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Western Digital’s Next Big Storage Bet — Can HAMR And UltraSMR Reshape Capacity?

Western Digital Corporation reported strong financial performance for fiscal year 2026, driven by a focused strategy as a pure-play hard disk drive (HDD) company. The company achieved 36% year-over-year revenue growth to $12.9 billion, with gross margins expanding by 970 basis points to 49.1% and operating margins improving by 1,290 basis points to 37.3%. Earnings per share (EPS) more than doubled to $10.22, supported by $3.5 billion in free cash flow and a strengthened net positive cash position. Capital returns included $3.1 billion returned to shareholders through share repurchases and dividends. The company highlighted robust customer demand fueled by secular growth drivers such as artificial intelligence (AI), cloud computing, and data-intensive workloads. Western Digital emphasized HDDs’ role in storing large-scale and persistent data sets generated by evolving AI workloads, including inference and Agentic AI, physical AI, autonomous vehicles, robotics, and synthetic data generation.