When the physical storage of data centers can't keep up with the "AI faith", the "super cycle" of storage has already begun.

In the unprecedented "AI Computing Power Competition" closely related to the accelerated global expansion and AI training/inference infrastructure, Wall Street giants such as Morgan Stanley have declared that the "super cycle of storage" has arrived. The surging demand for enterprise storage hard drives has driven up the stock prices of data storage giants such as Seagate Technology (STX.US), SanDisk (SNDK.US), and Western Digital Corporation (WDC.US) by over triple digits this year, significantly outperforming the overall US stock market and even the global stock market. Leading global storage chip manufacturers SK Hynix, Samsung Electronics, and Micron Technology, Inc., as well as storage chip/storage product leaders from China, are also seeing strong stock price performance this year, continuing the AI-driven record-high "artificial intelligence super bull market." However, compared to the triple-digit gains of the three major storage product giants like Seagate, they are slightly inferior. The latest stock price compilation data shows that, driven by the unprecedented "artificial intelligence frenzy," Seagate and Western Digital Corporation's stock prices have soared by over an astonishing 200% so far this year, both hovering near their all-time highs, and in the eyes of top Wall Street investment institutions, the upward trend of the stock prices of these three major enterprise hard disk storage product giants shows no signs of stopping. Cloud computing giants (Alphabet Inc. Class C's parent company Alphabet, Microsoft Corporation, Amazon.com, Inc., Tencent, Alibaba Group Holding Limited Sponsored ADR) collectively raise AI data center capital expenditures, with global AI infrastructure investment expected to reach $3-4 trillion by 2030, directly "exponentially boosting" demand for enterprise HDD hard drives and data center enterprise SSDs. In early trading on Wall Street on Friday, the stock price of Western Digital Corporation rose by over 12%, indicating a strong trend of establishing new historical highs, with the stock price anticipated to rise further after the company significantly raised its second-quarter profit expectations above Wall Street's continuously revised high expectations. Following a series of major positive catalysts released by Huang Renxun at the GTC conference, as well as significant signals from Microsoft Corporation, Alphabet Inc. Class C, and Meta, the parent company of Facebook, indicating a continued massive investment in acquiring AI computing power infrastructure to scale up AI data centers, the global AI chip industry chain has entered into a long-term bull market atmosphere of "bullish exuberance", especially with the "AI chip super leader" NVIDIA Corporation's total market value surpassing and stabilizing at $5 trillion, becoming the world's first company to reach a market value of $5 trillion. Recently, prices of high-performance storage products in the global DRAM and NAND series have continued to rise significantly, along with the acquisition of an over $1 trillion AI computing power infrastructure deal by the highest-valued AI startup OpenAI, and Taiwan Semiconductor Manufacturing Co., Ltd. Sponsored ADR announcing significantly stronger-than-expected performance and raising revenue growth expectations for 2025 to the mid-30% range, jointly reinforcing the "long-term bull market narrative" of AI GPU, ASIC, HBM, data center SSD storage systems, liquid cooling systems, core power equipment, and other AI computing power infrastructure sectors. The demand for AI computing power driven by generative AI applications and AI intelligent agents at the inference end can be described as vast, potentially driving the AI computing power infrastructure market to continue to experience exponential growth, with "AI inference systems" being the largest revenue source of NVIDIA Corporation as envisioned by Huang Renxun. The continued surge in global AI computing power demand, coupled with the increasingly massive AI infrastructure investment projects led by the US government and the continuous large-scale investment by tech giants in building large data centers, largely implies that the global "AI faith" sweeping through the leading AI computing power companies such as NVIDIA Corporation, Taiwan Semiconductor Manufacturing Co., Ltd. Sponsored ADR, Micron, SK Hynix, Seagate, Western Digital Corporation, etc., will continue to fuel the stock price "super catalyst," with investors betting on a continued "bullish curve" for these companies dominating the AI computing power industry chain. Western Digital Corporation, Seagate, and SanDisk, together with the three major storage chip giants, lead the "super cycle of storage" "Western Digital Corporation (WDC) has signed large-scale enterprise NAND storage product purchase orders with its top five customers, extending to the natural year of 