Seagate Tumbles 10%, Western Digital Drops 7% as Toshiba Moves to Double Hard Disk Output
Toshiba aims for a 30% HDD market share as added supply threatens pricing leverage for Seagate and Western Digital.
- Toshiba plans to double its hard drive production capacity at its Philippines facility, sending Seagate stock down 10% and Western Digital down 7% as the expansion threatens tight supply both companies relied on for pricing leverage.
- Seagate CEO Dave Mosley and Western Digital CEO Irving Tan credited tight supply for pricing leverage on recent earnings calls. Toshiba's expansion directly threatens the scarcity discipline both CEOs used to justify higher prices and support stock runs this year.
- Before the decline, Seagate shares were up 210% year to date and Western Digital stock rose 150% YTD. Toshiba, the smallest of three HDD manufacturers, targets 30% of the market by storage capacity, requiring significant share gains.
- The selloff remains isolated to HDD stocks; the Invesco QQQ Trust rose 1.17% and The Roundhill Memory ETF gained 0.82%. Broader technology and memory stocks trade stronger, confirming damage is confined to one product line.
- Toshiba targets storage demand from AI data centers, the same customers fueling Seagate and Western Digital results. Long-term contracts offer both companies some protection, though timing of Toshiba's capacity reaching cloud buyers remains uncertain.
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Why Western Digital Stock Just Crashed
Key PointsToshiba has 17% market share in hard disk drives. Western Digital has 40%-plus.Now, Toshiba wants to double its market share -- and Western Digital's share could be at risk.If a price war breaks out, Western D's profit margin could also suffer.10 stocks we like better than Western Digital › Computer hard-drive manufacturer Western Digital (NASDAQ:WDC) stock tumbled 11.7% through 1 p.m. ET Friday -- but not for any fault of its own.Inst…
Seagate Tumbles 10%, Western Digital Drops 7% as Toshiba Moves to Double Hard Disk Output
A single capacity announcement from Toshiba sent two of this year's hottest storage stocks into freefall while the rest of the memory sector shrugged it off, and the reason behind that split tells you everything about where the HDD trade stands right now.
The Japanese technology group Toshiba plans to double the production capacity of hard drives (HDDs) used in artificial intelligence data centers by the fiscal year 2027, as the accelerated growth of artificial intelligence (AI) drives demand for data storage. Exclusive material for subscribers. To have full access, access the link of the material and register.
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