Thanks to AI, WD and Seagate SSDs are about to get much more expensive

We're just two months into the new year, and hard drive manufacturers, Western Digital (WD) and Seagate, have announced that their high-capacity drives are almost completely sold out, meaning you will likely have to pay up to double the usual price just to get your hands on one.

The main culprit to blame here is AI (of course). Both WD and Seagate have locked in restrictive supply agreements with their top seven customers. We are looking at the usual hyperscale suspects like Amazon (AWS), Google, Microsoft (Azure), and Meta, who are frantically building infrastructure for massive AI workloads.

Western Digital CEO Tiang Yew Tan confirmed during a February earnings call that these clients have firmly locked in purchase orders that consume the company's entire production capacity for the calendar year 2026. It does not stop there because WD has signed Long-Term Agreements (LTAs) extending deep into 2027 and even 2028, completely booking exabytes of storage for the whole year. For context, a single exabyte is equivalent to one billion gigabytes.

According to Seagate CEO William Mosley, their nearline capacity is fully allocated. He noted that demand visibility is strengthening enough to extend to 2027 and that multiple cloud customers are already discussing 2028 because supply assurance is now their "highest priority." Seagate has no plans to expand production capacities. Growth is strictly coming from making denser drives, not more of them. CFO Gianluca Romano added that while they might sell a few extra exabytes on the open market if they get lucky with yields, the vast majority is already spoken for.

AI has been gobbling up PC components left and right. All that silicon is going to "hyperscalers" while leaving out the ordinary Joe who just wants to build a gaming rig. A 32GB kit of DDR5 RAM that used to cost under $95 can now cost up to $410, and it's not like the suppliers are to blame here. There is a lot of profit to be made when desperate companies start bidding wars. Western Digital's revenue, according to Heise online, jumped 25 percent in the fourth quarter of 2025 to hit $3 billion. Even better for the company, its operating profit climbed 62% to $908 million.

Companies like Samsung and SK hynix are also cashing in on the boom, with Samsung posting a record-breaking operating profit of over $14 billion recently. The Korean company explicitly stated that it would focus on high-bandwidth memory (HBM) and enterprise SSDs to support the AI rush, instead of consumer parts.

Source

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Posted Wednesday 18 February 2026 at 6:33 am AEST (my time).

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