Western Digital Exhausts Entire 2026 Hard Drive Production Due to AI Demand
In a move that underscores the colossal influence of AI on hardware supply chains, Western Digital’s CEO, Irving Tan, has declared that the company’s hard drive production capacity for the entirety of 2026 is already sold out—with over 10 months still left in the year.
During the firm’s Q2 2026 earnings call, Tan disclosed that Western Digital has solid purchase orders from its top seven clients. Moreover, it has already secured long-term agreements with two of these customers extending into 2027 and one into 2028. Astonishingly, the company’s cloud business now contributes to a whopping 89% of total revenue, dwarfing consumer sales which stand at a mere 5%.
This sell-out is propelled by the insatiable demand from AI companies and data centers that require enormous storage capacity for AI training and inference operations. Despite the advent of SSDs, hard drives continue to be a cost-effective storage solution, with SSDs currently priced at more than 16 times the cost per gigabyte of equivalent HDDs.
Such a shortage is anticipated to trigger significant price hikes for consumer hard drives. In fact, HDD prices have already witnessed an average surge of 46% since September 2025. Industry pundits caution that this trend may compel hard drive manufacturers to favor enterprise clients over individual consumers, potentially making bulk storage solutions financially unviable for home users, including those operating personal media servers.
Source: Tom’s Hardware