Toshiba Corporation to Double HDD Capacity for AI Demand

Toshiba Corporation plans to double its hard disk drive (HDD) production capacity by fiscal 2027 to meet the storage demands of AI data centers. The company intends to invest between ¥60 billion ($380 million) and $400 million in capital expansion, focusing primarily on its manufacturing facilities in the Philippines. Toshiba currently holds approximately 17% of the global market and aims to capture 30% of the market by storage capacity, a move that could propel it to second place in the industry.

The announcement triggered a sharp selloff of HDD stocks on October 2, 2026. Investors feared the increased supply would erode the pricing leverage currently enjoyed by market leaders Seagate Technology and Western Digital Inc., who each hold over 40% of the global market. Seagate shares fell between 10% and 14.8%, while Western Digital shares dropped between 7% and 12%. Analysts suggest the expansion could trigger price competition that may threaten Western Digital's projected 68% annual earnings growth rate.

Some industry analysts argue the expansion may not significantly alleviate the global supply shortage. Citi noted that Toshiba's reliance on external suppliers for key components like media and heads could limit actual output. Additionally, LYNX Equity Strategies suggested the investment might be intended to secure domestic supply within Japan rather than aggressively capturing global market share.