Western Digital (WDC) Stock Forecast & Price Target

Western Digital is well positioned by its practical HDD duopoly, disciplined supply, and structurally stronger pricing power, with nearline price/TB rising 17% Y/Y and management signaling sustained high-teens pricing through FY27. The company’s fundamentals remain solid despite the exabyte shortfall, as June-quarter shipments of 231EB still delivered $3.34B of revenue, 54.4% non-GAAP gross margin, and $3.56 non-GAAP EPS, while a net cash balance sheet of about $0.5B adds financial resilience. Its outlook is further supported by the 40TB ePMR, UltraSMR, and 44TB HAMR ramps, which should expand capacity without adding unit supply and support gross margins near 64% by FY28.

Western Digital is exposed to a structurally cyclical HDD market in which hyperscale and AI-driven storage demand can slow, reducing exabyte shipments and revenue growth, while shorter-than-expected cycles may compress cross-cycle profitability. Following F1Q27 results and updated guidance, estimates were cut to $18.95B/$27.60B in revenue for FY27E/FY28E and Non-GAAP EPS to $20.17/$33.98, signaling weaker fundamental momentum despite still being above consensus. Although it returned $1B via buybacks in 4Q26 and avoided issuing 773k shares, the business still faces meaningful execution risk from oversupply and an uneven HAMR ramp that could erode market share.