2026. This fact clearly indicates that as the demand for GPU computing and storage driven by large-scale AI training/inference continues to rise, these major clients are reluctant to take the huge risk of storage capacity shortage in the face of the surge in AI workloads," the analysts team from Morgan Stanley, a Wall Street financial giant, stated in a report. Earlier this week, one of its major competitors Seagate Technology Holdings PLC (Seagate Technology) provided second-quarter revenue and profit outlook significantly higher than market expectations. Since then, its stock price has risen by 20%, expected to continue the strong upward trend seen throughout this year. Seagate and Western Digital Corporation are the second and third companies in terms of stock price performance among the S&P 500 index constituents this year, following only the US retail traders' favorite stock trading platform operator Robinhood (HOOD.US), far outperforming the world's largest "AI chip dominator" NVIDIA Corporation, as well as the global AI ASIC leader Broadcom Inc. (AVGO.US). SanDisk, a smaller competitor in the enterprise hard drive storage product sector after being successfully spun off from Western Digital Corporation in February, has seen its stock price increase fivefold since the split. The company will announce its performance on November 6, with its stock price rising over 3% on Friday. The S&P 1500 Technology Hardware, Storage, and Peripherals sector index, including the three storage product companies mentioned above, has risen by over 11% so far this year, hitting a new record high on Thursday. The largest tech giants in the US -- Alphabet Inc. Class C's parent company Alphabet (GOOGL.US), Microsoft Corporation (MSFT.US), Meta, the parent company of Facebook (META.US), and Amazon.com, Inc. (AMZN.US) -- all announced in their latest earnings reports a significant increase in annual capital spending plans, increasing their massive investments in AI chips, enterprise storage hardware clusters, and the overall construction of AI data centers. Goldman Sachs Group, Inc., a Wall Street financial giant, predicts that by 2030, global AI-related AI infrastructure spending could reach $3-4 trillion, with nearly half of it expected to focus on a range of enterprise-level DRAM and NAND storage products. "If you rewind the timeline back twelve or twenty-four months and ask anyone about AI computing power infrastructure, they would talk primarily about AI GPUs and HBM, and almost never mention the long-neglected hard drives... Now, the strong upward trend of these storage giants' stock prices is truly exciting for investors," said Martin Frandsen, portfolio manager at Principal Asset Management. Morgan Stanley stated in a research report that in the current unprecedented frenzy of AI infrastructure investments led by large enterprises and various government departments around the world, the demand for core storage chips closely related to artificial intelligence training/inference systems remains incredibly robust, driving significant revenue growth for data center storage businesses including HBM storage systems, server-level DDR5, and enterprise SSD. Different from the three major producers of underlying DRAM/NAND storage chips including SK Hynix, Samsung, and Micron, Western Digital Corporation, Seagate, and SanDisk focus on mature enterprise hard drive storage products. Before the recent surge in storage product prices, the market's bet on the storage sector was primarily focused on HBM storage systems. At that time, the market did not anticipate the subsequent shortage of enterprise data center SSDs and HDDs due to the increasing dominance of various AI super large models such as Sora2 and performance update iterations. Additionally, SK Hynix, Samsung, and Micron have concentrated the majority of their capacity on HBM storage systems, which require more complex capacity, manufacturing, testing, and packaging compared to the DDR and HDD series storage chips. As a result, the continuous migration of capacity to HBM by these three storage chip leaders has in large part contributed to the shortage of these hard drive storage products. The current wave of "unprecedented strongest price increase" in the storage chip sector has been favoring Western Digital Corporation (WDC), Seagate, and the "new" SanDisk separated from Western Digital Corporation. The core logic lies in: the rapid development of AI data center construction not only drives the surge in HBM storage demand but also synchronously expands the three-layer storage stack of AI data centers (hot layer NVMe SSD, warm/near-line HDD, cold layer objects, and backup), with the long-standing supply restraint of the HDD industry oligopoly, the warming NAND cycle, and a multi-year commitment from cloud providers, allowing these three companies to increase both volume pricing and order visibility. Western Digital Corporation's warm-line/data center HDD focuses on ePMR + UltraSMR route, producing