WD Revenue Jumps 55% as AI Data-Center Demand Lifts Hard-Drive Sales

Revenue and profit exceed forecasts

WD, the data-storage company formerly known as Western Digital, reported fiscal first-quarter 2027 revenue of $4.38 billion on Thursday, up 55% from $2.82 billion a year earlier. GAAP net income reached $1.78 billion, or $4.63 per diluted share, while adjusted earnings were $4.64 per share, according to the company's Oct. 22 earnings release and presentation. ^{[1] [2]}

The results exceeded Wall Street expectations. Analysts surveyed ahead of the report had projected about $4.14 billion in revenue and adjusted earnings of $4.11 per share, Investor's Business Daily reported. WD had guided in August to revenue of $4.1 billion, plus or minus $100 million, and adjusted earnings of $4.00, plus or minus 15 cents. ^{[3] [4]}

More capacity sold at higher prices

WD shipped 248 exabytes of storage during the quarter, 22% more than a year earlier. Its blended average selling price per terabyte rose 28%, showing that growth came from both greater volume and higher pricing. Chief Financial Officer Kris Sennesael said robust exabyte growth and improved pricing drove the quarter's performance. ^{[1] [2]}

The company tied demand to expanding cloud and artificial-intelligence infrastructure. Revenue from cloud customers accounts for most of WD's business, while high-capacity hard drives remain central to storing the large datasets used by cloud services and AI systems. GAAP gross margin increased to 57.8%, and adjusted gross margin reached 58.1%. ^{[1] [5]}

The quarter covered the period ended Oct. 2. WD's earnings materials show that cloud shipments accounted for 223 of the 248 exabytes delivered, with consumer and channel shipments making up the remaining 25 exabytes. That mix helps explain why investors treat spending plans at hyperscale cloud operators and AI developers as important indicators for the company's future demand. ^{[1] [2]}

A stronger outlook, but shares retreat

For the fiscal second quarter, WD projected revenue between $5.0 billion and $5.2 billion, adjusted gross margin of 59.5% to 61.5%, and adjusted earnings of $5.60 to $6.00 per share. The board also raised the quarterly cash dividend by 17% to 17.5 cents a share, payable Dec. 17 to shareholders of record on Dec. 4. ^{[1] [2]}

The earnings beat did not prevent an immediate decline in the stock. WD shares fell more than 5% in after-hours trading following a session in which technology and AI-linked stocks broadly weakened. The reaction reflected investor concern about whether rapid AI infrastructure spending and favorable storage pricing can be sustained, despite the company's stronger-than-expected quarter and outlook. ^{[3] [6]}