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Western Digital expands buyback by $4 billion as AI drives chip demand

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Data storage maker Western Digital said its board has approved an additional $4 billion for share repurchases, citing strong demand for memory chips used in artificial intelligence servers. The announcement pushed shares up about 5% in premarket trading, extending a rally that has already lifted the stock sharply over the past year.

The company said the new authorization adds to an existing buyback program, under which roughly $484 million remained available as of earlier this week. Western Digital shares have surged on expectations that AI-driven data center investment will continue to boost demand for storage products, including hard drives and flash memory.

A global shortage of memory chips has intensified competition for supply, particularly from AI developers and consumer electronics makers. Limited manufacturing capacity and longer lead times have driven prices higher, benefiting suppliers positioned to serve the fast-growing AI server market.

Western Digital recently forecast fiscal third-quarter revenue and profit above Wall Street expectations, pointing to strong sales of storage solutions for AI workloads. Management said the buyback expansion reflects confidence in cash generation and long-term demand trends tied to artificial intelligence infrastructure.

Western Digital and Seagate Surge as AI Infrastructure Demand Fuels Record Gains

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Shares of data storage leaders Western Digital and Seagate have skyrocketed this year, outpacing the broader market as global demand for AI-driven infrastructure fuels unprecedented growth in hard drive sales. Both companies’ stocks have surged over 200% in 2025, reaching record highs amid a worldwide scramble to expand data storage capacity for artificial intelligence applications.

Western Digital shares rose more than 11% on Friday after the company forecast second-quarter earnings above Wall Street estimates. Analysts at J.P. Morgan noted that Western Digital has secured purchase orders from five of its largest customers through 2026, signaling strong confidence in sustained AI-related demand.

Seagate, a close rival, also projected revenue and profit above expectations earlier this week, pushing its stock up more than 22%. Both companies are now among the top three performers in the S&P 500 this year, trailing only Robinhood.

Smaller competitor Sandisk, spun off from Western Digital in February, has seen its shares soar fivefold since its debut and was up another 3.6% on Friday ahead of its upcoming earnings report.

The S&P 1500 tech hardware, storage, and peripherals sector—which includes all three companies—has climbed more than 12% this year, hitting an all-time high. As major tech firms like Alphabet, Microsoft, Meta, and Amazon ramp up capital spending on chips and data centers, analysts expect global AI infrastructure investments to reach up to $4 trillion by 2030.

Midday Stock Movers: Tapestry, Capri, L3Harris Technologies, and More

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Tapestry, Capri
Tapestry’s shares surged over 14%, while Capri’s stock dropped 47%. This volatility followed a court ruling in favor of the FTC’s move to block Tapestry’s acquisition of Capri, resulting in a major impact on both stocks.

L3Harris Technologies
Shares of L3Harris Technologies climbed 3.5% as the defense contractor reported stronger-than-expected earnings for the third quarter. The company also raised its adjusted earnings forecast to a range of $12.95 to $13.15 per share, up from a prior lower-end estimate of $12.85. Analysts had projected $13.04 per share.

Colgate-Palmolive
Despite surpassing expectations with adjusted earnings of 91 cents per share and revenue of $5.03 billion, Colgate-Palmolive shares declined more than 3%. Analysts had predicted slightly lower earnings of 89 cents per share and $5 billion in revenue.

Western Digital
Western Digital rose 7% following a favorable first-quarter earnings report, posting $1.78 in adjusted earnings per share, above the expected $1.72. Revenue came in at $4.1 billion, marginally below the forecasted $4.12 billion.

Digital Realty Trust
Digital Realty Trust’s stock jumped 11% after it announced record-breaking lease bookings in the third quarter. The company also adjusted its full-year guidance to a range of $6.65 to $6.75 per share, close to analyst projections of $6.69.

Coursera
Shares of Coursera dropped around 8% due to weak demand and retention trends impacting its revenue forecast, despite exceeding third-quarter expectations. The online education company expects fourth-quarter revenue between $174 million and $178 million, aligning with analyst forecasts.

ResMed
ResMed saw a 7% gain after posting strong quarterly results, with adjusted earnings of $2.20 per share and $1.22 billion in revenue, surpassing analysts’ estimates of $2.05 per share and $1.19 billion.

HCA Healthcare
HCA Healthcare’s stock fell over 9% as its third-quarter revenue of $17.49 billion narrowly missed analyst projections of $17.54 billion, and its adjusted EBITDA also fell slightly short of expectations.

Booz Allen Hamilton
Booz Allen Hamilton shares rose nearly 10% as the company reported better-than-expected earnings, with adjusted earnings per share of $1.81 on revenue of $3.15 billion, above analyst estimates of $1.47 per share and $2.97 billion in revenue. The company also increased its guidance for the full year.