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.
22 Articles
22 Articles
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