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The AI data center boom has driven storage companies to secure multiyear contracts with locked-in pricing and volumes extending into 2027-2029. Western Digital, Seagate, and Sandisk all benefit from this demand surge, but Seagate emerges as the top pick due to its pricing locked for all of 2027 and most capacity allocated through 2028, combined with accelerating 56% year-over-year growth guidance.
Western Digital ended fiscal 2026 with $3.51 billion in free cash flow and a net cash position of $500 million, returning $3.1 billion to shareholders through dividends and buybacks. The company expects Q1 fiscal 2027 revenue of $4.1 billion with non-GAAP EPS of $4.00. Competitors Seagate and SanDisk also demonstrated strong profitability and cash generation, with expanding margins and continued shareholder return programs.
Western Digital is capitalizing on persistent data storage demand driven by AI inference and Agentic AI workloads. The company is ramping 40TB ePMR drives and developing 44TB HAMR technology for 2027, while UltraSMR is expected to reach 60% of nearline exabyte shipments by fiscal 2027. As AI shifts from training to inference and autonomous systems generate massive data volumes, HDDs remain cost-efficient for long-term storage, positioning WDC for sustained capacity-driven growth.