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Western Digital (WDC) shares ended the last trading session 15.1% higher at $36.30. The jump came on an impressive volume with a higher-than-average number of shares changing hands in the session. This compares to the stock's 24.5% loss over the past four weeks.
The increase in share price can be credited to President Trump’s announcement of a 90-day halt on reciprocal tariffs, excluding China. This triggered a sharp rally in market indices, lifting the prices of many stocks, including Western Digital.
In addition to that, certain company-specific factors are also playing a key role in driving the stock’s performance. Increasing sales momentum across the Cloud end-market, fueled by elevated demand for nearline HDDs is driving Western Digital’s growth trajectory.
Management expects the proliferation of generative AI-driven storage deployments to result in a client and consumer device refresh cycle, and boost content growth in smartphone, gaming, PC and consumer in the long run. Increasing AI adoption is likely to drive increased storage demand across both HDD and Flash at the edge and core, thereby providing ample business opportunities.
Gen AI adoption surged to 65% in 2024 from 33% in 2023. As demand grows, high-bandwidth memory (HBM) becomes key for AI servers, while NAND flash remains vital for storage, powering SSDs for text, images and videos. Gen AI adoption is driving eSSD sales due to its speed, reliability and efficiency over HDDs. Growing AI data boosts demand, fueling eSSD market growth and reshaping storage.
In February 2025, Western Digital completed the separation of its HDD and Flash businesses into two independent, publicly traded companies, each with a specific focus on its respective market. With a deep understanding of memory and storage technology, the new SanDisk is ready to meet market demands. It is well-equipped to take advantage of AI opportunities while maximizing the value of its products for both consumers and businesses.
This maker of hard drives for businesses and personal computers is expected to post quarterly earnings of $1.06 per share in its upcoming report, which represents a year-over-year change of +68.3%. Revenues are expected to be $3.85 billion, up 11.4% from the year-ago quarter.
While earnings and revenue growth expectations are important in evaluating the potential strength in a stock, empirical research shows a strong correlation between trends in earnings estimate revisions and near-term stock price movements.
For Western Digital, the consensus EPS estimate for the quarter has been revised 3.2% higher over the last 30 days to the current level. And a positive trend in earnings estimate revision usually translates into price appreciation. So, make sure to keep an eye on WDC going forward to see if this recent jump can turn into more strength down the road.