WD Sold Out as AI Storage Demand Soars

Western Digital has effectively run out of hard disk drive (HDD) capacity after securing massive enterprise and AI-driven storage deals, signaling how aggressively artificial intelligence is reshaping global infrastructure demand.

During its Q2 earnings call, CEO Irving Tan revealed the company is “pretty much sold out for calendar 2026,” with firm purchase orders from its top seven customers. Long-term agreements (LTAs) are already in place extending into 2027 and even 2028, locking in both exabyte-scale volumes and pricing.

The numbers underscore a dramatic business shift. Cloud revenue now accounts for 89% of Western Digital’s total revenue, while consumer storage has shrunk to just 5%. As AI workloads expand—driven by model training, inference logs, web-scale data scraping, and large-scale backups—hyperscale cloud providers are turning to HDDs for cost-efficient, high-capacity storage.

While AI has already strained global DRAM and GPU supply chains, mechanical HDDs are now experiencing similar pressure. Prices have climbed to their highest levels in two years amid surging demand from the US and China.

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At exabyte scale, SSDs remain too costly for bulk storage, making high-density HDDs the backbone of AI data centers. Western Digital’s capacity crunch highlights a growing reality: the AI boom is no longer just about compute—it is about storage at unprecedented scale.