3 billion, and gross margin of 78.4%. Management sees a strong quarter to come as well, including revenue between $7.75 billion and $8.25 billion and gross margin as high as 81%. The company is also engaging in a massive share buyback program.
It goes to show just how well Sandisk has done that even after the massive rally, Wall Street still sees 17% in possible upside. In terms of ratings, 21 Buys and five Holds suggest a very bullish perspective among analysts, making SNDK a standout even within a strong industry.
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Western Digital ve 3. fiskálním čtvrtletí 2026 dodala 222 exabajtů, o 34 % více meziročně, a cílí na sériovou výrobu 40TB UltraSMR v druhé polovině fiskálního roku 2026. HAMR má začít nabíhat v roce 2027.
Key Takeaways Western Digital is advancing HAMR and ePMR to meet rising AI and cloud storage demand.WDC shipped 222 exabytes in fiscal Q3 2026, up 34% year over year, including 32TB ePMR drives.Western Digital targets 40TB UltraSMR volume production in fiscal 2026 and HAMR ramp in 2027. Western Digital Corporation (WDC - Free Report) is advancing its Heat-Assisted Magnetic Recording (HAMR) strategy to support rising demand for high-capacity storage in the AI-driven data economy. As artificial intelligence (AI) adoption and cloud computing continue to accelerate data creation, the company believes the need for persistent, scalable and cost-efficient storage will continue to increase.
On the last earnings call, management highlighted that AI training, inferencing, the emergence of agentic AI, synthetic data generation and physical AI applications, including robotics and autonomous vehicles, are expected to drive long-term storage demand CAGR of more than 25%. To address these evolving requirements, the company is expanding its HDD technology portfolio with higher-capacity drives, improved performance and lower total cost of ownership.
Western Digital continues to collaborate with hyperscale customers while advancing areal density improvements and accelerating its ePMR and HAMR roadmaps. In the third quarter of fiscal 2026, the company shipped 222 exabytes, up 34% year over year, including 4.1 million next-generation ePMR drives totaling 118 exabytes with capacities of up to 32TB. It is also expanding UltraSMR adoption, leveraging its reliability, scalability and total cost of ownership advantages for data center customers.
To strengthen its HAMR capabilities, the company acquired intellectual property and talent to enhance its in-house laser development expertise and introduced UltraSMR-enabled JBOD platforms with software ecosystem partners to broaden adoption through higher storage density and hyperscale-class performance. Firm purchase orders from its top seven customers extend through 2026, while multi-year commercial agreements with three of its top five customers continue into 2027 and 2028.
Western Digital has outlined a customer-focused storage roadmap centered on scalable capacity, improved performance, better power efficiency and faster deployment while maintaining HDD economics. Its 40TB UltraSMR ePMR HDD is targeted for volume production in the second half of fiscal 2026, while HAMR drives are expected to ramp in 2027. The roadmap extends ePMR to 60TB and scales HAMR technology toward 100TB by 2029. The company is also advancing High Bandwidth Drive Technology, Dual Pivot Technology and power-optimized drives, while expanding UltraSMR adoption and its Platforms business to support AI-scale storage deployments.
Taking a Look at WDC’s CompetitorsSeagate Technology Holdings plc (STX - Free Report) is strengthening its leadership in HAMR technology to address growing AI-driven demand for high-capacity, cost-efficient storage. Its second-generation Mozaic 4+ platform delivers up to 44TB per drive, more than 30% higher capacity than earlier versions, and is expected to dominate HAMR exabyte shipments by the end of 2026. The company has already shipped millions of HAMR drives and expects Mozaic 5, offering up to 50TB capacity, to enter qualification in late 2027. Seagate believes its HAMR roadmap, focused on increasing areal density, will support long-term exabyte growth while improving cost and power efficiency per terabyte.
NetApp, Inc. (NTAP - Free Report) is benefiting from rising enterprise demand for modern all-flash storage and hybrid cloud data management as customers scale AI workloads. Fourth-quarter fiscal 2026 results showed continued growth in all-flash, Public Cloud services and Keystone, supported by deeper hyperscaler partnerships and a larger services backlog. For fiscal 2027, management expects revenue growth to accelerate, and plans to continue returning capital to shareholders, including returning up to all free cash flow, while also investing in AI-focused product refreshes. For fiscal 2027, NetApp projects net revenues in the range of $7.325 billion to $7.575 billion.
