Western Digital, one of the world’s largest hard drive manufacturers, has completely sold out its storage capacity for 2026 with more than ten months remaining in the year, driven by overwhelming demand from AI companies.
Tom’s Hardware reports that Western Digital has announced that its hard drive production for the entire year of 2026 has been fully allocated, marking an unprecedented situation in the storage industry. The company revealed this information during its recent quarterly earnings call, highlighting the dramatic impact of AI-related demand on the computer hardware market.
CEO Irving Tan disclosed that the company has reached full capacity for calendar year 2026, with most of the storage allocation going to its top seven enterprise customers. The demand has been so strong that three of these major clients have already secured agreements extending into 2027 and 2028, effectively locking up production years in advance.
The sell-out represents a significant shift in Western Digital’s business model and customer base. According to the company, enterprise customers now account for 95 percent of its revenue, leaving consumer sales at just five percent. This dramatic rebalancing reduces the incentive for hard drive manufacturers to prioritize individual consumers and small businesses when allocating their limited production capacity.
The storage shortage is part of a broader pattern affecting the entire computer hardware industry. AI companies have been consuming massive quantities of computing components as the sector experiences rapid expansion. This surge in demand has created supply chain disruptions across multiple product categories, leading to significant price increases for consumers.
The impact extends beyond hard drives to virtually every type of computer memory and processing component. The technology sector has been grappling with memory shortages for months, forcing PC manufacturers to implement regular price increases on RAM products. These price adjustments have become routine as shortages persist without signs of abating.
Gaming hardware has not escaped the effects of AI-related supply constraints. Video game console manufacturers have felt the squeeze, with Sony reportedly considering delaying the launch of its next PlayStation console beyond the planned 2027 release date. The company hopes that by postponing the launch, AI-related hardware shortages might resolve themselves, allowing for adequate component availability.
Computer processors have seen dramatic price increases, and even products seemingly unrelated to AI development have been affected. The ripple effects throughout the supply chain have touched nearly every category of consumer electronics, as AI companies compete for the same fundamental components used in everyday devices.
Breitbart News previously reported that RAM giant Micron has predicted shortages based on AI’s insatiable demand for memory:
The tech giant reported record revenue of $13.64 billion in the past quarter, a significant increase from the $8.71 billion it earned during the same period last year. This impressive growth is largely attributed to the increasing demand from companies like OpenAI, Meta, Microsoft, and Google, as they fill their data centers with powerful chips that require high-bandwidth memory (HBM).
However, this surge in demand for HBM technology, which uses three times the silicon wafers compared to standard DRAM, has led Micron to prioritize these lucrative deals over its consumer-facing business, Crucial. As a result, the company has recently shuttered Crucial, leaving fewer resources for the production of DRAM used in everyday products such as PCs, smartphones, smart TVs, and even cars. This shift in focus has already started to impact the prices of DDR5 RAM kits, with other devices expected to feel the effects soon.
During the earnings call, Mehrotra emphasized the severity of the situation, stating that “over the last few months, our customers’ AI data center build-out plans have driven a sharp increase in demand forecast for memory and storage.” He further added that “supply will remain substantially short of the demand for the foreseeable future,” indicating that the memory shortage is likely to persist for an extended period.
Read more at Tom’s Hardware here.
Lucas Nolan is a reporter for Breitbart News covering issues of free speech and online censorship.
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