New York, January 5, 2026, 14:30 EST — Regular session
Western Digital Corp shares reversed early gains on Monday as investors re-priced the crowded “AI infrastructure” trade across storage and memory-linked names. The stock was down 0.9% at $186.00 in afternoon trading, after rising as much as 4.3% and trading between $182.77 and $195.75.
The swing matters now because traders have been treating storage as a levered bet on data-center buildouts, where AI workloads pull through both faster chips and more capacity to store the data they generate. When investors sense a tightening supply backdrop, they tend to move quickly into the group — and just as quickly back out when the narrative shifts.
A Reuters report earlier Monday said traders are betting on further price gains from a global supply crunch, as chipmakers divert capacity to high-bandwidth memory (HBM) — a fast memory used in AI servers — squeezing supply for other products such as flash. TrendForce data showed some prices have more than doubled since February last year; Seagate Technology and Applied Digital were among smaller U.S.-listed names up more than 3% in early trading, while Sandisk gained about 1.5%. Samsung co-CEO TM Roh called the shortage “unprecedented” in an interview with Reuters, and analysts at Morningstar and J.P. Morgan have said the upturn — dubbed a “supercycle,” industry shorthand for an extended boom — could persist well into 2027. Reuters
Western Digital develops and sells data storage devices and solutions, with hard-disk drives sold into cloud, client and consumer markets, according to a Reuters company profile. Its flash business was separated into Sandisk in February 2025, according to a company filing. Reuters
For Western Digital bulls, the immediate question is whether AI-related spending keeps translating into firmer pricing for high-capacity drives as hyperscalers expand server fleets. Bears are watching for the opposite: any hint that customers are digesting inventory or that supply is loosening.
Macro data is also on the radar. Investors will be watching the U.S. nonfarm payrolls report due Friday (Jan. 9) for clues on interest-rate expectations, a key input for equity valuations. Reuters
But the cycle can turn fast. Storage and memory demand has a long history of sharp reversals, and any cooling in AI capital spending — or a faster-than-expected supply response — can pressure pricing and margins across the sector.
On the chart, Monday’s range sets the near-term lines in the sand. Traders will be watching whether the shares stabilize above the mid-$180s after the pullback, or retest the session low, while a move back toward $195–$196 would signal the bid is returning.
The next company-specific catalyst is the next quarterly update, when investors will look for read-throughs on cloud demand, pricing and production plans. Zacks estimates Western Digital will report next on Feb. 4. Zacks