WDC Price Performance, Valuation and EstimatesIn the past month, shares of WDC have jumped 12.3% compared with the Zacks Computer-Storage Devices industry’s growth of 5.2%.
Image Source: Zacks Investment Research
In terms of forward price/earnings, WDC shares are trading at 29.54X, higher than the industry’s 13.18X.
Image Source: Zacks Investment Research
The Zacks Consensus Estimate for WDC’s earnings for fiscal 2026 has been revised north 0.4% to $10.06 over the past 60 days, while the same for fiscal 2027 has gone up 8.44% to $18.64.
Image Source: Zacks Investment Research
Currently, Western Digital has a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Key Takeaways WDC is benefiting from AI storage demand, pricing strength and enterprise infrastructure spending.Western Digital cut debt, built a net cash position and expanded share repurchase authorization.WDC's fiscal 2026 and 2027 earnings estimates have moved higher amid improving fundamentals. Western Digital Corporation (WDC - Free Report) has been a standout performer in the storage industry over the past year. Its shares have skyrocketed 723.1% over the past year, outpacing the 458.1% growth of the Zacks Computer-Storage Devices industry. The stock has also outperformed the Zacks Computer & Technology sector’s and the S&P 500’s growth of 33.7% and 23.6%, respectively. After enduring a prolonged downturn caused by weak PC demand and excess memory inventory, the company has benefited from a recovery in storage pricing, growing enterprise demand and the accelerating adoption of AI.
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Western Digital competes against several major players in both HDD and flash storage markets, such as Seagate Technology Holdings plc (STX - Free Report) , NetApp, Inc. (NTAP - Free Report) and Teradata (TDC - Free Report) . STX, TDC and NTAP have gained 482.8%, 60.4% and 55.4%, respectively, in the same time frame.
WDC boasts a 52-week high of $799.87. With WDC outperforming many peers over the last 12 months, investors wonder whether there is still upside potential or whether most of the gains have already been priced in.
Here's a closer look.
Industry Tailwinds Continue to Favor WDC StockSeveral broader trends continue supporting long-term storage demand, such as the AI boom, healthy cloud spending, rising enterprise digital transformation and improving operational efficiency. Driven by rising demand for AI-related storage, WD is strengthening its capacity leadership through continuous innovation. The company is advancing 44TB HAMR and 40TB ePMR high-capacity drives in qualification, with volume production expected in the second half of 2026 and a roadmap extending beyond 100TB.
It is also expanding adoption of its UltraSMR technology, now used by three major customers and supporting nearly all exabyte demand. In addition, WD is introducing high-bandwidth drives and dual-pivot technology to optimize AI workloads, while long-term customer agreements extending through 2028 and 2029 provide greater revenue visibility. AI workloads, agentic AI, synthetic data and physical AI are driving strong demand for HDD storage, with long-term exabyte growth projected to exceed 25% CAGR. As AI-generated data continues to expand, HDDs remain the preferred solution for long-term data retention in hyperscale data centers, complementing flash storage, which is optimized for high-speed performance.
Western Digital is also benefiting from higher pricing, a favorable product mix and cost efficiencies. It expects pricing momentum to continue into late 2026, while improvements in areal density, UltraSMR adoption and supply chain efficiencies are lowering costs and supporting margin expansion without requiring additional manufacturing capacity. The UltraSMR JBOD platform aims to broaden market reach, especially into Tier 2 CSPs and some hyperscalers in Asia. By the end of calendar 2027, most key customers will be on UltraSMR, either fully adopted or in qualification. The forecast indicates that close to 60% of exabytes shipped will be on UltraSMR by the end of fiscal 2027. Expansion into Tier 2 CSPs and hyperscalers is a key strategy.
The company is also considering investments in head and media capacity to support multiyear customer commitments, focusing on technological improvements rather than unit capacity. No new unit capacity investments are planned. The focus is on increasing capacity per drive through technology, such as higher aerial density and more platters. There is potential to increase capacity from 14 disks over time if it proves to be economically viable.
Spin-Off Creates New Opportunities for WDCWestern Digital has been restructuring its business by separating its flash memory operations into Sandisk (SNDK - Free Report) from its HDD business. Investors often reward companies that simplify their business models, allowing each segment to pursue strategies tailored to its specific market. During the fiscal third quarter, WDC strengthened its balance sheet by selling 5.8 million SanDisk shares and using the proceeds to reduce debt by $3.1 billion, leaving only $1.6 billion in convertible debt.