large-capacity disks such as the 32TB SMR, 24TB CMR (Ultrastar DC series), serving object storage and data lake super storage scenarios, serving as the "cost-effective" carrying layer for AI training/inference to create Beijing Vastdata Technology. Seagate's HAMR platform (Mozaic 3+) has begun mass production and shipment of 30TB-level near-line disks, with plans to advance to higher capacity (>30TB) nodes; HAMR leads in areal density, directly addressing the pain points of cloud providers in "rack power consumption/per-TB cost," and is a core beneficiary of AI data lake and cold data pool. SanDisk's data center NVMe SSD relies on next-generation 3D NAND like BiCS8, QLC high-capacity NVMe (E1.L/E3.S/U.2 form factors) to cover the high concurrency and high throughput of the "hot/warm layer," supporting feature libraries, retrieval, and intermediate results during AI training/inference. Wall Street's bullish sentiment towards storage giants is rising, with this round of the "super cycle of storage" expected to continue until 2027! Global HBM leader SK Hynix achieved historic high third-quarter performance, with operating profit soaring by 62%, fueled by its comprehensive "sell-out" of HBM storage systems, as the company indicated it has locked in all NAND and DRAM customer demands until 2026, with HBM4 set to ship by the end of 2025. Morgan Stanley, a Wall Street financial giant, stated that SK Hynix's "sell-out" signal indicates a further tightening of storage capacity supply, and the continuously rising prices exclusive to storage chips are expected to persist throughout 2026, potentially continuing into 2027, aligning closely with the performance growth prospects of the global storage chip sector akin to the super cycles benchmark of 2017-2018. Another Wall Street financial giant Nomura projects that meaningful increases in storage chip capacity and actual production within the entire storage industry range are likely to accelerate in the latter half of 2027, leading to a prolonged period of supply shortage for several years to come. Senior analyst Asiya Merchant from Citigroup Group wrote in a report to clients, "In line with similar statements from its peers, Western Digital Corporation's management points out that as the penetration of large AI models accelerates, the massive AI workloads and data generation from large-scale cloud/cloud customers continue to drive strong storage demand. To meet this demand, customers are adopting higher-capacity enterprise hard drives at a faster pace, and Western Digital Corporation is also accelerating the planned technological transition to the next generation of ePMR and HAMR qualifications. It is noteworthy that the company has now signed firm orders with seven customers until the first half of the natural year 2026, with five of them covering the entire natural year of 2026, and its largest agreement with major scale clients expected to cover the entire natural year of 2027." Analyst Merchant maintains a "buy" rating on Western Digital Corporation, significantly raising the target stock price within 12 months from $135 to $180 and including Western Digital Corporation in Citigroup Group's "90-day catalyst observation focus list". As of early trading on Friday, Western Digital Corporation's stock price rose by over 12% to $157. C.J. Muse, senior analyst at Cantor Fitzgerald, reiterated that due to the incredibly strong demand in the enterprise HDD market, Western Digital Corporation has been added to the firm's "top picks" list. "Considering we are still in the early stages of AI infrastructure development, coupled with the oligopoly conduct of HDD giants (only through EB transitions, manufacturing/testing efficiency, and automation to increase capacity, confirming no new unit capacity for now), we expect tight conditions to continue over the next few quarters, possibly intensifying," Muse wrote in a report. Muse rates Western Digital Corporation as "hold" and raises the target price from $160 to $200. Erik Woodring, senior analyst at Morgan Stanley, commented in a research report that this is a "real-time storage bull market". Price increases and the transition to high-capacity storage drives have helped Seagate achieve new record-high gross margins after adjustments, with the organization calling this the most impressive part of the report. Woodring wrote, "Looking ahead, we expect similar tailwinds to continue driving gross margins higher." As a result, Morgan Stanley maintains a "hold" rating and raises Seagate's target price from $265 to $270. Senior analyst Mark Miller from Benchmark Equity Research pointed out that the bullish factors for Seagate also include strong cloud computing demand and a significant increase in production of personal computers equipped with AI chips. Miller added that the company's current order backlog extends into the entire year 2027. (Note: This translation is provided for informational purposes only and should not be considered official or professional.)