Why did Seagate and Western Digital stocks fall?

Nikkei reported last week that Toshiba is preparing to ramp up production to capture a larger share of the AI-infrastructure storage market. Seagate fell 5% and Western Digital 4% in early trading Tuesday.

What is happening with TDK Corp.'s hard disk drive magnetic-head business?

Bloomberg reported late Monday that Seagate and Toshiba are vying for the business amid booming AI data center storage demand. Toshiba began talks with TDK in the spring, while Seagate submitted a higher offer in the summer.

How have these stocks performed this year?

Seagate stock is up more than 200% year to date, while Western Digital has gained more than 140%, as the AI infrastructure build-out fueled a shortage of memory chips.

AI Stocks & MarketsTop Companies' AI MovesAI Business & IndustryTop Companies AI6h agoOct 7, 2026, 06:31 JST

Toshiba AI storage push sinks Seagate 5%, Western Digital 4%

Send on LINE

3 Key Points

What happened
Seagate fell 5% and Western Digital 4% early Tuesday after Nikkei reported last week that Toshiba will ramp up production for AI-infrastructure storage. Bloomberg also reported Seagate and Toshiba are vying for TDK Corp.'s magnetic-head business.
Why it matters
Investors appear to be reading Toshiba's expansion as a threat to the two incumbents' pricing, though skeptics argue the sell-off is overblown and Toshiba's added capacity does not cure the drive shortage.
What to watch
The TDK contest is the concrete test — Toshiba opened talks in the spring, Seagate bid higher in the summer, and the winner is undecided. Note the run-up: Seagate is up more than 200% and Western Digital more than 140% year to date.

WHO IT HITSShareholders and analysts tracking Seagate, Western Digital and Toshiba now have to weigh Toshiba's planned capacity expansion and the TDK magnetic-head auction against a drive shortage that has driven the incumbents' stocks up sharply this year.

Not sure about something? Ask the AI

Questions and answers are published on this page.

Summaries like this, in your inbox every morning.

Get news like this every morning, free

Context & Analysis

The sell-off in Seagate and Western Digital traces back to a report from Nikkei last week that Toshiba is preparing to ramp up production for AI-infrastructure storage. Competitor stocks fell on that news, but the body notes there has been skepticism in recent days that the reaction is overblown and that Toshiba's expanded manufacturing capacity does not cure the shortage in drives.

Separately, Bloomberg reported late Monday that Seagate and Toshiba are competing for TDK Corp.'s hard disk drive magnetic-head business. Toshiba began talks with TDK in the spring, while Seagate submitted a higher offer in the summer. That auction sits alongside Toshiba's capacity plans as another point of friction between the two companies.

The backdrop is a shortage of memory chips driven by the AI infrastructure build-out, which has sent sector names soaring this year — Seagate is up more than 200% and Western Digital more than 140% year to date. Whether the current pullback holds may hinge on how much of Toshiba's added supply actually reaches the market, and on who ends up with TDK's magnetic-head unit.

FAQ

Why did Seagate and Western Digital stocks fall?: Nikkei reported last week that Toshiba is preparing to ramp up production to capture a larger share of the AI-infrastructure storage market. Seagate fell 5% and Western Digital 4% in early trading Tuesday.
What is happening with TDK Corp.'s hard disk drive magnetic-head business?: Bloomberg reported late Monday that Seagate and Toshiba are vying for the business amid booming AI data center storage demand. Toshiba began talks with TDK in the spring, while Seagate submitted a higher offer in the summer.
How have these stocks performed this year?: Seagate stock is up more than 200% year to date, while Western Digital has gained more than 140%, as the AI infrastructure build-out fueled a shortage of memory chips.

AI news that matters for your work, delivered every morning.

Pick your industry and the AI tools you use, and get news related to your work every day.

Get it free

Free · 30 seconds with Google · unsubscribe anytimeWhat is AIToday? →

Ask AI

Ask AI anything about this article. The AI reads this article, earlier AIToday articles, and Wikipedia, and cites its sources. Q&As are published on this page for other readers too.