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The company also ended the quarter with a net cash position of $450 million and expanded its capital return program by authorizing an additional $4 billion in share repurchases. Strong free cash flow continues to support WesternDigital's shareholder return strategy. The company increased its quarterly dividend by 20%, and has returned $2.2 billion to shareholders through dividends and share repurchases since the fourth quarter of 2025. Supported by a net cash position, management remains focused on returning excess free cash flow through ongoing buybacks and dividends.
Despite the positive outlook, Western Digital remains far from risk-free. The storage industry remains highly cyclical, with supply-demand imbalances capable of quickly pressuring pricing, margins and profitability. The company also faces intense competition, while any slowdown in AI investment or broader macroeconomic weakness could reduce demand for storage infrastructure.
Upbeat Estimate Revision Trend for WDCWDC’s estimate revisions are on an upward trajectory currently. The Zacks Consensus Estimate for WDC’s earnings for fiscal 2026 has been revised north by 0.4% to $10.06 over the past 60 days, while the same for fiscal 2027 has gone up 8.4% to $18.64.
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Valuation ConsiderationsSeveral factors could support continued appreciation, including rising enterprise demand, a better pricing environment, improving margins, the expansion of AI infrastructure and benefits from corporate restructuring. Going by the price/earnings ratio, the company’s shares currently trade at 28.66 forward earnings compared with 12.59 for the industry.
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In comparison, the forward 12-month price/earnings multiple for STX, TDC and NTAP are 29.51X, 19.71X and 22.67X, respectively.
Should You Consider Buying WDC Stock Now?Western Digital’s improving fundamentals, recovering storage markets, better profitability and growing exposure to AI-driven infrastructure spending drove its strong performance. Its long-term prospects remain encouraging as cloud computing, AI and exploding global data creation continue boosting storage demand. The company's strategic restructuring could unlock further shareholder value over time. However, short-term volatility, pricing swings and macroeconomic uncertainty could create periods of weakness even if the long-term trajectory remains intact.
For long-term investors who can tolerate industry cycles, WDC still appears to offer an attractive way to participate in the growing demand for enterprise storage and AI infrastructure. While last year's outsized gains may be hard to repeat, continued execution and favorable industry trends could still support further upside.
Flaunting a Zacks Rank #1 (Strong Buy), WDC is an appealing portfolio pick at the moment. You can see the complete list of today’s Zacks #1 Rank stocks here.
Western Digital, kterou letos nakoupily účty spojené s Trumpem, dnes klesá o 7,86 %. Firma přitom ve fiskálním 3. čtvrtletí zvýšila tržby o 45 % na 3,34 miliardy USD.
A recent federal ethics disclosure revealed that President Donald Trump's investment accounts bought shares of Western Digital (WDC 7.86%) earlier this year. It's one of the market's biggest AI winners, up more than 2,100% since the start of 2023. And in a bit of awkward timing, the stock is falling today.
Before reading too much into it, one important caveat. The accounts are reportedly managed by third-party institutions, so the president himself wasn't responsible for the decision to buy or sell any particular security. The disclosure, released by the U.S. Office of Government Ethics, showed thousands of trades across those accounts in the first quarter. The Western Digital purchase was just one of many.
Still, the trade is a useful excuse to look at a stock that has quietly become one of the best performers in the entire market.
Image source: Getty Images.
An improbable run The purchase, disclosed in a range of $45,000 to $150,000, went into a company most people know for hard drives. And that ordinary-sounding business is exactly what's driving the stock.
The AI boom has turned out to need somewhere to put all the data it generates. Much of that data lands on the high-capacity hard disk drives Western Digital sells to cloud and data center customers. That demand has transformed the company's results. In its fiscal third quarter (the period ended April 3, 2026), revenue rose 45% year over year to $3.34 billion, and gross margin topped 50%, up from about 40% a year earlier. Non-GAAP (adjusted) earnings per share nearly doubled to $2.72.
"Virtually every AI workload, from training, inference, agentic AI to physical AI, creates data that is stored persistently and cost-efficiently on HDDs," said Western Digital CEO Irving Tan in the company's fiscal third-quarter earnings release.
