Western Digital (WDC) has seen its stock surge by 170% in 2026, driven by a robust demand for hard disk drives (HDDs) in AI data centers. The company reported a remarkable 45% year-over-year revenue increase to $3.34 billion in its latest quarterly results, with adjusted earnings per share soaring 97% to $2.72, significantly surpassing Wall Street expectations. This growth is largely attributed to the cloud segment, which accounted for 89% of revenue, and the ongoing HDD shortage that allows Western Digital to command higher prices.
The implications for financial markets are substantial, as Western Digital’s strong performance reflects broader trends in the AI and cloud storage sectors. The company anticipates that the AI and cloud storage market will grow at a compound annual growth rate of over 25% through 2030, further solidifying its position. Analysts project earnings could exceed $25 per share in the coming years, suggesting a potential stock price of $851, representing an 81% upside from current levels.
For investors, Western Digital presents an attractive entry point at 29 times earnings, capitalizing on the sustained demand for AI infrastructure. As customers secure long-term storage agreements, the favorable pricing environment and strong earnings trajectory position Western Digital as a compelling growth stock in the evolving tech landscape.
Source: fool.com