Western Digital Projects 25% Exabyte CAGR, Hikes Pricing 9% and Boosts Drive Density
Western Digital projects over 25% CAGR in exabyte growth driven by AI storage and synthetic data, with pricing up 9% year-on-year and further high single-digit increases planned. The company foresees no unit capacity expansion, focusing on aerial density via next-gen ePMR drives and UltraSMR adoption by end-2027.
1. Growth Drivers
Western Digital forecasts over 25% CAGR in exabyte shipments driven by AI training storage, agentic AI data generation and synthetic data for inferencing. CEO Irving Tan highlighted these three core tailwinds as underpinning long-term demand.
2. Pricing and Margins
Pricing for hard disk drives rose 9% year-on-year, with further high single-digit increases expected as new long-term agreements take effect. CFO Kris Sennesael said gross margin will continue improving in Q4 thanks to strong pricing, a mix shift to higher-capacity drives and operational execution.
3. Technology Investments
The company plans no unit capacity expansion but will enhance aerial density through next-generation ePMR drives and accelerate UltraSMR JBOD platform adoption among Tier 2 cloud providers and Asian hyperscalers, aiming for 60% of exabytes shipped on UltraSMR by end-2027.