Management expects the momentum to continue. It guided for fiscal fourth-quarter revenue to rise 36% to 44% year over year, with adjusted gross margin climbing further to 51% to 52%. That would extend an already remarkable run and explain why the market has repriced the stock so dramatically. A company earning better than 50-cent margins on the dollar looks very different from the low-margin drive maker investors used to shrug at.
It's also worth noting what Western Digital is today. The company spun off its flash-memory business, Sandisk, into a separate company in early 2025, leaving Western Digital focused squarely on hard disk drives. That focus has turned into an advantage: the cheap, high-capacity drives it makes are exactly what hyperscalers reach for to store the flood of data that AI systems produce and consume.
Why it's down today So why is a stock this strong falling today? It has little to do with Western Digital itself.
Samsung announced guidance for record quarterly operating profit, driven by the same AI-fueled memory demand lifting the whole sector. Yet instead of cheering, investors sold. One worry may be that results this strong might mark the top of a notoriously volatile cycle. Memory and storage stocks slid across the board, and Western Digital, up more than 200% this year as of this writing, dropped alongside them.
That's the risk hiding inside the stock's 2,100% run-up. Storage and memory have always been cyclical, with booming demand eventually leading to oversupply and ultimately resulting in lower prices (and profits).
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Does the AI storage boom justify the price? After a move this large, a stock's valuation deserves a hard look. Even after today's slide, Western Digital trades at more than 30 times forward earnings. That's a rich multiple for a business the market treated as a sleepy hardware supplier not long ago.
But a valuation like this only makes sense if the current demand surge proves durable. If AI-driven storage demand keeps growing and pricing holds, today's earnings can keep climbing and grow into the valuation over time. On the other hand, if the cycle turns, shares could crater.
So, is Western Digital a buy after its enormous run?
I'd be cautious here. The business is booming, and the AI storage demand behind it is no mirage. But buying a cyclical stock just weeks after it set record highs, at more than 30 times earnings, after a 2,100% run, leaves little room for error if the cycle cools. Today's sell-off, triggered by good news rather than bad, is a reminder of how quickly sentiment can shift in this corner of the market.
Melius Research zahájila pokrytí Seagate a Western Digital s doporučením koupit a cílovými cenami zhruba o 55 % nad aktuální cenou. Obě firmy těží z poptávky po AI, silných marží a vysokého volného cash flow.
CNBC’s Oliver Renick highlighted a split in investor sentiment on his Options Action segment this morning. Melius Research initiated coverage of Seagate and Western Digital as Buy-rated stocks, with price targets about 55% above current levels. Renick reported that options flow leaned bullish in each stock, with roughly twice as many calls bought as puts, but that overall volume was “surprisingly muted” compared with the heat in adjacent memory names.
Seagate: Margins and Cash Flow Reset Higher Seagate Technology (NASDAQ:STX | STX Price Prediction) closed its March quarter with revenue of $3.11 billion, up 44.1% year over year, and non-GAAP EPS of $4.10 against a $3.50 consensus. Non-GAAP gross margin printed at 47.0%, up from 36.2% a year earlier, and free cash flow reached $953 million versus $216 million in the prior-year quarter. The company also retired roughly $641 million in debt during the quarter.
CEO Dave Mosley framed the setup as durable, telling investors that, “Seagate is entering a new era of structural growth as AI applications amplify data creation and support sustained storage demand.” Guidance for the June quarter calls for revenue of $3.45 billion plus or minus $100 million and non-GAAP EPS of $5.00 plus or minus $0.20.
Western Digital: A Pure-Play HDD Story Crosses 50% Gross Margin Western Digital (NASDAQ:WDC), now a pure-play HDD company after the February 2025 spin-off of its Flash business into Sandisk, reported Q3 FY2026 revenue of $3.337 billion, up 45.47% year over year, with non-GAAP EPS of $2.72 versus a $2.392 estimate. Non-GAAP gross margin reached 50.5%, and free cash flow came in at $978 million.
CEO Irving Tan tied the result to AI workloads, stating that “Virtually every AI workload, from training, inference, agentic AI to physical AI, creates data that is stored persistently and cost-efficiently on HDDs.” Management also raised the quarterly cash dividend by 20% to $0.15 per share and repurchased $752 million of stock during the quarter. Q4 FY2026 guidance calls for revenue of about $3.65 billion, non-GAAP gross margin of 51%-52%, and non-GAAP EPS of $3.25 plus or minus $0.15.
