New York, February 3, 2026, 18:01 EST — After-hours
- Western Digital shares jumped 7.4% in after-hours trading following an expansion of its buyback program
- The board greenlit an extra $4.0 billion for share buybacks, effective immediately
- The company also laid out a multi-year hard-drive roadmap targeting AI data centers
Western Digital Corporation shares jumped 7.4% to $290.24 in after-hours trading Tuesday, following the company’s announcement of an additional $4.0 billion share buyback authorization. During the session, the stock fluctuated between $272.11 and $296.27. The company said it could repurchase shares either on the open market or privately, including through a Rule 10b5-1 prearranged trading plan, and retains the option to pause or halt the program at any time. (Business Wire)
The new authorization comes as investors pile into hardware linked to AI server expansions and the strained supply chains supporting them. A global memory chip shortage has pushed prices higher and extended delivery times, Reuters reported. Western Digital’s stock has ridden that wave, climbing about 57% year-to-date before Tuesday’s gains, after more than tripling in 2025. The company also last week projected fiscal third-quarter revenue and profits that beat Wall Street estimates. (Reuters)
Buybacks matter because they shrink the share count, boosting earnings per share even when profit growth falters. In a market that’s begun to value cash returns once more, that boost can be just as impactful as expanding capacity.
Along with announcing its buyback, the company used Innovation Day to highlight a bigger push into AI-focused data centers run by “hyperscalers,” the top cloud operators. It revealed a 40-terabyte UltraSMR drive, featuring energy-assisted perpendicular magnetic recording (ePMR), currently in qualification with two hyperscale clients, with volume production slated for the second half of 2026. Western Digital also projects ePMR will expand to 60TB, while heat-assisted magnetic recording (HAMR) drives could hit 100TB by 2029, with a production ramp for HAMR planned in 2027. (Business Wire)
Western Digital’s pitch went beyond just capacity. The company highlighted new designs aimed at boosting hard-drive speed and lowering power consumption, alongside plans for an open-API software layer expected to roll out in 2027. CEO Irving Tan said these efforts have helped WD “reimagine the hard drive to meet the requirements of AI.” Meanwhile, Chief Product Officer Ahmed Shihab described Innovation Day as the moment “where our customer-centric business transformation meets our breakthrough technology for the AI era.” (Western Digital)
The roadmap ramps up the pressure on competitors like Seagate, which is also working to boost drive density as cloud clients demand more storage without escalating power costs, Investors.com reported. (Investors)
Western Digital insists AI demand is steering storage out of the sector’s typical boom-and-bust pattern. It’s a tough argument for some on the trading floor, but with solid numbers and a buyback announcement, the company is back on investors’ radar.
But the headline authorization doesn’t promise rapid purchases. The company noted that the timing and scale will hinge on market conditions, while product timelines remain tied to customer qualification and deployment schedules—both of which can shift rapidly if budgets get tighter.
On Wednesday, all eyes will be on whether the post-event rally sticks once after-hours trading thins out — and if investors see the buyback as a one-time boost or the beginning of a more consistent buyback strategy.
March 5 marks the record date for the upcoming quarterly dividend, set to be paid out on March 18, the company noted in its latest quarterly report. (Western Digital)
