Hard Drive Prices Forecast to Rise 24% Amid High Demand
Buyers of enterprise storage should prepare for increased procurement costs as demand for high-capacity hardware outpaces supply.
Updated on Oct. 22, 2026 in Economic Indicators
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Western Digital shares rose 3.89% after Bank of America increased its price target for the company to $800 from $720. The valuation shift follows strong revenue growth driven by sustained high demand for hard-drive storage.
Why it matters
Operators in sectors reliant on data storage infrastructure should note that demand currently exceeds supply, driving price increases that are bolstering profit margins for hardware providers. This environment is likely to persist through 2028 as storage capacity requirements continue to climb.
Western Digital reported revenue of $3.75 billion, a 44% increase in its fiscal fourth quarter, with Bank of America forecasting further growth to $4.22 billion in the next quarter. The company’s fiscal fourth-quarter adjusted gross margin hit 54.4%.
The players
Bank of America
A global financial institution providing investment banking and equity research services.
Western Digital
A developer and manufacturer of data storage solutions and hard-drive technology.
The details
Bank of America raised its target by applying a 16-times earnings multiple, relying on higher earnings estimates to offset a reduction in the multiple. The company is currently scaling volume production for its 40-terabyte ePMR hard drive, which has already qualified with two customers. Analysts expect average prices per terabyte to climb 24% while shipment growth accelerates through the second half of fiscal 2027.
Timeline
October 21, 2026: Bank of America raised the price target and shares rose.
October 22, 2026: Western Digital reports fiscal first-quarter results.
Second half of fiscal 2027: Exabyte shipment growth is expected to accelerate.
2028: Strong pricing and margins are expected to continue.
Market Landscape
This analyst outlook extends the baseline 2028 pricing and margin expectations for the data storage industry. Current valuation adjustments reflect a broader trend where supply-constrained hardware producers capitalize on surging demand for high-capacity storage.
Business owners should anticipate sustained, elevated pricing for high-capacity enterprise storage as demand continues to outpace available supply. Procurement teams should re-evaluate capital expenditure budgets for data infrastructure to account for a projected 24% increase in the average price per terabyte.
The takeaway
The data storage market is currently experiencing significant pricing power as supply remains tight relative to global demand. Operators should monitor average price-per-terabyte metrics over the coming quarters to manage procurement costs effectively.
Further reading
For more on broader business cycle trends, visit Economic Indicators.
Source note: This article includes information reported by The Telegraph.
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