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Memory Stocks Are Sending a Different Signal While Seagate and Western Digital attracted modestly bullish options activity, the rest of the memory sector looked far less optimistic. Renick noted that Micron was the most actively traded name of the morning, with nearly 300,000 options contracts changing hands and implied volatility around 100. Even so, the stock remained only slightly above its pre-earnings level, suggesting traders are still uncertain about its near-term direction.
SanDisk also came under pressure, with more than twice as many call options sold as bought. The bearish positioning coincided with reports that South Korean rivals SK Hynix and Samsung plan to invest roughly $500 billion in new manufacturing hubs. Renick also noted that the DRAM ETF was down 6.5%, underscoring the broader weakness across memory stocks.
What Investors Should Watch Next Melius Research believes Seagate and Western Digital are well positioned to benefit from a favorable supply-and-demand backdrop in hard disk drives, a thesis supported by both companies’ record margins, strong free cash flow, and improving shareholder returns.
The next signal to watch is whether options traders begin matching that optimism. If bullish options activity and trading volume increase, it could suggest broader investor confidence is building behind the analyst call. If traders continue favoring hedges in names like Micron and SanDisk instead, it would indicate investors remain cautious about the broader memory sector despite the bullish outlook for Seagate and Western Digital.
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Dell klesl o 6 %, zatímco Western Digital vzrostl o 5 % po silných výsledcích Micronu, které podpořily paměťové a úložné tituly. Trh tak dnes zvýhodňuje dodavatele pamětí před výrobci serverů a PC.
Shares of Dell Technologies (NYSE:DELL | DELL Price Prediction) are down 6% in midday trading Thursday, last changing hands near $407 after closing at $434.06 on Wednesday. The slide stands out because it’s happening on a day when memory and storage names are ripping higher.
At the same time, Western Digital (NASDAQ:WDC) stock is up 5%, trading near $678. The split between a server and PC builder falling while a storage maker rallies tells the story of today’s market action in AI hardware stocks.
Both names have been monster performers in 2026. Dell stock is up 224% year to date through Wednesday’s close, while Western Digital stock has climbed 296% year to date. Today’s divergence isn’t subtle.
Two Sides of the Memory Boom The catalyst behind Western Digital’s move is straightforward. Memory and storage stocks rallied after Micron Technology‘s (NASDAQ:MU) blowout quarterly results “justify elevated valuations” and reinforced the view that AI capital spending keeps accelerating. Memory has been a bottleneck in the AI buildout, and that scarcity is now showing up as pricing power for the suppliers.
Western Digital is a pure-play HDD beneficiary of that dynamic. The company’s most recent quarter showed non-GAAP gross margin of 51% and revenue of $3.34 billion, up 46% year over year. CEO Irving Tan summed up the demand backdrop, stating, “Virtually every AI workload, from training, inference, agentic AI to physical AI, creates data that is stored persistently and cost-efficiently on HDDs.”
Dell’s drop today doesn’t have a single confirmed catalyst, but it likely reflects the flip side of that same memory squeeze. Dell builds servers and PCs that buy memory, so the rising prices lifting Western Digital and peers translate into input-cost pressure for Dell’s box-maker business. It’s the same dynamic behind hardware-cost worries hitting other consumer device names this week.
Margin Pressure Was Already Visible Dell’s most recent earnings made the margin issue concrete. In Q1 FY2027, the company posted revenue of $43.84 billion, up 88% year over year, alongside AI-optimized server revenue of $16.13 billion, up 757% year over year. The top-line growth here is undeniable.
Yet, the same report showed gross margin compressed to 18% from 21% year over year, with management attributing the pressure to a mix shift toward lower-margin AI servers. With memory costs climbing on top of that mix shift, the bear read on Dell today is that the margin math gets harder before it gets easier.
There’s also a simpler explanation worth flagging. After a 224% run this year, some profit-taking in Dell stock is hardly surprising. One red day after that kind of rally isn’t a thesis change.
Peers Follow the Split The divergence is showing up across the complex. SanDisk (NASDAQ:SNDK) and Micron are riding the memory bid alongside Western Digital, while assemblers and hardware makers that purchase those components are mixed at best. Capital appears to be rotating, at least for the session, toward the picks-and-shovels suppliers feeding the AI buildout rather than the box makers stitching the systems together.
