Pricing Gains Continue for Western Digital as AI Related Demand Remains Strong

Western Digital leads the hard disk drive market. This market is concentrated, with only three players remaining: Western Digital, Seagate, and Toshiba. Seagate and Western Digital have jostled back and forth for top share over the past decade, while Toshiba remains a distant third. Key end markets are phasing out HDDs in favor of solid-state drives, but we still see a future for HDDs in data centers. Total cost of ownership still favors HDDs over SSDs for large workloads where controlling costs is paramount, but immediate read access is less important. This is commonly referred to as nearline storage, which we expect will make up almost all of Western’s business over time.