Hardware & Networking HDD Update: Forecast Pricing Acceleration to Represent Upsides to Already High Bar of Buy-side Expectations; Still See Material Room for Both WDC and STX; Reiterate OW

Research evidence excerpt

Hardware & Networking HDD Update: Forecast Pricing Acceleration to Represent Upsides to Already High Bar of Buy-side Expectations; Still See Material Room for Both WDC and STX; Reiterate OW

J P M O R G A N North America Equity Research

11 June 2026

Hardware & Networking

HDD Update: Forecast Pricing Acceleration to

Represent Upsides to Already High Bar of Buy-side

Expectations; Still See Material Room for Both WDC

and STX; Reiterate OW

IT Hardware/ Telecom & Networking

Equipment

Samik Chatterjee, CFA AC

(1-212) 622-0798

samik.x.chatterjee@jpmorgan.com

We are raising our earnings forecasts for the HDD companies primarily led by a Manmohanpreet Singh

more positive view on pricing, and in turn the incremental margins the companies (1-212) 622-4527

manmohanpreet.singh@jpmchase.com

are expected to report in the coming quarters. While the companies have already

Joseph Cardoso

turned a corner with both companies reporting y/y increases in pricing together for

(1-212) 622-9036

the first time in the March quarter, we expect to see the y/y price increases for the joseph.cardoso@jpmchase.com

industry to accelerate in the coming quarters with sequential price increases Marc Vitenzon

sustaining in the low- to mid-single digit range and cumulatively supporting the (1-212) 622-3342

acceleration in pricing. We expect the sustained improvement in pricing including marc.vitenzon@jpmchase.com

the consistent improvements on a q/q basis to support q/q incremental margins to Akanksh Chauhan

stay at elevated levels for both WDC and STX. Demand environment remains (1-212) 622-0045

robust driven by 1) continued AI training and retraining, where hyperscalers keep akanksh.chauhan@jpmorgan.com

generating and storing expanding datasets, 2) shift toward inferencing and agentic J.P.