Western Digital isn’t a cheap stock here. Sentiment in the WallStreetBets community spiked to a very bullish reading of 82 last week before cooling. That mix of retail enthusiasm and the scale of this year’s run means expectations are elevated.
What to Watch Western Digital reports its Q4 FY2026 results in late July, with the company guiding to revenue of $3.65 billion plus or minus $100 million and non-GAAP EPS of $3.25 plus or minus $0.15. Dell follows with Q2 FY2027 numbers in late August, with management guiding to revenue of $44 billion to $45 billion.
Investors can watch whether today’s split widens into a broader rotation between memory suppliers and hardware assemblers, or fades as the market digests Micron’s results. The next earnings cycle should clarify how much of the memory boom flows to margins, and how much gets absorbed by buyers like Dell.
Micron, Western Digital a SanDisk rostou před výsledky Micronu, protože trh s pamětí dál sílí. Needham zvýšil cílovou cenu Micronu na 1 550 USD z 500 USD a ponechal doporučení koupit.
Micron Technology (NASDAQ:MU | MU Price Prediction) stock is up about 6% in Monday morning trading to around $1,199, leading a broad memory and storage rally into the company’s Wednesday earnings report. Western Digital (NASDAQ:WDC) stock is also up by about 6% to around $788, while SanDisk (NASDAQ:SNDK) stock is up 5% to around $2,294.
The group is resisting worries about renewed U.S.-Iran tensions, including fresh strike threats and concerns over the Strait of Hormuz.
That memory and storage are catching a bid despite the geopolitical backdrop underscores how much conviction has built around the so-called memory supercycle. The memory/storage complex hit record highs last Thursday, with Friday, June 19, closed for Juneteenth.
Needham’s $1,550 Micron Target Lights the Fuse The freshest catalyst is a major Wall Street endorsement. Needham raised its price target on Micron stock to $1,550, up from $500, and maintained a Buy rating ahead of Wednesday’s report.
The firm argued that the memory market has continued to strengthen over the past 90 days, with fundamentals “stronger for longer” thanks to robust demand, a firm pricing environment, and limited capacity additions. Needham also believes long-term agreements being signed across the industry are giving suppliers, including Micron, better demand visibility that extends over multiple years.
Micron stock has been a freight train into the earnings report. The shares are up 298% year to date (YTD) through June 18, with last quarter’s results showing revenue of $23.86 billion and a guide for fiscal Q3 2026 revenue of $33.5 billion plus or minus $750 million.
Storage Peers Get Their Own Upgrades The bullish analyst drumbeat isn’t isolated to Micron. JPMorgan raised its Western Digital price target to $650 from $530 (Overweight) on June 12, citing a more positive pricing view and accelerating year-over-year price increases for HDD makers. Wells Fargo raised its Western Digital stock price target to $575 from $500 (Overweight) on June 1.
Micron stock also received price target upgrades last week from Wedbush, Rosenblatt, and Stifel. Adding to the demand-side narrative, Apple (NASDAQ:AAPL) CEO Tim Cook’s recent comments that memory and storage cost increases are making Apple price hikes “unavoidable” helped fuel the sector’s bullish momentum last week.
SanDisk stock, the NAND-focused spinoff, has ridden the same wave. Last quarter, SanDisk reported revenue of $5.95 billion with gross margin of 78%, validating the AI-storage thesis.
Bubble or Supercycle? The Debate Heats Up Not everyone is convinced that the move can continue without a pause. Technical readings are flashing yellow across the group, with RSI readings of 66.4 for Micron, 70.9 for SanDisk, 74 for Seagate, and 78 for Western Digital, with 70-plus generally considered overbought.
The crowd is also split. Retail sentiment on StockTwits has been bearish for SanDisk and Micron even amid the rally, even as the Polymarket contract for Micron’s Wednesday report is pricing in a 97% probability of a non-GAAP EPS beat above the $19.66 consensus. The analyst consensus target on Micron stock sits at $945.6, well below the current price, reflecting how far the tape has run ahead of Street models.
What to Watch The next pivot is Wednesday, June 24, after the close, when Micron reports its fiscal Q3 2026 results. Investors can watch for whether management’s guidance validates the “stronger for longer” thesis or gives the overbought tape a reason to cool.
Until then, the memory complex looks willing to ignore the macro noise. Keep an eye on whether Micron stock can hold above the $1,200 level, and whether Western Digital stock and SanDisk stock track it tick for tick.
