Seagate and Western Digital shares tumbled Friday after a report that rival Toshiba plans to double hard disk drive output by fiscal 2027 to chase AI data center demand.
Yahoo Finance reported that Seagate Technology stock fell 11% and Western Digital declined 7% as investors digested news of fresh supply heading into a market that had already rewarded the two storage firms with huge gains this year.
On-screen market data tied to the same session showed Seagate at 801.10, down 85.99, or 9.69%, and Western Digital off 7.44% as of 3:22:33 p.m. EDT while trading remained open.
The sell-off followed coverage that Toshiba is preparing a major ramp in hard disk drive production, a direct competitive threat in the storage hardware that feeds modern data centers.
Nikkei reported that Toshiba plans to double its hard disk drive production by fiscal 2027, Yahoo Finance relayed.
The push centers on expanding manufacturing capacity. Toshiba wants a larger slice of the storage market built around artificial intelligence infrastructure, where servers and training clusters chew through vast amounts of disk space.
That AI build-out is the same force that lifted Seagate and Western Digital for months. Even after Friday’s drop, Seagate remained up more than 200% year to date. Western Digital was still ahead more than 140% on the year.
Those run-ups tracked a simple story: AI data centers need storage, and hard disk drives still carry bulk data at a cost solid-state options struggle to match at scale. When a rival signals it will flood more drives into that channel, the market reprices the winners overnight.
Seagate and Western Digital had been among the clearest stock-market beneficiaries of the AI infrastructure boom. Friday showed how fast that premium can shrink when new capacity enters the picture.
Toshiba is not a startup guessing at demand. It is an established electronics name moving money into factories so it can ship more drives into the same AI storage race. Investors read that as more supply chasing the same customers Seagate and Western Digital have been serving at rich valuations.
No direct comments from Toshiba, Seagate, or Western Digital appeared in the Yahoo Finance account. The move was framed through the Nikkei report on the doubling plan and the capacity investment behind it.
Fiscal 2027 is still a ways out. Markets, though, do not wait for the first extra drive to roll off a line. They move on the signal that a competitor intends to grab share in a profitable niche.
Hard disk drives remain workhorse gear for large-scale storage even as flash memory grabs headlines. AI clusters create and retain enormous data sets. That keeps spinning disks relevant, and it keeps production plans material to investors who piled into the two U.S.-listed names on the back of that demand.
Friday’s session turned that thesis into a reminder. A sector can be real and still get crowded. When a third major supplier says it will double output for the same AI storage wave, holders of the highfliers pay attention with their sell buttons.
Free markets still do this work better than any planning board: prices fall when new supply threatens fat margins, and capital gets a cleaner read on who can actually deliver. The AI storage boom is not a free ride forever, and Friday’s tape made that plain.